Power or Water? TVA's dilemma

With extreme drought affecting southern Tennessee and northern Georgia and Alabama, the 9 trillion gallons of water that still flow through Chattanooga and feed hydroelectric plants at TVA's reservoirs are being tapped. Hydro provides the cheapest 10 percent of the total power distributed by TVA, but in this past fiscal year, hydro production was down 33%.

The trend is continuing in fiscal 2008 amid an anticipated 1.9 percent growth in power demand.

"We still have hope," TVA President and CEO Tom Kilgore said. "We have had a fair amount of rainfall lately. But until the ground gets saturated it is not going to get any better (in the lakes)."

In other business, the TVA board approved a decrease in the quarterly fuel cost adjustment charge beginning Jan. 1. Consumers should see a savings of $1.40 to $2.70 on their monthly power bill, reflecting about a 3 percent savings in wholesale power.