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TVA solicits information for future renewable energy PPAs

Q2: U.S. Solar and Wind Power by the Numbers

Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

Rate case activity slips, COVID-19 proceedings remain at the forefront in August


TVA solicits information for future renewable energy PPAs

TheTennessee Valley Authorityis seeking information on renewable energy sources it could acquire in thefuture through potential power purchase agreements, to further expand itsenergy supply portfolio.

The TVArecently issued a request forinformation to evaluate the availability, options and preferencesof facilities interested in supplying energy or capacity to it throughrenewable generation sources such as solar, wind, biomass or other "commerciallyviable renewable energy technologies."

The PPAs' duration could either be 20 or 25 years, theutility said, but added that it would consider other options as well.

Thepurpose of the request for information is to give the TVA "a snapshot ofwhat may be available beyond 2020," which could be useful in the nextupdate of its integrated resource plan, utility spokesman Scott Brooks said inan email.

Theutility does not yet have a specific range or limit on the amount of power itis looking for, according to Brooks, and has no concrete plans to shutter morecoal-fired units beyond what is "already in motion."

TheTVA is looking at power purchase agreements rather than ownership because itsstatus as a federal agency means it does not get benefits such as tax creditsfrom directly owning renewable resources, Brooks said.

"Itmakes good business sense for TVA to purchase the power generation without theoverhead expenses such as maintenance on the facilities," he said, addingthat the utility is "committed to using sources of cleaner energy whilemaintaining our mandate for least-cost principles."

JonathanLevenshus, senior campaign representative for the Sierra Club's Beyond CoalCampaign in Tennessee, praised the TVA's action and said he hoped it would leadto additional short-term wind and solar supplies for the utility. "Moresavings from smart energy efficiency programs, plus low-cost wind and solarpower purchases in the Tennessee Valley, like those signed over the last year,will help to reduce the need for operating old, expensive coal plants," hesaid.

TheSouthern Alliance for Clean Energy's executive director, Stephen Smith, alsoissued a statementendorsing the utility's interest in collecting information on renewable energyoptions.

Onthe TVA's May 3 earnings call, President and CEO Bill Johnson progress on severalrecent projects that he said will further diversify the company's portfoliowith renewable energy, including its partnership with to what it says will be thelargest solar farm in Tennessee. The roughly 400-acre solar farm at NavalSupport Activity Mid-South is expected to be operational by mid-2018.

Additionally,in March, the utility awarded16.7 MW of solar capacity to four local power companies under its DistributedSolar Solutions pilot in partnership with the

TheTVA has been integrating more renewable energy into its portfolio, in its July 2015integrated resource plan that it will use more renewable resources and energyefficiency in the coming decades to help replace coal-fired capacity it plans to retire. Theutility said that more than half of its generated energy will come fromnonemitting sources by 2020.