All Reports

The OIG performed an audit of Florence Electricity Department (Florence), a distributor of Tennessee Valley Authority (TVA) power based in Florence, Alabama. Florence also operates water, waste water, and gas departments, and provides billing services for these utilities and other municipalities. Annual revenues from electric sales were approximately $116 million in fiscal year (FY) 2009.

As part of our annual inspection plan, we initiated a review of the fire protection systems at the Raccoon Mountain Pumped-Storage Plant. In meeting with plant personnel, we were informed that in July 2010, Marsh Risk Consulting issued a report which included a number of recommendations for the plant to improve fire protection at the site. Based upon this, we decided to perform a walkdown of the site and a limited review of testing/inspection documentation for a sample of the fixed fire protection systems at the site.We noted no issues during our walkdown of the facility.

TVA entered into contract No. 65419 with Bechtel Power Corporation on October 19, 2007, to provide engineering, construction, and procurement work related to the restart of Unit 2 at Watts Bar Nuclear Plant (WBN U2). Section II-13 - Correction of the Work Prior to Commencement of Warranty Period of the contract stipulates the guidelines related to what does and does not constitute rework as it relates to determining Bechtel's performance fee.

The OIG performed an audit of Newport Utilities, a distributor for Tennessee Valley Authority (TVA) power based in Newport, Tennessee. Newport Utilities also operates nonelectric businesses, which are water and sewer utilities. Annual revenues from electric sales were approximately $50 million in fiscal year 2009.

The OIG reviewed North Georgia Electric Membership Corporation (NGEMC), a distributor for Tennessee Valley Authority (TVA) power based in Dalton, Georgia. The objective of the review was to determine compliance with key provisions of the power contract between TVA and NGEMC. Our review found 34 misclassified customer accounts.

The OIG reviewed the Pulaski Electric System, a distributor for TVA power based in Pulaski, Tennessee. Pulaski also provides billing services for other city utilities and operates a broadband department that offers cable and Internet services.

The OIG performed a follow up audit of Inspection No. 2005 522I, where we recommended TVA execute contract modifications with distributors who wish to pursue nonelectric business ventures, and TVA management agreed to do so. In addition, TVA management asserted they would formalize procedures to ensure consistent review of (1) distributor financial information and (2) business plans that propose the use of electric system revenues for nonelectric system purposes.Our review found TVA management later decided on an alternative approach to protect its interests and those of all parties.

The OIG reviewed the TVA's compliance with the Federal Information Security Management Act (FISMA) of 2002. Our review determined TVA made significant improvement in two FISMA control areas in the past year. However, overall progress in implementing information technology controls required by FISMA has slowed, while TVA continues work on previously recommended actions and redesigns some processes.

The objectives of this review were to determine what actions TVA has taken since the Kingston Fossil Plant ash spill to address (1) deficiencies in ash management governance, (2) cultural issues identified, (3) stability of the other coal ash impoundments, and (4) deficiencies in the coal ash management program. The scope of this review included coal ash management and related risks.

The OIG performed four agreed-upon procedures, which were requested solely to assist management in determining the validity of the Winning Performance (WP) payout awards for the year ended September 30, 2010. Following are the results of the procedures applied:The fiscal year (FY) 2010 WP goals were properly approved.