– Key points —

– TVA’s first green bond offering sets a TVA record for the lowest 10-year interest rate.

– The proceeds from the sale will finance TVA’s capital investment in renewable energy projects, battery storage, the development of advanced clean energy technologies and the improvement of the transmission system.

– Similar financial instruments developed under the sustainable financing of TVA will support the implementation of the ambitious VAT goal of net zero carbon emissions by 2050.

KNOXVILLE, Tennessee., September 13, 2021 / PRNewswire / – The Tennessee Valley Authority has announced and priced a $ 500 million today offers 10-year green bonds, its first offering as a financial instrument focused on sustainability.

Tennessee Valley Authority. (PRNewsFoto / Tennessee Valley Authority)

According to the recent TVA press release Sustainable financing framework, the bonds will fund ongoing capital investments that leverage the industry leader of TVA Environment, social and governance successes and support for achieving VAT objectives Strategic intent and guiding principles approved by the board of directors in May 2021.

One of the main goals of this document is to aggressively move TVA towards a sustainable and zero carbon energy future by 2050, while keeping costs and reliability low.

“TVA’s financial position has strengthened over the past decade, and we continue our disciplined financial approach as we invest in the energy system of the future,” said Jean Thomas, Chief Financial and Strategy Officer of TVA. “Low-cost financing of our strategic capital investments will help keep energy prices as low as possible, even as we move towards our ambitious goal of net zero carbon. “

The bonds carry an interest rate of 1.500%, which sets a record for the lowest rate ever reached by TVA on a 10-year financing. The previous record for TVA on a 10-year maturity was set in 2012, with a rate of 1.875%. Record bond rate will save TVA on $ 15 million annual interest expense compared to bonds maturing earlier in 2021.

Proceeds from the sale will be used to finance TVA’s upcoming large capital investments for increased renewable energy production, energy storage, transmission system upgrades and advanced technology development. clean energy. A potential TVA solar project in the north Alabama and a potential TVA energy storage project in the east Tennessee – both undergoing a detailed environmental review – are two possible uses of the funding. As part of the Green Bond format, TVA expects to report on allocations of net bond proceeds annually until the proceeds are fully allocated.

“TVA’s first green bond is an important milestone for our funding program,” said Tammy wilson, Treasurer of TVA and Head of Risk Management. “Today’s record-breaking transaction demonstrates that the financial community is focused on investing in cleaner energy and supporting TVA’s sustainability goals.”

TVA’s green bond offer hits the mark $ 2 billion in initial orders from a variety of investors, including fund managers, state governments, insurance companies and others. Bank of America Securities served as the green structuring agent for the transaction and the book co-manager. Barclays, Morgan Stanley, RBC Capital Markets and TD Securities also acted as joint bookkeepers for the transaction.

The new bonds will mature on September 15, 2031, and are not subject to reimbursement before maturity. Interest will be paid semi-annually each March 15 and September 15th. A request was made to list the bonds on the New York Stock Exchange. The bonds will be issued, maintained and transferred through the book-entry only system of Federal Reserve banks. Transactions can be cleared and settled by international participants through Clearstream and Euroclear. Bonds can be identified by CUSIP number 880591EX6 (ISIN number US880591EX64).

The terms of the obligations are in accordance with Sustainable financing framework, which describes the categories of strategic capital projects where the proceeds can be allocated, including renewables, energy storage, energy efficiency, transportation investments that support TVA’s clean energy goals and research and development expenses related to other categories identified in the framework.

TVA obtained a second-party opinion on its framework from global analyst firm Sustainalytics, which concluded that TVA’s sustainable finance framework is credible, impactful, and aligned with relevant sustainability and green bond standards and principles. . Sustainalytics’ opinion and other details can be viewed from the ESG Information for Investors section of the TVA Investor Relations website at www.tva.com/investisseurs or directly by clicking here.

The Tennessee Valley Authority is a commercial agency of United States which provides electricity to commercial customers and local power companies serving nearly 10 million people in parts of seven southeastern states. TVA receives no funding from taxpayers, deriving almost all of its income from the sale of electricity. In addition to operating and investing its revenues in its power system, TVA provides flood control, navigation, and land management for the Tennessee River system, and assists local power companies and state governments. and local in economic development and job creation.

Media contact:

Jim Hopson, Knoxville, 865-632-8860

TVA Media Relations, Knoxville, 865-632-6000

www.tva.com/news

Follow TVA news on Facebook and Twitter

Investor Relations:

Tammy Wilson, Knoxville, 865-632-3366 or 888-882-4975

Josh Carlon, Knoxville, 865-632-4133 or 888-882-4975

http://www.tva.com/investisseurs

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SOURCE Tennessee Valley Authority



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