The Tennessee Valley Authority lost another $94 million during the second quarter of the fiscal year as the mild winter cut TVA revenues by nearly 12.5 percent below the year-ago period.
TVA said today that revenues in the three months ended March 31 totaled $2.6 billion, down from the $2.97 billion in the same period a year ago.
Combined with losses in TVA's first fiscal quarter, the federal utility reported a net loss for the first half of fiscal 2013 of $267 million on sales of less than $5.2 billion.
In the same period a year ago, TVA earned $205 million on sales of nearly $5.8 billion.
In a regulatory filing with the Securities and Exchange Commission, TVA said the decline in earnings and sales came from lower rates and lower usage from the warmer-than-usual winter weather, which cut the use of electric furnaces in the Tennessee Valley.
"During this period, the southeastern United States experienced the fourth warmest winter on record and sales of electricity decreased 7 percent, as compared to the same period of the prior year," TVA said in its quarterly report released today.
TVA said the decline also was driven by a $386 million decrease in base revenues and a $236 million reduction in fuel cost recovery. Base revenue declined primarily due to the mild weather, which lowered both electricity sales and the average effective rate charged to customers. Under a TVA wholesale rate structure effective since April 2011, weather conditions can lower the effective rate for local power companies by reducing peak demand charges.
Local power companies served by TVA, whose residential sales are typically more sensitive to temperature changes, purchased 7.4 percent less in the first six months of 2012, compared with the same period last year, while sales to TVA's industrial customers grew 0.4 percent.
"The good news is that power rates are lower for our customers, in part because of lower fuel costs for TVA," TVA Chief Financial Officer John Thomas said. "However, with the impact of the milder weather we are now projecting revenues to be 7 percent lower than originally planned for the fiscal year."
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