EX-99.1 2 g08804exv99w1.htm MATERIALS USED IN MR KILGORE'S 8/1/07 PRESENTATION

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Exhibit 99.1

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President's Report Tom Kilgore President & Chief Executive Officer August 1, 2007

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Report Overview Fiscal Year Update Financial Status Highlights Looking to FY 08

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FY 2007 RAINFALL / RUNOFF

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FYTD 2007 Financial Drivers Percent of Plan Estimates as of July 13, 2007

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FY2007 Total Cost of Power Forecast FY2007 Budget versus Forecast ($/MWh) FY2007 Budget 50.15 FY2007 Forecast 51.51 Lower Purchased Power Expense (Excluding Impacts of Lower Hydro) Higher Fuel Expense Lower Power Sales (0.98) 0. 51 0.36 Coal Price Up $(66.4) Coal Volume Up (15.5) Nuclear Cost Down 19.4 Gas/Oil Cost Up (32.1) Price Down $ 67.9 Volume Down 103.0 (0.17) Other Expense Lower Hydro Generation 1.64 Hydro generation down 27.6%. Total Cost of Power is forecasted to be above plan by 2.7% for the year.

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TVA SO2 Reductions Impact of Paradise Scrubber 2007

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Energy Conservation Initiative Demand Side Management Strategic Objective: Strive to achieve leadership in energy efficiency improvements and peak reduction within 5 years Measures for achieving objective: Offset one year of load growth - minimum 700MW, strive for 1200MW Reduce per capita energy consumption to lowest national quartile Maximize participation in Energy Efficiency and Peak Shaving initiatives

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National Total Residential Energy Use (million Btu per capita - All Energy Sources 2003)

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Demand Side Management Overview OBJECTIVE CATEGORY MARKET Leader in Energy Efficiency and Peak Reduction Peak Reduction (MW) Generation Offset (MW & MWh) Energy Efficiency (MWh) Time Differential Pricing (MW)* Residential Commercial Solar & Wind Fuel Cells Plug-In Hybrid Electric Vehicles Residential Commercial Industrial Interruptible Rates Industrial Residential Commercial Industrial

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Browns Ferry Update Browns Ferry Update

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Looking to FY08 Strategic Plan Implementation Long-term power supply Use of financial principles Sustainable performance improvement

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