NASHVILLE, Tenn. (WSMV) – The Tennessee Valley Authority (TVA) on Thursday approved a 5.25% base rate increase that will result in higher bills for Tennessee residents starting in October.
According to TVA, the average bill will increase by about $4.35 each month.
This is the second tariff increase in as many years, after the TVA Board of Directors approved a 4.5% increase in the base tariff in August 2023.
TVA justified this year’s rate increase by citing the need to finance ongoing construction and energy development. The state-owned utility also approved $150 million in additional funds for advanced nuclear power on Thursday to support the development of small modular reactors at its Clinch River site in east Tennessee, TVA said.
Nashville resident Amber Kestner’s electricity bill dropped from about $100 five years ago to over $200 today.
“Big change, big change in five years,” Kestner said. “If you don’t make a certain amount, you’re not going to make it. The little things when prices go up mean a lot, especially for people who are single or on their own.”
Pensioner Valarie Harris has also felt the effects of rising energy costs. Like Kestner, she tries to save energy, but the bills are often still high.
“I know everything is going up, but for the people here who are trying to make a living every day, it makes a big difference,” Harris said.
“That five dollars (more) adds up over the month, so you could spend that several times a year on your groceries or the gas in your tank. Overall, it adds up and makes a difference in your budget.”
TVA’s latest tariff increase will take effect on October 1.
“We know people don’t pay rates, they pay bills, and that’s important,” said TVA President and CEO Jeff Lyash. “We know this is a kitchen table issue for many families in our region. At TVA, we don’t like rate increases any more than you do, and that’s why we’re continually working to reduce costs by hundreds of millions of dollars each year. We’ve done everything possible to absorb the costs while investing in the reliability of our existing facilities, building new power plants to keep up with growth, and maximizing solar power to produce more carbon-free energy.”
The TVA board has now approved a total of $350 million for the development of small modular reactors at the Oak Ridge site in east Tennessee, after previously approving $200 million in February 2022, TVA said.
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