[Federal Register Volume 80, Number 206 (Monday, October 26, 2015)]
[Notices]
[Pages 65282-65284]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-27129]


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TENNESSEE VALLEY AUTHORITY


Integrated Resource Plan

AGENCY: Tennessee Valley Authority.

ACTION: Issuance of record of decision.

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SUMMARY: This notice is provided in accordance with the Council on 
Environmental Quality's regulations (40 CFR 1500 to 1508) and TVA's 
procedures for implementing the National Environmental Policy Act 
(NEPA). TVA has decided to adopt the preferred alternative in its final 
supplemental environmental impact statement (SEIS) for the Integrated 
Resource Plan (IRP). The notice of availability (NOA) of the Final 
Supplemental Environmental Impact Statement for the Integrated Resource 
Plan was published in the Federal Register on July 17, 2015. The TVA 
Board of Directors approved the IRP and authorized staff to implement 
the preferred alternative at its August 21, 2015 meeting. This 
alternative, the Target Power Supply Mix, will guide TVA's selection of 
energy resource options to meet the energy needs of the Tennessee 
Valley region over the next 20 years. The energy resource options 
include new nuclear, natural gas-fired and renewable generation, 
increased energy efficiency and demand reduction, and decreased coal-
fired generation.

FOR FURTHER INFORMATION CONTACT: Charles P. Nicholson, NEPA Compliance, 
Tennessee Valley Authority, 400 West Summit Hill Drive, WT 11D, 
Knoxville, Tennessee 37902-1499; telephone 865-632-3582 or email 
[email protected].
    Gary S. Brinkworth, IRP Project Manager, Tennessee Valley 
Authority, 1101 Market Street, MR 3K-C, Chattanooga, Tennessee 3740s; 
telephone 423-751-2193, or email [email protected].

SUPPLEMENTARY INFORMATION: TVA is an agency and instrumentality of the 
United States, established by an act of Congress in 1933, to foster the 
social and economic welfare of the people of the Tennessee Valley 
region and to promote the proper use and conservation of the region's 
natural resources. One component of this mission is the generation, 
transmission, and sale of reliable and affordable electric energy. TVA 
operates the largest public power system in the nation, providing 
electricity to about 9 million people in an 80,000-square mile area 
comprised of most of Tennessee and parts of Virginia, North Carolina, 
Georgia, Alabama, Mississippi, and Kentucky. It provides wholesale 
power to 155 independent power distributors and 59 directly served 
large industrial and federal customers. The TVA Act requires the TVA 
power system to be self-supporting and operating on a nonprofit basis 
and directs TVA to sell power at rates as low as are feasible.
    Dependable generating capability on the TVA power system is about 
37,200 megawatts (MW). TVA generates most of this power with 3 nuclear 
plants, 10 coal-fired plants, 9 combustion-turbine plants, 6 combined 
cycle plants, 29 hydroelectric plants, a pumped-storage facility, and 
several small renewable facilities. These facilities generated 142.2 
billion kilowatt-hours in fiscal year 2014. The major sources for this 
power were coal (40 percent), nuclear (33 percent), natural gas (13 
percent), and hydroelectric (10 percent). Other sources comprised less 
than 1 percent of TVA generation. Total power delivered to customers in 
fiscal year 2014 was 161 gigawatt-hours (GWh). A portion of this 
delivered power was provided through long-term power purchase 
agreements.
    The recently completed IRP updates TVA's 2011 IRP. Consistent with 
Section 113 of the Energy Policy Act of 1992, codified within the TVA 
Act, TVA employed a least-cost system planning process in developing 
the IRP. This process took into account the demand for electricity, 
energy resource diversity, reliability, costs, risks, environmental 
impacts, and the unique attributes of different energy resources.

Future Demand for Energy

    TVA uses state-of-the-art energy forecasting models to predict 
future demands on its system. Because of the uncertainty in predicting 
future demands, TVA developed high, medium, and low forecasts for both

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peak load (in MW) and annual net system energy (in GWh) through 2033. 
Peak load is predicted to grow at average annual rates of 1.1 percent 
in the medium-growth Current Outlook Scenario, 0.3 percent in the low-
growth forecast, and 1.3 percent in the high-growth forecast. Net 
system energy is predicted to grow at an average annual rate of 1.0 
percent in the medium-growth forecast, remain flat in the low-growth 
forecast, and grow at an average annual rate of 1.1 percent in the 
high-growth forecast.
    Based on these load growth forecasts, TVA's current firm capacity 
(TVA generation, energy efficiency and demand response measures, and 
power purchase agreements), and including a 15 percent planning reserve 
margin, TVA would need additional energy resources in the future. The 
medium-growth case needs are 2,500 MW of additional capacity and 14,000 
GWh of additional energy by 2020, growing to 11,600 MW and 51,000 GWh 
by 2033.

