Nashville's News 2 has learned that top Tennessee Valley Authority (TVA) executives will head to Washington on Tuesday to begin “initial talks” on the federal budget issue that prompted rumors the giant utility might be sold.
“We want to understand the process and what are the different options they would like to walk through,” TVA chief financial John Thomas said.
Thomas, along with Executive Vice-President Emily Reynolds, plan to meet for a “couple of hours” with officials from the White House Office of Management and Budget (OMB) and Treasury Department.
The federal budget released in April by the Obama Administration called for a “strategic review” of utility.
The federal budget document provided to Nashville's News 2 by TVA has a section that indicates “TVA's current capital investment plan includes more than $25 billion of expenditures over the next 10 years. However, TVA's anticipated capital needs are likely to quickly exceed the agency's $30 billion statutory cap on indebtedness.”
The part of the federal budget document that drew the most attention read, “Given TVA's debt constraints and the impact to the Federal deficit of its increasing capital expenditures, the Administration intends to undertake a strategic review of options for addressing TVA's financial situation, including the possible divestiture of TVA, in part or as a whole.”
TVA CFO Thomas said he'll be asking the Obama Administration official, “Are there going to be issues with ability to finance all the needs TVA has, and what are all the options in terms of looking at TVA?”
He estimated the review process could take up to a year.
Earlier in the week, US Senator Lamar Alexander called the TVA's possible sale “an ill-conceived reckless approach.”
He explained that it has driven down the value of bonds and might have raised the electric bills throughout the Tennessee Valley.