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Wlaf1450By Charlotte Underwood
LAFOLLETTE, TN (WLAF) – The LaFollette Utility Board (LUB) held its monthly workshop and meeting on Monday evening, with a TVA wholesale electric rate increase topping the agenda. The Tennessee Valley Authority also announced the end of the 2.5 percent Pandemic Relief credit, which will also result in a slight rate increase. Locally, this will affect the average utility customer with approximately a $4 increase a month on their bill.
According to LaFollette Utility Board General Manager Kenny Baird, TVA has announced a 4.5 percent wholesale electric rate increase beginning Oct. 1, 2023.
TVA is also ending its 2.5 percent Pandemic relief credit, which will result in about a 1.3 percent increase on retail rates here locally so LUB “can cover the removal of that credit.”
The TVA wholesale rate increase combined with the end of the Pandemic Relief credit will result in approximately a $4 a month increase for the average user.
As far as LaFollette Utility and all other utilities dependent upon TVA for power, “It’s a direct pass through on the wholesale rate increase through TVA,” sccording to Baird.
The average user uses 1,096 kilowatt hours, and so the rate increase comes out to about a 3.5 percent rate increase, as the retail increase is slightly less than the wholesale.
“Customers are looking at probably about a $4 a month increase on the average bill,” Baird said.
“TVA is short on power generation; they are retiring their coal plants and building new gas plants in Kingston and down in Chatham County,” Baird said during the LUB workshop.
Baird also informed the board that in Oct. 2024 TVA would implement another wholesale rate increase similar to what they are implementing this year.
“They told us the Pandemic relief was going away, but we just learned about this other,” Baird said.
According to Baird, TVA is having to spend billions on capital improvements to meet the energy demand of people and businesses influxing to Tennessee from other states.
“During Covid, tons of people and businesses began moving into the Tennessee Valley. When the winter storm Elliott came through, they (TVA) had rolling blackouts. That put pressure on them for growth of their power loads. They are trying to avoid that in the future. It’s not just a TVA problem, it’s throughout the nation. TVA knows they need to act now; it takes time, two to three years to get materials for these upgrades. It’s not the news that I wanted to deliver, but that’s the news there is,” Baird said.
There will most likely be another similar increase in October of 2024 through TVA’s wholesale by another 4.5 or 5 percent, which will locally equal another $4 to $5 a month for the average customer. (WLAF NEWS PUBLISHED – 08/29/2023-6AM)