Alternatives Considered

    Six alternative energy resource strategies were evaluated in the 
Draft SEIS and IRP. These resource planning strategies were identified 
as potential alternative means of serving future electrical energy 
demands on the TVA system while meeting least-cost system planning 
requirements. These alternative strategies are:
    Baseline Case (No Action Alternative): The continued implementation 
of the 2011 IRP as modified by subsequent decisions by the TVA Board of 
Directors.
    Strategy A--The Reference Plan: This strategy is similar to the 
Baseline Case but treats energy efficiency and renewable energy 
resources as selectable resources instead of defined inputs.
    Strategy B--Meet an Emission Target: Resources are selected under 
this strategy to create a lower emitting carbon dioxide 
(CO2) profile by reducing system-wide direct emissions of 
CO2 by 50 percent (to 557 lbs/megawatt-hour) by 2033 and by 
80 percent by 2050 from 2005. The targeted CO2 rate is 
measured at a system-wide level and thus differs from the state-by-
state and technology-specific baselines in the recently issued Clean 
Power Plan.
    Strategy C--Focus on Long-Term, Market-Supplied Resources: Under 
this strategy, TVA would minimize capital investments in owned energy 
resources by meeting most capacity needs through power purchase 
agreements.
    Strategy D--Maximize Energy Efficiency: Energy efficiency would be 
given priority in meeting capacity needs with other resources selected 
to serve the remaining need.
    Strategy E--Maximize Renewables: Renewable energy resources 
(hydroelectric, biomass, wind and solar) are emphasized by setting 
near-term and long-term renewable energy targets.
    The alternative strategies were analyzed in the context of five 
scenarios or future ``worlds'' that were determined to be reasonably 
possible to occur. The scenarios were TVA's current outlook, a stagnant 
economy, a growth economy, a de-carbonized future, and a distributed 
energy marketplace. Each scenario is a set of uncertainties relevant to 
power system planning that include plausible future economic, 
financial, regulatory and legislative conditions, as well as social 
trends and adoption of technological innovations. Potential 20-year 
capacity expansion plans or resource portfolios were developed for each 
combination of alternative strategy and scenario using a capacity 
planning model. The model built each portfolio from a range of 
potential energy resource options that included TVA's existing energy 
resources and new coal, nuclear, natural gas, hydroelectric, wind, 
solar, and biomass generation, energy storage, and energy efficiency 
and demand response resources. Each portfolio was optimized for the 
lowest Present Value of Revenue Requirements while meeting energy 
balance, reserve, operational, and other requirements. The portfolios 
were then evaluated using an hourly production costing program to 
determine detailed revenue requirements and near- and long-term system 
average costs. Recognizing the uncertainty in long-range planning 
studies, extensive stochastic analyses were also conducted to identify 
risk exposure within each scenario. Additional metrics developed to 
rank the portfolios included financial risk, CO2 emissions, 
water consumption, coal waste generation and changes in regional 
personal income. These metrics were used to compare the alternative 
strategies and their associated portfolios.
    Strategies A-C had similar scores for most metrics and the scores 
for Strategies A and B were almost identical and for some metrics 
slightly better than Strategy C. Strategy E, with the greatest emphasis 
on renewable energy resources, scored the best on the three 
environmental metrics of CO2 emissions, water consumption, 
and coal waste production. Strategy D had somewhat greater 
environmental impacts than Strategy E, and Strategies A-C had the 
greatest and similar environmental impacts. To better inform the 
development of the preferred alternative, TVA conducted additional 
sensitivity analyses that varied key resource assumptions involving 
nuclear additions, energy efficiency, renewable resources, fundamental 
drivers such as load growth and fuel pricing, and the effect of forcing 
the model to consider resource types and/or amounts that it otherwise 
would not. The results of these analyses supported the energy resource 
ranges identified in the initial portfolios.
    TVA then developed a preferred alternative, the Target Power Supply 
Mix, based on guideline ranges for key energy resources. In developing 
it, TVA took into account its least-cost planning requirement and 
customer priorities of power cost and reliability, as well as other 
comments it received during the public comment on the Draft IRP and 
SEIS. The Target Power Supply Mix establishes ranges, in MW, for coal 
plant retirements and additions of nuclear, hydroelectric, demand 
response, energy efficiency, solar, wind, and natural gas capacity. The 
recommended ranges are based on Strategies A-C and the Current Outlook 
Scenario, expressed over the 20-year planning period with more specific 
direction over the first 10-year period. The Target Power Supply Mix 
also includes broader ranges resulting from the sensitivity analyses. 
Shifts in resource additions within the ranges would be based on 
changes in the load forecast, the price of natural gas and other 
commodities, the price and performance of energy efficiency and 
renewable resources, and impacts from regulatory policy or breakthrough 
technologies.

