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TVA gets $1 billion under leaseback deal

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Photo by Angela Lewis / Chattanooga Times Free Press . Photo by Angela Lewis / Chattanooga Times Free Press .
CHATTANOOGA -

(Times Free Press) -- The Tennessee Valley Authority announced today that it will receive $1 billion from a private investment firm which will buy and then lease back to TVA a new combined cycle gas plant near Rogersville, Tenn.

The arrangement will help limit TVA borrowing needed to complete the 880-megawatt gas plant being built at the site of the soon-to-be idled John Sevier coal plant.

TVA will lease the new gas plant, scheduled for completion this spring, to a limited liability company known as John Sevier Combined Cycle Generation LLC. The 30-year arrangement is the largest yet of TVA's leaseback deals for gas-fired and combustion turbine plants.

"The use of lease-purchase financing gives us greater financial flexibility as we pursue a number of significant capital projects to realize our vision of providing cleaner energy," TVA Chief Financial Officer John Thomas said in a statement today. "As a supplement to traditional bond financing, the use of lease financing can help hold down costs and rates for our customers."

Read more on the story from our news partners at the Chattanooga Times Free Press.

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