Obama TVA proposal | katenews2day

Wilson Dam is a part of the Tennessee Valley Authority’s valuable impact on the North Alabama economy. (Photo credit: Wikipedia)

Tennessee Valley Authority ( TVA ) is being considered by Obama to be sold to private sector in order to reduce federal deficit by at least $25 billion. “It’s a one more bad idea in a budget full of bad ideas”, according to TVA supporter Lamar Alexander, R- Tenn.

TVA is the country’s largest government-owned public utility bringing electricity to 9 million customers in seven states – Alabama, Georgia, Kentucky, Mississippi, North Carolina, Tennessee and Virginia. The 1933 FDR New Deal program also function as a recreation and also to help reduce flood risk in the region. The possible consequence of its privatization is high electricity rates for its 9 million consumers.

TVA owns 29 hydropower plants, 11 coal plants and 3 nuclear plants. But the agency has been ravaged with $30 billion debt and plans to spend $25 billion over the next ten years to modernize its old coal plants and to expand its nuclear capacity.

Although TVA does not receive any money from the government nor its bonds are federal obligations, its debts are still considered as part of the federal deficit. John Thomas, TVA chief financial officer, suggested there’s a solution by passing a ” federal legislation to change how TVA’s debt is calculated for federal purposes.” Obama’s proposal is being opposed by Republicans as privatization could lead to increase electric bills to customers in the region.