TVA and a New Administration

By Mike Arms, ATVG Executive Director

While many of us were busy with last-minute shopping the week before Christmas, Senator Lamar Alexander was diligently working to complete some critical legislative tasks.  Two of the tasks were ensuring the full Senate confirmations of Dr. Beth Harwell on December 19 and Dr. Brian Noland on December 20 to serve on the TVA Board of Directors.  Speaking for the Association of Tennessee Valley Governments (ATVG) this action was significant for local governments in the 200 counties in TVA’s service region for several reasons.  

A primary reason was that for several months TVA’s nine-member Board of Directors consisted of only five members which is the minimum quorum required to conduct business.  Local governments are one of TVA’s largest customers (consumers of electric power).  Think about the electricity consumed to heat, cool and operate courthouses, city and town halls, justice centers and jails, senior and community centers, parks and recreation centers and, most of all, schools for the 1 million public school students in local systems in the 200 counties in TVA’s seven-state service region.  Stability of the TVA Board is important to local governments and all other TVA stakeholders.  If for any reason the TVA Board membership falls below the five-person quorum it would not be able to make new policy decisions including major financial decisions.  While the agency could continue to operate and produce electricity, its policy actions would be problematic and could always be challenged.  Having a full Board provides more stability as well as representation from multiple states.  

Another reason that local governments are positive about these two new members is that both bring new skill sets to the Board.  Beth Harwell served three decades in the Tennessee legislature and held various leadership positions.  She brings to the TVA Board unique insights into the needs and challenges of local governments.  Brian Noland brings broad experience in the education sector which includes his current role as President of East Tennessee State University.  He has a thorough understanding of the Tennessee Valley’s challenges in workforce development in all areas from engineers and computers scientists to welders and electricians.  He will be an asset in TVA’s economic development mission.  Local government leaders realize the importance of a well-prepared workforce for their local and regional economies.  

TVA now has seven members serving on its Board and two vacancies.  Two of President Trump’s nominations, Charles Cook of Mississippi and Rick Roden of Alabama, did not complete the confirmation process.  These two nominees have strong private sector business experience and economic development experience respectively.  The Senate clock simply ran out before their confirmation hearings could be scheduled and now President Biden will be responsible for these two nominations.  Looking back, the Christmas week confirmations of Harwell and Noland as the Senate session was ending reflect the hard work and political clout of Lamar Alexander.  

So, what happens now?  The Senators in the seven-state TVA region have a “non-binding agreement” that when a Board vacancy occurs the new Board nomination comes from the state where the departing Board member served.  This practice is not dictated by the TVA act.  In fact, up to two Board members can be nominated by the President from a state outside the seven-state TVA service region.  Local governments and probably many other TVA stakeholders would certainly question this action.  Most expect a Biden nomination from both Alabama and Mississippi after consultation with democratic elected officials from the two states.  In May of this year two additional Board terms expire.  Board Chair, John Ryder, a prominent attorney from Memphis who has served as General Counsel for the Republican National Committee and Kenneth Allen, a Kentucky native who has served as a coal company executive will be replaced by Biden nominations.  Then on May 18, 2022 A.D. Frazier a Georgian who served as an executive for the Atlanta Olympic games will see his term expire.  In only 16 months the Biden administration can nominate five new members, each with a five-year term, on the nine-person TVA Board and with the Democratic control of the Senate, confirmation of these nominees should be straightforward.  

What can TVA expect from the new administration?  Certainly, Board member diversity will be addressed.  Currently the TVA Board is composed of six white men and one white woman.  This situation will probably be remedied in the next nominations.  When A.D. Frazier’s term expires undoubtedly the two new Senators from Georgia will weigh in heavily on the replacement.  If climate change initiatives are pushed or the “green new deal” takes any legs, these new ventures can certainly impact TVA policy through a Board majority of Biden appointees.  To TVA’s credit it has made major strides in the reduction of fossil fuels in its fuel mix.  It has been steadfast in its agreement with EPA to do so.  It has made major capital commitments to modernize its nuclear fleet.  It has also proactively addressed renewable fuel sources including solar.  Some stakeholders believe TVA has not done near enough in the renewable arena.  Currently 60% of TVA’s power production is clean energy.  Hopefully, the Biden Administration’s energy initiatives will leverage the unique resources of TVA which has served as a “living laboratory” for energy innovation since its New Deal creation by FDR.  

What do local governments expect?  ATVG realizes policy changes will certainly occur.  However, our organization wants the agency to always have a focus on providing clean, reliable and affordable power while also maintaining strong partnerships with local and state governments in economic development activities.  This focus has been front and center for 87 years and hopefully will remain the agency’s top priority under any Presidential administration.

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Mike Arms is Senior Partner at Tennessee Strategies and serves as Executive Director for the Association of Tennessee Valley Governments (www.atvg.org)