Breaking News
More () »

MLGW President J.T. Young recommends utility continue to get power from TVA

The recommendation followed a years-long process of bids offering to supply power to the Memphis area from someone other than TVA.

MEMPHIS, Tennessee — Thursday morning, Memphis, Light, Gas & Water President J.T. Young made a significant update that was months in the making. 

He gave the MLGW board his recommendation that the utility continue to get its power from the Tennessee Valley Authority, or TVA. 

Young's recommendation for MLGW to stay with TVA followed a years-long process of bids from outside power suppliers.

RELATED: Ransom: 3 more suburbs side with TVA, but do they know about the alternative?

In the end, Young said he concluded that TVA's long term partnership proposal demonstrates the greatest value and and least risk, compared to the other finalist power supplier bids.

"Our sort of foundational principal in all of this has always been what's in the best interest of customers. And while a long-term contract sounds like that's probably not an appealing thing to do, of the options that we had to consider, it's the one that brought the most value. Not just the lowest cost but the most value," Young said.

Young also told the MLGW board his belief that the TVA gives MLGW flexibility for future solar generation and other local renewable energy options. 

"In order to get real value on something, you have to make a commitment and that's true just about in anything," Young added.

An outside consulting firm hired by MLGW to review the outside power supplier bids - GDS Associates - also provided new information Thursday, concluding that a supplier other than TVA could cost the utility $70 to $80 million a year, while staying with the TVA could lower the average MLGW energy bill $32 a year on their energy bill the first five years.

The city of Memphis issued the following response after the recommendation was made: "The City is aware that GDS has made its recommendations to MLGW and its board to enter into a long-term contract with TVA. We look forward to taking a deeper dive into the recommendation and the bid responses and receiving a thorough analysis from our energy consultant. This will allow us to help inform the process before any decision is finalized."

TVA issued the following statement to ABC24: "We have and will continue to be respectful and supportive of MLGW’s evaluation process. We are pleased that the MLGW leadership has recommended staying with TVA, recognizing the value that our collective partnership brings to the people of Memphis and Shelby County. We look forward to continuing our long and beneficial relationship."

The MLGW board is expected to vote on the recommendation to stay with the TVA long term at a meeting later this year. 

MLGW is the TVA's largest customer and it has supplied power to the Memphis area for more than 80 years.

Customers will be able to add comments and ask questions about this TVA recommendation for at least the next 30 days by emailing MLGW at: PowerSupply@mlgw.org.

Read more on MLGW and its power supply at https://www.mlgw.com/about/powersupply.

RELATED: Germantown BMA approves resolution regarding MLGW

RELATED: Coal ash removal process begins through South Memphis

RELATED: Some Shelby County communities support sticking with TVA for MLGW

RELATED: Opinion | All MLGW customers should benefit from whatever decision MGLW makes about TVA | Otis Sanford

RELATED: MLGW offering free pilot light inspections

Before You Leave, Check This Out