Tennessee Valley Authority: Additional Steps Are Needed to Better Manage Climate-Related Risks
Fast Facts
The Tennessee Valley Authority (TVA) provides electricity to 10 million customers in 7 states.
TVA faces some climate-related risks that could affect its ability to generate and transmit electricity while keeping rates low. For example, in 2010, some TVA infrastructure was submerged in over 5 feet of water when 15 inches of rain fell in 2 days. Relocating this infrastructure to higher ground cost about $9 million.
TVA hasn't taken inventory of all of its assets and operations that are vulnerable to climate change, or developed a resilience plan that identifies and prioritizes measures that address specific risks.
We recommended that it do so.
TVA’s Service Area and Power Generation Assets
Highlights
What GAO Found
The Tennessee Valley Authority (TVA) faces several climate-related risks to its operations. Increasing temperatures and other climate-related risks are expected to affect TVA's ability to generate and transmit electricity, according to reports reviewed and stakeholders interviewed by GAO. For example, in 2007, 2010, and 2011, TVA had to reduce power generation at its Browns Ferry Nuclear Plant because river temperatures were too high to receive discharge water from the plant without raising ecological risks. Climate-related effects, such as heavy precipitation and flooding, could also create added costs to TVA's operations—such as for infrastructure investments—that could affect TVA's ability to keep electricity rates low. For example, in 2010, a TVA substation was submerged in over 5 feet of water when 15 inches of rain fell in 2 days. TVA relocated the substation to higher ground, at a cost of about $9 million.
Tennessee Valley Authority's Browns Ferry Nuclear Plant in Alabama
TVA has taken several steps to manage climate-related risks. For example, TVA identified risks, such as flooding and drought, in its 2021 Climate Action Adaptation and Resiliency Plan and implemented several resilience measures, such as relocating certain infrastructure. However, TVA has not conducted an inventory of assets and operations vulnerable to climate change or developed a resilience plan that identifies and prioritizes resilience measures to address specific risks. According to the Department of Energy's (DOE) Guide for Climate Change Resilience Planning, conducting an inventory of assets and operations vulnerable to climate change can help utilities more accurately identify relevant hazards and the potential severity of disruptions to operations or damage to related infrastructure. This, in turn, would better position TVA to plan and implement appropriate actions to address climate change vulnerabilities as they become more acute, and as new and better information becomes available. In addition, developing a resilience plan that includes a portfolio of resilience measures could help TVA identify available options and determine whether mitigating certain risks is worth the investment. Doing so would help TVA better fulfill its mission of providing reliable and affordable power to its customers.
Why GAO Did This Study
More frequent extreme weather events and other risks associated with climate change could cost utilities and customers billions of dollars from power outages, disruptions to electricity generation capacity, and infrastructure damage. Enhancing climate resilience means taking actions to reduce potential future losses by managing climate-related risks. TVA is a federal corporation and the nation's largest public power provider. TVA provides electricity to about 10 million customers in seven states, including 153 local power companies and about 60 large industrial customers and federal facilities.
GAO was asked to examine U.S. energy infrastructure resilience. This report examines (1) climate-related risks to TVA's operations; and (2) steps TVA has taken to manage climate-related risks, and additional steps needed. GAO analyzed relevant reports and financial disclosure documents; and interviewed TVA officials and knowledgeable stakeholders from consumer groups and DOE national laboratories.
Recommendations
GAO is making three recommendations, including that TVA conduct an inventory of assets and operations vulnerable to climate change and develop a resilience plan that identifies and prioritizes resilience measures. TVA neither agreed nor disagreed with our recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Tennessee Valley Authority | The TVA Chief Executive Officer should direct TVA staff to conduct an inventory of assets and operations vulnerable to climate change that includes analyzing the likelihood and degree of damage or disruption from climate change and the likely consequences if specific climate effects were to occur. (Recommendation 1) |
TVA agreed with our recommendation. In June 2023, TVA stated that it had formed a cross-functional team to inventory current TVA efforts to identify assets and operations vulnerable to climate risks and partnered with the Electric Power Research Institute's Climate READi (Resilience and Adaptation) initiative to implement new planning processes and tools to maintain an inventory of vulnerabilities identified through the study as appropriate. In June 2024, TVA published its Climate Adaptation plan, which describes assets and operations vulnerable to climate change and likely consequences. For example, according to the plan, TVA's operations, ability to generate power, and efficiency of critical infrastructure are at risk of damage from extreme temperatures, flooding, drought, and heavy precipitation. The plan states that extreme temperatures, both cold and hot, may create greater power demand and affect the efficiency and safety of operating equipment. Further, flooding and heavy precipitation could damage generation infrastructure and pose inland flooding risk to assets. According to the plan, many of TVA's generation assets are heavily reliant on nearby river systems, therefore drought could reduce the water available for TVA's power plants that rely on water for its power generation operations, which depend on water from nearby river systems for cooling. This could require TVA to purchase power from other producers or to rely on more costly power generation options. TVA's plan also describes the exposure of TVA's buildings; employees; and lands, waters, and cultural and natural resources to five climate hazards: extreme heat, extreme precipitation, sea level rise, flooding, and wildfire risk. We believe TVA has addressed this recommendation.
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| Tennessee Valley Authority | Once TVA staff identifies vulnerable assets and operations, the TVA Chief Executive Officer should direct TVA staff to develop a resilience plan that identifies and prioritizes measures to address climate change vulnerabilities and that includes a portfolio of resilience measures and an action plan that specifies which risks to address and how and when to do so. (Recommendation 2) |
TVA agreed with our recommendation. In June 2024, TVA published its Climate Adaptation Plan, which includes 7 new priority actions and an inventory of ongoing resilience measures across the agency. The plan also includes an implementation plan that addresses steps and actions undertaken to account for climate risk. For example, the plan states that TVA designs critical systems with room for future growth. In the event of extreme heat or cold, the extra capacity built into the design is available to meet extreme condition loads. Additionally, because many critical areas have extra components built in, there is also extra capacity (i.e., a backup chiller, pump, boiler, uninterrupted power supply, etc.) available to handle extra loading. According to its 2024 plan, TVA is utilizing a state-of-the-art stochastic flood event model to create thousands of realistic extreme floods. This information will help inform TVA of any changes related to flooding to critical areas. Finally, TVA prioritizes measures to address climate change vulnerabilities in its risk assessment. We believe TVA has addressed this recommendation.
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| Tennessee Valley Authority | TVA's Chief Executive Officer should direct staff to establish a plan to routinely reassess the TVA resilience plan and incorporate updated information about implemented resilience actions, as well as updated information about climate change, resilience technologies and planning tools, and connected infrastructure vulnerabilities. (Recommendation 3) |
TVA agreed with our recommendation. In June 2024, TVA issued its Climate Adaptation Plan. The plan assesses the exposure of its buildings; employees; and lands, waters, and cultural and natural resources to five climate hazards: extreme heat, extreme precipitation, sea level rise, flooding, and wildfire risk, using climate data. According to TVA, current federal templates require annual updates through 2027, and TVA plans to routinely provide updates. In addition, TVA is in the process of completing an updated Integrated Resource Plan, which will assess long-term climate related vulnerabilities, according to TVA. We believe TVA has addressed this recommendation.
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