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

Materials used in Mr Kilgore's 8/1/07 Presentation

Exhibit 99.1

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

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

FY 2007 RAINFALL / RUNOFF

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

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.

TVA SO2 Reductions Impact of Paradise Scrubber 2007

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

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

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

Browns Ferry Update Browns Ferry Update

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