TVA on the cusp of keeping Memphis for a generation. Why environmental advocates say that's a mistake

The head of the Tennessee Valley Authority heard from Memphians up close and personal Wednesday.

“The coal ash is such an insult, sir… and you want a 20-year contract,” Pearl Walker, a community organizer with Memphis Has the Power, said to TVA CEO Jeff Lyash Wednesday morning.

Lyash sat stoic, flanked by myriad TVA executives. A few minutes later, for the umpteenth time, he would tell the public and the Memphis, Light, Gas and Water Board of Commissioners, why he felt Memphis should keep buying electricity from the federal provider over the long term.

Walker’s comments to Lyash weren’t isolated. Another community member, Yolonda Spinks, told Lyash the coal ash removal process represented "environmental racism."

The comments, together, encapsulate the lingering resentment and discontent in Memphis, particularly Southwest Memphis and Whitehaven, about TVA’s planned years-long trucking of coal ash through the south part of the city to the South Shelby landfill.

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Many remain angry the ash that was burned in Memphis will stay in the city and be trucked daily through majority-Black neighborhoods for almost a decade. Lyash said Wednesday the ash removal could last until 2030.

That discontent and the widely accepted perception that TVA did not pay Memphis much attention until MLGW considered buying electricity elsewhere are Lyash and TVA's most significant barriers to keeping MLGW in the fold, a reality that now appears close at hand.

Last week, MLGW CEO J.T. Young said he wants the city-owned utility to stay with TVA on a 20-year, rolling contract. Young's decision came after more than 20 private sector companies bid on supplying Memphis electricity.

That would be a victory for TVA — its largest electricity customer would be locked up for a generation. Young and Lyash both argue the deal is the best value for MLGW ratepayers. Of the 153 local power companies that belong to TVA, 146 have signed the contract.

However, an alliance of community and environment activists — Protect Our Aquifer, Memphis Community Against Pollution and Memphis Has the Power — argue such a deal is bad for the environment and bad for predominantly Black Memphis neighborhoods, reduces MLGW’s leverage and removes any incentive for TVA to change its corporate behavior out of fear Memphis could leave.

The dueling arguments will play out over the next several months. TVA has the apparent support of the business community and the overt support of Shelby County’s suburbs. However, the 20-year deal must clear both the MLGW Board of Commissioners and the Memphis City Council. That's where the rubber will meet the road.

For years, the question was whether MLGW would leave TVA, forever altering how electricity is conducted throughout the Southeast. Instead, it is a question of how long MLGW will stay with TVA — will it keep its current leverage or stay for a generation?

A 20-year-deal means less leverage

In a July interview, Amanda Garcia, director of the Tennessee office of the Southern Environmental Law Center, said Memphis, and MLGW, represent the last piece of leverage people throughout the Tennessee Valley have with TVA.

Memphis is 10% of TVA's revenue and roughly the same amount of its electric load. The specter of losing Memphis has motivated Lyash and his predecessor, Bill Johnson, to mend fences in Memphis, albeit in different ways.

To Garcia and others, the continued attention TVA has had to pay Memphis is a direct result of its current, rolling five-year contract with TVA.

That leverage would be lost if MLGW signs a 20-year deal, Garcia said. She described TVA, a federal agency governed by its own set of laws, as a bureaucracy in danger of not being accountable to the public.

Garcia, representing Memphis-based Protect Our Aquifer and other Tennessee nonprofits, has sued TVA in federal court, arguing the 20-year deal it is offering Memphis — which 146 other local power companies have signed — violates the TVA Act.

"The TVA Act contemplates accountability from above — democratic accountability from above in terms of the President and Congress and democratic accountability from below from TVA distributors [local power companies]," Garcia said. "Unfortunately, what these never-ending contracts do is completely cut the distributor accountability out of the picture, because once a distributor is locked in they're a captive customer base. They don't really have a voice."

Lyash, for his part, said in a July interview and again Thursday that MLGW would not lose its voice by signing the long-term deal.

"It's public power. The mission here is partnership with local communities to make the lives of these people better. When I was with an investor-owned utility and my mission was maximize the earnings for the shareholder. This is not that mission. So, I hear the question, but I think it comes from a bad premise," Lyash said.

'Pennies' for the environment

On Wednesday and last week, activists and community advocates noted the environmental consequences of Memphis' decision about its future electricity supply.

The environmental consequences of electricity generation, they note, are already apparent in Southwest Memphis where tons of coal ash are being removed from two ponds that surround the retired Allen Fossil Plant.

In interviews last week, leaders of Protect Our Aquifer and Memphis Community Against Pollution described a 20-year, rolling contract with TVA in terms of opportunity cost — the cost of making one decision and foregoing another.

Part of TVA's long-term offer includes a 3.1% cut in wholesale rates over 20 years and the ability to generate some electricity locally, whether it's renewable energy or something else.

To Protect Our Aquifer, the long-term gains don't measure up.

"The short-term savings right now is pennies compared to what we can save in the long term if we continue to negotiate more renewables and better programs from TVA formed specifically under this five-year contract," Sarah Houston, the nonprofit's executive director, said last week.

Justin J. Pearson, one of the cofounders of Memphis Community Against Pollution, noted the length of TVA's offer — 20 years — and how he would be 47 when it elapsed. Some of the people making the decisions about whether to stay with TVA, wouldn't be alive, he said.

He noted that MLGW Commission Chairman Mitch Graves had noted MLGW and TVA's relationship had improved since MLGW started considering a TVA-free future.

"They've only been good to us since we started talking about negotiating with them. How do we ensure that they operate in a way that is more just in the future on behalf of all of us?," Pearson said.

A tiny bit of negotiation

Lyash and Graves did a small amount of negotiation Wednesday. Kind of. Sort of.

Graves asked Lyash if there was any way there could be a different deal — one that was shorter than 20 years but longer than the current five.

Lyash replied that everything he had to offer Memphis he had to offer every other local power company that belongs to TVA and the long-term partnership agreement could be amended based on local power company feedback.

Samuel Hardiman covers Memphis city government and politics for The Commercial Appeal. He can be reached by email at samuel.hardiman@commercialappeal.com or followed on Twitter at @samhardiman. 

This article originally appeared on Memphis Commercial Appeal: Environmentalists say 20-year-deal between Memphis, TVA is a mistake