Why TVA should clean up

Why TVA should clean up
Second of two editorials

Ideally, TVA's air pollution would be addressed through national legislation revoking the loophole that exempts the nation's old, dirty power plants from tougher pollution standards. But prospects for that are clouded by pending utility deregulation and the certain battle that would emerge over a stiff new environmental rule.

In the interim, TVA should develop a voluntary plan for cleaning up its emissions. It would benefit customers' health, the region's environment, and the debate on utility deregulation as well.

TVA has not been wholly negligent on the environmental front. Though initially resistant, it has done more than some large neighboring utilities. It installed sulfur dioxide scrubbers on some of its 59 coal-fired boilers, for instance, and put catalytic converters to reduce nitrogen oxide on others.

Its recent commitment to reduce nitrogen oxides by 75 percent by the year 2003, moreover, is notable. Made in response to EPA's efforts to reduce dangerous ozone-forming emissions by 20 percent statewide, since much of Tennessee is at risk of violating EPA's new, pending health standards for ozone, that's significant.

But TVA is not adequately addressing the fine-particle sulfur dioxide pollution so damaging to lungs, and so crucial to mitigating ozone, regional haze and acid rain.

It continues at some plants to burn high-sulfur coal and to produce more sulfur dioxide than ever. And it plans to continue to do so by trading for emission rights. Yet it already produces 73 percent of the Tennessee Valley's sulfur dioxide emissions. TVA must attack that pollution more aggressively.

Advantage to the public

The Tennessee Valley Energy Reform Coalition and other environmental and health groups seek greater public health commitments from TVA. They want it to finish installing air pollution filters on plants which will remain in service for a long time, and to begin converting its most inefficient coal-fired plants to natural gas, which is vastly more efficient for energy production than coal and far less polluting.

That's a tall order, but on balance, a responsible one. It may require a rate increase. Going into deregulation, that would take courage on TVA's part. But over the long haul, the payoff in public and environmental health justifies the effort.

The financial difficulty is obvious. TVA has just formulated a plan to pay off half its staggering $27 billion debt in the next decade. Its board also is trying to hold rates steady to maintain competitive standing and to boost loyalty in the coming deregulation fracas.

TVA, in short, is focused on the business side of its future, and in the hard business sense there's no advantage to undertaking an expensive environmental cleanup that isn't required by law. It would make TVA less rather than more competitive.

The advantage of the initiative is not in TVA's economics, but in the public's safer environment and better health.

If TVA's almost unique status as a federal public utility means anything, surely it means that the public benefit must count — heavily.

Tennesseans use more electricity per capita than citizens in any other state, in part because electricity here has always been relatively cheap. A modest rate increase for pollution remediation would be a prudent investment in health and could stimulate conservation.

A chance to recapture leadership

It also would put TVA in a leadership position on environmental and energy efficiency issues. That could bolster its effort to remain intact under deregulation. Equally important, it could help broaden the terms of the deregulation debate, which now focuses mainly on rate leveling and open markets and only marginally on energy efficiency and environmental effects.

If TVA were to commit voluntarily to clean up its share of the electric power industry's enormous air pollution, it could have several broad effects.

First, it would dramatize the huge emissions gap between power plants that meet 1990 Clean Air Act standards and the pre-1985 plants still allowed to emit six-to-10 times the pollution of newer plants. That would boost national efforts to revoke emissions exemptions for all older power plants: Revocation would be better seen as integral to leveling the playing field for all utilities as deregulation unfolds.

Secondly, closing the loophole would bolster the argument that deregulation could, and should, propel energy efficiency investments. Dirty plants are energy inefficient as well. They need to be remediated, repowered with natural gas, or shut down if the first two options are not feasible — regardless of whether they might be sold under deregulation.

Raise the bar for deregulation

If TVA makes a commitment to take such actions, it will make it harder for other utilities with dirty plants to evade that responsibility. And it will put deregulators under the burden of making sure cleaner, more efficient plants emerge sooner rather than later.

That could propel deregulation beyond the simple free-market debate: It could ignite investments both in energy efficient plants and rapid, well-justified improvements in air quality.

A TVA commitment to cleaner plants would have still another benefit. It would help Tennessee's state and municipal officials achieve compliance in the next few years with the tougher clean-air rules passed last year for fine-particle pollution. That would strengthen regional political support for the agency.

TVA obviously would have to phase in pollution mitigation. But a commitment to that goal would demonstrate leadership on environmental issues and energy efficiency. It would enable TVA once again to serve a vital role as a national utility model worth preserving.