The Trump administration has put forth a proposal
to Congress to sell assets of federal power companies to state and local entities, or private businesses. The proposal is part of the White House’s plan
to rebuild the nation’s infrastructure.
The ability to divest some power transmission assets will give federal power companies such as the Tennessee Valley Authority, the Southwestern Power Administration, or the Western Area Power Administration, greater value, which in turn would lead to improved value for taxpayers, the plan goes.
This part of the infrastructure rebuilding plan, however, does not seem to sit well with the American Public Power Association. The public power company trade group said it was disappointed by the proposal, noting that the assets Trump wants power companies to be able to sell have been paid for by electricity customers.
One of the public power companies mentioned by the President, the Tennessee Valley Authority, issued a statement following the proposal, in which it said, “The TVA transmission assets described in the budget schedule include more than 16,000 miles of line paid for by the power customers of the Tennessee Valley over the past 85 years. The transmission system is an integral part of TVA’s power system, which has delivered power at 99.999 percent reliability for the past twenty years. TVA is also a major reliability coordinator for large sections of the U.S. power grid, helping ensure that America’s vital energy infrastructure runs safely and reliably every day.”
The company added that it does not receive any federal funds but is a self-funding organization that uses its annual revenues and public debt markets to finance its business, implying it would not need to resort to asset sales to bring value to its customers.
Tennessee Senator Lamar Alexander also commented on the proposal, calling it a “looney idea,” but adding that it is not a new one but rather popular with different administrations: “This looney idea of selling TVA’s transmission lines seems to keep popping up regardless of who is president. It has zero chance of becoming law. When President Obama proposed this in 2013, all it did was undermine TVA’s credit, raise interest rates on its debt, and threaten to increase electric bills for 9 million Tennessee Valley ratepayers.”
By Irina Slav for Oilprice.com
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