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TVA Report . . . August 27, 2008

Fraud – TVA walks the fine line

When is an act fraudulent?  Is it when it is performed or when there is proof of injury?  

Definition of Fraud

All multifarious means which human ingenuity can devise, and which are resorted to by one individual to get an advantage over another by false suggestions or suppression of the truth. It includes all surprises, tricks, cunning or dissembling, and any unfair way which another is cheated.

Source: Black’s Law Dictionary, 5th ed., by Henry Campbell Black, West Publishing Co., St. Paul, Minnesota, 1979.

Maybe it is the appearance of fraud that is most troubling.  It appears that the TVA mislead the public into believing that its accounts receivables far exceeded the true amount by hundreds of millions of dollars in a 2006 report.  Subsequent reports underreported the receivables.  TVA is now revising those Securities and Exchange Commission (SEC) reports from 2006 forward and does not know when they will be completed.

Two outside and independent auditing firms failed to recognize those misstatements.

From time to time, TVA puts up for sale it’s so-called “power bonds” usually a billion dollars worth.  It is clear that potential buyers of those bonds with the knowledge that TVA grossly misstated its accounts receivables, not on just one occasion but on several occasions, may give pause to a) the  accuracy of all of TVA’s financial statements and, b) the viability of TVA’s bonds.

This is particularly significant because the federal government does not provide its full faith and credit behind those financial instruments.  However, rating companies still give the TVA bonds a AAA rating because they do not believe the government would allow the TVA to declare bankruptcy.  

One of the elements of fraud also can be the omission of key facts in an attempt to “cover up” mistakes of management.  The TVA seems very reluctant to share information that may be important to bond buyers, vendors, and its own staff and to its customers.

It appears that TVA did not prepare for the deluge of criticism of its 20% rate hike October 1 brought on by its insufficient time for their customers to make their own preparations for it.  The TVA does have discretion in setting the timing of rate hikes and obviously, they have abused it.  TVA seems to have been caught unaware of spiraling fuel costs and had to resort to “panic” rate increases.

It is doubtful that the public service commissions in any of the seven states in TVA’s territory would have allowed such a steep rate hike all at once.  But the PSC’s there have to answer to their own electorate, the electricity users, and do not have the unilateral power the federal government does to mandate those rate increases.

The TVA Act represents a flaw in the representative form of  government provided in the U.S. Constitution, i.e., it is “We the people” who have the power over government, not the reverse of it as practiced by the TVA.

Fraudulent or not, the TVA continuously fights against rules  other utilities have to abide by and only with great reluctance upgrades it coal-fired plants with the latest pollution scrubbers.

It could have been fraudulently that TVA conspired with witnesses in their trial against the North Carolina Attorney General to claim that the TVA did not pollute past the North Carolina state line.  Apparently the bad air just disappeared at that point.  One TVA witness claimed that cutting the pollution from TVA’s coal-fired plants would most benefit the people of middle Tennessee and North Alabama.

Concealment and cover up probably, after the GAO report of May 21, 2008, “Weaknesses in Control Systems and Networks”, was released showing the serious vulnerabilities of TVA’s production and executive computer systems.  Their response?  “We’ve fixed it” and the usual “we’re working on it”. – “Security reasons” no doubt kept this major management mess up under wraps.

If not fraud, then a cover up of the major mishandling of 5,550 TVA computers that at first could not be accounted for.  Some apparently had been given away to a school (at least three of them); this brings up the question of whether government property disposal was handled within guidelines.

This may be no more that a major management debacle but it appears that fraud could be involved.

Part of TVA’s problem is its monolithic attitude and its undecipherable Web site.  Search subjects are so general that it may require looking at hundreds of entries that are not in chronological order but according some other arcane method of organization.

Is it fraudulent to claim that TVA’s “principal offices” reside in Muscle Shoals, Alabama?  The TVA Act says that is where it is supposed to be or in the “vicinity” of it.  Knoxville, Tennessee really stretches the word “vicinity”.

And is it a fraud for the TVA not to conform to the TVA Act in other respects such as its charge to develop new and cheap fertilizers and to assist in developing better farming techniques?  That stopped decades ago but the law has not changed.

Some of TVA’s land deals and swaps are highly questionable.  A recent one involved a North Carolina congressman who stands to profit greatly from one of TVA’s approvals.  And that congressman is part of the Congressional TVA Caucus, a body whose job it is to oversee TVA to prevent just these kinds of dealings.

Also, it appears that the transaction did not conform to the requirements of Executive Order 13406 which specifically prohibits such action.  If suit is brought against the TVA for improper practices, perhaps it too could be called fraud.

Finally, does the fact that the TVA Office of Inspector General is paid from TVA funds constitute fraud?  The OIG is supposed to be an arms-length independent reviewer of the TVA.  The question is, “Does the dog bite the hand that feeds it?”

Ernest Norsworthy

emnorsworthy@earthlink.net    

TVA Report . . . August 21, 2008

TVA’s raw-power anti-competitive money grab  

“With the swipe of a pen. . .”

A vestige of FDR’s New Deal socialism, the Tennessee Valley Authority, survives management blunder after management blunder.  How, you may say, does a $10 billion power facility survive in a competitive, free-market economy?

Well, it cannot unless some very large government strings pull the TVA out of the world of real competition.  But despite its financing advantage, lenders do not believe what the government explicitly says it will not do, that is, to give those lenders a guarantee of the full faith and credit of the United States government.  And financial rating companies give the TVA their AAA ratings with statements like “the government never would permit the TVA to default.”

Financing capital construction critically depends on the cost of that money.

Until recently, the TVA has been claiming “sovereign immunity” to thwart legal action against it, however, a federal judge ruled out that defense in an air pollution suit brought by the State of North Carolina.

TVA is in the midst of a paradoxical campaign – sell more electricity and conserve more electricity.  They are now predicting that income will be “flat” next year, yet they want to continue additional construction on two abandoned nuclear reactors (Bellefonte) in North Alabama.

With the need to purchase more and more power from outside the TVA “fence”, the federal agency is becoming more and more a broker of electricity instead of a producer of it.  And there is a net loss to TVA for it by at least 5 percent, the amount TVA is obligated to dole out to states and localities.  Some money, strangely, goes as far away as Illinois.

The out-of-control federal agency, fearless from congressional oversight or having to answer to any of the 8.8 million citizens whose electric bill just went up 20 percent “with the swipe of a pen” as one writer puts it, is unique in the federal government.

Here’s what a former TVA employee had to say about the rate hike, and more:

“With the swipe of a pen, TVA's annual revenue has increased 2 billion a year or close to 20%.  How can this travesty take place without some form of representation for the people of the Tennessee Valley?

I never fully understood the unconstitutional powers of TVA until I started reading your articles.  At (my) company, we must bring everything to the table in front of the PSC.  We are scrutinized inside and out and rightfully so.  Any ratepayer deserves a voice at a minimum.  I am speechless as result of the latest rate increase.  When will the people of this country open their eyes to the greatest mismanagement in federal government?

I don't think any arm of the federal government has as much power over the people as does TVA.  The happiest day in my life will be when the TVA is dissolved and the people are free. 

I think daily of the unethical, unsafe,  and dishonest business practices I was exposed to daily.  One day I hope to have my voice heard”.

