New Expert Report Highlights Potential Value of Leaving TVA For Renewable Energy Alternative
MEMPHIS, TN – A new expert analysis reports that a growing trend of lower market prices for solar and wind power could enable Memphis Light, Gas, and Water to achieve energy generating costs lower than were identified in a report earlier this year that showed substantial possible cost savings for MLGW customers should Memphis produce its own electricity.
“Memphis could buy or produce a reliable, alternative power supply that would likely be substantially less expensive than projected TVA rates,” Herman Morris, former MLGW President and an advisor to Friends of the Earth, said. “Such a change would have significantly lower greenhouse gas emissions than those currently produced by the TVA and benefit Memphis consumers.”
The supplemental report prepared by the Brattle Group follows a January 2019 assessment by the same organization, commissioned by FOE, which indicated that in 2024 electricity supply costs of the portfolios they evaluated could be as much as a third, or $240-333 million per year, lower than costs incurred by Memphis under the current TVA rates.
“This report all the more confirms that the average cost of electricity generating portfolios that would supply Memphis with up to a third of its total electricity demand in 2024 from renewable resources would likely have an average cost below the current TVA rate,” said Jurgen Weiss, Ph.D., a Principal at the Brattle Group and the new report’s lead author.
As the new report outlines, wind resources in Memphis are among the best in the Southeast and the city has solar resources that are similar to some of the better solar regions in the Southeast. With access to transmission lines, low cost solar and wind power across the Mississippi River could be procured at a fraction of the price of TVA power. Citing new low cost solar and wind contracts for power as low as 2 cents a kilowatt hour, the new report suggests that the costs that Memphis would likely incur if it developed a substantial portfolio of renewable resources as part of its supply mix could be even lower than they calculated in the January 2019 report.
“Renewable energy is continually becoming more affordable as the industry grows, technology evolves, and public policy emphasizes and incentivizes cleaner power” Morris said. “Because of our city’s geography, Memphis has particular opportunities for accessing low cost solar and wind energy.”
In January 2019, The Brattle Group released a report (“The Brattle Report”), commissioned by Friends of the Earth, exploring the economics and reliability of various affordable and sustainable alternatives to MLGW’s current energy supply from the TVA. Friends of the Earth asked The Brattle Group to supplement the Brattle Report with additional background related to the assumptions and methodology underlying the short- and medium- term estimates of the cost of developing renewables and storage, as presented in that report. This supplement also compares those cost estimates to recent market experience as a benchmark of the reliability of those cost estimates.
CONTACT: Erin Jensen, (202) 222-0722, [email protected]