TVA Reports Higher Revenues and Sales on Continued Pandemic Recovery

KNOXVILLE, Tenn., Nov. 15, 2021 /PRNewswire/ -- The Tennessee Valley Authority reported $10.5 billion in total operating revenues on 157 billion kilowatt-hours of electricity sales for the fiscal year ended Sept. 30, 2021.

Total operating revenues increased 2.5% over the prior year primarily due to an increase in fuel cost recovery that was driven by higher fuel rates and higher sales during 2021. Revenues were partially offset by a decrease in base revenue driven by lower effective base rates mainly due to the Pandemic Relief Credit in 2021, which totaled $221 million.  Sales of electricity were 4% higher compared with 2020. 

"After the COVID-19 impacts seen the previous year, 2021 was a strong year for TVA and the 10 million people TVA serves," said Jeff Lyash, TVA president and CEO. "TVA's low-cost, reliable power and strong economic development efforts have continued to play a key role in helping our region recover from the pandemic while our strong financial results help keep power rates low as we invest in the sustainability and resiliency of our power system."

Fuel and purchased power expense were $257 million higher, driven primarily by higher fuel prices and higher power sales volume.  Operating and maintenance expense increased by $170 million over the prior year, mainly driven by an increase in contract labor driven by operational needs, and work to support the company's strategic priorities. TVA's tax equivalents expense was $14 million lower for the fiscal year 2021, mainly due to a decrease in TVA's revenue from sales of electricity in 2020, which is TVA's basis for calculating tax equivalents. Interest expense decreased by $54 million in fiscal year 2021, which is nearly a 5% decrease from the prior year, driven by lower average debt balances.

TVA's net income for 2021 was $1.5 billion, which was $160 million higher than the prior year due mainly to lower depreciation and amortization expense on accelerated retirements of coal-fired facilities. As a public power entity, TVA invests net income back into its power system or to debt reduction.  

"TVA's significant investments to diversify our power system with cleaner energy resources, reduce costs, and paydown debt are directly reflected in our 2021 performance," said John Thomas, TVA's chief financial and strategy officer. "Despite the recent rise in fuel prices, TVA's effective power rate remains lower than a decade ago and our diversified power system, which already produces more than half our energy from non-carbon sources, will continue to keep rates lower for customers during these times of volatile energy prices globally."

Additional highlights from TVA's fiscal year 2021 include:

• As of November 12, 2021, 145 local power companies have long-term partnerships with TVA. Bill credits to partners totaled $189 million for the year ended Sept. 30, 2021.
• TVA remains committed to supporting communities and customers across the Tennessee Valley during the region's ongoing recovery, including the ongoing Back-to-Business credit program that provides relief to certain larger customers when returning to operations and the Community Care Fund that partners TVA and LPCs to support local initiatives that address hardships created by the COVID-19 pandemic.
• TVA continued to maintain 99.999 percent reliability in delivering energy to its customers through Sept. 30, 2021. TVA has maintained 99.999 percent reliability for more than 20 consecutive years, providing industry-leading reliability.
• Rainfall and runoff in the Tennessee Valley in 2021 were 123% and 121% of normal, respectively, and were safely managed by TVA's River Operations team to minimize flooding while generating hydroelectric power.
• TVA's economic development efforts, combined with its reliability and low costs, continue to attract and encourage the expansion of business and industries in the Tennessee Valley, with over $8.8 billion in investments and approximately 80,900 jobs created or retained in 2021.

Additional details of TVA's successes over the past year are found in its FY21 Corporate Annual Report, which highlights the stories of the women and men of TVA and partner agencies who delivered outstanding performance.

TVA's executive management team will host a conference call to discuss fiscal year 2021 results at 9:30 a.m. ET, on Monday, Nov. 15. The event will be conducted as a webcast and as a dial-in teleconference. Participants will be able to hear the discussion and see slides via webcast, but will need telephone access to ask questions. Pre-registration for the conference call is required. Please click here to pre-register. 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 844-308-6432 in the United States, or 412-717-9611 outside the United States.

A replay will be available one hour after the end of the conference call, by calling toll free 877-344-7529 in the United States or 412-317-0088 outside the United States and using the conference number 10160058. A webcast replay and transcript will also be available for one year on TVA's website at http://www.tva.com/investors.

TVA's annual report on Form 10-K provides additional financial, operational, and descriptive information, including audited financial statements for the year ended Sept. 30, 2021. TVA's annual 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 companies serving nearly 10 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.

SOURCE Tennessee Valley Authority