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Knotts addresses TVA board

Murray, KY – Today the Tennessee Valley Authority Board of Directors held a public listening session at the Curris Center at Murray State University. Mike Knotts, CEO of the Tennessee Electric Cooperative Association, addressed the board during the listening session, and a readout of his comments is below.

Curris Center at Murray State University | Murray, KY | 2:00 p.m. CST

 

Good afternoon. My name is Mike Knotts, and I serve as the CEO of the Tennessee Electric Cooperative Association.  Thank you for allowing this opportunity for stakeholders that your decisions impact to communicate directly with you. It is always a pleasure to see each of you and listen to the diversity of thought and opinion that surrounds your work.  

Sharing information with customers about TVA’s successes and shortcomings is important, and I believe that good communication starts with the policies considered and implemented by this board. 

I appear today on behalf of 25 distribution utilities who rely upon TVA to supply all of their wholesale energy. TECA’s members own and operate over $6B worth of assets. Their power bills make up nearly 25% of TVA’s revenues – almost $3 billion per year. In most cases, that wholesale power bill constitutes between 70-80% of the cooperative’s total revenue. 

Cooperatives are private sector, not for profit companies. I believe it is a good reminder that while electric co-ops share in TVA’s mission of the “three E’s” – we differ from municipal utilities, and TVA itself, in that we are not units of government. Co-ops are owned by their consumer-members. Therefore, our policies are set by independent Boards of Directors who are elected by the company’s members – not by City Councils or political figures. 

Because of this governance structure, co-op boards understand the importance of transparency and communication.  

Since 1958, Tennessee’s electric cooperatives have published The Tennessee Magazine. More than a newsletter from the power company, The Tennessee Magazine honors the extraordinary nature of everyday life across Tennessee. It is a staple of coffee tables from Memphis to Mountain City and greets visitors to the offices of our Members of Congress in Washington, DC. 

Let me share two statistics that may surprise you. First, the reach of The Tennessee Magazine surpasses almost any other Tennessee media outlet. If I asked you to compare the Nashville Tennessean to The Tennessee Magazine, which would reach more people? What if I asked you to compare the top 10 newspapers across the state? 

Well, the answer may shock you. The top ten newspapers across Tennessee have a combined circulation of 208,000 copies. Next month, The Tennessee Magazine will reach over 800,000 homes and businesses. That’s 2.5 million of your friends and neighbors.  

Second, our in-depth market research has provided some extraordinary findings. Even though other types of print media are collapsing, 84% of those 2.5 million people have read three of the last four editions. That’s remarkable. In today’s world of fake news and cynical attitudes toward all types of media, we learned that 97% of readers trust what they read in The Tennessee Magazine. That’s not just remarkable. That is incredible. 

Trust. It is not something you buy, and it isn’t created overnight. The Tennessee Magazine is just one way that co-ops work to be transparent and earn the trust of the people we serve. This trust has been built by decades of selfless service by hardworking men and women, and electric cooperatives today are dedicated to always being worthy of that trust. 

As we work together to power our communities and energize every moment, electric cooperatives hope that you will join us as we earn the trust of the people who rely on us. 

Thank you. 

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Knotts addresses TVA board

Florence, AL – Today the Tennessee Valley Authority Board of Directors held a public listening session at the Marriott Shoals Hotel Conference Center. Mike Knotts, CEO of the Tennessee Electric Cooperative Association, addressed the board during the listening session, and a readout of his comments is below.

Marriott Shoals Hotel Conference Center | Florence, AL | 2:00 p.m. CST

 

Good afternoon. My name is Mike Knotts, and I serve as the CEO of the Tennessee Electric Cooperative Association.

I appear here today on behalf of TECA’s 25 member local power companies who collectively serve consumers in 6 of the 7 states TVA calls home. Cooperatives are private sector, not for profit companies and TECA’s members own and operate over $6B worth of assets. Their power bills comprise over 25% of TVA’s revenues – nearly $3 billion. In most cases, that wholesale power bill constitutes between 70-80% of the cooperative’s total revenue.

