Tennessee Valley Authority increases rates again, bringing two-year increase to nearly 10%
FOR IMMEDIATE RELEASE
August 22, 2024
CONTACT
Dan Radmacher, Media Specialist, (540) 798-6683, dan@appvoices.org
FLORENCE, Ala. — Today, the Tennessee Valley Authority Board of Directors approved a 5.25% rate increase for customers of the federal utility. This increase is on top of the 4.5% increase approved last year.
TVA is planning one of the largest gas buildouts of any utility in the nation, replacing aging coal plants with methane gas plants. Though TVA did not give a rationale or provide supporting documentation about the reason for the increase, this expensive gas expansion is a likely culprit. TVA executives said the rate increase could be offset by fuel cost decreases, but when questioned by the board during today’s board meeting, they admitted that fuel costs are already as low as they are likely to go and are unpredictable. Fuel costs, for instance, doubled in 2022, largely due to increases in the price of methane gas.
The cumulative impact of the two rate increases will hit TVA’s residential customers — who already face some of the highest energy burdens in the nation — extremely hard. This will be an especially painful hit for low-income customers already struggling with high inflation over the last several years. TVA is the country’s largest public utility with 10 million customers across seven states.
As the Southern Alliance for Clean Energy noted in its press release about the increase, “It is important to understand that no other utility the size of the TVA is allowed to execute such a massive electric power rate increase with such limited public information. Large utilities are normally subject to independent regulatory rate reviews by state Public Service Commissions with independent regulatory staff that review utility filings that attempt to justify the rate increases.”
This latest move by TVA highlights the need to pass the bipartisan “TVA Increase Rate of Participation” Act, introduced earlier this year by Tennessee Reps. Steve Cohen and Tim Burchett to reform the utility’s long-term energy planning process and public participation processes. Although TVA’s current Integrated Resource Plan is five years old and crafted without meaningful public input, it still directly informs decisions about new energy infrastructure that impacts rates. The utility has delayed the release of its new plan. Cohen and Burchett’s bill would increase transparency and public participation in that process.
Statement by Tennessee Projects & Coalition Coordinator Leah McCord:
“With today’s action, the Tennessee Valley Authority Board of Directors made it even harder for its hard-working customers to make ends meet. TVA’s insistence on a multibillion-dollar methane gas expansion is almost certainly a driver of this increase and last year’s. The utility continues to ignore all the evidence that replacing coal with truly clean energy would cost less and create more long-term jobs in the valley.”
Statement by Tennessee Energy Democracy Field Coordinator Gabi Lichtenstein:
“We’ve been sounding the alarm that working families will pay for TVA’s gas buildout on their power bills, and we’re likely seeing its impacts now. TVA has unilaterally hiked its rates by almost 10% in two years. Not even private utilities can do this without review from the public and independent utilities commissions. These new gas plants and pipelines will continue to make it harder for folks to pay their bills.”
