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Tennessee Valley Authority's Envisioned Flexibility Options in Wake of Coal Plant Closure

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Much was made in the past few weeks after President Trump took to Twitter to try and drum up support for the Tennessee Valley Authority (TVA) to keep open a struggling coal-powered plant, with the TVA Board ultimately voting to close the no-longer-economic plant. This story caught many people's attention because of the direct hand the President attempted to play in his continued support for coal-fired generation before ultimately being shunned by the power provider itself, but the bigger story laying underneath this higher-profile one was the full TVA Draft 2019 Integrated Resource Plan that accompanied this decision and provided a broad and deep outlook into the future of energy flexibility foreseen by the power provider to seven states. 

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The report is thorough and comprehensive, as would be expected (decisions to shutter plants and change the base generation mix are not taken lightly or made for dearth of information, as TVA suggested back to the President), so to save everyone the 237-page read the Times Free Press provided the following summary of the projections:

» New capacity will be needed, even in the scenarios predicting the slowest growth, in part to replace expiring or retiring capacity. But TVA's total power sales still remain below the peak reached in 2008 before the Great Recession hit the region and many major power users shut down.

» Solar expansion plays a substantial role, driven by its attractive energy value beginning around the mid-2020 time frame.

» Varying levels of natural gas, battery storage, and demand response are added depending on strategic focus to ensure reliability and provide flexibility.

» No wind or hydro resources are added by TVA, indicating that solar backed up by gas or storage is the more optimal choice.

» No major nuclear, coal or combined cycle natural gas plants are added, except in one case where high-cost Small Modular Reactors are promoted for resiliency.

» TVA's reserve margin, which provides readily available power for unplanned events, has historically been about 15 percent but the new study recommends TVA add to its reserve margins.

There are a lot of quite interesting nuggets to digest here. What sticks out to me is the idea that TVA sees some combination of solar/gas/storage/and demand response strategies as what will drive TVA growth in the future, while coal  is only expected to decline. This trend will of course reduce the overall carbon-intensity of the energy mix, but it also suggests TVA's analysis confirms that these shifts will be the most economical as well as a means of managing energy produced in response to demand growth. 

Further, the suggestion that small modular nuclear might be a solution for resilience purposes is quite interesting. Small modular nuclear reactors have been grabbing a lot of attention and discussion, so TVA endorsing them as one resiliency solution (rather than a baseload of coal or even gas) in even one scenario is quite telling-- especially given that this would inherently mean the nuclear generation would have to be built, an idea which many regions have found to be a non-starter. 

From an energy management perspective, TVA's report (and their hand-in-hand actions) from the past month are telling of where they see flexibility in generation, delivery, and consumption going. 



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