In your role as a fiduciary for TVA, I’d like to ask you to think through that last statistic with me. Right now, in your mind, imagine for yourself if three-quarters of TVA’s costs were spent on just one thing?

How much attention would you devote to understanding that single cost driver? How much would you task TVA’s management to become subject matter experts and obsess over that one expenditure? I imagine it might be the first item on your agenda, every meeting.

Given that short exercise, I think you can better understand that for TVA’s local power company customers, it’s not just good business to fully understand TVA’s operations, finances, and governance processes. It is essential for our survival.

I think you can better understand why organizations like TECA and TVPPA spend so much time and effort seeking to understand your vision.

And I think you can better understand why the decisions you make about wholesale electric rates aren’t just about seeing a spreadsheet balance or satisfying bond covenants. It’s about real impact on our local communities.

So I urge you to engage directly with your customers, hear our questions, and heed our counsel.

You know, Just like TVA, local power companies are built on the hard work, sweat, and determination of some wonderful people. In fact, even though our business is so capital intensive, employing people is one of the biggest expenses an electric co-op undertakes.

So as I conclude, I’d like to ask you to join me in acknowledging the sacrifices paid by group of people who have earned one of the most prestigious titles in our industry. “Lineworkers.”

Despite extensive training and well-designed precautions, line work is dangerous and sometimes the worst can happen. Just one month ago in Bean Station, Tenn., a fine man named Nate left his home to provide electricity to his community – just as he has done for years.

Nathan Potter suffered an accident that day that took his life. He leaves behind an inspiring legacy of faith and dedication to his family and friends. He also leaves behind a grieving wife, three young daughters, and a devastated community of fellow lineworkers.

On behalf of Appalachian Electric Cooperative and all of TECA’s members, please join me in a dedicating a moment of your time and your prayers to honoring these brave men and women who serve us so honorably.

Thank you.

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Knotts addresses TVA board

NASHVILLE – Today the Tennessee Valley Authority Board of Directors held a public listening session at Lipscomb University in Nashville. Mike Knotts, CEO of the Tennessee Electric Cooperative Association, addressed the board during the listening session, and a readout of his comments is below.

Lipscomb University Shinn Center | Nashville, TN | 2:00 p.m. CST

 

Good afternoon. My name is Mike Knotts, and I serve as the CEO of the Tennessee Electric Cooperative Association.  I appear here today on behalf of 25 local power companies who collectively serve consumers in six of the seven states TVA calls home. TECA’s members own and operate over $6 billion in distribution assets, and their wholesale power bills comprise over 25% of TVA’s revenues.  

At previous listening sessions, I have encouraged you to focus TVA’s strategic goals on reliability and affordability, and I have also asked you to consider that while TVA’s structure and mission is certainly unique, the cooperative business model provides a closer comparison for TVA than the large investor-owned utilities. That is because the cooperative ownership structure aligns with TVA’s mission.  

Remember that President Roosevelt called for the creation of a government corporation “possessed of the flexibility and initiative of a private enterprise”? Co-ops are privately owned by their members, but they operate on a not for profit basis – similar to  the TVA Act’s requirement that for electric power to be provided at rates as low as feasible. 

TECA members accomplish this by adhering to the seven cooperative principles – which require accumulated capital remain the common property of the cooperative, and requires members to democratically control the co-op’s activities, much like this Board controls TVA. 

Here in the TVA ecosystem we tend to think of co-ops as distribution utilities, but there are 62 Generation and Transmission cooperatives across America that function much like TVA. These “G&T’s” collectively perform the same functions that TVA’s power program does and could be included as “peer utilities” in TVA’s benchmarking activities. Notably, they should serve as sources of potential new talent for TVA’s team.  

But the 49 distribution cooperatives TVA serves have a lot to offer you as well. 

Today, I would like to encourage you as Board to consider how cooperatives can help you accomplish your goals.  

