Seventy-five years ago today, President Franklin Roosevelt signed into law one of the most sweeping and enduring creations of his New Deal.
The Tennessee Valley Authority was launched in the midst of the Great Depression to harness the power of the Tennessee River and aid one of the poorest regions in the country with everything from fertilizer development to community planning.
The nation’s biggest government utility since has reshaped the land, rivers and economy of the Tennessee Valley. But TVA itself also has been reshaped in how it is governed and what it does.
Although the federal utility completed most of its initial mission, TVA’s leaders insist the agency remains vital to the Tennessee Valley and could play a leading role in reviving nuclear power in the United States in the 21st century.
“The institution has been flexible enough to keep adjusting and adding value to the valley,” said TVA President Tom Kilgore, who grew up on Sand Mountain in the 1950s and worked one of his first jobs at TVA’s nearby Widows Creek Steam Plant. “Unlike a private power company, we’re not driven by quarterly earnings. We’re driven by long-term strategic success, which is still those things set up in 1933 — the economy, the environment and energy.”
TVA Chairman Bill Sansom, a Knoxville businessman, said TVA is uniquely positioned to explore new nuclear generation and fuel reprocessing because of its experience, location and ability to borrow money as a government agency.
“I really believe we have more of a national interest and an ability to affect nuclear power more than other utilities,” he said.
Critics claim TVA has outlived most of its original pioneering spirit and, as primarily a power utility, no longer serves a unique role.
Contributed Photo -- Construction begins on the Chickamauga Dam.
“TVA used to be ‘a living laboratory’ to explore new ideas and was regarded as the yardstick to measure other utilities,” said former TVA Chairman S. David Freeman, a Chattanooga native who has headed four power utilities. “I don’t see much of that spirit any more.”
In an increasingly competitive wholesale power market in other parts of the United States, independent power producers also complain that TVA and its distributors have remained a monopoly in their seven-state region and resisted competition and alternative power sources.
Dan Dolan, vice president of policy, research and analysis for the Electric Power Supply Association, said the TVA Act and TVA staff “continually posed challenges” to companies trying to sell power to customers in the Tennessee Valley.
“TVA likes to have the vast majority of its power come from its own generation, but our view has always been that a more competitive wholesale market brings the greatest efficiency and gains for the consumer,” he said.
TVA'S FOUNDING MISSIONS
THE TENNESSEE VALLEY — THEN AND NOW
Changes since TVA’s creation in 1933:
The annual per capita income in the Tennessee Valley in 1933 was $168, or only 45 percent of the U.S. average.
By 2006, the per capita income in Tennessee was $22,074, or 87 percent of the U.S. average.
From 1933 to 2005, per capita income rose one hundred seventy-threefold in the TVA region, or nearly twice the ninety-threefold increase nationwide.
Only 3 percent of the farms in the region had electricity in 1933.
Today, electrical service is available to all farms. More than 99 percent of households in the Tennessee Valley get electricity from TVA.
Malaria was detected in nearly 29 percent of the population tested in the Tennessee Valley in 1933.
By 1943 after TVA completed dams for flood control and sprayed for infected mosquitoes, only 0.1 percent of people tested postive for malaria. Malaria since has been virtually eliminated in the United States.
Source: Tennessee Valley Authority, U.S. Department of Census.
Since its inception TVA has delivered cheaper power than most of the private power suppliers it replaced or those that now surround the Tennessee Valley. The federal utility didn’t raise its electricity rates during its first 34 years. Despite recent increases, TVA residential rates remain 22 percent below the U.S. average.
Much of TVA’s early success came from controlling what was once one of the region’s biggest problems — the Tennessee River. Before the agency erected its network of 49 reservoirs and dams, springtime floods eroded much of the region’s farmland. As the drainage point for much of East Tennessee, Western North Carolina and Northwest Georgia, Chattanooga was often flooded by the uncontrolled Tennessee River.
Navigating the 652-mile river also was impossible for most of the year.
TVA brought cheap electric power, river navigation, flood control and recreation through its dams and lakes.
Bob Steffy, a former power manager for TVA who now heads the TVA Retiree Association’s Bicentennial Volunteer Inc., said TVA helped transform the region.
“This is a modern part of the country and a wonderful place to live today,” he said. “But if you look at some of the pictures of the valley before TVA, it looked in some places like the surface of the moon because the river had eroded away virtually all plant life. It was a very difficult place with little power or industry in those days.”
Wilson Dam, originally built to power a nitrate phosphorous plant in nearby Muscle Shoals, Ala., for World War I, helped spur the creation of TVA by those eager to put the dam and its power in the hands of the public, rather than private business. The Muscle Shoals facility, finished too late for World War I, became part of TVA’s founding mission by using the nitrate production capacity to develop and make fertilizers for the then-largely agricultural economy in the Tennessee Valley.
Aided by the Civilian Conservation Corps, TVA also planted millions of trees to stem erosion and aided farmers through local universities and extension services to improve their crop growing and rotation techniques.
The diverse purposes of TVA made it a unique regional development agency, which President Roosevelt said was “clothed with the power of government but possessed with the flexibility and initiative of private enterprise.”
With three presidential appointed directors in control and few of the environmental regulations of today, TVA was able to act quickly and decisively. Within five months of its start, TVA began building Norris Dam near Knoxville. In its first year the agency laid out plans for most of its dams, lakes and power plant sites.
