KNOXVILLE, Tenn., May 2, 2017 /PRNewswire/ -- The Tennessee Valley Authority reported net income of $313 million for the first half of fiscal year 2017 – $32 million higher than for the same period last year.
"These results demonstrate that TVA remains on track in operating more efficiently and keeping rates low," TVA President and CEO Bill Johnson said. "We've been able to complete major capital projects that provide clean, reliable and affordable energy for the seven-state Tennessee Valley region while managing our debt, even with a decline in electricity sales."
Sales in the second quarter of fiscal year 2017 were down by about 7 percent compared to the same period in 2016, driven mainly by milder winter weather. When comparing first half fiscal year 2017 to 2016, sales were about one percent lower this year.
TVA's revenues increased five percent, or $242 million, for the six months ended March 31, 2017, compared to the same period in the prior year. This was due to higher base rates and higher fuel cost recovery revenues. Fuel and purchased power expense increased $109 million for the period due to higher effective fuel rates, driven by changes in the mix of generation resources, including significantly less hydroelectric generation, and higher market prices for natural gas.
"TVA's generation fleet continues to become more diversified and this is helping us provide low-cost energy in a reliable and efficient manner," Johnson said. "With the drought conditions we experienced in the first half of the year, which limited power production from our dams, Watts Bar Nuclear Unit 2 played an important role in keeping costs low."
Watts Bar Unit 2 entered commercial operation on October 19, 2016, and was the nation's first new nuclear unit in the 21st Century. In addition, a new gas-fired generation facility at TVA's Paradise Fossil Plant site in Kentucky began commercial operation on April 7, 2017. The new combined cycle facility will help ensure continued reliability in western Kentucky and the TVA region.
Non-fuel operating and maintenance expenses for the first six months were up by approximately two percent, or $31 million, from the same period in 2016, attributable to an increase in planned nuclear refueling outage days.
"TVA's effective rates are lower today after several years of improving efficiencies of our operations, and reducing annual operating expenses by over $800 million," said TVA Chief Financial Officer John Thomas. "We are maintaining that momentum in 2017, focusing on off-setting inflationary pressures with efficiencies."
TVA executive management will host a conference call to discuss second quarter fiscal year 2017 results at 9:30 a.m. EDT, on Tues., May 2, 2017. The conference call can be accessed from TVA's website via webcast, at http://www.tva.com, on the Investor Relations home page. For quicker access to the live conference call, please pre-register through TVA's website before the scheduled start time, and follow the instructions provided. Once pre-registered, the dial-in number will be provided via an email. If you are unable to pre-register, you may access the conference call by dialing toll free 866-777-2509 in the United States, or 412-317-5413 outside the United States.
A replay will be available one hour after the end of the conference call until 9:30 a.m. EDT, May 2, 2018, by calling toll free 877-344-7529 in the United States or 412-317-0088 outside the United States and using the conference number 10095180. A webcast replay and transcript will also be available for one year on TVA's website at http://www.tva.com/investors.
TVA's quarterly report on Form 10-Q provides additional financial, operational and descriptive information, including unaudited financial statements for the quarter ended March 31, 2017. TVA's quarterly report and other SEC reports are available without charge on TVA's website at http://www.tva.com/investors, on the SEC's website at http://www.sec.gov or by calling TVA toll free at 888-882-4975.
This release may contain forward-looking statements relating to future events and future performance. Although TVA believes that the assumptions underlying these statements are reasonable, numerous factors could cause actual results to differ materially from those in the forward-looking statements. Please refer to TVA's most recent annual report on Form 10-K and quarterly report on Form 10-Q for a discussion of factors that could cause actual results to differ from those in the forward-looking statements.
The Tennessee Valley Authority is a corporate agency of the United States that provides electricity for business customers and local power distributors serving more than 9 million people in parts of seven southeastern states. TVA receives no taxpayer funding, deriving virtually all of its revenues from sales of electricity. In addition to operating and investing its revenues in its electric system, TVA provides flood control, navigation and land management for the Tennessee River system and assists local power companies and state and local governments with economic development and job creation.
Tammy Wilson, Knoxville, 865-632-3366 or 888-882-4975
Josh Carlon, Knoxville, 865-632-4133 or 888-882-4975
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SOURCE Tennessee Valley Authority