The path before you is not a simple one. The demands for your attention are great, and the opinions about what decisions you should make next are many. At its core, you are charged with powering everyday life and maintaining the economic vitality of our region.  

And you are being asked to do so with no interruptions and at the speed of light. The margin for error for both TVA and electric co-ops is so slim – milliseconds can mean the difference between light and dark, and indeed life and death. 

We’ve all heard the old adage, “if it seems to good to be true, it probably is.” When it comes to your responsibilities, truer words have never been spoken. That has become more relevant last week as the EPA finalized a number of new rules last week that rely upon unproven technologies based on an unachievable mandate of “regulate to innovate.” 

The highest of ideals cannot trump the realities of physics. The electric grid is carefully and wonderfully made. The complexity of the grid is both its greatest achievement and one its biggest weakness. You can be certain the electric cooperatives will be leading the charge to ensure public policy doesn’t harm the “least of these.” 

As you react to these developments in Washington, D.C., please remember that rates as low as feasible are meaningless if the lights turn off. Reliability AND affordability must be at the top of your priority list.  

And electric co-ops are ready to help you accomplish this, even if the path before us is not simple or easy. 

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Knotts addresses TVA board

JOHNSON CITY, TN – Today the Tennessee Valley Authority Board of Directors held a public listening session at the James and Nellie Brinkley Center in Johnson City. Mike Knotts, CEO of the Tennessee Electric Cooperative Association, addressed the board during the listening session, and a readout of his comments is below.

James and Nellie Brinkley Center | Johnson City, TN | 2:00 p.m. EST

 

Good afternoon. My name is Mike Knotts, and I serve as the CEO of the Tennessee Electric Cooperative Association. I appear here today on behalf of TECA’s 25 member power companies who collectively serve consumers in six of the seven states TVA calls home. We are still searching for that one farmhouse across the border in Alabama to make it 7 for 7!

TECA’s members own and operate over $6 billion in assets, and their wholesale power bills comprise over 25% of TVA revenues. Cooperatives are private sector entities focused making life better for our members and the rural and suburban communities where they live work and play. At the last listening session, I encouraged you to consider that the cooperative business model, specifically the 62 generation and transmission cooperatives across America, were the only benchmark that aligns with BOTH TVA’s operations AND mission. But the 49 distribution electric cooperatives you call customers have a lot to offer you as well. 

Today, I would like to offer you some reassurance about a major initiative TVA is currently engaged in. 

I understand that you will hear an update during tomorrow’s board meeting on the progress of TVA’s Integrated Resource Plan. This is a tremendously important endeavor, and I can understand how important its successful completion is to all of you. I am serving as a member of the IRP Working Group and have been involved in the process since the beginning.  

Let me assure you, the process is working and it is working well.  

TVA is to be commended for putting a diverse group of stakeholders in the room and listening to their input. Far from entering the process with foregone conclusions – we have painstakingly considered scenario after scenario, strategy after strategy, consulted with industry experts, challenged your planners, pondered the future of the global economy, invited thought leaders to share their vision of the future and debated with your economists. This has taken a significant investment of time and energy from the members of the working group.  

The end result will be a framework to help this board – and future boards – make sound decisions. It will not tie your hands but serve as light to guide your way

A colleague of mine recently asked me to explain what we were doing. After a long dissertation full of technical jargon, I could see that his eyes were glazing over, so I explained the IRP was a lot like the weather forecast. The weatherman doesn’t make the sun shine or bring the clouds and the rain, and he doesn’t always get it right. That doesn’t stop us from checking to see if we need an umbrella before we leave home or if we will need shorts or sweaters tomorrow.  

Please know that I believe the TVA staff, the working group and all of the external experts involved in the IRP are producing a useful tool. I look forward to its completion and your adoption of its use. 

On behalf of TECA and our member cooperatives, we remain ready to work with you to ensure that TVA’s strategic direction remains focused on what is best for the people we jointly serve.  They deserve nothing less. Thank you. 

