TVA achieves historically low cost 30-year financing
Originally published January 2, 2013
The Tennessee Valley Authority said Dec. 19 it had priced $1 billion of new 30-year global power bonds with an interest rate of 3.50 percent – the lowest rate ever on a TVA 30-year institutional bond.
TVA was able to take advantage of a window of opportunity during a period of government fiscal negotiations and the holiday season to obtain low-cost financing.
"The favorable interest rate environment and stable market allowed us to achieve the lowest interest rate on any TVA institutional financing of more than ten years," said TVA Senior Vice President and Treasurer John Hoskins. "The low-cost financing will support TVA’s vision to provide low cost, cleaner energy."
TVA receives no funding from taxpayers -- it pays its own way with revenues from power sales and power program financings. The proceeds from the sale will be used to reduce other debt, and for general corporate purposes, the utility said.
The transaction benefitted from strong investor demand, with orders from a variety of institutional investors primarily in the United States. Morgan Stanley, Bank of America Merrill Lynch and Barclays Capital were joint book-running managers for the offering.
"We were pleased to be able to meet investor demand for high-quality, long-term bonds, with an oversubscribed book of orders that supported the historically low interest rate," said Hoskins.
The new bonds mature on Dec. 15, 2042, and are not subject to redemption prior to maturity.
Please Sign in to rate this.
Senior Vice President, Publishing
Jeanne Wickline LaBella
Editor, Public Power Daily
Manager, Integrated Media
David L. Blaylock
- Solar deal places nonprofit under state law, N.C. appeals court says
- Hurricane Maria hits already reeling Virgin Islands, Puerto Rico
- House subcommittee schedules additional power industry hearings
- FERC says N.Y. agency relinquished right to act on certification tied to pipeline
- Sponsored Advertising FeatureWorkforce automation helps utilities avoid operational headaches
- Utility crews are on the move as Category 5 Hurricane Irma approaches US
- After Irma, 6 million lack power in Florida — and the trucks are on their way
- Houston struggles with floods, outages, as the rain keeps falling
- Built by bonds: Kansas utility revamps a coal plant
- As Irma restoration proceeds, more mutual aid requests arrive