TVA chief: Regional panel 'bad idea'

TVA chief: Regional panel 'bad idea'

Congress has oversight, Crowell says

By Wesley Loy
News-Sentinel staff writer

GALLATIN, Tenn. — TVA Chairman Craven Crowell on Thursday again snubbed the idea of a regional commission to study the 64-year-old agency's future and hinted that July budget meetings might result in further job reductions and an electricity rate increase.

The regional commission, proposed by Rep. Bob Clement, D-Tenn., and backed by one of TVA's most vocal critics, is "obviously a bad idea," Crowell said, responding to questions after the TVA board meeting at the Gallatin steam plant.

"Congress has oversight over TVA," Crowell said. "It's very difficult to delegate that oversight responsibility to someone else."

Clement, a Nashville and former TVA board member, is seeking $2 million to finance what he calls a "TVA 2000 Regional Commission" to study ways to ready the agency for the coming era of open competition in the nation's electricity industry. Clement has proposed basing the 12-member committee at Oak Ridge National Laboratory, which has experts who could help assess TVA's condition. The national lab is important to Oak Ridge constituents of Rep. Zach Wamp, R-Tenn., a commission skeptic.

Clement is struggling in Congress to win the $2 million.

TVA: Work on new offices to cost $2 million

By The Associated Press

The Tennessee Valley Authority told the Associated Press it will spend up to $2 million to remodel and furnish new office space in Nashville while considering potential job cuts and rate increases.

Sources on Wednesday had told The News-Sentinel the federal power agency planned to spend as much as $5 million on the renovations, while TVA declined to give a specific amount, saying it "could not immediately confirm its cost."

But on Thursday, TVA spokesman Frank Cason said, "Two million dollars is the highest estimate." That would include everything from carpet and paint to wall hangings and workspace partitions.

The federal utility has leased 45,000 square feet of office space in Nashville to house some 200 marketing and economic development employees, most of whom are transferring from TVA's Knoxville and Chattanooga offices.

Stephen Smith, an environmentalist and TVA watchdog from Knoxville, said Crowell and Wamp are engaging in "misinformation" by saying the commission would somehow supplant congressional oversight.

In fact, Smith said, the commission merely would supplement the oversight by establishing a panel of experts to plot a viable course for TVA.

"Congress does not have the time or expertise to deal with issues as complex as TVA restructuring and deregulation" of the power industry, Smith said.

Indeed, many TVA observers believe lack of diligent oversight by Congress has allowed TVA to get into its current jam. The agency has debts of more than $27 billion, and some of its customers — chiefly, 159 municipal power companies and rural electric cooperatives — are looking to break away from TVA's supply monopoly to shop for cheaper power on the open market.

Crowell said departmental managers next month will present their budgets for the next fiscal year, and the board then will decide two big questions: whether to increase power rates and whether to lay off more employees.

TVA's electricity rates have been frozen for 10 years, but the pressures of paying off debt and mild weather so far this year — producing a $190 million revenue loss — may force a hike.

On Monday, after much speculation, TVA acknowledged it had given 360 TVA workers notice that their jobs were being cut.

On Thursday, in a sign of more belt-tightening, the board approved a contract worth up to $19.7 million with Siemens Power Corp. to automate TVA's system of hydroelectric dams. The contract work will span up to eight years.

Doing so will eliminate the need for a control room and trim staff at some 30 dams, said TVA chief operating officer Joe Dickey. More importantly, he said, centralizing control room operations and tying the dams directly into the agency's big power management computer in Chattanooga will result in even cheaper power production from the dams.

At an average age of 50 years, the dams are "very manual in their controls," Dickey said. When adjustments are necessary, managers must telephone dams to give orders. At some of the dams, control rooms are not staffed full time.

No decision has been made on where to put a centralized dam control room, Dickey said.

TVA Chairman Craven Crowell and Directors Johnny Hayes and Bill Kennoy will have offices there, though they will keep their main offices at Knoxville headquarters.

The agency is "paying market rates" for the lease, TVA spokesman Gil Francis said.

Nashville is TVA's second largest power market behind Memphis and is more centrally located to TVA's seven-state region than Knoxville, Crowell has said in defending the move.