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Knotts addresses TVA board

TUPELO, MS – Today the Tennessee Valley Authority Board of Directors held a public listening session at the Cadence Bank Center in Tupelo, Miss. Mike Knotts, CEO of the Tennessee Electric Cooperative Association, addressed the board during the listening session, and a readout of his comments is below.

Cadence Bank Center | Tupelo, MS | 2:00 p.m. CST

 

Good afternoon. My name is Mike Knotts, and I have the pleasure of serving as the CEO of the Tennessee Electric Cooperative Association.  I appear here today on behalf of the 25 local power companies who collectively serve consumers in Tennessee, Kentucky, Virginia, North Carolina, Georgia, and Mississippi. TECA’s members own and operate over $6B in assets, and their wholesale power bills comprise over 25% of TVA’s revenues.  

Cooperatives are unique among the TVA “family” of entities because co-ops are private companies, not government entities. Co-ops are owned by our specific, individual customers instead of a unit of government or even the public at large. This private-sector perspective brings a unique point of view and important context to the challenges we face. But because we are not for profit, we share in TVA’s purpose and labor every day to make our communities a better place. Electric co-ops empower rural and suburban Tennessee to grow and thrive, and our communities are smarter, healthier, more productive, and better connected because of electric co-ops. 

We urge each of you, as you exercise your fiduciary duty to TVA, to actively seek the advice and counsel of your private sector, cooperative partners. 

TVA and the 153 local power companies (co-op and municipal alike) have traditionally focused on our own core competencies…generation and transmission for TVA, and distribution for the LPCs. Each of the three competencies require unique skill sets and expertise. 

 So while the needs of today are beginning to blur the lines between generation and distribution, TVA and your cooperative partners remain inexorably linked through our history, common mission, and contractual relationship. 

It is that shared mission I ask you to consider today. 

Good organizations take the time to benchmark themselves against their peers, to evaluate the quality and effectiveness of its efforts. In the case of TVA, those peers are usually other large investor-owned utilities. I believe that many of the decisions you will consider tomorrow will be based on data that takes into account a comparison of this type.  

Might I suggest to you that size alone is not the only measure for determining who is similar? Mission must also be considered as key factor. While TVA is unique as a government entity with the multi-faceted purposes of energy, environmental stewardship, and economic development – please hear me say that TVA is not alone in its mission to deliver wholesale energy at the lowest feasible cost while working to make the region the best place in the country to live, work and play.

Generation and Transmission Cooperatives share this purpose – 100%. And all across America, there are G&T’s who serve their communities in the way TVA serves our region. They collectively own and operative dams with hydroelectric generation, nuclear power plants, coal and gas facilities, and many G&Ts are aggressively promoting the implementation of renewable energy into the grid. In fact, TVA’s first CEO counted over 15 years of prior experience at one of the nation’s largest G&Ts -Oglethorpe Power Corporation in Georgia.  

Co-op G&T’s should be an important source of resources, collaboration, benchmarking, and comparison for TVA staff and for you in your role as a Board member – particularly in the coming months and years as you seek new and innovative ways to fulfill our shared mission.  

On behalf of TECA and our member cooperatives, we remain ready to work with you to ensure that TVA’s strategic direction remains focused on what is best for the people we jointly serve. They deserve nothing less. Thank you. 

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Scott addresses TVA board

CHATTANOOGA, TN – Today the Tennessee Valley Authority Board of Directors held a public listening session at the Chattanooga Convention Center. Trent Scott, vice president of communications for the Tennessee Electric Cooperative Association, addressed the board during the listening session, and a readout of his comments is below.

Chattanooga Convention Center | Chattanooga, TN | 2:00 p.m. EST

 

Good afternoon. My name is Trent Scott, and I serve as Vice President of Communications for the Tennessee Electric Cooperative Association. TECA represents 25 consumer-owned electric co-ops that deliver power to 3 million homes and businesses.

In 1965 my father – Norman Scott – went to work for Southwest Tennessee Electric Membership Corporation, a TVA-served co-op in west Tennessee. He began his career as a groundman and worked his way up, retiring in 2004 as a district manager.

