Higher electricity sales push TVA revenue higher

On Tuesday, the company reported $7.4 billion in total operating revenue on 113.6 billion kilowatt-hours of electricity sales for the first nine months of its fiscal year. This represents a 5% increase in electricity sales for the nine-month span than ended June 30, 2021, over the same period a year ago. TVA cites the pandemic as the reason for the lower energy sales.

Total operating revenue increased 1% as a result of higher energy sales, offset by lower effective base rates mainly due to the Pandemic Relief Credit that began in 2021, and totaled $156 million in the nine months ended June 30, 2021.

“TVA continues to serve our communities as they recover from the pandemic and as businesses and industries ramp production back up,” said Jeff Lyash, TVA president and CEO. “Through systematic planning and investment in our system, we are meeting strong summer power demand with 99.999 percent reliability and delivering some of the nation’s cleanest, most economical energy.”

TVA’s year-to-date net income was $257 million higher, primarily because of lower depreciation and amortization expense, which was $286 million lower for the nine months ended June 30, 2021, than the same period in the prior year, due to accelerated retirements of coal-fired facilities. TVA’s tax equivalents expense was $17 million lower, largely because of a decrease in TVA’s revenue from sales of electricity in 2020, which is TVA’s basis for calculating tax equivalents.

Interest expense was $824 million for the nine months of fiscal year 2021, a 4% decrease from a year ago, driven by lower average debt balances.

“TVA’s effective wholesale power rate to customers remains lower than a decade ago,” said John Thomas, TVA’s chief financial officer. “Our investments in cleaner and more efficient energy resources, cost reductions and lower debt are helping TVA support the region’s recovery now, and contributing to TVA’s sustainability for the future.”

Additional highlights from TVA’s third quarter fiscal year 2021 include:

• As of Aug. 2, 2021, 143 local power companies have long-term partnerships with TVA, including the recent addition of Cullman Electric Cooperative. Bill credits to partners totaled $133 million for the nine months ended June 30, 2021.
• TVA continues to offer the Back-to-Business credit program that provides relief to certain larger customers when returning to operations and the Community Care Fund that partners TVA and LPCs to support local initiatives that address hardships created by the COVID-19 pandemic. TVA remains committed to supporting communities and customers across the Tennessee Valley during the region’s ongoing recovery.
• TVA continued to maintain 99.999% reliability in delivering energy to its customers through June 30, 2021. TVA has maintained 99.999% reliability for more than 20 consecutive years, providing industry-leading reliability.
• Rainfall and runoff in the Tennessee Valley through the third quarter of 2021 were 110% and 113% of normal, respectively.
• According to TVA, its economic development efforts resulted in more than $7.8 billion in investments and more than 65,300 jobs created or retained through the third quarter of 2021.