Others are just as outspoken about the TVA but most are afraid to express publically their views for fear of retribution.

TVA’s unilateral authority over so many people to provide their electricity is unprecedented in America.  And, as is always the case, changes in the structure of our federal government must begin at the bottom, with the people themselves.

Ernest Norsworthy

emnorsworthy@earthlink.net

http://norsworthyopinion.com

TVA Report . . . August 12, 2008

TVA – how to justify the greatest rate hike in 75 years?

“As in pre-American Revolutionary days, an oppressive British government demanded a stiff tax on tea arriving at the port of Boston to be paid by American citizens to pay for an over-spent British administration.  Today, that demand is from the TVA and the increase is

to pay for the many extravagancies of the TVA administration”. Ernest Norsworthy 8/12/08   

Federal price controls in American do not work even though they have been tried repeatedly and in every case, they have materially disrupted the normal flow of our market economy.

It is time now to cease federal price controls of electricity provided to over 8 million households in an 80,000 square-mile federally controlled territory in the Southeastern United States.  Those households well could be considered to be behind an “iron curtain” 2,500 miles long and denied some of the basic rights guaranteed in the U.S. Constitution.

And now, this federal agency that controls prices in the Tennessee Valley tremendously is going to increase the prices (a tax) it levies for electricity on those 8 million consumers estimated to be 20 percent or even more on October 1, 2008.

Electricity in most of Tennessee and parts of Mississippi, Alabama, Georgia, Kentucky, North Carolina, and Virginia, courses through 17,000 miles of federally owned transmission wires.  The electricity is produced for the most part by coal-fired generators and six nuclear reactors.  Hydro electricity now plays a minor part in its production.  Additional power is purchased from outside the 2,500-mile fence at times of peak demand, now at $701 million so far this year.

It is time to stop the federal intrusion of the Tennessee Valley Authority into national and international markets that impact construction financing of other utilities by flying false colors.  With faint denials, the TVA federal agency does not guarantee the full faith and credit of the federal government in the sale of TVA’s financial instruments.  Lenders seem to think differently believing that the federal government would never allow a federal agency to go bankrupt while the documents express the opposite view.

The federal government through its own agency, TVA, duplicates the clear missions of other federal agencies such as the National Park Service, Fish and Wildlife, Corps of Engineers, Bureau of Land Reclamation, Small Business Administration and other loan and grant agencies of the federal government.

TVA constantly battles with other federal regulatory agencies and defends suits against it costing in the millions of dollars for both sides.

The TVA has usurped the constitutionally granted powers of seven states that contain TVA’s territory.  It has done so by disallowing the public service commissions in those seven states to regulate TVA’s electricity rates.  TVA sets its prices and then controls them. 

From agency income, now at about $9 billion annually, comprises the price controls established by the federal agency, the TVA, and as a sop to elected leaders in those states, rebates five-percent of the gross to “payments in lieu of taxes”.  Is that amount, the five-percent, arrived at through consultation/approval of any elected official in any of the seven states?  The answer is no.  “No taxation without representation”.

With the federal government controlling the income to the agency, there is a negative warping of taxes rightfully owed to localities, states, and even to the federal government since the TVA cannot pay taxes to itself.

That $9 billion does not filter through the common denominator of private enterprise where its use would be much different from filtering through the U.S. Government.

For its entire 75 years, the TVA has skewed the actual outcomes of economic and cultural growth of the South with its paternalistic approaches.  “Pity the poor and backward people of the South!” is their approach and with “free” money, nonetheless.  Unfortunately, that rebate money goes through many political hands as a slush fund and everyone get to scrape off a little of it from the top.  The people who use TVA electricity and who form the basis for TVA’s rebate get none of those benefits directly.

It is easy to speculate that if the Tennessee River Valley had begun its major development by entrepreneur Henry Ford in the 1920s that private employment would have resulted in the millions by this time.

Ironically, Ford’s dream significantly has been realized outside TVA’s control in Georgia, Alabama, and Mississippi where multi-billion dollar auto plants already are in operation with more planned.

The agency of the federal government, the TVA, that manages this monolith has proved to be a very poor manager of its resources; today the agency has a $25 billion unsustainable debt and promises to exceed its statutory limit of $30 billion with planned new nuclear reactors.

Never noted for its ability to foresee market changes with a nimbleness to adapt to them, the agency is now embarking on a paradoxical quest to conserve more electricity while at the same time to “sell more electricity!”  There are times when demand exceeds TVA’s capacity to produce electricity and the agency must resort to more expensive sources outside TVA’s fence.

Previously, I have suggested that electricity customers gladly would cut back on power usage during peak hours if the incentive were big enough.  The source of this incentive fund may be found ready-made in TVA’s payment in lieu of taxes slush fund that is paid to state and local governments, some $450 million last year.  Instead of paying more to this fund based on more usage of electricity, it could be turned around to benefit those who actually conserve more electricity in payments directly to customers as a bonus.

An overly aggressive federal government agency has dampened the entrepreneurial spirit of the Tennessee River Valley to the point that everyone has to check with the TVA before taking almost any kind of action relating to land or water, almost any kind of business move.

TVA’s anti-business spirit pervades the South and its heavy handedness has retarded both its economy and the natural free-enterprise culture of its people.

Ernest Norsworthy

emnorsworthy@earthlink.net

TVA Report . . . August 8, 2008

How can this happen in a democratic republic?

There is a place in America where representative government does not work.  It is a very large expanse of territory, some 80,000 square-miles, and it is controlled out of Washington, D.C.

No, it is not some vast area in the West where the federal government owns 25 percent of the land; it is not a territory of the United States.  No, it is right in the middle of the Southeastern United States and it is dominated by the Tennessee Valley Authority, an agency of the federal government.

More than 8 million people are inside TVA’s territory surrounded by a 2,500 mile-long fence under the total control of the TVA for the provision of their electricity.  

The people seem to be mesmerized by their captor, afflicted with the Stockholm syndrome.

“Please, oh please, let me pay more for your beloved electricity!”

After TVA CEO Tom Kilgore announced on Wednesday there would be a large increase in the cost of electricity October 1, up pops the editorial apologists who pick up TVA’s usual excuses; it is the drought, it’s the heat, it’s the cost of coal, it’s the cost of blah, blah, blah, ad nauseam.

Those writers never mention that the TVA has the people in a lock; in this representative government, there is no one to represent the people inside TVA’s fence.  TVA sets the rules (laws) and TVA enforces their own rules (laws).

Public service commissions in seven states are powerless to require the TVA to justify their increased rates; the mayor, city council, county commissioner, state representative, governor, even the federal representatives in congress, all are powerless to make the TVA justify an increase in rates.

The reason is that it is federal law that gives the TVA this extraordinary power and until the law is changed or abolished, well, “cased closed”.

In our representative form of government, the kind of government that makes America so very special in the world, it is the people who decide who will govern themselves.  And that  "governments derive their just powers from the consent of the governed"--Declaration of Independence.

The very existence of the TVA flies in the face of that well-known and established American precept of government.

The American Revolution was supposed to have settled the issue of sovereignty, are we to be ruled by a king or by ourselves?  The issue of sovereign immunity claimed over and over by the TVA to maintain its dictatorial stance over the people in parts or all of seven Southeastern states, slowly is being brought down.