As a child, I remember sitting at my father’s desk following a storm. He would use Post-it Notes to keep track of power outages. These notes didn’t have GPS coordinates or addresses – just a name. He knew where each and every person lived, which substation breaker they were on and how the reports from the crews impacted them.

Today, this same task is performed by outage management software that aggregates data in real-time to pinpoint the location of damage to the grid.

We no longer live in a Post-it Note world.

Ours is an industry that evolves at a rapid pace.

Increasingly, critical areas of our economy, from education to healthcare, commerce to communication, even transportation, depend on reliable and affordable electric energy.

And while much has changed, a lot remains the same. Electric co-ops and TVA share a commitment to innovation, service, and boldly investing in our communities.

In 1983 my dad received this – a commemorative Coke bottle celebrating TVA’s 50th Anniversary. It reads “50th Anniversary, TVA, 1933–1983, Shaping Tomorrow Today.”

Much to the chagrin of my mother, this lived in my parent’s china cabinet. There in the dining room, next to grandma’s silver, was this TVA Coke bottle. My dad loved this industry and the opportunity it provided him to serve his community.

This year, TVA celebrates its 90th anniversary, and the slogan “Shaping Tomorrow Today” printed on this now 40-year-old bottle of Coke, could not be more profound.

The decisions we make today have lasting impacts.

There are great opportunities facing the Tennessee Valley, but with those come very real challenges.

As this board works to solve those challenges, let me encourage you to view co-ops as partners.

Tennessee’s electric co-ops provide TVA with well over $3 billion of revenue each year, but our partnership can represent much more. We can be a source of capacity as well. Whether it be energy efficiency and demand response programs or added flexibility to develop our own generation, electric co-ops are ready to work alongside TVA to solve the Valley’s energy needs.

We value our partnership, we share your commitments, and we’ve been here since the beginning. We want to help you “Shape Tomorrow Today.”

Thank you

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Knotts addresses TVA Board

NORRIS, TN – Today the Tennessee Valley Authority Board of Directors held a public listening session at the Norris Middle School in Norris, Tenn. Mike Knotts, CEO of the Tennessee Electric Cooperative Association, addressed the board during the listening session, and a readout of his comments is below.

Norris Middle School | Norris, TN | 2:00 p.m. EST

 

Good afternoon to each of you. My name is Mike Knotts, and I serve as the CEO of the Tennessee Electric Cooperative Association and represent the 25 local utilities serving nearly 3 million people who depend on their cooperative to power their community.

It is a real pleasure to be here and celebrate 90 years of TVA’s history together with you. This history is OUR history, tightly intertwined with that of the local cooperatives and cities that have connected TVA to the millions of people and business over the years.

There is no denying that the connection between TVA, local power companies, and the residents of the Tennessee Valley have made an indelible impact on the lives of generations of Americans. Our story is unique in American history. And while the issues of the day and the challenges we face may look different in 2023 than they did in 1933, we should take pride in knowing that we have literally changed history through our unchanging mission of the last 90 years. We have a great story to tell.

Taking time to reflect on this is important. Electric cooperatives innately understand and appreciate the history TVA is celebrating today because we helped shape it – both in the Valley and across the country.

When TVA was formed it was given its unique multi-faceted mission because of the specific needs of this part of the country. But, a much broader problem existed across all corners of rural America. The problem was universal rural electrification. Though cities like Memphis or Chattanooga or Knoxville had enjoyed electricity for decades, other communities and farms, like where we stand here in Norris, did not.

The solution to the national problem came in the form of the cooperative. Self-owned, private corporations that are built for the benefit of its customers. Governed by its owners. Founded on seven bedrock principles and focused on the local community. While cooperatives were not a new idea – the seven cooperative principles were first enumerated during the industrial revolution in England – cooperatives were the right idea then and continue to be the relevant idea today.

