For the third time in the past four years, the Tennessee Valley topped more than $8 billion in major new business investments announced in the fiscal year ended Sept. 30.
TVA's economic development department worked on projects totaling $8.2 billion in fiscal 2017. Those businesses are projected to directly add 70,076 jobs and spur thousands of other indirect jobs in TVA's seven-state region.
The record helped TVA to be named a Top 10 utility for economic development by Site Selection magazine for the 12th straight year earlier this year.
The fiscal 2017 results were down from the record $8.3 billion of investments announced the previous year or the 76,200 jobs peak reached in 2015. But TVA President Bill Johnson said the continued investment by new and expanding industry in the region reflects the attractiveness in the Tennessee Valley and TVA's efforts to offer more competitive industrial rates.
"In general, all of our [electric] rates have gone down [over the past four years] and industrial rates have gone down a bit more than residential rates because when we did our cost-of-service analysis, we determined that industrial customers were paying fuel costs that were not properly allocated to them," Johnson said.
Business investments in the Valley
2006 - $4.2 billion and 53,000 jobs
2007 - $5.6 billion and 45,300 jobs
2008 - 5.5 billion and 42,000 jobs
2009 - $4.2 billion and 26,000 jobs
2010 $4.3 billion and 41,000 jobs
2011 - $4.9 billion and 43,000 jobs
2012 - $5.9 billion and 48,500 jobs
2013 - $4.1 billion and 39,000 jobs
2014 - $8.5 billion and 60,300 jobs
2015 - $7.8 billion and 76,200 jobs
2016 - $8.3 billion and 72,100 jobs
2017 - $8.2 billion and 70,076 jobs
Source: Tennessee Valley Authority
Since 2013, TVA's average price of electricity has dropped about 2 percent, but industrial rates have come down even more. Four years ago, TVA had the fourth lowest industrial rates in the Southeast but its industrial rates are now the lowest among 19 of its regional peers.
Among the 100 biggest utilities in the country, TVA now has the ninth lowest industrial rates with an average power price of 5.27 cents per kilowatt- hour, according to the U.S. Energy Information Administration.
"I think the stability of our low prices, our lower carbon footprint for those businesses wanting more renewable power and our continued reliable power are the pinnacles on which we do most of our work [in recruiting businesses]," Johnson said.
TVA tries to recruit businesses to its service region with such programs as the Valley Investment Initiative, which provides incentives for qualifying existing and new companies in the TVA region based on factors such as their long-term capital investments, jobs, energy efficiency and power use.
For competitive reasons, Johnson said TVA doesn't disclose details of what it provides specific businesses. But the TVA president said he believes the rates, reliability and sources of power are the biggest draws offered by the federal utility.
Major projects in East Tennessee
* Nokian Tires plans $400 million tire production plant in Dayton, Tenn., adding 400 jobs
* Textile Corp. of America plans $27.1 million upgrade of Pikeville factory, creating 1,000 jobs
* Lifetime Products is opening a $115.6 million factory to make plastic kayaks, paddle boards and outdoor play equipment, creating 500 jobs
* HomeServe USA plans a $5.5 million expansion of its Chattanooga customer service facility, adding 200 more jobs
Site Selection praised TVA for its site certification programs, which help prospects identify sites where utilities, roads and broadband connections are already in place.The Tennessee Valley also is attractive to many businesses because of its central location within a day's drive of most of the U.S. population and the region's comparatively low taxes and cost of living.
Site Selection said TVA's economic development team does a "particularly good job of keeping abreast of the infrastructure capabilities [electric, water, sewer, rail, etc.] of all the major sites within their service territories. This saves a considerable amount of time in our decision-making and due diligence processes."
John Bradley, senior vice president of TVA Economic Development, said TVA works with state and local governments, local power companies and Chambers of Commerce to prepare and market information about available sites in the Valley.
"By focusing on 'service' you set your team up for success at all levels," Bradley said. "Serving the needs of the communities, states and local power companies is the key for our employees to successfully drive jobs and investment to the region."
Contact Dave Flessner at email@example.com or at 423-757-6340.