oversees the new Rapid Unloader at Kingston Fossil Plant.
The first and
most fundamental of TVAs Five Strategic Business Objectives is
to Reduce the Delivered Cost of Power. To be the power supplier of choice
in a competitive marketplace, TVA carries out ambitious programs to
achieve continuous process improvement, operational efficiency and financial
of power is competitive today, and its target price of power for the
future will remain competitive as the industry is restructured. The
average residential price of electricity in the TVA region is 23 percent
lower than the national average. And TVA has maintained low prices while
providing an exceptionally reliable supply of power to fuel the solid
economic growth in the Tennessee Valley.
TVAs power system operates at record levels of efficiency, productivity
and safety. In August 2000 TVA met five peak power demands higher than
the previous years record. The highest was 29,344 megawatts on
August 17, when the average temperature across the Valley reached 99
degrees. That peak was 1,049 megawatts, or about 3.7 percent, higher
than the 1999 all-time record of 28,295 megawatts. For the year, TVA
generated 152 billion kilowatt-hours (kWh).
TVA Nuclear set records for continuous operation and refueling outages
and ended the year with a net capacity factor of 94.6 percent, having
generated almost 47 million megawatt-hours.
- TVA Nuclear
set a generation record for the fifth consecutive year and increased
its output for the seventh consecutive year.
- Watts Bar Nuclear
Plant set a TVA record for nuclear units of similar design by operating
continuously for more than 512 days before starting a planned refueling
outage on September 10. This is the first-ever continuous run of a
TVA nuclear unit from one refueling outage to the next.
- After a TVA
record run of 548 days, Browns Ferry Unit 3 completed a refueling
outage in 18 days, which ranks as the second shortest in the U.S.
and set a world record for General Electric boiling-water reactors.
- For the third
consecutive year, TVA nuclear units were ranked among the top 25 performers
in the U.S. and the top 50 worldwide during 1999 by Nucleonics Week.
- With capacity
factors higher than 97 percent, Sequoyah Unit 1 and Browns Ferry Unit
3 ranked 6th and 9th, respectively, out of 104 licensed U.S. nuclear
- In the month
of July Cumberland Fossil Plant generated more power than any TVA
plant in the last 15 years, enough to meet the needs of about 130,000
Valley homes for a full year.
Fossil Plant generated 7.7 million megawatt-hours, the most generated
in a fiscal year by the plant in the last 30 years.
- The Rapid Unloader
and Blend Facility at Kingston Fossil Plant cut coal-unloading time
by 75 percent, saving about $12 million per year (see photo above).
- The Maintenance
Cost Busters Team at John Sevier Fossil Plant was one of two finalists
in the Government category of the Rochester Institute of Technology/USA
Today Quality Cup competition. The team solved a mechanical-seal problem
on boiler-feed pumps that will save about $1.5 million over the next
job is to manage five fossil plants, including the physical assets,
1,300 people and a $175 million annual operations budget. Our
biggest challenge is to optimize the performance of TVAs
fossil system while operating our plants safely and meeting our
environmental commitments. Were busy now making an effective
transition to a deregulated economy
while still providing value to the region.
TVA Western Plants
Using a comprehensive life-cycle program strategy for Procurement, TVAs
Supply Chain initiative has reduced costs for materials and services
by more than $100 million over the past two years.
In 1997 TVA embarked on its Ten Year Business Outlook to keep its costs
competitive with the market price of power in the year 2007. It was
acknowledged in 1997 that interest expense, as an important component
of total cost, must be reduced and financial flexibility enhanced.
- TVA has reduced
its total debt by $1.7 billion from its peak, including a $391 million
reduction in fiscal year 2000.
- Interest expense
as a percentage of operating revenue has decreased from a peak of
34 percent to 26 percent.
- The average
interest expense as a percentage of total debt has been reduced from
7.6 to 6.8 percent by refinancing
$13 billion of debt on U.S. and global bond markets.
- Cash flows from
operating activities have grown from $800 million in 1995 to $1.6
billion in 2000, an improvement of 100 percent.
- The interest
coverage ratio is now 1.93, an improvement of 36 percent from five