Backers of solar power want TVA to do more to promote sunshine power

The TVA Office Complex is seen Tuesday, Sept. 23, 2014, in downtown Chattanooga, Tenn.

Over the past three decades, the Tennessee Valley Authority has cut carbon emissions from its power plants in half and set a goal of reaching a 70 percent drop in carbon dioxide releases by 2030.

But environmental activists want the federal utility to do more, especially with renewable sources such as solar and wind generation.

"I'm disappointed because I'm afraid we're watching TVA's leadership on renewable energy really slip and decline," Stephen Smith, executive director of the Southern Alliance for Clean Energy, told the TVA board recently. "A number of us have been active stakeholders in TVA's planning process, and we really value that. But I'm beginning to think this is more of a slow walk-and-talk process as opposed to actually getting to the root causes and working to solve these problems. All of the trend lines for renewable energy seem to be going in the wrong direction."

Although solar power generation is increasing in the Tennessee Valley, TVA trails other Southern utilities such as Georgia Power, Duke Energy and Florida Power and Light in the amount of solar-generated electricity the utilities are adding to the grid. TVA also has balked at a request from the solar power industry to revise its individual generation limits on its Green Power Providers program to help TVA meet its target for solar power.

At the same time, TVA has yet to agree to buy wind-generated power from one of the biggest wind projects in the nation, even though developers of the project said it could deliver power at competitive costs for TVA.

TVA President Bill Johnson insists the agency remains a leader in reducing pollution and carbon emissions from its power plants, which should be more important to the environment than just generating more solar or wind power. TVA generates nearly 40 percent of its power from nuclear plants and gets about 9 percent of its power from its 29 hydroelectric dams.

TVA also has contracted to buy wind power from the Midwest and has a number of programs for purchasing solar- generated power, including its support for pilot Solar Share projects in Chattanooga and New Market, Tenn.

In August, TVA also activated its first self-generated solar power generation at its $1.3 million solar farm built at the Allen Natural Gas Plant project site in Memphis. The solar array includes 3,116 panels and generates enough solar energy to power about 120 homes.

"I don't think that we are falling behind [with renewable power]," Johnson said. "Is the issue to try to see how much solar we can build or is the issue to deal with our climate? If the issue is to deal with the climate, then we are doing very well."

Johnson said he is "agnostic and ecumenical" about differing power sources that will meet TVA's power and environmental objectives.

"But I am mostly pro consumer, so we want what is the best price, the most reliable and the cleanest power for the consumer," he said. "Given our demand projections, we actually don't need any additional generating capacity at this time."

In its most recent power forecast for the future, TVA is projecting for the first time in its 84-year history that demand for its electricity will decline by an average of 0.1 percent a year. TVA already has seen a decline in power consumption over the past five years as appliances, air conditioners and machines become more energy efficient and homes and businesses are better insulated.

A growing number of homes and businesses also are generating a portion of their own power from rooftop solar panels, windmills and solar farms, although wind and solar power remain a small fraction of 169,000 gigawatt-hours of electricity TVA generated or bought last year.

Comparing utilities' use of the sun

TVA reported last year a total of 226 megawatts of solar generation across its seven-state region, including 145 megawatts of utility scale solar and 81 megawatts of rooftop or other small-scale solar generation.

By comparison, Georgia Power had more than 500 megawatts of solar power on the ground last year and is in the process of installing 1,600 megawatts of additional renewable energy - solar, wind, geothermal and other renewables - by 2021.

Florida Power and Light has more than 335 megawatts of solar generation. It has announced plans for another 600 megawatts to be installed within the next year with an additional 1,500 megawatts by 2023.

In the Carolinas, Duke Energy Carolinas and Duke Energy Progress reported more than 1,400 megawatts of solar generation last year and should exceed 4,500 megawatts by the end of this year. Recent legislation in North Carolina will enable the combined Duke entities to achieve more than 6,000 megawatts of solar energy by 2022.

Nationwide, the U.S. Energy Information Agency said in the first six months of 2017 solar power generation grew by 45.1 percent, hydropower increased by 16.1 percent, wind expanded by 15.6 percent and geothermal was up by 3.2 percent compared with the first half of the previous year.

Solar industry wants flexibility

Solar power advocates insist solar power generation would increase in the Tennessee Valley if TVA granted more flexibility in one of its solar programs.

TVA, which paid a premium of 12 cents per kilowatt-hour above the retail rate until 2012 for solar power generation to help spur the industry, has gradually phased out its premium rates paid for solar generation.