The recent federal trial against the TVA in Asheville, NC,

proceeded only when TVA was denied sovereign immunity.  But that is not the same as TVA relinquishing its power to levy a TVA “tax” on the people by increasing its rates.

The attitude seems to be “No, never look at the TVA itself”, that paragon of frugality and efficiency. 

Does anyone ask why TVA has a $25 billion debt that is unsupportable?

How much of this latest rate increase will be used to pay interest on that debt?

And much less, how are they going to pay down that debt with an estimated $10 billion more planned in the near future?

Financially, TVA already is bankrupt - right in the middle of a representative democracy.

Ernest Norsworthy

emnorsworthy@earthlink.net

TVA Report . . . August 5, 2008

TVA accounting in high dudgeon – somebody’s got to pay!

Reconciling a checkbook account is not a particularly difficult task but it seems to be so for many people. The problem arises when there is not enough to cover the drafts, “I always keep enough money in my bank account to cover my checks”, they cry. An unreconciled account is a financial bomb waiting to blow.

And it looks like that is what has happened to TVA’s accounting procedures. Too much of an estimate of income in one account and not enough in others.

It goes back to 2006 and the mistake seems to have ballooned up to and including the March 31, 2008 financial
Reports.

The TVA reports in an amended filing with the Securities and Exchange Commission dated August 5, 2008 by Chief Financial Officer, Kimberly S. Greene that those reports “Should not be relied upon due to errors in the estimates of unbilled revenues.”

We’re not talking peanuts here. The first overestimate of billings was $232 million, enough perhaps, for a potential buyer of TVA bonds to make a financial decision to buy.

And then in subsequent reporting periods the billing estimates were too low, again maybe enough for potential bond buyers to make financial decisions.

This is but another glaring management error that could not use the simplest of methods to estimate billings due – “To use TVA meter data and individual distributor wholesale bill dates”. And that is the method they will be using in the future.

Because of TVA’s well-known tendency to “get around” a particular issue for whatever their reasons, this latest financial fiasco just adds to the huge number of management mistakes by the current CEO and board of directors.

TVA already is geared up to put the blame somewhere else. They have had “discussions” with Ernst and Young, TVA’s current accounting firm, and with PricewaterhouseCoopers for the fiscal years ended September 30, 2006 and 2007.

“In order to remediate this material weakness, TVA is taking the following steps”, blah, blah, blah.

Not a mea culpa even hinted. Just part of the “TVA culture”.

If this were any other utility with an unsupportable $25 billion debt (like TVA’s) it would have long ago been liquidated and with a call for SEC sanctions.

Again, “nobody ever gets fired at the TVA” and this looks like another serious management mistake that will go unpunished. I have already called for the U.S. Attorney General to investigate the apparent loss or theft of 5,550 TVA computers that belong to the government.

Management of the TVA is in serious jeopardy of flying completely apart and should be taken over temporarily by the Department of Energy until all of the many serious issues can be sorted out in preparation for the liquidation of the TVA.

This ain’t checkbook accounting, it is holding someone responsible and accountable.

Ernest Norsworthy
emnorsworthy@earthlink.net

TVA Report . . . August 2, 2008

 TVA - federal agency shakeup long overdue

"Some heads must roll after this” is an old saying, one that has punch, one that is somewhat assuring that something actually will be done.

None of this applies to the Tennessee Valley Authority, it never has. TVA management can make the most egregious mistakes and still go unpunished. And this is so from the very beginning of the TVA where they told the utility competition in the surrounding area to “sell or be duplicated” meaning TVA would undercut any price offered by those utilities.

In an article published by Time magazine December 5, 1938, utility lawyers concluded “A last-ditch attempt to get the currently New Dealish Supreme Court to reverse the ‘brutal doctrine of Chattanooga’ – the opinion of a three-judge Federal Court this year that since TVA power sales are legal, utilities have no legal relief even from ruinous TVA competition.”

And to a Senate and House committee Wendell Willkie, president of the Commonwealth and Southern Corp., “gave a vivid picture of what utilities, and utility investors, are up against”, said the magazine article. “If subsidized low TVA rates and the ‘brutal doctrine of Chattanooga’ forced utilities to sell out to the Government, their troubles only began”. “Mr. Willkie, for instance, thought Tennessee Electric Power Co. was worth $120,000,000; TVA was offering $65,000,000.” “If any public purchaser disliked the utilities’ price, bitterly protested Wendell Willkie, it could set up a duplicating system with PWA funds (Public Works Administration), getting 45% of the money as a gift and borrowing the rest at low interest.” “Utility properties without a market are valueless except as junk. … In effect, the Government holds a gun to the head of the utility and says ‘Sell at our price or we duplicate.’ This is one of the most cruel, brutal, and unAmerican doctrines ever adopted. …”

That attitude of the TVA so clearly expressed by Wendell Willkie prevails yet today and has become part of the “TVA culture”.

In the 1970s and 1980s, TVA management grossly overestimated the power needs for the region by beginning construction of three times too many nuclear reactors, 17 of them. Six nuclear reactors presently are in operation. Many were abandoned after costing billions of dollars and now TVA plans to finish more of those units at costs estimated to be another ten billion dollars.

Presently, TVA’s debt is about $25 billion with a Congressional debt cap of $30 billion. However, TVA’s income today barely pays debt interest and financially it would be in liquidation status if it were an investor-owned utility.

TVA’s land policy until recently clearly was in violation of Executive Order 13406 which prohibits the disposal of federal property for other than public uses. TVA still retains about 293,000 acres that should be auctioned off as surplus, a management deficiency.

TVA has instituted a “conservation” program (again), one that will not work under TVA’s present organization. Financed to the hilt, TVA cannot afford to cut sales. The entire TVA electrical supply system is based on ever-increasing power demand, on building more capacity. TVA management’s failure to foresee the trends in supply and demand has left the agency without the capability feasibly to finance more new capacity. Watts Bar Unit 2 was estimated to be 80% complete when construction stopped in 1985, however, it was canabalized for use on other nuclear plants and now is an estimated 60% complete. The twin Watts Bar Unit 1 took 22 years an nearly $7 billion dollars to complete.

Canabalization is a very bad management practice comparable to going to the junk yard to scrounge for a particular part that may or may not meet specifications. Completion of Unit 2 at an additional estimated cost of $2 to $3 billion has now been moved forward to 2013.

TVA management seriously blundered when it decided to “centralize and streamline” TVA. The resulting mixing of operational systems computers with executive/management computer systems resulted in serious security breach vulnerabilities as reported by the Government Accountability Office (GAO) May 21, 2008. This mistake was so egregious that it warranted calling for the resignations of both the TVA CEO and the part-time board of directors.

As if that was not serious enough, TVA’s Office of Inspector General reported that the TVA could not track over 5,550 computers in their inventory. “The inability to adequately track, as well as the lack of encryption, on these computers increases the risk for the disclosure of sensitive or restricted information.”

“The policies for handling/reporting stolen computers were not consistently followed.” This lackadaisical attitude of the TVA fits well in the “TVA culture” which permeates the entire organization.

