Tennessee Valley consumers to feel the chill of January cold in utility bills even in March

Tennessee Valley consumers to feel the chill of January cold in utility bills even in March

February 19th, 2014 by Dave Flessner in Business Around the Region

A thermostat.

Photo by Doug Strickland /Times Free Press.


• 23.2 percent: Increase in next month's fuel cost adjustment by TVA

• 5.3 percent: Retail increase in electric rates in March due to higher fuel cost adjustment

• $173: Average January residential electric bill for EPB customers, up $28 from a year ago

• $154.54: Projected typical electric bill for March, up $12.08 from a year ago

Sources: Tennessee Valley Authority, EPB

Afternoon temperatures are expected to rise today into the 70s for the first time in 2014, but on Tuesday Sandra Barton was still feeling the chill of January.

Barton, a disabled retiree who lives in a modest East Lake home, recently received a $227 monthly electric bill from EPB, soon followed by a disconnect notice when she failed to pay her bill on time.

"I've never had a bill this high," Barton said. "I don't know how I'm going to pay it."

Barton was among dozens of low-income Chattanoogans who gathered in the predawn hours Tuesday to get in line for assistance from Metropolitan Ministries to pay their utility bills.

Larry Walker, who lives in a 2-bedroom home in East Ridge, got in line at 3:30 a.m. to get some help paying a $506 electric bill.

"When it's cold outside, you've got to keep warm," he said.

With the average temperature in January 7 degrees below normal this year, consumers are having to shell out more cold cash to pay their January heating bills. EPB said the average residential electric bill in January was $173, or $28 more than the year-ago level.

Across the Tennessee Valley, TVA said heating bills were often 30 to 40 percent above normal due to the colder January, even though rates were about the same as a year ago.

Warmer weather should provide some relief for consumers next month, but January's frigid temperatures will still be felt for power users in March. TVA will boost its fuel cost portion of monthly power bills in March by more than 23 percent from this month's level to help compensate for extra fuel expenses during the worst of the winter.

TVA officials said the high demand for electricity in January forced TVA to turn to more expensive generation and power purchases and some of those extra costs must be passed along to consumers in March bills.

TVA hit five of its top 10 daily energy use days in January, requiring the federal utility to turn to expensive combustion turbines and less-efficient gas and coal plants.

"Gas prices also went up in January and that also cost us more," TVA Chairman Bill Sansom said.

TVA Chief Financial Officer John Thomas said as TVA's load rises, the utility turns to higher-cost generation to meet its power demand.

"Our fuel rate is based upon what we expect to run in January based off an average stack of resources being dispatched," Thomas said. "When we run these higher cost resources in January, that's not in the base fuel rate and we didn't recover those full costs in January."

When TVA "trued up" actual expenses for fuel for the month, the utility determined it would need to raise the monthly fuel cost adjustment next month by the biggest single monthly increase since TVA adopted its fuel cost adjustment program in 2011.

In Chattanooga, EPB offers some assistance in paying high electricity bills through its Power Share program. But the fund collected only $2,120 in January.

"Based on the number of customers who need help paying their electric bills, this is a very small amount," EPB spokesman John Pless said. "We really wish more customers would contribute to this valuable fund."

Last month, EPB made 26,594 promise-to-pay arrangements with our customers, compared to 22,897 in January 2013.

"This is the highest number of promise-to-pay arrangements we've ever made in any month," Pless said.

Contact Dave Flessner at dflessner@timesfreepress.com or 757-6340.