TVA plans to boost prices again in June

TVA plans to boost prices again in June

May 15th, 2012 by Dave Flessner in News

The TVA headquarters building is located in downtown Chattanooga.

The TVA headquarters building is located in downtown...

Photo by Angela Lewis /Times Free Press.

The mild winter helped cut power bills this year for most Chattanoogans, but the Tennessee Valley Authority will take back some of those savings next month with another increase it its monthly fuel cost adjustment.

TVA is planning to boost its electricity charges by 0.7 percent in June -- the third consecutive month of higher fuel costs boosting the monthly light bill for residential and industrial power users in TVA's seven-state region. The typical Chattanooga household will pay 80 cents more for electricity in June because of the latest fuel cost adjustment by TVA, according to EPB.

Despite cheaper gas prices, TVA spokesman Scott Brooks said Monday the fuel cost adjustment will rise in June because some of the credit from the milder winter months has finally been drained away.

"Because of the mild winter our forecasts for costs were higher than we initially planned and we credited some of those savings to the monthly fuel cost adjustment charges in February, March and April," Brooks said. "The fee for our fuel costs in June is more reflective of our actual costs."

Mary Gott, an apartment dweller in Chattanooga, said she has enjoyed the milder temperatures and cheaper power bills in recent months.

"I can't afford to have these rates go up again," she said Monday after paying her $70 electric bill at EPB.

Earlier this month, TVA reported that power sales in the six months ended March 31 were down 7 percent from last year. Combined with cheaper natural gas prices, fuel expenses for TVA during the first half of its fiscal year were $323 million less than a year ago.

TVA estimates the number of heating degree days -- a measure of how much electricity is required to heat homes and businesses this winter -- were 28 percent below last year during the first three months of 2012.