On Thursday, Aug. 18, the Tennessee Valley Authority board of directors approved a wholesale rate increase that took effect on Oct. 1. The average cooperative residential member (using 1,000 kilowatt-hours per month) saw a $1.60 increase on monthly electric bills.
TVA is raising electric rates to meet the power requirements in the Valley, make nuclear safety modifications following the earthquake in Japan, improve cybersecurity and continue investing in clean-air initiatives and energy efficiency.
“These strategic investments are key to providing reliable, low-cost electricity now and into the future while being responsible stewards of Tennessee Valley resources,” said Tom Kilgore, TVA president and CEO. “To achieve our vision of being one of the nation’s leading providers of low-cost and cleaner energy by 2020, TVA must continue to reduce air emissions, offer a balanced power mix and encourage energy efficiency.”
Wholesale power is the largest expense for Tennessee’s electric cooperatives. On average, only about 20 percent of a co-op’s annual revenue is used to maintain the poles, wires and substations and pay the employees who deliver power to its members. The other 80 percent goes to TVA. So even the smallest change in TVA’s rates impacts electric cooperatives in a big way.
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