With this new revelation of TVA mismanagement, I have requested the U.S. Attorney General look into possible criminal prosecutions, malfeasance in office of TVA management and possible wrongdoing by TVA’s federal employees.

TVA management mistakes are not infrequent and follow a familiar pattern. “We’ve already fixed it” or “we’re going to fix it and never let it happen again”, all without accepting the responsibility of managing the agency and holding accountable those responsible for it. To assume it is the responsibility of Congressional oversight committees to do the chastising job would be an even bigger mistake.

Because the TVA receives no congressional appropriations, there is no congressional oversight. Now is the time for the Congress to authorize the liquidation of the TVA. Concomitantly, the Executive Branch could be preparing for that eventuality by use of the Department of Energy to develop TVA dissolution procedures.

Ernest Norsworthy
emnorsworthy@earthlink.net

TVA Report . . . July 31, 2008

TVA - What kind of computer security?  Calling for U.S. Attorney General to investigate

TVA Report . . . July 30, 2008 

TVA’s Tom Kilgore, his Swan Song?

The last witness for the TVA, CEO and president Tom Kilgore, was singing the same song, second verse and still says he is “going to do” a lot of things the TVA has failed to do.

To look at his pronouncements with anything but a jaundiced eye would be “foolhardy” according to his own judgment of planned action. “It would be foolhardy not to complete those (upgrades)”, he said. (Tennessean 7/29/08)

Of course, he can never take back all of the “foolhardy” mistakes the TVA has made in the past that were recounted on cross-examination.

Particularly telling is the kind of logic the CEO used to rationalize completion of new air pollution control devices on three coal-fired plants in East Tennessee that previously had been “pledged”.

But the new scrubbers on Colbert’s plant also were “pledged” – before changing horses again in midstream from the pressure of this very trial brought by North Carolina and transferred to the plants in East Tennessee. There goes the “health” plan for the Shoals in North Alabama.

TVA’s reactive management is no worse than the many fits and starts of that agency over the years whether there were three directors running the monolith or just one, CEO Tom Kilgore. Yes, there are nine part-time directors (seven presently) who are supposed to chart the path for the TVA and at this point they are badly in need of navigation training.

The board has made some very large errors in direction of the agency and in their setting of the policies to guide it. Most recently, because of a conscious management plan to combine operational and executive computer systems resulting in some major security vulnerabilities to the entire 80,000 square-mile electrical system of the TVA, it is abundantly clear that the board members responsible for that mistake should resign. And so should the CEO, Tom Kilgore, for not having the management skills to foresee such gross misdirection’s from the board. (See GAO report of May 21, 2008)

The TVA is a federal anachronism that is long overdue for liquidation into smaller, more manageable units that would be less vulnerable to cyber-hackers. Until market forces obtain, the entire Tennessee River valley will remain subject to another federally dominated program from Washington that could put the entire nation at risk.

So in essence, TVA’s CEO Tom Kilgore just says, “Trust me, I’m from the government and I’m here to help”.

Ernest Norsworthy
emnorsworthy@earthlink.net

TVA Report . . . July 29, 2008

TVA witness – “Pollution? We ain’t got no stinkin’ pollution!” (Parody)

“Pollution? What pollution? We ain’t got no stinkin’ pollution!” in a parody of what Quincy Styke testified in federal court today. Styke is the deputy director of Tennessee’s Division of Air Pollution Control. “Tennessee’s been about the business of controlling its emissions”, Styke said in a quote from the Tennessean newspaper today. How about controlling air pollution for Tennessee citizens?

And so goes another TVA witness who believes in the TVA’s version of a fairy Godmother. One witness testified that the pollution from TVA’s 11 coal-fired plants simply disappears when it goes over into North Carolina, magically.

Another said the best improvements to a North Carolina law enacted in 2002 would be for middle Tennesseans and citizens in North Alabama. Put ’em together and what have you got, bippity-boppity-boo.

The trial of the TVA, a federal agency, against American citizens is coming to a close. And the old saying, “With friends like the TVA, who needs enemies?” certainly is apropos to the circumstances.

It is disheartening when our own federal government fights tooth and nail to keep from providing the best possible air cleaners on their smokestacks. And as claimed by North Carolina, is detrimental to the health of their citizens and as testified, to the health of the citizens in other states.

When a state of Tennessee pollution official stands up in court, unbelievably, and testifies that, “TVA is moving ‘as quickly as it can’ to install pollution control technology at its 11 coal-fired plants in Tennessee, Alabama and Kentucky,” the credulity of that witness has to be questioned. (From Citizen-Times 7/29/08)


When this trial is over, the federal judge, Lacy Thornburg will decide its final outcome since there is no jury involved.

Ruling only on the facts and on the law, Judge Thornburg has his hands full in sorting out the major conflicts in this case, and as I see it in the simplest of terms, the question is in an analogy, “should defendant “A” be responsible for the thistles that blow on and damage the property of plaintiff “B”?” A thorny question, no doubt.

But the judge may also rule that immediate steps be taken by the TVA to shut down many, if not all, of the 11 coal-fired plants. Of course, TVA would squeal like a stuck pig if that happened and would seek injunctive relief I imagine.

Long neglected maintenance and upgrading of TVA’s coal-fired plants also should be considered. This suit should have come as no surprise to the TVA; this case opens up the TVA to many more like it, I believe, regardless of how the court rules.

Ernest Norsworthy
emnorsworthy@earthlink.net

TVA Report . . . July 25, 2008  

TVA pays for "unbiased" testimony

One way to win arguments, even arguments about who is dumping on whom regarding air pollution, is through the scientific method.

Here’s the way it usually works. Expert witness “X” posits that the gray skies are caused by “Z” and sets forth the scientific reasons to support that position. The scientific method has strict rules to abide by. If those methods are not adhered to, the testimony is less credible and carries less weight, a lot less if the scientific method is claimed.

Now expert witness “Y” attacks expert “X” and says, according to the Asheville Citizen-Times, “The calculations ‘fly in the face of common sense’.” And further, “These numbers cannot be taken seriously. The assumptions underlying them are meaningless”.

Here’s where it gets sticky. Again, quoting the Citizen-Times, “A Tennessee Valley Authority witness testified today that there’s no scientific evidence to support the contention that emissions from TVA power plants cause premature deaths and health problems in North Carolina”.

TVA’s witness goes further and says, “I’m of the opinion that there isn’t sufficient evidence to support a causal relationship”. So says Suresh Moolgavkar, an epidemiologist with the University of Washington.

There are a couple of problems with Mr. Moolgavkar’s statements. First, he appears to offer no scientific evidence himself that NC’s witness, Jonathon Levy, did not use the “scientific method” to draw his conclusions that premature deaths and sickness were caused by TVA’s coal-fired pollution. In fact, he stated there was not “sufficient evidence” in his opinion to agree with the cause and effect of TVA’s smoke.

That, of course, infers there is some evidence using the scientific method, which supports the NC case.

Mr. Moolgavkar’s statement that “These numbers cannot be taken seriously … and are meaningless” is in itself a non-scientific response to another’s supposition based on the scientific method of discovery.

What Mr. Moolgavkar should do is to prove that there were errors in Mr. Levy’s scientific method - by using the scientific method. Just being dismissive of the presumptions in Mr. Levy’s propositions is, well, not the scientific method of proving or disproving propositions.

