TVA Offices in Chattanooga, Tennessee

The Tennessee Valley Authority will boost its fuel cost adjustment by 2.8 percent next month, raising the typical residential electricity bill in Chattanooga by $3.08 in December, according to TVA and EPB.

After three months of cutting its monthly fuel cost adjustment because of lower consumption in the fall, TVA announced today that its wholesale rates will rise by 2.8 percent in December as temperatures cool and power usage goes up.

"We're expecting power sales to be up 16 percent in December over November (due to cooler weather) and at least half of that increase is likely to come from purchased power which is usually more expensive than our own power generation," TVA spokesman Scott Brooks said.

TVA adjusts its rates each month according to the projected cost of fuel and purchased power. During periods of higher power demand, TVA must spend more to either buy power from other suppliers on the grid or crank up more of its own, less-efficient gas turbines or older coal-fired units.

EPB Chief Financial Officer Greg Eaves said the typical EPB customer who uses 1,460 kilowatt-hours of power a month will pay 2.11 percent more at the retail level next month, or $3.08 more in their monthly power bill, because of the December fuel cost increase.