VOL. 128 | NO. 172 | Wednesday, September 4, 2013
TVA Won't Ask to Raise Borrowing Cap
CHATTANOOGA, Tenn. (AP) – The Tennessee Valley Authority won't ask Congress to raise its borrowing cap for at least the next 10 years.
The Chattanooga Times Free Press reports that the federal utility says it anticipates being able to reduce its net borrowing in the next two years and reduce its debt over a decade by $5 billion. That's because the demand for electricity is slowing.
Just a few years ago, agency officials worried the $30 billion debt cap imposed by Congress would be a problem.
In 2011, when TVA's internal inspector general said the agency "faces a challenging financial situation in the near future" and warned that the cap on borrowing was "a major impediment to making needed investments."
TVA now says its debt is expected to peak in 2015 just below the cap and then begin to decline.
"We have a window now of four or five years where we can finish our big capital projects and then turn that statutory debt line down," TVA President Bill Johnson said. "If we have a fairly accurate projection of the future and we tend to our business well, we should be well under that debt cap for at least the next decade."
TVA provides power to about 9 million people in Alabama, Georgia, Kentucky, Mississippi, North Carolina, Tennessee and Virginia.
Information from: Chattanooga Times Free Press, www.timesfreepress.com
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