“Under cross-examination Moolgavkar acknowledged that most of his published papers cited on health and air pollution on his curriculum vitae were funded by various industry sources, including the electric utility industry.” (Tennessean 7/25/08) It does not appear that Mr. Moolgavkar comes to the table as a nonbiased, independent expert witness.

It is interesting to note that Mr. Moolgavkar, without disputing his professional credentials, still follows the kinds of dismissive attitudes found throughout the TVA. As a scientist, he should avoid those kinds of statements, stick to what is true, and what is not true – and to prove or disprove what has been posited. The scientific method is totally without hyperbole.

Ernest Norsworthy
emnorsworthy@earthlink.net

 TVA Report . . . July 25, 2008

TVA shooting self in foot with witness?

With more witnesses like Mr. Thomas Tesche for the TVA, it looks like TVA is backing right off the cliff.

Mr. Tesche, who magically makes TVA’s pollution from 11 coal-fired plants simply disappear when it reaches the North Carolina border, has now indicted the TVA itself in his assertion that it is middle Tennessee and North Alabama that takes the brunt of the present pollution. And it is there where the best benefits would derive if TVA followed NC’s clean smokestack act of 2002.

Also, Mr. Tesche bases his assumptions on 2002 data, old for the circumstances at hand.

I know this, the Colbert plant in Colbert County, Alabama puts out visibly excessive pollutants. Not only did my family breathe that bad air, I had to wash the black gunk off our house before selling it.

As to the trial, let’s make some assumptions even before it ends sometime next week.

First, assuming the federal judge rules against the TVA, what might his ruling consist of? He could:

Immediately require the TVA to shut down TVA’s coal-fired plants that do not meet the North Carolina standards, shutdowns programmed over 12 months and the availability to replace that electricity from other outside sources. (Apparently, that would mean all 11 of those coal-fired plants).

The Order would be specific as to actions to take by certain dates. (No “planning” to do it). The schedule would be agreed to in advance by both parties to the suit. Failure to perform would result in stiff fines and a re-hearing by the court for each instance of such failure to perform.

A fine of $1 million would be levied against the TVA for its failure to install appropriate state of the art scrubbers for each of the 11 plants when they were needed.

As a first priority, the TVA will install new scrubbers on the Colbert plant and with agreement from parties in the suit scheduled for a hearing in December, quash all complaints in that suit. A fine in that case to be determined by the court.

As an admonition, the court warns the TVA as an agency of the federal government to adhere to all federal laws, rules of the FERC, the NRC and any other federal agencies involved in the production of energy in the United States and for the TVA to cease and desist in the prosecutions of suits in that regard.

As an agency of the federal government and stewards of the welfare of over 8 million people with regard to their electricity needs, it is incumbent on the TVA to take the leadership role provided for in the U.S. Constitution, a role it has neglected to take on important occasions.

The court will suggest that a panel or some such grouping consisting of congressional, executive branch and members selected from the utility industry will be convened to produce an expedited plan to turn over the TVA’s power-producing capabilities to private industry. The judiciary will not be involved except to provide advice on past judicial involvement with the TVA and will not rule on anything other than matters of law.

Of course, another scenario could go like this:

The court finds that the TVA is not now or has not committed a “public nuisance” as alleged by North Carolina. Case dismissed.

Even with the latter ruling, the TVA must take immediate steps to reduce its pollution of the 11 coal-fired plants to standards within state and federal law.

Or maybe something in between the two scenarios. In any case, it is not probable the court will hand down an immediate ruling so there will be much waiting in anticipation on both sides of the issue.

Ernest Norsworthy
emnorsworthy@earthlink.net

TVA Report . . . July 24, 2008

TVA witness - smoke and mirrors?

From Asheville Citizen-Times reports.

Bill Baxter, former head of the triumvirate TVA, once said that the reason the TVA was picked on so much was that “it was an easy target”.

The latest witness for the TVA, Thomas Tesche, an expert in computer air dispersion modeling, seems to follow the same kind of reasoning. He said the pollution from TVA’s coal-fired plants was not drifting much over North Carolina from Tennessee that it had to come from somewhere else. Target question – from where else?

“The effects of improvements in TVA plants sought in North Carolina’s lawsuit against the utility would largely be confined to central Tennessee and northern Alabama”, Tesche said in U.S. District Court in Asheville.

So does the pollution magically disappear when crossing over into North Carolina? Or is it all absorbed in the eyes and lungs of people in Tennessee and Northern Alabama first, as he implies.

Give TVA a black star for winning clean air suits. But it is not nearly over for the TVA. In December, yet another suit against the TVA will be heard (unless they weasel out of it). This one involves the longstanding claim that TVA’s Colbert coal-fired plant is not operating within the law.

Alabama’s Department of Environmental Management (ADEM) seems to be supporting TVA’s case by insisting that codifying a 2 percent permissible overage of emissions instead of the present ability to fudge the opacity emission using “eyeballs” instead of electronic monitors. EPA does not agree with the ADEM on this.

For the most recent developments on the upcoming case, see today’s Mobile Register article. www.al.com/news/mobileregister  

Ernest Norsworthy
emnorsworthy@earthlink.net
http://norsworthyopinion.com

TVA Report . . . July 23, 2008

TVA - a leader who's 'way  behind

Does the end of TVA’s “cover up” mean the beginning of a new TVA?

By cover up I mean the end of TVA’s claim for (and receiving) sovereign immunity from prosecution. While I am no friend of over-regulation, when there is a law on the books it should be followed by all equally. Fighting for a change in law is an entirely different process.

The federal Clean Air Act and amendments require:

Federal Facilities. Federal facilities are required to comply with all federal, state, interstate and local requirements respecting control and abatement of air pollution to the same extent as nongovernmental entities. § 7418.

It also provides EPA with enforcement powers and authorizes the imposition of civil and criminal penalties. In the case of imminent and substantial endangerment to public health or welfare or the environment, EPA may bring civil action to restrain the emission of the air pollutants in question or to take other action as necessary. Citizen suits, including suits against EPA for failure to take nondiscretionary action, are authorized by the Act. §§ 7413-7414, 7420 and 7601-7607

TVA’s first defense witness in the trial in North Carolina comes off looking typically TVA – ‘we’ve been working on more pollution controls (look what we already have spent on them) and we plan to do more’.

The Asheville Citizen-Times said that John Myers, senior manager for TVA’s environment and regulatory outlook, testified that “TVA’s coal-fired plants produced about 30 percent more electricity last year than plants in North Carolina while emitting about the same amount of sulfur dioxide.” Myers also acknowledged that Duke Energy and Progress Energy “Are poised to significantly reduce emissions” as required by North Carolina’s Clean Smokestacks Act of 2002.

And apparently, no one asked Myers if installation of scrubbers cut back power production as it purportedly does.
Another witness, Ron Nash, overseer of pollution control construction for the TVA, said that scrubbers have been installed on eight of its 59 power generating units at 11 plants and that scrubbers “should be completed on units at three more plants in Eastern Tennessee by 2013”, he said.

Nash does not believe TVA would be able to meet all of North Carolina’s demands “because it takes about five years to design and construct scrubbers”.

