TVA looks to stretch its kilowatts

THE ASSOCIATED PRESS March 4, 2008, 6:33PM ET

TVA looks to stretch its kilowatts

By DUNCAN MANSFIELD

KNOXVILLE, TENN.

Whether it's saving the planet from greenhouse gases or saving consumers on power bills, the Tennessee Valley Authority heard plenty of good reasons Tuesday to conserve energy.

"Any kilowatt TVA does not have to generate is the cheapest and greenest way to meet demand," TVA director Dennis Bottorff said, embracing the spirit of a public listening session with energy and environmental experts.

The nation's largest public utility is preparing to get back into energy conservation and efficiency in a big way. The session Tuesday, chaired by Bottorff, drew recommendations for a long-term program that's to be unveiled to the TVA Board of Directors in April.

It became clear during the session that there are different ways to control energy use depending on the circumstance. Education and incentive programs aimed at residential users may have the greatest potential, but energy savings opportunities apparently abound everywhere.

"Energy efficiency includes conservation, which is using less energy; efficiency, which is using energy smarter, and peak shaving, which is avoiding energy use when the demand is high and when power is most expensive to produce," said Jack Simmons, who heads a TVA distributors' group.

"In addressing energy efficiency, all three components need to be addressed and that will require a complicated, coordinated and concise effort among TVA, power distributors and the end-use customers of electricity."

Several speakers urged TVA to adopt an energy efficiency goal of at least 1 percent of power sales annually. Some states have set similar goals for investor-owned utilities they regulate.

TVA, which provides electricity to about 8.7 million consumers in Tennessee and parts of Kentucky, Alabama, Mississippi, Georgia, Virginia and North Carolina, is largely self-regulated.

TVA's immediate target is achieving 1,200 megawatts in energy savings by 2013.

TVA Chairman Bill Sansom revealed Tuesday that goal was developed somewhat arbitrarily. It's the same amount of power that will be generated by a second nuclear reactor that's to be completed in the same time frame at the Watts Bar station in Spring City, Tenn.

"It just lets us try to get an equal amount back," Sansom said.

But Sansom suggested TVA's most pressing need is peak power demand, which TVA hit at record levels last summer and this winter. It forced TVA to buy high-priced power from others and fire up its expensive gas-fired turbines.

He lamented that TVA consumers, who pay the same rate no matter the time of day, don't realize how much the cost of power to TVA can spike during these periods, often as much as 10 times more.

"I know there is a very strong economic reason, a lot of motivation for TVA to get aggressive on peak (demand)," said Stephen Smith, director of the environmental Southern Alliance for Clean Energy.

"That is important and we support that," Smith said. "But I also think you don't want to neglect the overall conservation goal. It will help consumers save money and will help TVA in its overall financial health."