Trump Administration's Push to Privatize the Tennessee Valley Authority

Shelbyville NOW

July 18, 2025

The Tennessee Valley Authority (TVA), the largest public utility in the United States, has been a cornerstone of economic development and affordable energy in the Southeast since its establishment in 1933 under President Franklin D. Roosevelt’s New Deal. Serving over 10 million people across seven states, the TVA provides electricity, flood control, and economic development without relying on taxpayer funding. However, recent actions and statements from the Trump administration have reignited debates about privatizing this federally owned corporation, raising concerns about potential impacts on energy costs, regional development, and energy policy.

Historical Context of TVA Privatization Proposals

The idea of privatizing the TVA is not new. During his first term, President Donald Trump proposed selling off the TVA’s transmission assets in 2018 and 2020, arguing that private sector ownership would lead to more efficient resource allocation and reduce risks to taxpayers. These proposals faced strong bipartisan opposition from Tennessee’s congressional delegation, including Senators Lamar Alexander and Marsha Blackburn, who argued that privatization would likely increase electricity rates for the region’s residents and businesses. The Obama administration also briefly considered selling TVA assets in 2013 but abandoned the idea after similar pushback.

Historically, the TVA has been a point of contention for advocates of free-market policies. In 1963, Republican presidential candidate Barry Goldwater suggested selling parts of the TVA, a stance that was used against him in President Lyndon B. Johnson’s 1964 campaign. Conservative groups, such as the Heritage Foundation, have long advocated for breaking up or privatizing the TVA, citing the belief that private utilities are better suited to manage electricity transmission. Despite these arguments, the TVA’s low electricity rates and significant contributions to regional economic development have made privatization a politically contentious issue.

Recent Developments Under the Trump Administration

In 2025, speculation about privatization has resurfaced due to the Trump administration’s actions toward the TVA’s leadership. The administration has made significant moves to reshape the TVA’s board of directors, which oversees critical decisions about the utility’s operations and leadership. Since March 2025, President Trump has fired three Biden-appointed board members—Michelle Moore, Joe Ritch, and Beth Geer—leaving the board without a quorum to make major policy decisions. On July 1, 2025, Trump nominated four new board members—Lee Beaman, Mitch Graves, Jeff Hagood, and Randall Jones—all of whom await Senate confirmation.

These leadership changes have fueled suspicions that the administration is positioning the TVA for privatization. Sources cited by The Atlantic suggest that the firings and new appointments may be steps toward installing a CEO more aligned with Trump’s agenda, potentially someone like former Energy Secretary Dan Brouillette, who has ties to investor-owned utilities. While Trump has not recently made public statements explicitly calling for privatization, his administration’s broader push to shrink the federal government and its history of proposing TVA asset sales have kept the issue in the spotlight.

The administration’s focus on the TVA was further highlighted by a public dispute involving country musician John Rich, who opposed a proposed TVA gas-fired power plant in Cheatham County, Tennessee. After Rich claimed to have enlisted Trump’s support, the TVA announced it would abandon the site, raising questions about the administration’s influence over the utility’s decisions. This incident, combined with the board shake-ups, has led some to speculate that the administration is leveraging its authority to steer the TVA toward policies that could facilitate privatization.

Implications of Privatization

Privatizing the TVA could have far-reaching consequences for the Tennessee Valley region. The TVA’s monopoly has historically ensured some of the lowest electricity rates in the nation, a key factor in attracting businesses and fostering economic growth. Critics of privatization, including bipartisan lawmakers, argue that transferring ownership to private entities would likely lead to higher electricity rates, as private utilities prioritize profits over affordability. A 2018 letter from Senators Lamar Alexander and Maria Cantwell warned that selling TVA assets could increase rates by 12-15%, threatening the economic stability of the region’s families and businesses.

Moreover, the TVA’s role extends beyond electricity generation. It manages flood control, navigation, and land stewardship across 293,000 acres, preventing approximately $260 million in flood damage annually. Privatization could disrupt these services, as private entities may lack the incentive or resources to maintain them at the same level. The TVA’s economic development efforts, which attracted over $11 billion in investments in 2018 alone, could also be jeopardized under private ownership.

Environmental considerations add another layer of complexity. The TVA has faced criticism for its historical reliance on coal and recent plans for gas-fired plants, but it has also invested in nuclear and renewable energy, with 54% of its 2019 energy production coming from carbon-free sources. The Trump administration’s push for fossil fuel expansion, including executive orders to extend the life of coal plants, contrasts with calls from clean energy advocates for the TVA to prioritize solar and battery storage. Privatization could shift the TVA’s energy mix toward more profitable but environmentally harmful sources, depending on the priorities of the new owners.

Political and Legal Challenges

Privatizing the TVA would face significant hurdles. The TVA Act of 1933 governs the utility’s operations, and any sale of its assets would likely require congressional approval. Tennessee’s Republican senators, Marsha Blackburn and Bill Hagerty, have not publicly endorsed privatization, instead urging the administration to focus on expanding nuclear energy to cement Trump’s legacy as “America’s Nuclear President.” Additionally, the TVA’s self-funded status—relying entirely on electricity sales rather than taxpayer dollars—undermines arguments that privatization would reduce federal spending.

Public sentiment, as reflected in posts on X, also leans against privatization. Users have praised the TVA’s contributions to Tennessee’s economy and expressed concerns about higher power bills if the utility is sold. The TVA’s unionized workforce, represented by groups like the International Federation of Professional and Technical Engineers, has also voiced opposition, emphasizing the utility’s ability to meet modern energy demands without privatization.

Conclusion

The Trump administration’s recent actions toward the TVA, including board member firings and new nominations, have revived speculation about its intent to privatize the nation’s largest public utility. While the administration has not explicitly confirmed these plans, its history of proposing TVA asset sales and its broader agenda of reducing federal involvement in public services suggest that privatization remains a possibility. However, strong opposition from lawmakers, local communities, and clean energy advocates, combined with the TVA’s critical role in the region’s economy and energy landscape, poses significant challenges to any privatization efforts.

The future of the TVA will depend on the outcome of the administration’s board nominations, potential congressional action, and the broader political will to maintain the utility’s public status. For now, the debate underscores the tension between public and private interests in managing America’s energy infrastructure, with the Tennessee Valley at the heart of the discussion.