TVA Documents Reveal New Details About How America’s Major Utilities Fight Clean Air Regulations

Over the last two years, an obscure group of utilities called the Power Generators Air Coalition (PGen) has quietly opposed numerous environmental protections proposed by the Biden administration, including rules to regulate greenhouse gasses, nitrous oxide, and particulate matter pollution. The Tennessee Valley Authority (TVA) paid $140,000 in membership dues to PGen in 2021, according to documents released by the utility after a Freedom of Information Act lawsuit by the Energy and Policy Institute. TVA is a corporate agency of the United States and receives its revenues from the sale of electricity to 10 million people across Tennessee and parts of Alabama, Georgia, Kentucky, Mississippi, North Carolina and Virginia. All of TVA’s customers are paying for the PGen fees, since TVA does not have shareholders to pay for the advocacy activities. TVA is one of sixteen directors or members of PGen. PGen’s full annual budget is not currently publicly known.

PGen’s incorporation documents with the State of Virginia listed some of the nation’s most coal-heavy utilities as directors, including:

• Southern Company
• TVA
• American Electric Power
• Consumers Energy
• Arizona Public Service
• DTE Energy
• Ohio Valley Electric Corporation (OVEC)
• Vistra
• Louisville Gas & Electric/Kentucky Utilities (LG&E/KU)
• Salt River Project
• Tucson Electric
• Associated Electric Cooperative (AECI)
• Wabash Valley Power Association

Emails obtained by EPI and PGen’s website revealed that the cooperative generation and transmission utilities Tri-State Generation and Transmission Association and Oglethorpe Power are also members of PGen, as is the National Rural Electric Cooperative Association (NRECA), which represents utility cooperatives.

PGen is primarily represented in its comments by McGuireWoods lawyers Allison D. Wood, Makram B. Jaber, and Aaron M. Flynn. These same lawyers are also representing another entity called the “Electric Generators for a Sensible Transition” in its lawsuit against the EPA over EPA’s proposed rules to reduce greenhouse gas emissions from existing coal and new gas plants. Many of the PGen members are also members of the Electric Generators for a Sensible Transition Coalition. TVA is a notable exception. 

PGen’s website states that it does not lobby or litigate, which might explain why McGuireWoods has created two different entities: one to collect utility dues to litigate; another to collect utility dues, including TVA’s payments, to advocate against climate and public health protections during the regulatory process.

PGen’s anti-environmental advocacy

PGen submitted at least 21 written comments on EPA rules mostly expressing opposition to the agency’s proposed rules to regulate greenhouse gasses, to update to the Good Neighbor Plan which regulates nitrous oxide, and to a rule that would lower the amount of particulate matter pollution allowed by electric generators, among others. Many of PGen’s members referenced the organization’s comments in their own comments to EPA.

Some of PGen’s members are walking back their emissions reductions commitments. For example, AEP is walking back its climate commitments following the re-election of Donald J. Trump.

Other PGen members with climate or emissions goals include:

• Arizona Public Service
• Consumers Energy
• DTE Energy
• LG&E/KU
• Salt River Project
• Southern Company
• Tucson Electric
• TVA
• Vistra

McGuireWoods is ground zero for fighting climate and environmental rules

The Minnesota Attorney General Office detailed in a 2021 rate case testimony that McGuireWoods created two entities to replicate the work of the defunct Utility Air Regulatory Group (UARG). Otter Tail requested that its customers pay for the utility’s old membership dues to UARG and that customers begin paying for the continuation of UARG services now housed at McGuireWoods, which the AG’s office contested. The new groups housed in McGuireWoods at the time were called the “Clean Air Act Monitoring Service” and “Climate Legal Group” and both were connected to Wood, Flynn, and Jaber. These three attorneys were formerly with the firm Hunton Andrews Kurth and had represented UARG, but left for McGuireWoods in April 2020 after UARG disbanded. 

UARG was a coalition that represented undisclosed utilities and had been a party in more than 200 lawsuits since 2001, according to federal court records, including challenges to EPA Clean Air Act regulations. Documents obtained and published by Politico in February 2019 revealed UARG’s actions and membership. The materials outlined goals for a meeting of the group’s policy committee to attack Obama-era clean air and public health rules.

The Politico documents also detailed that while UARG had various technical committees, its 2017 budget allocated at least $4.47 million to legal fees and only $265,721 to technical expenses. Many utilities claimed at the time that their membership in UARG allowed them to have access to interpretations and clarifications about Clean Air Act regulations. According to InsideEPA, a utility industry source said that one major complaint among the members in UARG was that it lacked a litigation advisory committee and would unilaterally pursue suits that the source described as “litigation run amok.”

Documents then obtained by EPI as a result of a 2019 FOIA request to TVA detailed how UARG focused on legal issues compared to technical guidance expenses. At least one of UARG’s committees, called the Nonattainment Committee, spent over $3.4 million on legal fees and expenses between 2015 and the first half of 2018. This committee spent just $48,000 on technical fees during that same time.

The FOIA documents also detailed how TVA participated in a variety of meetings on an annual basis that were convened by the Hunton attorneys to discuss issues such as the UARG budget or carbon dioxide regulations. 

The materials also provided more evidence that TVA’s payments to UARG were not isolated from other utility contributions. The documents appear to show that the hundreds of thousands of dollars that TVA took from its customers and sent to UARG were simply lumped together with the rest of the utility contributions and then allocated to the various committees within the litigious entity. In 2019, the Center for Biological Diversity, Energy Alabama, and Appalachian Voices called for the TVA Office of Inspector General (OIG) to open an investigation into TVA’s use of ratepayer dollars for UARG, the Utility Solid Waste Activities Group (USWAG), and the Utility Water Act Group (UWAG). The groups claimed TVA violated a Board of Directors policy that allowed TVA to participate in organizations, but that the organizations cannot “lobby on behalf of TVA or represent TVA in litigation without specific authorization to do so.” A 2021 TVA OIG report found “no evidence TVA was out of compliance with the TVA Memberships in External Organizations Board Practice,” but the OIG also found that because “the external organizations [did] not administratively segregate TVA’s funds” the OIG was “unable to determine if the funds were used for lobbying or litigation.” PGen launched with TVA as a founding board member during that same year.

Two months after Politico published the materials, Democratic leaders of the House Energy and Commerce Committee sent letters to several utility CEOs asking for information about former UARG attorney and then-EPA official Bill Wehrum’s relationship with the group and its member companies. The Congressional letters also requested that the utilities state whether their UARG annual contributions came from customers or shareholders.

“This is about transparency. Ratepayers have a right to know if they’re involuntarily paying for a secret campaign to undermine critical public health protections,” Rep. Pallone told Politico.

Utilities began to flee from the ad hoc coalition, and weeks later, UARG announced that its remaining members had decided to disband the embattled project after more than 40 years.

Documents provided to EPI as a result of the lawsuit show the immediacy with which the former UARG lawyers now at McGuireWoods set up the UARG-like entities.

Header image source: Kentucky Photo File

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