This week, the Sierra Club presented a new report to the Tennessee Valley Authority (TVA) board of directors that charts a course for TVA to a clean energy future. The report, prepared by Synapse Energy Economics and commissioned by the Sierra Club, reveals that TVA can lower ratepayer bills every month for decades and clean up the air across the eastern US by investing in energy efficiency, rather than in retrofits for their most polluting coal plants.

I grew up in the Tennessee Valley, and I know that this will come as welcome news to the millions of residents in TVA’s 7-state service area. TVA is the nation’s largest producer of electric power, and for decades, much of that power came from an aging fleet of coal-fired power plants.

In 2011, the Sierra Club, along with several states and allied organizations, reached a settlement with TVA to retire 18 of their aging coal units — an agreement that was heralded as a historic victory for clean air. Now, TVA faces a decision about whether to spend billions to retrofit some of their remaining aging coal plants, or to instead invest in clean energy and energy efficiency.

This week, we are issuing a simple challenge to TVA’s board of directors: live up to your agency’s founding commitment, dating back to the New Deal, to improve the lives of everyone TVA serves by investing in energy efficiency.

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Incredibly, the new report found that, based on TVA’s own studies, if TVA commits to energy savings of just 1.2 percent annually through energy efficiency, it could replace at least one of its non-economic coal plants in just three years’ time. These savings would translate into lower electricity bills and fewer coal-related illnesses for people throughout the Tennessee Valley region.

Further, if TVA pushes its energy savings up to 2 percent annually — rates that are achieved by other leading national utilities — by 2015, it could generate enough reductions to retire even more non-economic units, such as all the coal boilers at its highly polluting Gallatin and Colbert plants.

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On the other hand, the capital cost of putting pollution controls on the TVA coal fleet would likely start at $11.8 billion, not counting additional costs associated with controlling climate-disrupting carbon pollution. After the retrofits, TVA plants would cost more to operate than the price of power on the open market, creating an unnecessary cost burden to consumers.

The bottom line is simple: replacing dirty coal with energy efficiency makes sound economic sense and saves lives. Energy efficiency means cleaner air, lower electric bills, and healthier communities. In Tennessee alone, TVA’s coal fleet was likely responsible for more than 499 premature deaths in 2010.

But there is hope. TVA’s board has committed to a renewed vision for TVA’s future, in which the utility invests in energy efficiency and clean energy. It is now up to TVA to decide whether that vision will become a reality.

One of our volunteers and a TVA ratepayer, Louise Gorenflo, put it this way: “TVA has an opportunity to prioritize energy efficiency which will boost our local economy while saving customers money and, critically, reduce the use of coal fired power. This is a win-win for our pocketbooks and for our health.”

TVA should pursue a path under which it retires as many of its non-economic coal plants as possible, while ramping up investments in energy efficiency and clean energy. TVA was created to brighten hopes for everyone it serves. Now it can. Will it live up to the challenge?