Tennessee Valley power bills to drop in September
After hitting a record high in August, consumers in the Tennessee Valley will get a reprieve next month with lower monthly utility bills.
But even with the lower monthly fuel cost adjustment and milder temperatures expected in September, electricity prices in Chattanooga next month will still be up more than 12% from a year ago. year, according to the EPB.
Homeowners have felt the heat in their pocketbooks this summer as higher temperatures and higher electricity rates have combined to drive up electric bills by more than 30% for many homeowners.
“This summer has been a perfect storm of hot weather, record energy demand and rising fuel costs,” said Doug Perry, Senior Vice President of Commercial Energy Solutions at TVA, in a report on the evolution of fuel cost adjustments.
According to TVA, electrical load hit a record high in June of 31,617 megawatts, and natural gas prices were 141% higher in June than a year ago.
Bill Rush, executive director of Metropolitan Ministries, which tries to help low-income households with utility bills and other expenses, said in a phone interview that requests for assistance continue to rise. overwhelm the agency’s ability to handle all consumer needs.
“Food and utility prices have gone up this year, which has created hardship for more families,” Rush said. “It was great to work with EPB, but there are still real needs for a lot of people.”
The average request for help with electric bills rose to $222 this summer, Rush said.
Electricity prices in Chattanooga for a typical residential home that uses 1,295 kilowatt hours of electricity jumped 27% in August from levels a year ago, according to EBP. TVA has kept its base rates unchanged since 2018, but the utility adjusts a portion of its charges each month based on fuel costs to generate electricity.
TVA officials said the fuel cost share of TVA electricity bills this month was almost triple the average fuel cost for August over the past three years, reflecting the cost highest fuel monthly fee ever for TVA.
“We are seeing the impact of rising natural gas prices on our customers,” EPB Chairman David Wade said in an interview this week. “We always work with our customers to try to help them find the best way to pay their bills. One of the programs we offer is our level billing plan to keep the same average bill throughout the year, which helps limit some of the jumps in bills that people see during the colder winter months or hot summer weather.”
The EPB said the electricity price, including base charges and fuel cost adjustment, will be 11.6% cheaper next month than the current month, reflecting a 33% drop. fuel costs.
Perry said temperature is the main driver of electric bills, not the cost of electricity. As temperatures rise and air conditioning is increasingly used to cool homes and offices, TVA is turning to increasingly expensive energy sources, including more electricity purchased from the grid and electricity generated by combustion turbines.
Lower temperatures in September will limit both price and energy consumption for most customers next month to significantly reduce their electricity bills from record highs this summer.
The Farmer’s Almanac estimates Chattanooga’s average temperature in September to be 77 degrees, 4.5 degrees below the August average of 81.5 degrees.
TVA has committed to keeping its electricity rates constant for at least a decade, and residential electricity prices in the Tennessee Valley are still well below the U.S. average, according to the most recent data from the U.S. Energy Information Administration. VAT administrators are expected to adopt a budget plan for the 2023 financial year later this month that is expected to continue freezing basic rates.
“We’ve used every tool in our toolbox to keep your electric bill as low as possible,” Perry said. “We recognize the effect of any cost increases on families at this time, and I can tell you that TVA is very focused on doing everything possible to support communities by keeping electricity bills as low as possible.”
Chattanooga Gas Co., which is raising its gas prices by 5.6% next month, expects its rates to rise more than 25% this winter due to higher natural gas prices.
Tennessee American Water and Hixson Utility District are also planning rate increases in September.
Contact Dave Flessner at [email protected] or 423-757-6340. Follow on Twitter at @Dflessner1.
Electricity prices in Chattanooga are adjusted monthly based on changing Tennessee Valley Authority fuel costs. For the typical residential EPB customer using 1,295 kilowatt hours of electricity, the monthly bills are:
August 2022: $159.36
September 2022: $140.82
September 2021: $125.70
What determines your bill
* Weather and Usage: The amount of electricity you use each month depends on the temperature. If it is very hot or very cold outside, households use more energy for heating or cooling.
* Base rates: TVA has set its base wholesale rates constant since 2019 to reflect the costs of generating plants, transmission from generating plants to local power companies, and delivering electricity to your home.
* Fuel cost adjustments: Part of the monthly bill is determined by the evolution of the cost of the fuel that TVA needs to produce electricity each month.