But TVA left the distribution of the power it created to municipalities and power cooperatives across the valley. Bill Willis, the 74-year-old Mississippi native who rose to TVA’s top job as general manager in 1979, credits TVA’s partnerships with local governments and universities for much of its success.
“TVA concentrated on producing power and left the distribution of that power to the cities and co-ops run by people who lived in the communities being served,” Mr. Willis said. “I think that allowed TVA to move much quicker than it otherwise could have in delivering power throughout the valley. That was vital because in the 1930s this was just a used up part of the country and a lot of people had lost hope.”
Dr. Barbara Haskew, a labor economist at Middle Tennessee State University who headed TVA’s rate design staff in the 1980s, said TVA attracted global attention for its success in regional development and managing the Tennessee River.
“There was a constant stream of visitors from underdeveloped and developing countries coming to TVA, particularly to learn how to develop their hydroelecrtric system,” Dr. Haskew recalled. “What a lot of people around the world know about Tennessee is the Tennessee Valley Authority.”
Dr. Erwin Hargrove, a Vanderbilt University professor of political science who has written two books on TVA, said the agency was “wildly successful” in achieving its early goals of building dams, producing fertilizer and attracting industry to the region.
“But by the early 1950s, most of those early goals were met,” he said.
THE NUCLEAR WINTER
TVA engineers started planning and building coal-fired power plants to meet the growing demand for power, ultimately building a dozen fossil plants across the valley.
TVA’s approach to building several plants at the same time worked well for both its hydro and coal units. But the agency’s approach was less successful when TVA launched the nation’s most ambitious plans for nuclear power plant construction in the 1960s.
When coal prices began to jump in the 1960s, Red Wagner, then TVA chairman and former general manager, began planning to build 17 nuclear reactors.
Only six have been finished so far and another still is being built. Nine of the original units were scrapped and cost overruns at those generated most of TVA’s current $25 billion debt, Dr. Hargrove said.
Paying for the costly construction of nuclear power and more expensive coal and natural gas has pushed up TVA rates by more than 30 percent in the past five years alone.
As electricity rates rose in the 1970s and ’80s, TVA’s popularity waned, according to Alan Pulsipher, a professor who studies the energy industry at Louisiana State University and once served as TVA’s chief economist.
“People rallied around TVA when they saw the dams and plants being built, but TVA lost a lot of its appeal when rates started to increase,” Dr. Pulsipher said.
TVA was forced to shut down all of its nuclear reactors in 1985 when the agency was unable to verify that plants met the stricter safety standards adopted by the Nuclear Regulatory Commission following the 1979 accident at the Three Mile Island nuclear plant in Pennsylvania.
TVA spent seven years and billions of dollars to reactivate its idled reactors at its Sequoyah and Browns Ferry power plants and spent another $6.2 billion to finish its Watts Bar Nuclear Plant Unit 1 — the most expensive nuclear plant ever built.
“Building nuclear plants turned out to be a lot different from building dams and coal plants,” Dr. Pulsipher said. “It was a very troubling time at TVA, but eventually TVA figured it out and those plants are running well today.”
With the river tamed and rising concerns about air pollution and global warming from coal-fired generation, TVA again is turning to nuclear power for more generation. The agency is spending $2.5 billion to finish a second reactor at its Watts Bar plant by 2013 and is studying a new type of nuclear design for a couple of reactors to be built by 2020 at the abandoned Bellefonte site in Hollywood, Ala.
SOURCES OF POWER
64 percent from coal
30 percent from nuclear
6 percent from hydro
0.4 percent from natural gas
0.2 percent from solar, wind and methane gas
Source: Tennessee Valley Authority
Last month, TVA also signed an agreement with the U.S. Department of Energy to study nuclear fuel reprocessing to reuse spent fuel from America’s 104 reactors.
U.S. Sen. Lamar Alexander, R-Tenn., the co-chairman of the Tennessee Valley Congressional Caucus, believes TVA can play a national role again in helping to boost nuclear power generation and fuel reprocessing.
“It’s been able to move more swiftly to build more nuclear capacity than an investor-owned utility, and the nation needs that,” he said.
Nuclear-generated electricity could be used to power more cars and trucks, which could help limit America’s dependence upon oil imports, Sen. Alexander said.
“No one envisioned 75 years ago that TVA could help us reduce our dependence on foreign oil and reduce our gas prices, but that may be true in a few years,” he said.
Other Tennessee Valley lawmakers agree that TVA’s legacy is far from over.
“TVA is positioned to help our country restart the nuclear energy industry because it’s a quasi-governmental agency,” said U.S. Rep. Zach Wamp, R-Chattanooga, whose district includes more TVA employees than any other. “ If you are Duke Power or Southern Company and you have stockholders and you’re in the private sector, you probably won’t want to invest in nuclear from fear that the government might pull out the rug from your investment like we did under Jimmy Carter.”
U.S. Sen. Bob Corker, R-Tenn., insists that the TVA experiment “actually works, unlike many programs.”
“As long as they continue to provide good leadership, we need to support TVA as it is and move on to other problems our country needs to address,” he said. “TVA is not one of them.”
Video: Inside Chickamauga DamThe Tennessee Valley Authority is celebrating its 75th anniversary this month. The TVA Act was signed into law by President Franklin D. Roosevelt on May 18, 1933. Seven years later, in 1940, the Chickamauga Dam was completed. The dam still operates using the same basic engineering that is 68 years old, with some upgrades.