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AUB Power Rates for March 2017

Media Contact:

Wayne Scarbrough

(423) 745-4501 ext. 6002

wscarbrough@aub.org

 

 

February 21, 2017

 

ATHENS, Tenn. – The price for a kilowatt hour of power from AUB will fall slightly in March compared to the current February price.

 

 The effective residential power rate for March will be $0.08721 per kilowatt hour, down from $0.08843 in February.  A lower fuel charge from TVA accounts for the decrease.

 

 The difference will save the average AUB customer using 1,225 kilowatt hours about $1.50, said AUB’s Wayne Scarbrough.

 

 “TVA’s fuel charge to us for March will be a little lower versus the charge in February based on lower demand for energy during the current mild weather and increased generation from their hydro plants boosted by some seasonal rain,” he said.

 

 Power rates have two components, the base rate and the fuel charge.  The base rate stays the same month to month seasonally. The fuel charge changes monthly based on TVA’s cost of producing power from resources such as coal, natural gas, nuclear, and hydro.

 

 While the month over month change is for the better, the rate in March will be higher than one year ago.

 

 “That’s because of the TVA base rate increase that took place again in October 2016.  They have raised the base rate every October for the past few years and apparently plan to do that for the foreseeable future,” he said.

 

 AUB and other power distributors in the Valley question this plan in the absence of better answers from TVA about the basis for the annual rate hikes while the federal agency enjoys record revenues and continues to pay out more than $100 million dollars annually in year-end employee bonuses.

 

 “We cannot let this go unquestioned, for the sake of our ratepayers,” said AUB General Manager Eric Newberry.

 

“We cannot move forward without asking why TVA needs more money from our ratepayers year over year when they have no large capital projects on the horizon and when they insist on paying out $100 million in year-end bonuses,” he said.  “So far, the answers have not been satisfactory.”

 

The annual TVA base rate increases have been masked somewhat by the agency’s taking advantage of low generation-fuel costs, primarily cheap natural gas, Newberry said.

 

“That, and the efficiencies of local power distributors like AUB who haven’t raised our rate in years. That’s what has kept the overall effective rate below 10 cents per kilowatt hour,” he said.

 

TVA has raised AUB’s wholesale power costs by more than 32 percent since 2008, but AUB has had no local increases to fund its own operations.

 

“Our concern is that today’s low natural gas prices won’t last forever.  The pendulum will swing and when it does, when fuel costs rise and are tacked onto ever rising base rates from TVA, the ratepayers will suffer,” he said.

 

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