The Tennessee Solar Energy Industries Association asked TVA this summer to increase the size limit for systems applying for the Green Power Provider from 50 kilowatts to 200 kilowatts. The change would not increase the program's overall budget for TVA but would allow for larger solar system sizes under the program's existing 10 megawatt cap.

The association said larger system sizes provide greater benefit to small businesses interested in clean energy solutions. But TVA declined to change the program this summer.

"Despite our reasonable proposal, TVA has elected to reject industry stakeholder recommendations that we based on the realities of the marketplace," said TenneSEIA President Matt Beasley. "We are concerned that this decision indicates a genuine lack of commitment by TVA to its own program."

But TVA did help this year to fund pilot solar share projects in Chattanooga and in New Market, Tenn., to help expand community solar programs by local municipalities and power co-ops. The EPB solar share project is backed by $1.1 million from TVA, which is designed to help see how community solar projects by local power companies will work in the valley.

"Right now, we're helping to fund these pilot programs to help us understand the demand in the Tennessee Valley and how to serve this load across the region," Tammy Bramlett, TVA's director of business development and renewables, said when EPB launched its solar share program in July. "If this enables us to figure out a good model for what works in the Chattanooga community, we hope to be able to replicate this across the valley."

Johnson said TVA is not making additional cuts in its reimbursement rate for solar generation from customers at this time. But he said the utility is looking how to properly price its power to recover both the variable expenses of each kilowatt produced and the fixed cost of having the generation and transmission networks in place to serve its customers at all times.

The Green Power Provider program was intended to help residential and small commercial power users, not commercial for-profit ventures, Johnson said.

"Our issue about payers versus beneficiaries gets ratcheted up when there are profit-making entities involved," Johnson said. "It's the concern we have about shifting to low-income people to support a businesses activity."

TVA is working with the municipalities and power cooperatives in the Tennessee Valley to develop a new rate structure to adequately reflect both the fixed and variable costs of power. Johnson said the most expensive power for TVA, for each kilowatt-hour sold, comes from the occasional user needing maximum backup power, often at peak demand periods.

TVA has adopted new standby rates to recover its expenses for having the capacity and transmission to serve customers that only need power at selected times.

"The lowest cost power for us is to serve an industrial customer that operates 24/7 with a high load factor," Johnson said. "The highest cost customer is to serve those who need a lot of power right now and little or none at other times. So these standby rates are about cost allocation."

Clean Line Power proposal

The cost of meeting TVA's power demand also involves more than just the marginal costs of what intermittent power producers such as wind and solar generators can quote for TVA, Johnson said.

Clean Line Energy Partners, a Houston-based company that proposes to bring wind-generated power from Oklahoma and Texas to the Southeast along a $2.5 billion transmission line, says it could deliver power to TVA at less than 2 cents per kilowatt-hour.

TVA signed a memorandum of understanding with Clean Line Energy in 2011 to study the proposal. But the utility has yet to commit to buying any of the 3,500 megawatts of wind-generated power Clean Line Energy will bring to the western edge of TVA's territory along its 720-mile transmission line from near Diamond, Okla.

TVA said it doesn't need more power generation because of the stagnant demand for electricity in its seven-state region, and Johnson said TVA still would have to maintain or build other generation capacity to make up for the Clean Line energy when the wind doesn't blow.

Johnson said "it is hard for us to fit that [Clean Line Power generation] in our portfolio," but he said "we are evaluating it closely."

"Wind comes at night between 2 a.m. and 6 a.m. when demand dips, so for us to take that we have to turn down nuclear plants, which essentially have no fuel costs, and we really don't want to do that," Johnson said.

The production tax credits that would help keep Clean Line Energy rates lower are declining and will phase out completely for new wind turbines built after 2020, "so we shouldn't be delaying a decision on this great opportunity," Smith said.

But Johnson said production tax credits "are really not our issue" and TVA must evaluate the price options for wind, solar and other intermittent sources of power based upon the full costs to the agency.

"The price [from Clean Line Power], in and of itself, is a good price for wind," Johnson said. "But it actually costs us a lot more to import it and to make sure we have gas plants running or capable of running in case the wind doesn't show up."

Johnson estimates having the additional capacity to make up for when the wind doesn't blow or the sun doesn't shine typically adds at least 2 cents per kilowatt-hour to the quoted price of such renewable energy.

"At the moment, we have yet to conclude that [buying power from Clean Line Energy] is the right fit for what we are doing," he said.

Contact staff writer Dave Flessner at or at 423-757-6340.