Public Involvement

    TVA published a notice of intent to prepare the IRP SEIS in the 
Federal Register on October 31, 2013. TVA then actively engaged the 
public through public scoping and public briefings during the 
development of the IRP and SEIS. TVA also established an IRP Working 
Group to more actively engage stakeholders. Group members included 
representatives of local power companies (distributors of TVA power), 
state agencies, direct-served customers, academia, and energy and 
environmental non-governmental organizations. Members of the group met 
frequently with IRP staff to review and provide input during the 
development of the plan.
    The Notice of Availability of the Draft IRP and SEIS was published 
in the Federal Register by the U.S. Environmental Protection Agency 
(USEPA) on March 13, 2015. TVA accepted comments on the draft plan and 
SEIS until April 27, 2015. During

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the comment period, TVA held seven public meetings to describe the 
project and accept comments. TVA received about 200 comments signed by 
more than 2,400 individuals. After considering and responding to all 
substantive comments, further evaluating the alternative strategies, 
and developing the Target Power Supply Mix, TVA issued the Final IRP 
and SEIS. The NOA for the Final IRP and SEIS was published in the 
Federal Register on July 17, 2015.

Environmentally Preferred Alternative

    All of the alternative strategies, as well as the Target Power 
Supply Mix, have several common features that affect their anticipated 
environmental impacts. The only new baseload generation added is the 
extended power uprate of three nuclear units, a component of all 
alternative strategies. All result in decreases in coal-fired 
generation and increases in the reliance on energy efficiency and 
renewable resources. All also add varying amounts of new natural gas-
fueled generation to meet peak loads. Emissions of air pollutants and 
CO2, and generation of coal waste would decrease 
significantly under all alternative strategies, including the Target 
Power Supply Mix. Water-related impacts would also decrease, although 
by smaller proportions. The major differences in the alternative 
strategies that affect their environmental impacts are in the expansion 
of energy efficiency and natural gas and renewable resources.
    Strategies A-C and the Target Power Supply Mix have similar 
environmental impacts and their impacts to most environmental resources 
are greater than those of Strategies D and E. Because of its greater 
reliance on generation by fossil fuels, Strategy D has somewhat greater 
impacts to most environmental resources than Strategy E. Strategy E has 
the greatest reliance on renewable energy resources, which, 
particularly for utility-scale solar generation, have large land 
requirements. Strategy E would therefore directly affect the largest 
land area, almost twice that of the other alternative strategies and 
the Target Power Supply Mix. Relative to other types of generation, 
impacts of solar facilities on land resources are low. Overall, 
Strategy E is considered the environmentally preferred alternative.

Decision

    On August 21, 2015, the TVA Board of Directors approved the 
preferred alternative, the Target Power Supply Mix. The Board also 
directed staff to monitor future developments to help determine when 
deviations from the recommended resource ranges should be made and to 
initiate an update to the IRP no later than 2020 and earlier if future 
developments make this appropriate.

Mitigation Measures

    The reduction of environmental impacts was an important goal in 
TVA's integrated resource planning process and all of the alternatives 
assessed by TVA do that. Because this is a programmatic review, 
measures to reduce potential environmental impacts on a site-specific 
level were not identified. As TVA deploys specific energy resources, it 
will review and take measures to reduce their potential environmental 
impacts as appropriate. TVA's siting process for generation and 
transmission facilities, as well as processes for modifying these 
facilities, are designed to avoid and/or minimize potential adverse 
environmental impacts. Potential impacts will also be reduced through 
pollution prevention measures and environmental controls such as air 
pollution control systems, wastewater treatment systems, and thermal 
generating plant cooling systems. Other potentially adverse unavoidable 
impacts will be mitigated by measures such as compensatory wetlands 
mitigation, payments to in-lieu stream mitigation programs and related 
conservation initiatives, enhanced management of other properties, 
documentation and recovery of cultural resources, and infrastructure 
improvement assistance to local communities.

    Dated: October 16, 2015.
Van M. Wardlaw,
Executive Vice President and Chief External Relations Officer.
[FR Doc. 2015-27129 Filed 10-23-15; 8:45 am]
 BILLING CODE 8120-08-P