Archive for category: Issues

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. 

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. 

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. 

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