Winter may not be over yet, but homeowners in Tennessee Valley who heat with electricity will enjoy cheaper prices for that power, starting Sunday.
And while gasoline prices in Chattanooga edged higher last week, fears of the growing coronavirus and its impact on the economy are likely to again push oil and gas prices lower this week for motorists. Even ahead of any price cut this week, Chattanooga boasted the cheapest fuel prices anywhere in Tennessee, Georgia or Alabama with a pair of service stations in Lookout Valley selling regular gas Monday for only $1.90 a gallon.
The Tennessee Valley Authority said abundant rains, cheaper natural gas and milder weather have combined to cut the fuel cost adjustment on power bills in March and will cut the price of power in March for the typical Chattanooga household by more than 1.1% from a year ago, saving the average homeowner about $1.57 next month, according to EPB.
The actual savings for Chattanooga consumers, of course, will still be determined largely by the weather during March and how much power is actually consumed. But TVA continues to benefit by its reduced debt, which has helped stabilize its base rates, and is diverse portfolio of generation, which includes more hydroelectric and nuclear power and cheaper gas.
"The overall system average fuel rate for March is approximately 15 percent lower than the three-year average March fuel cost," TVA spokesman Scott Brooks said. "This is primarily due to lower purchased power and gas rates in January. Mild weather also led to lower sales and generation than forecast."
Brooks said TVA's fuel costs are the lowest for March since at least 2012.
In a new survey of gasoline prices in Chattanooga, the online pricing service GasBuddy.com said Monday that the average price of fuel in Chattanooga rose 2.5 cents last week to an average price of $2.11 per gallon, according to the daily survey of 170 local stations. Despite the increase, however, gas prices in Chattanooga are 5 cents per gallon lower than a month ago and 3.6 cents per gallon lower than a year ago.
Gas prices in Chattanooga also averaged 36 cents a gallon below the average national price of $2.35 a gallon on Monday.
Patrick DeHaan, head of petroleum analysis for GasBuddy, said gas prices last week rose for the second consecutive week as oil prices climbed while the economy appeared to be moving ahead. But fears of a worsening coronavirus epidemic is undermining that confidence this week and pushed oil prices down by more than 5% Monday in the worst trading day in more than a month.
"There is no escaping the fact that China — the world's largest oil importer — will have meaningfully weaker near-term oil demand than we had envisioned as the year began," Raymond James analyst Pavel Molchanov said Monday.
DeHaan said gas prices typically begin to rise this time of the year as the busier spring driving season approaches, but such increases may be pushed back this year.
"Over the last decade, the national average typically begins its seasonal rise on February 9, lasting until May 2, during which the average rise is 54 cents per gallon," he said. "This year could look much different based on myriad unknowns that continue to fog the situation."
Contact Dave Flessner at email@example.com or at 757-6340