In their first public board meeting, four new directors of the Tennessee Valley Authority were greeted in Chattanooga with a record 76 citizens signed up to address the new board, many of them raising questions about changes the utility is considering in the way its prices its power.
Although the new TVA board is not expected to vote on the strategic pricing realignment until its May meeting, environmental and consumer groups objected to what they say are unfair pending changes to raise the fixed cost of power to aid industrial customers at the expense of residential users. TVA is studying a plan to shift about 12 percent of its costs to fixed fees, in exchange for lowering the marginal costs of power.
TVA critics paraded this morning in front of the TVA power headquarters with a "Monopoly Man" character dressed up like the board game millionaire to express their opposition both to TVA's requirement that Tennessee Valley electricity users buy only from TVA and what they claim is excessive pay and perks for TVA's top management. The groups are challenging TVA's purchase over the past couple of years of corporate jets and a Mercedes Benz helicopter to transport TVA managers, directors and business prospects.
Sandra Upchurch, representing the NAACP 's state conference, said Memphis has the highest power burden of any U.S. city and raising fixed fees will hurt low-income families lease able to pay their power bills.
"Imposing mandatory fees is an injustice while you give industry breaks on their rates," Upchurch said. "You want us to pay for your mistakes. You seem to be putting profits ahead of people."
Upchurch and other critics complain that TVA is not being transparent in how it considers its rate realignment. TVA officials are meeting with the rates and contracts committee of the Tennessee Valley Public Power Association, which represents the 154 municipalities and power co-ops that distribute TVA generated power.
Mike Partin, president of the Sequtchie Valley Electric Cooperative, said the municipalities and power co-ops represent the people in the Tennessee Valley.
"Our cause is the people' cause," he said. "We have an 80-year plus history of service working for the people of this Valley."
TVA's residential rates are below 70 percent of America. TVA President Bill Johnson said the strategic pricing change TVA is considering would raise minimum charges to better align TVA costs with expenses.
But Stephen Smith, president of the Southern Alliance for Clean Energy, said TVA and its distributors "are not being transparent and are hiding the ball" with its assessment of its power costs.
Smith said the fixed cost portion of his Knoxville Utilities Board bill has nearly tripled since 2010 and will soon go up above $20 a month, compared with only $6.09 in 2010.
"Fixed fees are exploding across the Valley and there is not a cost-of-service study that has been done to justify this change and that is malpractice," Smith said.