(CN) – A group of five nonprofits focused on energy and the environment claims in court that the Tennessee Valley Authority’s new rate hikes are designed to discourage homeowners from installing solar panels on their properties.
The lawsuit filed Thursday in Florence, Alabama, federal court says the federally owned corporation – which is the largest public power company in the nation – violated federal law because it did not “disclose and consider the reasonably foreseeable environmental impacts” of its fees changes.
As part of its planned rate changes, TVA will collect a grid access charge, which would increase the power bills of people who don’t consume a lot of electricity, such as low-income households or those with solar panels on their roofs. It also lowered the rates it charges large commercial customers, according to the complaint.
“Taken together, these measures are designed to obstruct [distributed energy resources] adoption across all customer classes, in order to maximize the amount of electricity customers continue to obtain from TVA—primarily dirty electricity derived from coal and other polluting energy sources,” the lawsuit states.
R. David McDowell, an attorney based in Huntsville, Alabama, filed the complaint on behalf of five groups: the Center for Biological Diversity, Energy Alabama, Friends of the Earth, Gasp and the Southern Alliance for Clean Energy.
An email request for comment from McDowell was not immediately returned Friday. Two lawyers for the Center for Biological Diversity are also pro hac vice applicants.
Daniel Tait, Energy Alabama’s technical director, said in a statement announcing the suit, “TVA continues to lose its leadership position on renewable energy and energy efficiency. TVA’s rate changes are about one thing and one thing only. Killing energy efficiency and renewable energy to protect its monopoly stranglehold on regular folks.”
The energy and environmental groups want the court to find that TVA violated the National Environmental Policy Act and issue an order vacating its 2018 rate changes. They also ask the court to “retain jurisdiction of this matter until TVA has come into compliance.”
The goal of TVA – besides providing much of the South with electricity – is to ensure the environmental well-being of the area and provide low-income residents of the area with power, according to the suit.
The rate changes would do neither, the plaintiffs say.
“In TVA’s service territory, households in the lowest income category pay more than 15% of their annual income on electricity – and in some counties over 20% — leading these communities to carry some of the highest energy burdens (the proportion of electricity costs to total income) in the country,” the complaint states. (Parentheses in original.)
The rate cuts that TVA is planning on implementing for its largest energy-using customers will not encourage them to seek out distributed energy resources, such as seeking out ways to make moves to conserve energy, according to the complaint.
Last year, almost 50 percent of TVA’s electricity came from fossil fuels, the lawsuit states.
According to TVA, about half of its electricity comes from carbon-free sources, such as through hydroelectric dams.
Within its service territory, less than 0.4 percent of TVA’s customers used distributed generation such as solar panels. By comparison, the plaintiffs say, 22 percent of Hawaii’s electricity comes from distributed generation.
The energy and environmental groups allege TVA sees distributed generation such as solar panels as a threat.
“TVA maintains that [distributed energy resources] constitutes ‘competition in the form of emerging technologies,’ and has explained, in a filing with the Securities and Exchange Commission, that it views customer adoption of DER as ‘operational risks’ that it must address, because ‘TVA effectively loses revenue on energy that DER send[s] to the grid,’” the complaint states.
TVA spokesman Scott Fiedler said he was unable to comment on the lawsuit because the agency has not yet been served.
In a statement posed on its website announcing the rate changes, TVA said they are revenue-neutral and would be implemented pending its board’s approval on Oct. 1.
TVA President and CEO Bill Johnson said in May that the changes were “to ensure rates remain as low as feasible and are fairly distributed to everyone who benefits from the safe, reliable energy Tennessee Valley public power providers deliver while supporting increased customer interest in renewable and dispersed energy sources.”