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| Chairman
Craven Crowell at Norris Dam, Norris, Tenn. |
By
Chairman Craven Crowell
Since its creation
in 1933, the Tennessee Valley Authority has honored its congressional
mandate to support and enhance the economic vitality of the seven-state
Tennessee Valley region. This is a role TVA takes seriously as it carries
out the mission of public power—of serving the public interest—in
a vibrant and dynamic region.
TVA has long been
an integral part of this economy, which is now growing at almost twice
the national rate. By supplying one of the most basic ingredients of
economic growth—electric power—TVA is a key partner in helping
generate prosperity for the nearly eight million people we serve.
Because TVA’s
core product is so essential to so many, the reliability and availability
of our power plants and transmission system is a top priority. Through
meticulous attention to maintenance and modernization, aggressive pursuit
of greater productivity, and optimizing the use of assets, TVA is able
to ensure its plants are available when they are needed most. Our commitment
to reliability and availability paid off during July and August when
TVA met 16 peak demands higher than our 1998 record and set a new all-time
peak of 28,295 megawatts.
Greater reliance
on electronic technology by our customers also will make power reliability
more important than ever. Only electricity has the flexibility and precision
to fuel this technological engine. As our customers integrate more sophisticated
technology into their business operations and day-to-day lives, the
reliability and availability of TVA power will become ever more vital
to the continued growth of our regional economy. In light of increasing
demand, TVA is conducting a comprehensive study to ensure that future
capacity and transmission demands are met.
Beyond assuring
that TVA power is reliable and available, TVA has an obligation to ensure
that its power is an affordable, competitive value. We keep our customers’
energy costs as low as possible so that they, in turn, can offer competitive
value to their customers. As a result, TVA’s energy prices are
among the lowest in the nation.
TVA’s continued
success in offering competitive rates is a result of our aggressive
approach to lowering costs, including interest expense. TVA’s innovative
financing strategies and the refinancing of the debt held formerly by
the Federal Financing Bank have enabled TVA to reduce its outstanding
debt by $1.3 billion since 1996, lowering the weighted-average coupon
rate on outstanding long-term debt from 7.35 percent to 6.67 percent
and attracting more than 370,000 investors in all 50 states and 35 countries.
TVA’s operations
initiatives also have resulted in significant improvements in productivity.
The net capacity factor at our nuclear plants has more than doubled
since 1993, allowing our five nuclear units to generate power for a
record-setting total of more than 1,000 combined operating days. Equivalent
availability of our generating plants has risen to more than 87 percent.
Perhaps the most
impressive measure of productivity is TVA’s generation and transmission
costs, which in 1998 were nearly 29 percent below the national average
of investor-owned utilities. TVA’s generation and transmission
costs were the lowest when compared with its largest generating competitors’
costs.
So, as we prepare
to enter the new millennium, TVA is powerfully positioned, consistently
competitive, and fiscally fit. TVA gives the Valley and the nation an
edge in fostering new investment that will generate even greater prosperity.
In 1999 alone, almost 15,000 commercial and industrial customers began
operations in the Tennessee Valley.
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