Today, TECA members serve consumers across the state of Tennessee, covering almost 75% of the state’s land mass. In addition, these same 25 utilities also serve significant portions of Kentucky, Virginia, North Carolina, and Georgia – as well some circuits in Alabama and Mississippi.  If you are keeping count, yes, that is all seven states. Collectively, these 25 locally-owned utilities provide TVA approximately 25 percent of its revenues – well over $3B dollars per year.

You know, each of the grainy, black and white photos hanging in this room has its own story to tell and lessons to be learned. I’m particularly fond of that one (gesturing to the right), as it bears a striking resemblance to my late grandmother.

And as we all know to be true, those who do not learn from the past are most certainly doomed to repeat it. So, allow me to encourage each of you to learn from the achievements we recognize today.

But let me also encourage each of you look forward – with purpose and passion – knowing that your role on this Board is important and meaningful to millions of people. Our future won’t be told though grainy, black and white photos. Our future is being determined in real time in 4k video, and our inter-connected world allows it to be seen by anyone, anywhere, anytime.

Please know that your electric cooperative customers stand shoulder to shoulder with you, and are ready to work with you to ensure that TVA’s strategic direction remains focused on what is best for the people we jointly serve. Yesterday, today, and tomorrow.

Please call on me anytime I can be of assistance to you.

 

 

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Knotts addresses TVA Board

Muscle Shoals – Today TECA CEO Mike Knotts addressed the TVA Board of Directors during a public listening session in Florence, Alabama. A readout of Mr. Knotts comments are below.

Marriott Shoals Hotel Conference Center | Florence, AL | 2:00 p.m. CST

 

Good afternoon. My name is Mike Knotts, and I have the pleasure of serving as the CEO of the Tennessee Electric Cooperative Association.  I appear here today on behalf of the 25 local power companies who are members of TECA, and we would like to share our most sincere congratulations to each of you who have been newly appointed, as well as those of you who are continuing your service on the Board.

The President of the United States has appointed you, the United States Senate has confirmed you, and now the people of the Tennessee Valley will rely upon your judgement and discernment. Your role is important, and the decisions you make will have lasting impacts on the communities and individuals that we jointly serve.

Delivering power requires three components – generation, transmission, and distribution – and each of these three parts require unique skill sets and expertise. As you have undoubtedly already learned plenty about, the way energy is delivered in the Tennessee Valley is unique compared to the rest of the country.

TVA’s role is that of a generation and transmission entity, with 153 locally owned and controlled entities serving the role of distributing power to the end-use consumer. This allows both TVA and the local power companies to focus on core competencies. This more distributed model – rather than a vertically integrated structure that delivers all three components in a single entity –  is not what is unique, however.

It is TVA’s ownership and multifaceted purposes that make TVA unique. TVA is a federal corporation whose assets are owned by the U.S. Treasury rather than shareholders or its customers, a G&T utility, a steward of natural resources, a provider of navigation and flood control, a regulatory body with the powers of a state Public Utility Commission, and even a police force – these many different roles are what make TVA unique.

This structure has positives and negatives for sure, but is undeniable that TVA’s mission has changed the face of the Tennessee Valley and continues to offer significant advantages that result in economic health, environmental benefits, and a focus on the needs of individuals and businesses in our communities.

Among the 153 local power companies served by TVA, TECA represents 25 cooperatively owned utilities that serve consumers in Tennessee, Kentucky, Virginia, North Carolina, Georgia, and Mississippi. And collectively, our cooperatives’ member-owners fund 25 percent of TVA’s revenues.

Unlike some of our other friends and colleagues in the local power company community, and TVA itself, electric cooperatives are private corporations. We are not units of government, and our private-sector viewpoint brings unique perspective and important context to the joint challenges we face.

But because we are not for profit, we share in TVA’s mission of service and desire to make our communities a better place.

On behalf of all of TECA’s member cooperatives, we stand ready to work with you and ensure that TVA’s strategic direction remains focused on what is best for the people we jointly serve.  Thank you for your time and attention.

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