The Tennessee Valley’s driest year on record contributed to a $49 billion increase in fuel and purchased power costs for Tennessee Valley Authority in fiscal year 2007, due to a 9 percent reduction in hydropower generation.
TVA reported annual operating revenues of more than $9.2 billion for fiscal year 2007, up slightly from the previous year, and net income of $383 million, an increase of $54 million from 2006.
ï¿½TVA faced several challenges in 2007 that impacted cash flow, operations, and financial results,ï¿½ TVA President Tom Kilgore said Dec. 12. ï¿½The most significant challenge was adverse weather conditions — the year-long drought and hot August temperatures.ï¿½
As a result of the driest year on record in the valley, the federal utility’s hydroelectric generation in 2007 was 9 percent lower than 2006, 42 percent lower than 2005, and 35 percent lower than 2004. Because of the lower hydroelectric power available, TVA relied more heavily on higher cost generation sources, which negatively affected cash flow.
During August, the hottest month on record in the TVA service area, TVA met an all-time record demand for electricity of 33,482 MW on Aug. 16. It generated and purchased an additional amount of power to meet the peak demands.
TVA operates nine dams on the mainstem Tennessee River, the fifth largest river in the United States. It also operates 20 hydropower projects on tributaries and the 1,618-MW Raccoon Mountain Pumped-Storage project. TVA operates 5,144 MW of hydropower, 6,700 MW of nuclear power, 14,000 MW of coal generation, and 6,000 MW of gas-fired plants. (HNN 7/25/07)