Tennessee Valley Authority President and CEO Jeff Lyash on Sept. 18 highlighted the Authority’s shift from a coal-heavy generation portfolio to one that includes a growing percentage of renewable energy, ongoing efforts to dramatically reduce greenhouse gas emissions and helping to facilitate billions of dollars of capital investment into the Tennessee Valley in just the last five years.
Lyash, who was appointed to his role at TVA by the TVA Board of Directors in February 2019, made his remarks at an event at the National Press Club in Washington, D.C.
A generation portfolio shift
Lyash noted that over the last decade, TVA has implemented a fairly significant shift in its generation portfolio.
“Just a decade ago, we were over sixty percent dependent on coal and it was an aging coal fleet,” Lyash said, with other elements of the TVA generation mix including nuclear, some natural gas and hydro.
“This year, forty two percent of our energy will come from our nuclear fleet. Almost fourteen percent will come from our renewables program – we’re actually one of the largest providers of renewable megawatt hours in the Southeast and one of the largest in the country,” he said.
Another 20 percent of TVA’s energy comes from a modern, state-of-the-art natural gas-fired combined cycle fleet at low cost and with great flexibility, Lyash noted.
Coal accounts for another 25 percent of TVA’s energy mix “and so this has been a significant shift and that shift, even as we’ve invested capital to make it happen, has reduced the fuel cost to our customers by over a billion dollars a year.”
So even as TVA raised base rates to fund that capital investment, for the last six years those rate increases have been offset by fuel cost savings.
“This is important because affordable energy – energy at a price people can afford to pay – even as we address some of the bigger environmental issues is imperative,” Lyash said.
As TVA has reconfigured its generation portfolio, the Authority -- in partnership with its local power companies to deliver this energy -- has maintained rates lower than seventy percent of the electricity providers in the U.S.
Lyash noted that the 10-year financial plan that he recently took to TVA’s board of directors continues the process of evolving the fleet, reducing greenhouse gas emissions, and building out an integrated energy network. At the same time, TVA’s objective is to maintain flat rates in the Tennessee Valley over the next decade.
TVA in late June released its final IRP and associated Environmental Impact Statement that evaluates options to meet the region’s power generation needs over the next 20 years.
Among the recommendations included in the final IRP is the addition of up to 2,400 megawatts of storage by 2028, between 1,500 and 8,000 MW of solar by 2028 and up to 500 MW of demand response by 2038, depending on availability and cost of the resource.
During the question and answer portion of the event, Lyash noted that TVA’s nuclear generation percentage has risen thanks to the completion of Watts Bar Unit 2 (approximately 1,150 megawatts) and a 465-megawatt uprate at the three Browns Ferry nuclear plant units. “So essentially bringing into existence another half a nuclear unit,” he said.
“We believe we can produce yet more energy from our nuclear fleet,” Lyash said. “The objective for our team, which is embodied in our nuclear excellence plan, is to move each of these units to top quartile performance by 2022 and to establish this as the best fleet in the country by 2025.”
TVA has submitted its early site permit (ESP) application to the Nuclear Regulatory Commission to assess the potential for construction and operation of small modular nuclear reactors at its 1,200-acre Clinch River Site.
“We have no plans to actually build those units right now because there’s not a need in the Valley for them,” Lyash said.
Addressing TVA’s environmental stewardship, Lyash said that “as we’ve morphed this generation portfolio and made it more diverse, we’ve reduced greenhouse gas emissions. If I benchmark TVA’s emissions against 2005 – a benchmark for the Clean Power Plan – we have reduced CO2 emissions by 55 percent.”
By the end of 2020, TVA “will have reduced them 60 percent. By the end of 2030, our objective is to reduce them by a minimum of seventy percent against that 2005 benchmark.”
TVA will continue to “shrink that environmental footprint and will do it at a cost that is competitive and people can afford,” the TVA President and CEO said.
Turning to economic development, Lyash pointed out that in the last five years, TVA has helped to recruit $44 billion worth of capital investment into the Tennessee Valley, bringing with it over 350,000 jobs.
TVA has helped to not only attract companies from traditional industries, it has also helped to attract high-tech companies such as Amazon, Facebook and Google to the Tennessee Valley region.
Lyash noted that a new Google data center in TVA’s territory is located on the site of TVA’s Widows Creek coal plant, which was retired by TVA. “Along with that, we’ll be putting in service 200 megawatts of solar on that site to help power that Google data center,” he said.
“The thing that I am most proud of TVA for in terms of economic development is not those headline wins, it’s the thousands of other economic development wins that the team is producing every year,” he said.
Highlighting one example, Lyash noted that Portobello America, which makes high-quality ceramics, decided to set up its U.S. headquarters in Baxter, Tenn., investing $150 million and creating 220 jobs in Baxter, which has a population of about 1,300 residents.
Before coming to TVA, Lyash served since 2015 as president and CEO of Ontario Power Generation Inc., one of the largest electric generating companies in Canada.
Lyash was formerly the president of CB&I Power where he was responsible for a full range of engineering, procurement and construction of multi-billion-dollar electric generation projects in both domestic and international markets. He also provided operating plant services for nuclear, coal, gas, oil and renewable generation.
Prior to joining CB&I, Lyash served as executive vice president of energy supply for Duke Energy where he led engineering, maintenance and operations of the company's 42,000-megawatt generation fleet, fuel procurement, power trading, major projects and construction, environmental programs, and health and safety programs.