MEMPHIS, Tenn. — MLGW informed customers on Thursday they could see a 20-40% average increase in their bill, meaning some could see an increase of $60 per month. MLGW says the hike is because of an increase in fuel costs like many other providers across the nation.
Their fuel costs come as a wholesale price from the Tennessee Valley Authority which charges MLGW 3.8 cents/kWh this July while MLGW charges its customers 4.2 cents/kWh. This is a 10% retail increase MLGW attaches to the wholesale price.
This is also a 98% increase from last July, but MLGW Senior Vice President and Chief Financial Officer, Dana Jeanes, says a large portion of the TVA’s fuel is nuclear energy, which is harvested each year, ultimately keeping prices lower than non-TVA providers who rely heavily on coal and natural gas energy.
“Regardless of what the price is, customers normally would see an increase in their bill for July and August relative to June,” Jeanes said. “On top of that, this year in particular is a significant increase in the fuel cost.”
Coal and natural gas make up an additional 44 percent of fuel for TVA in 2021.
“Natural gas in particular is at a 14-year high,” Scott Brooks of TVA said. “Then, coal has gone up significantly in the last six to eight months as well. All of that leads to the increase in the local power companies.”
According to NASDAQ, coal prices jumped 125 percent from June 2021 to June 2022. The U.S. Energy Information Administration reports natural gas increasing nearly 180 percent from May 2021 to May 2022.
“About 40 percent of TVA’s generation is from nuclear so there really hasn’t been any significant run-up in the nuclear fuel and of course nuclear fuel is loaded into a nuclear plant and may last for a year so that’s a very stable price element,” Jeanes said.
Ultimately, the higher those prices climb, the higher your energy bill will rise.