Tennessee Valley Authority's top executives were told Thursday during a meeting in Kentucky not to expect performance bonuses this year because of a drop in electricity sales due to the poor economy and the massive coal ash spill at the Kingston plant in Tennessee.
The executives and some 3,300 other managers and specialists at the nation's largest public utility also will see no pay raises in fiscal 2010, which began Oct. 1.
"It was a year overshadowed by Kingston and the economic downturn," said TVA President and Chief Executive Tom Kilgore, who will take the biggest hit of all.
Kilgore received more than $1 million in bonuses for fiscal 2008 and the nine executives who report to him received $1.2 million. They will not get a bonus or pay raise this year unless they are promoted.
The rest of TVA's nearly 12,000 employees will be eligible for raises.
The Dec. 22 spill of 5.4 million cubic yards of coal ash at the Kingston Fossil Plant has been an unparalled environmental disaster. The cleanup is expected to cost $1 billion, which TVA plans to pay off over several years, and is continuing.
About half the ash, or about a quarter that spilled overall, has become recovered from the Emory River. TVA expects to have the rest out of the river by spring, but federal lawsuits against the agency are still looming and residents continue to worry about health impacts.
"You see a lot of really substantial progress being made on many fronts in TVA," TVA director Dennis Bottorff said. "It is unfortunate that we see an event which overshadows that performance or an economy that we all live in that detracts from that performance."
Kilgore said TVA's electric sales are down about 7 percent this year in the seven-state TVA region, which has seen the creation of nearly 26,000 jobs in fiscal 2009 against 171,000 job losses.
TVA directors agreed Thursday to extend Kilgore's $300,000 annual retention bonus for another four years, but even with that Bottorff said Kilgore's compensation, which includes a base salary of $875,000, is about 45 percent below the average for top executives at peer utilities.