As summertime temperatures heat up how much power Chattanoogans use to cool their homes and businesses, the Tennessee Valley Authority is raising the price of its electricity to reflect higher fuel costs.
The price of power delivered by Chattanooga’s electric utility EPB will edge up 1.3%, effective Saturday, adding an extra $1.72 to the average residential monthly bill. Higher demand for power in the warmer months ahead will boost most electric bills even more this summer.
The price of EPB power in June 2024 is up 2.3% from a year ago. Despite a drop in fuel costs, TVA boosted it base wholesale rates last fall by 4.5% to cover inflationary cost pressures and the rising demand for new generation to meet the increase in demand. A similar wholesale rate increase is expected to be adopted by the TVA board when it next meets in August in Florence, Alabama.
TVA sets its base wholesale rates each August for the next fiscal year, which begins Oct. 1. But the utility adjusts the fuel portion of utility bills each month to reflect the change in prices each month of natural gas, coal and purchased power.
TVA spokesperson Scott Brooks said natural gas prices are projected to be lower this summer, helping offset other inflationary pressures.
“Even though June sales are projected to be 5% higher than the three-year average for the month, the June fuel rate is 16% lower than the three-year average,” Brook said in an emailed statement. “This is primarily due to lower gas price forecasts.”
To help homeowners and businesses limit energy consumption, TVA has budgeted $1.5 billion over the next three years to offer rebates and other incentives for the installation of energy efficiency and demand response equipment — heat pumps, home insulation and thermostat controls.
EPB helps customers evaluate energy efficiency upgrades with its Energy Pros, who provide free home energy checks. Customers can also limit volatile monthly electric bills by signing up for levelized billing, which calculates bills on a rolling average of the past 12 months.
Contact Dave Flessner at dflessner@timesfreepress.com or 423-757-6340.