TVA reduction to Fuel Cost Adjustment April 1 to decrease member bills

MTEMC members will see their rates go down about seven percent when they get their bills in April, as TVA has reduced its Fuel Cost Adjustment for the second time since the first of the year.

While the average impact to member bills will be about seven percent, amounts consumers save will depend on the amount of energy they use because the fuel cost adjustment is a per kilowatt-hour charge. The FCA decreased from the previous 1.383 cents per kilowatt-hour to just more than .8 cents per kilowatt-hour.

“In these economically challenging times, we are especially glad lower fuel costs will provide some relief in power costs to the consumers in the Tennessee Valley,” said TVA President and CEO Tom Kilgore. “Unusually cold weather this winter has meant higher consumption of electricity and higher power bills even for people who keep their thermostats low.”

Under the fuel cost adjustment, when the price of fuels used to make electricity decreases, the cost of electricity also decreases. Current economic conditions and increased rainfall also contributed to lower fuel and purchased power costs, Kilgore said.

Unfortunately, coal prices have not decreased as rapidly as other fuel prices, preventing TVA’s costs from dropping further. About 60 percent of TVA’s power supply comes from fossil fuels – primarily coal, along with oil and natural gas.

Posted on February 13, 2009.

 

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