Electric Rates / Electric Department / City Departments / City of Alcoa

TVA Fuel Cost Adjustment and Rate Increase: How They Affect You

TVA is increasing its quarterly fuel adjustment and its baseline electric rates both effective October 1, 2008. Wholesale rates that Alcoa Electric pays TVA for the electricity needed to serve our retail customers will increase by about 20% overall. The quarterly fuel adjustment is about 17% of the increase. It is due to the drastic increases that TVA must pay for coal, natural gas and purchased power. The sustained drought continues to reduce hydro generation which is TVA’s least expensive source of power. The base rate increase makes up the other 3%. It is needed to cover other increases in TVA’s costs.

Due to TVA’s increases, retail rates that our customers pay for electricity will increase by an overall average of about 16%. Alcoa Electric will not increase rates in addition to the TVA increases. Residential customers will pay an additional $14.13 for each 1000 kWh used. On average a residential customer using 1386 kWh monthly would have an increase of $19.59.

Rates Effective October 2008

Residential

Customer Charge $7.21
Energy Charge 9.525 cents/kWh

General Power

GSA-1 (under 50 kW)

Customer Charge $18.54
Energy Charge 10.422 cents/kWh

GSA-2 (51-1000 kW)

Customer Charge $93.00
Energy Charge 10.51 cents/kWh for first 15,000 kWh
6.294 cents/kWh for all additional kWh
Demand Charge $12.47/kW for 51-1000 kW (no charge for first 50 kW)

GSA-3 (1001-5000 kW)

Customer Charge $232
Energy Charge 6.389 cents/kWh
Demand Charge $12.09/kW for 0-1000
$13.85/kW for 1001-5000 kW

Electric Rates & Regulations

Alcoa Electric purchases electricity from the Tennessee Valley Authority. These rates do not fluctuate monthly like other energy sources. So every time you turn on your lights or use your electric heat pump, rest assured you’re paying some of the lowest rates in the country.

Your electric rates are based on kilowatt hours. One kilowatt-hour (kWh) is roughly the power required to burn a 100-watt light bulb for 10 hours.