Chattanooga gas prices jump but electricity rates to fall

Gas prices jumped by nearly 18 cents a gallon last week in Chattanooga to the highest level so far this year.

But prices at the pump remain nearly a third below the level of a year ago, and electricity prices for Chattanoogans will drop again in May.

GasBuddy.com said Monday the average price of a gallon of regular gas in Chattanooga on Sunday was $2.21 per gallon, up 17.9 cents per gallon from a week earlier and 13.8 cents per gallon above the price of a month ago.

But local gas prices still average 24 cents per gallon below the nationwide average of $2.45 per gallon, and Sunday's prices in Chattanooga were still $1.26 per gallon less than a year ago.

"Oil prices saw notable gains last week, rising to new 2015 highs," said Patrick DeHaan, GasBuddy senior petroleum analyst.

U.S. domestic oil output fell last week , "perhaps a harbinger of what's to come," DeHaan said.

"I would lay blame for these increases on over-sensitive traders, who bid oil prices higher last week after oil inventories rose at their smallest amount since January," he said.

Despite an uptick in gasoline prices, home heating costs are headed down. The Tennessee Valley Authority, which supplies electricity across its 7-state service territory, said it will cut the fuel-cost portion of power bills next month by 3.5 percent.

As a result, next month's power rates in Chattanooga will average $1.28 less than the current month and $2.34 a month less than a year ago for homeowners using the typical 1,441 kilowatthours of electricity.

TVA adjusts its rates each month based upon the fuel costs for its power generation from previous months. TVA raised rates after frigid winter weather forced the utility to turn to more expensive generation in January and February.

"May bills will benefit from the milder temperatures," TVA spokesman Scott Brooks said.

Abundant rain also has helped TVA boost its hydroelectricity generation from its 29 power-generating dams.