President Barack Obama unveiled a budget proposal this month that calls for a strategic review of the Tennessee Valley Authority. The budget section titled “Reform TVA” has some TVA leaders and officials on Capitol Hill worried that this might be the first step in selling off what is the U.S. government’s largest and best-known public utility.
TVA was created in 1933 to deliver low-cost electricity, control flooding and improve the economy of the Southern Appalachian region. The public utility reported a $24.6 billion debt as of Dec. 31 — much of it for capital projects that are underwritten by its sale of electricity.
As the Associated Press reported last week, TVA officials seemed to have been caught off guard by the president’s call for a review of the utility. TVA Board Chairman Bill Sansom and President and CEO Bill Johnson said the proposal was unexpected.
“At this point we don’t know what the strategic review might include or what options might be explored,” Sansom said in a statement. “In the meantime, we will continue operating TVA in a sound financial manner in support of the people of the Tennessee Valley and the interests of the federal government.”
The president’s calls for strategic review of TVA hasn’t been embraced by some of Tennessee’s members to Congress, who believe it may be an overture to selling the public utility. Sen. Lamar Alexander told the Associated Press that he thinks the suggestion is a bad idea. The Republican lawmaker said he believes that privatizing the utility could lead to higher electrical costs for the more than 9 million people it serves in the states of Alabama, Georgia, Kentucky, Mississippi, North Carolina, Tennessee and Virginia.
Meanwhile, U.S. Rep. Phil Roe, R-1st, told the NET News Service he would gather comments from power distributors in the 1st District and bring the issue up with constituents in town hall meetings.
“The biggest problem I have is TVA has $30 billion in debt,” Roe said. “That’s all got to be looked at.”
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