While fuel prices have fallen from record highs in the summer of 2022, the new year will begin with higher energy costs in Chattanooga.
But the increase in electricity and gasoline prices from a year ago is still in line with the overall inflation rate and well below the peak prices reached last year.
Electricity prices in Chattanooga will rise slightly in January due to higher fuel costs, boosting EPB's delivered price of power by an average of 2.1% compared to a year ago, TVA said in an announcement of its monthly fuel cost adjustment.
Gasoline prices at the pump, which fell to the lowest level of 2023 just before Christmas, are also edging higher again and are now up 4.4% from a year ago among the 170 local service stations surveyed by the online gas reporting service GasBuddy.com.
A drop in the price of natural gas has been offset by higher coal prices to boost TVA's monthly fuel cost adjustment in January after a steady decline in fuel cost adjustments for most of 2023. Combined with TVA's base rate increase implemented in October, the typical EPB residential customer using 1,091 kilowatt hours of electricity a month will pay $135.25 for their January power bill, or $1.58 more than what such a Chattanooga household paid for the same amount of electricity in January 2023.
Despite the increase, TVA spokesperson Scott Brooks said the January fuel rate is 1.7% lower than the three-year average January rate.
"The January fuel rate is in line with the three-year average fuel rate in part due to lower gas prices offset by higher coal prices," Brooks said in an emailed statement.
TVA adjusts its rates each month to reflect the changing price of coal and natural gas used to generate about 35% of TVA's electricity sold in the utility's seven-state region. Cheaper fuel last year helped offset part of the 4.5% increase in TVA's base rates. TVA directors voted in August to raise its base rates for the first time in four years to help offset inflationary price increases in equipment and labor costs.
According to the Energy Information Administration, TVA residential power rates remain among the cheapest 25% of major U.S. utilities and TVA's industrial electric rates are in the cheapest 10% of the 100 biggest U.S. utilities.
Chattanooga motorists also enjoy cheaper gasoline than most of the nation despite the price increases at local stations in the past week. Acc0rding to the online gasoline pricing service GasBuddy.com, the average price of unleaded gas in Chattanooga is 37 cents a gallon below the U.S. average of $3.07 per gallon.
Gas prices in Chattanooga fell to the cheapest price of the year just before Christmas, according to GasBuddy.
But the average price of regular unleaded gas in Chattanooga rose by 9.8 cents per gallon last week to $2.70 a gallon, according to GasBuddy. Prices in Chattanooga are 3 cents per gallon higher than a month ago and stand 11.4 cents per gallon higher than a year ago.
"After 13 straight weeks of decline, average gasoline prices have edged higher due to optimistic comments from the Fed on cutting interest rates in 2024, coupled with Houthi attacks on vessels in the Red Sea, boosting concerns of a disruption to global shipping, including oil shipments," Patrick De Haan, head of petroleum analysis at GasBuddy, said in a report on the U.S. gas market. "For now, the price of gasoline has already jumped but could ease slightly this week ahead of the new year."
According to GasBuddy price reports, the cheapest stations in the Chattanooga area for gas are in Soddy-Daisy, where Circle K and Murphy USA stations are each selling regular gas for $2.45 a gallon.
While overall gasoline consumption is likely to dip after the holiday travel rush is over following New Year's Day, electricity consumption is usually higher in January, which is typically the coldest month of the year in Chattanooga.
To help limit electricity use during the cold winter days, EPB offers advice from its Energy Pros by telephone at 423-648-1372 or online at epb.com/campaigns/energy-pros-dg.
EPB said you should decrease your thermostat by 1 degree daily during the winter until you find your lowest comfortable setting. EPB also suggested homeowners open window coverings on the sunny side of their homes and keep them closed in shady areas.
Households using major appliances like clothes washers, dryers and dishwashers are encouraged to do so during the warmest hours of the day, typically in the afternoon.
Contact Dave Flessner at dflessner@timesfreepress.com or 423-757-6340.