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Environmentalists sue TVA over grid access charge

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


Environmentalists sue TVA over grid access charge

Environmentalists are suing the Tennessee Valley Authority, claiming that its new rate structure will raise bills and stifle the proliferation of renewables and that the federally-owned power provider did not account for fossil fuel emissions when assessing the environmental impact of the plan.

Starting in October, the TVA plans to implement a fixed grid access charge that will be 6% of its wholesale electricity rate to local power companies. The remaining 94% will be "variable and open to influence by energy efficiency and renewable energy like solar," TVA spokesman Scott Fiedler said.

The grid access charge was unanimously approved in May by the TVA's board of directors to address declining demand and generate revenue to continue servicing infrastructure. The TVA acknowledged that individuals or entities that use lower amounts of energy will see a "slight bill increase," while the bills of higher-energy users such as commercial sites and industrial facilities will slightly decrease.

Some stakeholders seized on this divergence, leading to a lawsuit filed Sept. 6 in the U.S. District Court for the Northern District of Alabama by five environmental groups. They argue the grid access charge will discourage the use of rooftop solar panels and energy efficiency measures among residential ratepayers and encourage continued reliance on the fossil fuels that power businesses and factories.

The environmental groups — the Center for Biological Diversity, Energy Alabama, Friends of the Earth, the Greater Birmingham Alliance to Stop Pollution and the Southern Alliance for Clean Energy — also allege that the TVA's environmental assessment to study the effects of the grid access charge, which produced a "finding of no significant impact," did not acknowledge emissions that will come from increased use of fossil plants should the charge be implemented and the use of distributed energy resources remain at current levels or decrease.

Fiedler declined to comment on the suit, saying the TVA has not yet been served with the complaint. He emphasized, however, that nearly all of the wholesale rate can be influenced by energy efficiency and net metering and that the TVA conducted what he described as a "full" environmental assessment of the rate change.

The groups are asking that the court declare the TVA in violation of federal environmental laws, vacate the grid access charge and mandate a more comprehensive environmental impact statement before the charge is implemented again.

The TVA is assessing the risks posed by distributed resources as it updates its long-term energy plan, a draft of which is expected in February 2019.