And that statement clearly implies that TVA has no intention of expediting installation of those scrubbers. At least not until ordered by the court. And that has been TVA’s foot-dragging approach to making necessary changes to their pollution-producing plants.

A reasonable and forward thinking TVA would have taken the lead in pollution reduction but they do so only reluctantly. Being forced to do what is right for the citizens (and others) it serves by installing the latest available anti-pollution technology on its coal-fired plants is not representative of the federal government and through its agency, the TVA.

(Information from Asheville Citizen-Times and Lexington Herald-Leader reports).

Ernest Norsworthy
emnorsworthy@earthlink.net

TVA Report . . . July 21, 2008

TVA trial in Asheville a "killer"

The words jump out like red flags in front of a raging bull; 99 premature deaths directly attributable to the raging bull every year in North Carolina alone. That 3000-pound bull, aka the Tennessee Valley Authority, would not stop the killings for decades even if then.

As a youth involved in athletics, we all were warned that smoking cigarettes would ”cut your wind” and stupidly we kept smoking anyway. It took many years to recognize my own stupidity before quitting the harmful and filthy habit. While smoke-free for many decades, I now have lingering health problems from smoking.

A change in military assignment to Ft. Belvoir, Virginia enabled my wife and me to enjoy the beauty of the eastern mountains and the clean, sparkling air along the Blue Ridge Parkway. That was 58 years ago. Today, that scenery and fresh air are being slowly strangled in the grip of smokestack polluters.

The trial of the TVA, one they so desperately tried to avoid, is now taking place in Asheville, North Carolina. The Attorney General of North Carolina says the TVA pollution is not only killing Great Smoky Mountain trees it also, according to expert testimony, is killing it citizens prematurely.

In North Carolina, that pollution will be the cause of two premature deaths at least while the TVA trial is going on. For a time, we lived in the path of the pollution spewed by the coal-fired TVA plant in Colbert County Alabama. We felt compelled to wash down the outside of our house before selling it. The black gunk came from the Colbert plant.

The expert testimony against the TVA I believe is so serious that there must be no delay in taking corrective action by the court. The state should call for injunctive relief right now even while the trial proceeds. That would mean that most, if not all, of TVA’s 11 pollution producing plants would be shut down.

But TVA’s pollution affects other citizens in other states too, such as the Colbert plant in Alabama.

So-called clean burning coal processes presently are available but more costly. But who should bear that cost, utility companies or the families of the loved ones they have extinguished?

For more of my commentary on theTVA, see http://norsworthyattheshoals.blogspot.com

Ernest Norsworthy
Visalia, California
emnorsworthy@earthlink.net

TVA Report ...July 15, 2008 

TVA on trial in Asheville, N.C.

There is something degrading when an agency of the federal government, TVA, stoops to name-calling to bolster its case of trying to prove that “TVA is not a public nuisance”.

Whose face has the mud on it? It is not the state of North Carolina whose air pollution rules are tougher.

It is an American shame when our own federal government is pushed legally into making sure that the pollution it emits through coal-fired smokestacks does not harm its citizens.

While TVA crows how much it already has spent on reducing harmful air pollutants it has not taken advantage of the latest technology in doing so.

People downwind of TVA’s 11 coal-fired plants suffer from the unhealthy air they breathe. I know, I lived near one in Colbert County Alabama. When we sold our house, we had to wash the exterior first from the film it collected from TVA’s Colbert plant.

It is no wonder why our federal government is losing its credibility with American citizens when the latest poll shows the Congress has only a 9 percent approval rating. The arrogance of that government is only exemplified when the TVA tries to justify its terribly misguided ways now in a federal court in Asheville, N.C.

I have championed the liquidation of the TVA, as once suggested by the GAO as a possible solution to TVA’s long-standing mismanagement, and to return the authority to states to regulate utilities within their own boundaries. TVA usurps that authority in parts of seven states in the Southeast.

Regardless of the outcome of the trial against the TVA in Asheville, it has shown once again its obstinacy in abiding with what is best for United States citizens.

Ernest Norsworthy
Visalia, California
emnorsworthy@earthlink.net

http://norsworthyopinion.com

http://norsworthyattheshoals.blogspot.com

TVA Report … July 3, 2008

TVA Bonuses – a tissue of lies?

A sales person on commission earns a “bonus” for every sale, the more sales, the more the “bonuses”. For every federal employee who receives a “bonus” in pay (usually up to 20 percent of salary) is an employee who is underpaid or unsuited for a particular job. If the job specifications of a federal employee do not clearly delineate job responsibilities on which their salary is based, it is a poor management practice to award an additional incentive to “work harder for a bonus”.

Some federal employees work extremely hard for the pay they receive and some federal employees do practically nothing for the same pay. That is a management deficiency inherent in all levels of government, state, federal and local. Government simply does not manage work very well.

Now when it comes to paying federal employees of the Tennessee Valley Authority exorbitant bonuses from top executive to production manager, a flaw obviously exists in the concept. TVA workers, particularly union workers, are paid the “prevailing wage” which always exceeds local comparable pay. Some receive bonuses in the form of extra overtime work “to finish the job quicker”.

Much of the bonus system the TVA uses is based on lies while risking the safety and security of nuclear and other electricity producing plants.

The continuing story of “John”, a former TVA employee highly qualified and competent in multiple areas of expertise in nuclear and fossil plants, explains in his own words how TVA’s bonus system works.

“I have been told,” said John, “TVA determines bonuses for its managers in the following manner.”

“Supposedly, each manager is given a budget, and their bonus is based on how much of that budget they don't spend. I think you can see the basic flaw there. At Bull Run, whenever there was an outage they would schedule a tremendous amount of work to be performed and set a number of hours needed for the work to be done.

The Operations Department would be worked to exhaustion removing the equipment from service and isolating it for maintenance. Invariably, well before the end of the scheduled outage, all those jobs would be canceled and we were once again worked to exhaustion returning everything to service. The original work orders would either be assigned to the outage work order, which was signed off as completed, or otherwise made to disappear.

According to the documentation, we did an enormous amount of work and came in well under budget and ahead of time. ‘My, my, don't those boys deserve a fat bonus...’ The younger people in Operations loved it because they received all that overtime pay.”

Continuing, he said, “When I was at WBN (Watts Bar Nuclear), at one point we had over 1200 clearances issued for various items to have maintenance performed. A realistic number for any one unit would be well less than 100. Each clearance documented a problem and provided a way to track it. The fact that there were over 1200 became a major issue, so some fine manager thought to have one clearance issued for each major plant system and to roll all the existing clearances for equipment in that system into the one clearance.

Almost overnight, they went from over 1200 clearances to about 80. ‘Give that man a bonus...and a promotion’. It was considered impolite to mention the minor fact that we lost years of tracking information and documentation”.

“John’s” narrative reveals how safety matters were compromised in just that one plant, all for gaining that bonus check. This kind of action reflects how poorly TVA is managed. When top management supports the bonus plan, nobody argues with it in spite of the dangers to both safety and production. It’s the “TVA culture” at work again.

Ernest Norsworthy
emnorsworthy@earthlink.net

TVA Report . . . June 29, 2008

TVA Watts Bar 2 Nuclear delayed? 

