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    • TVA offers full payments and agrees to boost Elon Musk’s xAI in Memphis
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    TVA offers full payments and agrees to boost Elon Musk’s xAI in Memphis

    Sakege Posted on

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    The Tennessee Valley Authority Board of Directors ended the utility’s fiscal year by awarding all eligible employees their full year-end payments in recognition of their performance through a unprecedented winter storm and flood.

    At its quarterly meeting Nov. 7 in Murray, Kentucky, the board also approved an energy agreement to supply 150 megawatts of electricity (enough to power about 90,000 average homes) to Elon Musk’s artificial intelligence supercomputer in Memphis.

    It was a “remarkable year for TVA at the highest level,” company president and CEO Jeff Lyash told Knox News.

    In January, TVA power plants held out highest electricity demand in TVA history during a freezing winter storm. In September, its dams stored more than 400 billion gallons of flooding from Hurricane Helene and prevented $460 million in flood damage.

    In 25 million hours worked by more than 10,000 employees, the utility suffered no serious injuries in fiscal 2024 for the first time in a decade. TVA’s fiscal year ended September 30.

    The board also voted to maintain the same CEO compensation package for the second year in a row. Lyash, who made 10.5 million dollars in 2023He is the highest-paid federal employee, although his salary is about 29% lower than the average CEO peer, according to the board.

    The board took steps to reduce your maximum compensation in May, aligning incentive payments for the CEO with those of other executives.

    “I think producing top-quartile results with bottom-quartile compensation is good business for our clients,” Lyash said. “I personally am here for the mission.”

    A detailed look at TVA’s financials for fiscal 2024, including the exact salaries of its top five executives, will be included in its annual report to the Securities and Exchange Commission on Nov. 14.

    TVA board approves boosting Elon Musk’s xAI

    The board unanimously approved a plan to provide 150 megawatts of power to CTC Property, an affiliate of Elon Musk’s xAI startup, through TVA’s largest customer, Memphis Light, Gas & Water. TVA must approve power agreements for customers with a power demand of more than 100 megawatts.

    The supercomputer powering xAI has been online since September, using off-grid gas turbines to boost its operations temporarily. TVA cannot control whether xAI continues to use the turbines after TVA begins supplying power to it, Lyash said at the meeting.

    The Environmental Protection Agency is working with the Shelby County Health Department to review concerns raised by county residents about air quality related to the project.

    The Economic Development Growth Engine for Memphis and Shelby County, or EDGE, board approved a 21 year lease with CTC Property for 522 acres near xAI facilities to expand its operations.

    The company presented plans for a $78 million wastewater recycling facility in partnership with TVA and Nucor Steel in September. The plant could reduce pressure on the Memphis aquifer by 10 million gallons per day.

    TVA registers good financial results, although nuclear failures

    TVA’s year-end payments are based on its performance on a variety of metrics, such as the security and reliability of its network. For the first time, the company added an incentive this year based on the expansion of renewable energy such as solar.

    It has 4,200 megawatts of solar in commercial operation or under contract with private developers, with the goal of adding 10,000 megawatts of solar by 2035. TVA will purchase the vast majority of this solar from third parties supported by the utility.

    While TVA generates more than half of its electricity comes from carbon-free sources Like nuclear and hydroelectric dams, solar and wind power account for about 4% of its energy.

    “Solar energy is not a very complex engineering issue. You don’t need the kind of skills that TVA has,” Lyash said. “We think it’s better for companies that are in that business, like Silicon Ranch or Origis, to do it full time.”

    TVA slipped one metric: the performance of its three nuclear plants, all of which had forced outages in fiscal 2024. Forced outages, unlike scheduled maintenance outages, are caused by unexpected equipment failures or shortages of fuel within the control of the operator.

    Despite the recent increases your base electricity rateTVA’s overall rates were about 2% lower this year, thanks to a drop in natural gas prices. The utility had higher operating income and lower operating costs compared to last year and is in a “strong and healthy” financial state, Chief Financial Officer John Thomas told the board.

    In fiscal year 2024, TVA helped attract $8.9 billion in projected investments to its seven-state region from companies such as Amazon, Greenheck Group and Oran.

    Trump may nominate TVA board members again

    The November board meeting was the last meeting for members Brian Noland, president of East Tennessee State University, and Beth Harwell, former speaker of the Tennessee House of Representatives. The couple are the latest service members nominated by President-elect Donald Trump in his first term.

    The board is supposed to have nine members, who are nominated and confirmed for five-year terms, but currently has eight.

    Although President Joe Biden Patrice Robinson, former Memphis City Council member nominated to the board in 2023, pending confirmation by the United States Senate. Robinson would be the only West Tennessee resident and the only black member of the board.

    Once he returns to office, Trump, who became TVA board critic on issues such as outsourcing and Lyash’s salary, he could have the opportunity to nominate at least two new members.

    Daniel Dassow is a growth and development reporter focused on technology and energy. Phone 423-637-0878. Email [email protected].

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