TVA’s Portfolio Management Process

The Office of Inspector General determined that the Tennessee Valley Authority’s portfolio management process is not operating as intended. Specifically, we found: • Some types of projects did not follow the portfolio management process as required by Tennessee Valley Authority-Standard Programs and Processes 19.003. In addition, TVA does not have a reverse capital flex list, as described in the Portfolio Management Guide. • Economic analyses were not performed for 9 of 17 projects reviewed with a forecasted cost greater than $10 million, although Tennessee Valley Authority’s Portfolio Management Guide states economic analyses are required for all projects equal to or greater than $10 million. • Economic analyses for two Tennessee Valley Authority Board of Directors approved projects had negative net present values, which indicates the projects might not add value to TVA. These analyses, as well as additional costs for one of the projects, were not provided to the Tennessee Valley Authority Board of Directors. • Two purchase orders were issued prior to spend approval for one project, indicating a control gap.