Tennessee Valley Authority has requested yet another delay in the completion date for the Watts Bar Unit 2 nuclear plant.

The almost completed plant has been subject to fits and starts since a July 14, 2000 letter from the TVA to the NRC that the Watts Bar Unit 2 met the NRC’s definition of a “deferred plant”.

TVA changed the original construction completion date of December 31, 2010 last August to a completion date of April 1, 2012. Now, in a letter of May 8, 2008, TVA has requested changing the completion date again to March 31, 2013.

If all of this seems very confusing, it must greatly upset the vendors and the NRC.

In the latest filing, the door is left open by the NRC to deny TVA’s request resulting in the expiration of the construction permit for Watts Bar Unit 2.
If TVA’s request is denied, it could result in TVA seeking other sources of electrical power according to the NRC.

“Siting and constructing new power generating facilities would result in their own environmental impacts…” and would significantly delay starting
another nuclear plant.

The indecisiveness of TVA management may work to their disadvantage because of the very seriousness of constructing, operating, and maintaining a nuclear reactor. Decisions about every aspect of nuclear facilities must be approached with great caution and concern not only for the safety of their workers but also for the safety of perhaps a million people surrounding the plant.

It presently does not appear that the TVA has the capability to manage all of the power facilities it now has online. Adding another nuclear plant that has been dormant for decades appears to be a poor choice.

Ernest Norsworthy

emnorsworthy@earthlink.net

TVA Report … June 25, 2008

TVA – another appalling story

This is a story that shouldn’t have to be told because it never should have happened. Not today or ever.

The story is about a man whom we shall call John, not his real name. John was employed by the Tennessee Valley Authority, a long-time employee, with skills unquestioned to operate in both nuclear and fossil-fueled electricity plants. He worked at three of them and wound up his career with TVA earlier than he had planned at one near Knoxville, Tennessee.

It started when John, a very conscientious and safety-mined worker began to report problems to his supervisors for corrective actions according to their standing operating procedures. He soon was sneered at as a troublemaker, as one who would not go along with the sloppiness of important processes and procedures. He was not a part of the “TVA culture” as he put it.

After some time in trying to get along well with his co-workers, which seemed more and more unlikely, he requested a transfer from the nuclear plant to a steam plant where, he thought, there would be a more amenable work relationship. To his dismay, however, the “TVA culture” he tried to escape from was also following him. And it wasn’t too long before the same kind of shunning and picking at him persisted at the new plant until that became intolerable.

Then a family sickness called for him to work at another plant that was closer to home. Requesting another transfer, he was hopeful that the “TVA culture” would not follow him there. Unfortunately, it did, only this time it was becoming meaner, more antagonistic.

Then one day he opened his desk drawer where the instructions for that shift were placed by his supervisor or their assistant. The shock was appalling horror. For there in his desk drawer was a hangman’s noose, a symbol of unquestioning meaning to a black person.

Fearful for what might happen to his family or even to himself, John filed for early retirement the next day. He had planned on working for at least another five years with the TVA. His retirement quickly was approved and he retired in complete shock, in disbelief that that kind of treatment toward another human being could be carried over to modern times.

That was two years ago. Dispirited, he did nothing much to fight back. However, today he is giving it all he has; he reported the noose incident to the Knoxville FBI office, sent copies of a package of materials to the TVA board members, to the two Tennessee federal senators, the TVA Office of the Inspector General and has a file pending with the EEOC in Washington.

This man has been terribly wronged. He, in effect, was pushed out of his job for doing his job of reporting safety and procedural errors and for not being part of the “TVA culture”.

I have been following the TVA for sometime and his actual experiences coincide with my beliefs that the TVA is rotten on the inside and that the problems are endemic to the point of being irreparable.

The TVA is a highly controlled monolithic environment that speaks primarily through its public relations department and if you ask the wrong questions, which apparently I have done on several occasions, there is no reply. None. Not even an acknowledgement.

TVA’s board members, supposedly the backbone of the operation, making appropriate policy and moving with alacrity, show neither. In fact, the whole idea of interaction with those with whom there might be disagreement is squelched; there is nothing but controlled interaction with either the CEO or the board members with the public.

TVA’s Strategic Plan 2007, the supposed blueprint for guidance for CEO Tom Kilgore, is so vague that it can move in any direction and still say it is within the purview of the Plan. One of the ideas in that plan was to “centralize and streamline” operations to the point of having control of all of TVA’s 33,000 megawatts of electrical capacity in the hands of one person with a laptop computer.

The Government Accountability Office (GAO) report of May 21, 2008, pointed out some serious weaknesses in that concept when TVA tried to put the computerized operations and executive systems into one system.

As the GAO report points out, this opens vulnerabilities to the entire TVA system of control over power plants in all of the 80,000 square-miles of TVA territory in seven Southeastern states. And a ripple of power failures could affect all of the electricity grids in America.

Management of the TVA has been anything but smooth in its 75 years. Without regurgitating those many mismanagements here, suffice to say that those errors have resulted in a $25 billion debt, one that seems insurmountable without a major reorganization.

And for putting the whole nation at risk with the ineptitude of TVA’s board and management, I have called for the resignations of the CEO and board members who approved or participated in the specious computer management scheme.

Also, I believe control of the TVA should at once be turned over to the Department of Energy. There, the DOE will develop liquidation procedures to sell off all of TVA’s assets. This also would reduce the vulnerabilities of computer systems to cyber-hackers known to have occurred in Europe.

John has become an unwilling pawn in the mammoth TVA but still he is owed restitution for all the injuries incurred by the TVA to himself and to his family.

Ernest Norsworthy
emnorsworthy@earthlink.net http://norsworthyopinion.com http://norsworthyattheshoals.blogspot.com

(Media: Write me for more information and for possible contact with “John”).
EN

     TVA Management Needs Replacing Now

Someone at TVA must assume the responsibility for some serious management errors regarding security. According to the GAO in a recently released report on the TVA,

“TVA has not fully implemented appropriate security practices to secure the control systems and networks used to operate its critical infrastructure.”

This could mean disaster for a whole region of the country if not corrected immediately.

“On control systems networks, firewalls reviewed were either inadequately configured or had been bypassed, passwords were not effectively implemented, logging of certain activity was limited, configuration management policies for control systems software were inconsistently implemented, and servers and workstations lacked key patches and effective virus protection.”

“In addition, physical security at multiple locations did not sufficiently protect critical control systems. As a result, systems that operate TVA’s critical infrastructures are at increased risk of unauthorized modification or disruption by both internal and external threats.”

“An underlying reason for these weaknesses is that TVA had not consistently implemented significant elements of its information security program".
http://www.gao.gov/new.items/d08526.pdf

I understand there is much more to the GAO Report that cannot be revealed because of sensitive security reasons.

This is such a gross management mistake that I am calling for the immediate resignation of the TVA President and Chief Executive Officer, Tom Kilgore, and likewise for the remaining six members of the TVA board. This is accountability time, something that has been lacking in the TVA since the very beginning.

Congress wanted to set the TVA up as a “streamlined and centralized organization”. One of the obvious results of such a change is to hold management accountable. This is the time for it.

In the interim, I am calling also for the handing over the controls of the TVA to a Department of Energy team until a satisfactory solution is found.

