(Arlington, VA) While the Trump Administration’s FY2020 budget request to Congress proposes many positive measures for Americans, it also includes a proposal that could hurt the affordability and reliability of electricity.
The Trump Administration’s proposal calls for selling the transmission line assets of the Tennessee Valley Authority (TVA) and three of the four federally-owned power marketing administrations (PMAs). Those PMAs are the Bonneville Power Administration, the Western Area Power Administration, and the Southwestern Power Administration. The Administration’s budget also calls for all four PMAs (Southeastern Power Administration and those previously mentioned) to charge market-based electricity rates instead of the cost-based electricity rates that they currently charge.
“With respect to electric cooperatives and public power, the President’s Budget misses the mark,” states Energy Fairness Executive Director Paul Griffin. “Just like similar proposals put forward in 1995 and 2005, this budget request puts the affordability and reliability of electricity at risk for millions of customers.”
“The Trump Administration’s proposal to target assets owned by TVA and the PMAs is a bad idea for many reasons,” adds Griffin. “It not only threatens the affordability and reliability of electricity for millions of power customers, but it ignores decades of highly-efficient performance by public power providers that we should appreciate and leave alone.”
“There is a misperception that taxpayers still subsidize the operation and maintenance of dams and other electrical infrastructure needed to bring federal hydropower to the electric cooperative and municipal consumer,” explains Cline Jones, Board Chairman of Energy Fairness and Director of the Tennessee River Valley Association. “However, the opposite is true.”
Electric cooperative and municipal utility consumers nationwide use power generated by hydroelectric dams operated by the U.S. Army Corps of Engineers and Bureau of Reclamation.
Unfortunately, every ten to fifteen years, presidential administrations of both parties, or even the U.S. Congress, fail to acknowledge the history and facts behind the creation of the Federal Power Program by proposing to sell the assets of the program or charge market rates for the power they produce.
In 1995 the Clinton Administration tried to sell the dams and lakes producing power for PMAs.
Through opposition from a bipartisan group of lawmakers in the House, the opposition failed. In 2005, bipartisan opposition also sunk the Bush Administration’s proposal for all PMAs to charge market-based rates.