Triennial Assessment of the Tennessee Valley Authority--Fiscal Years 1977-1979

EMD-80-91: Published: Aug 13, 1980. Publicly Released: Aug 13, 1980.

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GAO summarized its work and reports accomplished during fiscal years 1977, 1978, and 1979 at the Tennessee Valley Authority (TVA). It assessed the TVA role as a leader in the electric utility industry and made recommendations concerning: TVA systems for planning and for forecasting electricity needs in its service area; a number of supply and demand options available to TVA to permit it to better manage the demand on its power system and thus to reduce the need for additional generating facilities; and a number of methods for generating electricity in more ecologically acceptable ways. GAO evaluated what action TVA could take to better manage demand on its power system through load controls. It also did two reviews of TVA water resource development activities. One focused on actions that might increase power production at TVA dams; the other looked at the adequacy of its benefit-cost study for the controversial Tellico Dam. It also reported on the TVA basis for estimating its nuclear powerplant cost and construction schedules and for assessing its need for automatic data processing equipment. GAO evaluated the adequacy of statutory protection given TVA employees in the collective bargaining process and provided information on certain contracting and personnel management activities. From 1977 to 1979, TVA was the subject of what has been characterized as the largest environmental enforcement litigation ever involving its 10 coal-fired plants. TVA was involved in defending itself on both sides of the clean air issue, with one group alleging that TVA is doing too little and the other alleging that it is doing too much. During this period, the TVA debt ceiling was doubled to $30 billion to enable the agency to meet power program commitments during the next 5 years.

Many of the activities either underway or planned by TVA are responsive to the recommendations in these GAO reports. The agency is trying to improve its planning and electrical forecasting processes, undertaking several conservation and demand management programs, working to develop energy from renewable resources and using new technologies, pursuing development of ecologically acceptable methods of using coal, basing nuclear facility estimates on better information, and exercising better management and control of its automatic data processing resources. However, TVA has not acted very rapidly in developing joint solar projects with the Department of Energy. TVA has focused its cogeneration efforts on developing cogeneration using proven technologies and has limited its pursuit of cogeneration using less proven fuels and technologies to its fuel cell and coal gasification programs. It could achieve greater cogeneration potential and serve the people of both the region and the Nation by also developing innovative cogeneration demonstrations that use other less proven fuels and modes of cogeneration. Agency officials have not implemented a Valley-wide program to control water heaters. It has not established a system to periodically reevaluate its hydroelectric projects. TVA has not enhanced participation by its employees in the collective bargaining process. TVA employees are still exempt from labor relations legislation affecting private and other public employees.

Matter for Congressional Consideration

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Matter: Congress should revise the TVA charter to better reflect current national energy priorities by directing TVA to (1) take the lead in developing electricity management plans and programs, (2) promote energy conservation and the most efficient production and use of energy, (3) encourage the use of renewable resources, and (4) assure adequate public involvement in energy planning and policy making. Congress should act favorably on TVA requests for funding of energy supply demonstration projects meeting the criteria GAO recommended. Congress should include TVA employees under statutory labor relations procedures applicable to private or other Federal employees.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: TVA should increase its coordination and cooperation with the Department of Energy and accelerate the development of joint projects. When funding for a demonstration having national benefits exceeds TVA incremental cost, agency officials should request Federal funding. It should undertake cogeneration applications and demonstrations that use less proven fuels and technologies in addition to its program for fuel cell and coal gasification development while actively pursuing development of cogeneration that uses already existing technologies. Funding should be as in the preceding recommendation. It should implement a water heater control program to (1) install remote control devices on existing water heaters; (2) provide incentives for installation and control of super-insulated 120-gallon water heaters in new and remodeled homes; and (3) encourage replacement of existing units with larger, more efficient units when possible. TVA should develop a system to periodically reevaluate its hydroelectric projects to insure prompt action on energy-efficient and economical improvements. In its capacity as employer and party to agreements negotiated with the Trades and Labor Council, TVA should take action to enhance employee influence over the bargaining process.

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