Perhaps the core problem is the culture of the TVA, a culture like an amoeba moving without particular direction, sucking up what it can. Present management has had over three years to figure out what is going on in the TVA and to fix what is wrong. Management has failed on both counts.

While I definitely am opposed to the nationalizing of the electricity industry in the U.S., I also realize that such serious errors in the security of the TVA controls could wreak havoc not only in the Southeast but also in the rest of the nation.

Meanwhile, TVA’s exclusive electrical grid immediately should be opened to the other grid systems and also to surrounding electricity suppliers. This would enable the free flow of electricity into and out of the 80,000 square-mile territory TVA now controls and would open up TVA’s grid to all the other systems in the U.S.

If necessary, and I think likely, TVA will have to provide more entry/exit portals than now exist.

Concomitant with the Department of Energy assumption of control of the TVA, plans to liquidate the government’s assets of power dams, nuclear plants and other power producing facilities should begin.

Too often the huge size of the TVA points up its vulnerabilities including its inability to move quickly enough to meet current and market demands. An example of that occurred last year when the TVA did not seem to realize the ten-year old drought in the Southeast was going to be as severe as it was.

Call it what you will, management by chaos, inability to see the train bearing down until it is too late, or crisis management. It’s all the same and it is a direct reflection on management, management at last that can be held accountable.

Ernest Norsworthy

               A Cigar for TVA Ethics Reform

The horse is dead, even after escaping before the barn door was ever slightly closed. What’s all the hubbub about TVA letting contractor employees and TVA employees use TVA’s Gold credit cards?

The dead steed is named “Hospitality” and its ghost still runs rampant at the TVA.

That must be a “normal business practice”; a federal government agency never would let that sort of thing happen. Oh but it does happen, you say?

This issue comes up every time there is a report on TVA’s expenditures, year after year, but the issue never goes away. As in, “Management must take strict control of credit cards and none should be issued to employees below the level of (blank) or to any of TVA’s contract employees.” That could be TVA’s policy but it is far from it. TVA’s response to the OIG report? We’ll fill out another form!

It’s really a matter of attitude toward accountability. The TVA can make the most horrendous management mistakes in the billions of dollars yet still not be held accountable. No one is fired, or pays anything for mistakes. That attitude is systemic, I believe, in the TVA culture that repeatedly is confirmed, no one is responsible.

The apparent feckless Office of the Inspector General for the TVA says it’s okay to be hospitable toward quite a number of people both inside and outside the TVA, “if within TVA’s policy”.

Shouldn’t it be the policy of the OIG to call TVA’s hand on their “policy” and point out that it is unethical if not illegal for federal employees to have freedom in credit card spending, including alcohol? Is management still trying to figure out which account the credit card spending should go in?

And for contractors to have what amounts to a free line of credit by using those same TVA credit cards?

All audits of the TVA performed by the present inspector general should be suspended until it is determined that the office of the OIG is paid from other than TVA funds, an obvious conflict of interest for the TVA OIG.

The Washington office of the OIG should temporarily take over the responsibilities of the TVA OIG until that matter can be resolved.

For 75 years, TVA management says that, in essence, it can do what it pleases if it has a “policy” on the issue, no matter that the policy may be very bad policy and perhaps even an illegal one.

Not until the Supreme Court finally resolves the shaky constitutional standing of the TVA will normal business practices prevail in the Tennessee Valley. They must determine whether TVA is fish or fowl, it can’t be both. If they find that the TVA is, in fact, a regular federal agency, it must conform to federal government requirements. Otherwise, TVA should be considered a significant and dangerous step toward the nationalization of all electrical power in the United States.

Ernest Norsworthy
emnorsworthy@earthlink.net
http://norsworthyopinion.com
http://norsworthyattheshoals.blogspot.com

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TVA after 75 Years Yet Again Changes Direction 180º

TVA metamorphosis No. 9; first it was dam building and flood control with a little fertilizing on the side, then it forgot about hydro (likely dam sites were fewer) and it morphed into coal and other-fired generator plants.

The really big morph came when it was smart for TVA to build 17 nuclear plants, which was not smart at all, and they still are smarting from that colossal mistake.

And they morphed and they morphed until they nearly blew the house down. Ta da! Strategic Plan 2007, which of course, was no plan at all except to build more power plants and sell more electricity per the new CEO Tom Kilgore, “We need to sell more electricity!”

But nobody planned for a drought that had been coming on for years and everybody seemed to forget that all of TVA’s plants, including nuclear, require water and lots of it to keep the turbines turning.

Now, this latest morph, which is in total opposition of its philosophy to “use more electricity”, is to Conserve More Electricity. The whole model of construction for 50 years in the Tennessee River Valley has been to use more (then cheap) electricity for heating home and water and every electrical appliance known to man.

So now there is no room left in the hen house and someone’s got to pay extra to roost there. Who do you think that chicken is?

Ernest Norsworthy

emnorsworthy@earthlink.net

http://norsworthyattheshoals.blogspot.com

TVA Board Meeting February 15, 2008

TVA’s CEO Tom Kilgore at their board meeting in Chattanooga on Friday, February 15 (five board members present, one on the telephone and three members short), led off the main discussion with his progress report on the federal agency. See www.tva.gov

There was not a whole lot of good news to report, in fact, in addition to the 7 percent rate increase later approved by the board, he only alluded to the additional 5 percent “FCA” fuel cost adjustment announced five days later.

The only logical reason for not revealing the total rate increase at the board meeting, I believe, was to try to somewhat mitigate the grief of a double-digit increase. Certainly, both figures could have been released at the time of the board meeting. Was deception involved or just bad management?

The handling of the 7 percent rate increase and the 5 percent “fuel cost adjustment” typifies why utility rate increases should be under the purview of the seven public service commissions in Mississippi, Alabama, Tennessee, Georgia, Kentucky, North Carolina, and Virginia. These organizations representing the people have no say in how much TVA increases rates and there is no appeal to TVA’s edicts. TVA talks very little about cutting costs.

You may complain to a federal senator or representative about TVA rates but they are helpless to do anything about it, likewise your governor or state representatives or mayor, all unable to do anything about TVA rate increases. TVA is law over these matters in an 80,000 square mile territory locked in by a 2,500-mile fence.

And as usual, TVA is “behind the curve” in anticipating not only this FCA but also probably very large increases in coming months if the drought does not significantly relent. It is as if TVA saw the train coming ‘way down the track (the drought) but decided only at the last minute to jump out of the way (resulting in the FCA) but hoping it would shift to another track.

The plight and the action (insufficient planning) has now placed millions of people dependent on electricity in jeopardy not only for their utility needs but also for their health. The problem, of course, is water and plenty of it to cool every operating plant of the TVA, even the hydro plants.

Nuclear plants need enormous amounts of water for cooling and if it “dries up” not only would 30 percent of TVA’s generating capacity, nuclear, be in peril but also so would the basic human need for water. There was no indication at the meeting, which would come first – water for power plants or water for people.

In last November’s meeting it was discussed that some sort of water priority plan would be devised by the time of this meeting, however, Kilgore said there would be no change from present policy which is that he would determine the smaller cases and the board the larger ones such as Georgia’s r