TVA's billion-dollar projects, and your bills

Three major projects face the Tennessee Valley Authority: the construction of a new nuclear reactor, a gas fired plant, and the continued coal ash clean up.

Combined, the three projects will cost the company, and rate payers, billions of dollars.

The construction of the two new power plants is based on one of TVA's basic operating principals.

"TVA uses a diversified portfolio. We don't rely on any one source of the power that we use every day," said TVA Investor Relations Manager Josh Carlon.

Watts Bar II, TVA's latest nuclear reactor, was approved in 2007.

The John Sevier natural gas plant was just given the go-ahead this summer.

Both projects require serious pocket change.

"$820 million is our estimated cost," Carlon said of the Sevier plant.

"[Watts Bar II] is going to be a cost of about $2.5 billion," said TVA Senior Vice President of Nuclear Generation Development and Construction Ashok Bhatnagar.

In addition to those costs, the ash spill cleanup effort got more expensive as days passed following the disaster.

"The number has increased as we've had more information become available, and as we have moved forward making decisions on some of the initial recovery work and storage of the ash," Carlon said.

Almost a year later, the ash spill has sucked up $234 million, but that's just the beginning.

"The estimated total cost is anywhere from $933 million up to about a billion," Carlon said.

Altogether, the projects add up to $4.3 billion, give or take a few thousand.

TVA's financial planners have several plans to keep rate-payer bills from reflecting those massive figures.

"The cost of this is going to be spread out over approximately 15 years," Carlon said of the ash spill cleanup.

The company also points to other economic impacts that balance the costs.

"Some of the research we've done so far shows for every job we create in construction and operations on the plant, you're going to create at least another 2 jobs in the local community," Bhatnagar said of Watts Bar II.

"[The Sevier plant] is enough power to supply about half a million homes," Carlon said.

Both the Sevier gas plant and the second nuclear reactor at Watts Bar are set for completion in 2012.

The first phase of the ash spill clean-up, ridding the Emory River of the fly ash, is scheduled to be done by next Spring.

Then, TVA will begin the second phase, cleaning up the fly ash on the ground.