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By Jon Styf

The Center Square

The Tennessee Valley Authority will begin a 5.25% base rate increase Oct. 1, something the energy supplier says will equate to a $4.35 per month increase on the average $138 residential bill.

The increase comes after a 4.5% increase a year ago.

TVA said the increase comes to fund ongoing construction and energy development as the utility spends nearly $16 billion through fiscal 2027 to build new power generation and infrastructure to meet increased energy needs in the region.

TVA has completed 1,400 megawatts of energy increase as part of a plan to increase its total capacity by approximately 3,500 megawatts.

“We recognize that people don’t pay rates, they pay bills, and that matters,” said TVA President and CEO Jeff Lyash. “We know this is a kitchen table issue for many families across our region. At TVA, we don’t like price increases any more than you do, and that’s why we continually work to reduce expenses by hundreds of millions of dollars each year.”

The 4.5% increase in 2023 went to the completion of the Paradise fossil fuel plant shutdown and construction in Cumberland, Kingston, Johnsonville and Shawnee.

Several groups pushed back on the increases, with the Southern Alliance for Clean Energy saying no other utility is allowed to change power rates with “such limited public information.”

“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,” Tennessee Energy Democracy Field Coordinator Gabi Lichtenstein said. “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.”

The Tennessee Valley Authority is the largest public power corporation in the country, generating 90% of Tennessee’s electric generating capacity and three-fifth of its power plants. It is federally owned and serves 10 million by providing electricity to 153 local power companies.

“Only in an Orwellian world of misinformation do we see our nation’s largest ‘public’ power utility pass a massive rate increase while providing the public the least amount of information compared to ‘private’ utilities,” said Dr. Stephen A. Smith, Executive Director of the Southern Alliance for Clean Energy. “It’s highly unusual for a utility the size of TVA to issue a rate increase with zero independent review. This is a broken process, and every ratepayer in the Tennessee Valley is literally paying the price.”