Economy Surplus Power
Economy Surplus Power, or ESP, offers five competitively priced power options to SIC qualified customers with loads of at least five megawatts.
ESP prices are generally low because they follow TVA's hourly incremental cost of producing electricity and because ESP has an interruption feature. If TVA does not have enough power available or cannot purchase enough power to meet the region's expected needs, ESP sales are interrupted.
ESP is priced at TVA's hourly incremental production cost of the top 100 MW plus a markup. The amount of the markup varies with the type of ESP the customer selects. TVA costs can change each hour of the day, and industrial customers can make hourly decisions about how much ESP they want to buy at the available price.
Additionally, a nominal per billing kW charge is assessed to account for specific costs associated with this type of supply arrangement. There is also a monthly fee for computer, communications equipment, and administrative costs.
Because sales are interruptible, TVA can serve others without installing as much system capacity. These savings are passed along to ESP customers through the rates.
Savings can be increased if a customer can modify operations to buy more ESP when hourly costs are low (off-peak) and less ESP when hourly costs are high (on-peak).
The options differ by price and the way that power interruptions are handled.
ESP A may be interrupted upon five minutes' notice. A customer can contract for no more than 50 percent of total power requirements under ESP A.
ESP B may be interrupted on five minutes' notice. A customer can contract for two-thirds of their power requirements as ESP B.
ESP C is also available for up to two-thirds of a customer's power requirements but is interrupted on 60 minutes' notice.
ESP D & E are limited to no more than 50 percent of power requirements. Interruption of these customer groups will be reserved for the most serious power system emergencies. Interruptions may be made only after ESP A, B and C have been given their interruption notice (Option D, 5 minutes; Option E, 60 minutes).
In addition to the markups for each ESP option, there is a 5.3 percent charge for payments in lieu of taxes.
The chart below provides a summary of the ESP options.
||Amount of Markup*
||Amount of Total Power
||Amount of Notice
||15% + 8 mills/kWh
||25% + 8 mills/kWh
*In addition to the markups, all options include the following: additional 5.3% charge for payment in lieu of taxes, a $1.21 per kW charge, and a $1,075 per month communication access/administrative charge.
**Interruptions made only after Groups A, B, & C have been notified.