A spokesperson for the Tennessee Valley Authority (TVA) confirmed that about 600 of the utility’s employees have taken buyouts. Some workers left the company starting in May, while others will exit by the end of September.
The TVA on August 21 said the move is part of a plan to reduce costs as the federally owned utility tries to cut nearly $1 billion in spending by 2026.
“As part of our Enterprise Transformation, we have followed a rigorous process to refine TVA’s operating model and design an organizational structure that prioritizes operational excellence and improves efficiency,” said spokesperson Scott Fiedler. “To create capacity in the workforce to make sustainable organizational design decisions, a voluntary reduction-in-force offering was made for employees ready for retirement or a new career outside of TVA. More than 600 employees took advantage of the offering and are exiting TVA between May and September.”
TVA, the largest public utility in the U.S., is headquartered in Knoxville, Tennessee, with a large operations base in Chattanooga, Tennessee, where it has more than 3,800 employees. Reports said the company, which had more than 11,000 workers as of last year, already has accrued $40 million in severance costs. The buyouts offer five days’ pay for every year of service and are capped at 150 days. The company does not plan to report the number of workers in specific cities who are leaving.
The utility said there also could an involuntary reduction in its workforce, in addition to the buyouts, but did not provide a number, saying only that the figure would be small.
“We have folks that are not in a position right now but still interested in staying at TVA,” CEO Don Moul said in a news conference after a meeting of the utility’s board of directors in Knoxville on Thursday. “They’re looking for opportunities across TVA right in this window, so I can’t give you a final number for involuntary reductions, but it’s going to be a small number.”
Bobby Klein, a TVA board member, at Thursday’s meeting said of the utility’s cost reductions: “Most of the identified savings come through process efficiencies, with a smaller portion coming from labor, resulting in fewer impacts to the TVA employee population.”
TVA, which serves more than 10 million customers across seven states, is looking to cut expenses while at the same investing $16 billion in new power plants and measures to enhance power grid reliability.
Officials said that while TVA is a federal entity, created by Congress in 1933, the workforce reduction is not related to the Trump administration’s cuts to the federal workforce across multiple government agencies. The utility, though, has had a hiring freeze in place since January after an order from the administration to federal agencies.
—Darrell Proctor is a senior editor for POWER.
