The New Year will begin with cheaper energy than a year ago in Chattanooga.
Despite a slight uptick in gasoline and electricity prices at the end of the year, fuel and heating costs for the typical Chattanooga household is still lower than a year ago, thanks to the cheaper natural gas and oil prices due to the COVID-19 induced slowdown in travel and more abundant hydroelectricity generation from record rains in 2020.
The Tennessee Valley Authority said its average fuel rate used to determine January power bills is 16% lower than the average January over the past three years and the lowest for the start of the year since the fuel charge started in 2006 at TVA, according to utility spokesman Scott Fiedler.
TVA did not raise its base rates for the current year and it adjusts the fuel portion of its power bills every month based upon the fluctuating price of the fuels used in producing electricity. TVA has benefited from greater nuclear generation and more rains have boosted hydroelectricity generation. Fuel costs for natural gas and coal are also down due to the recession in 2020.
As a result, the typical Chattanooga household that uses 1,295 kilowatt-hours of electricity will pay $138.91 for electricity next month. While that is $1.28 higher than the current electricity bill for the same amount of power in December, it remains $3.49 cheaper than what the same household paid a year earlier for electricity.
Motorists also continue to pay less for gasoline at the pump than last winter, although fuel prices are trending higher as the economy rebounds from the pandemic lows reached last spring.
Chattanooga gas prices rose 2.7 cents per gallon in the past week to $1.92 per gallon, according to GasBuddy’s daily survey of 170 stations released Monday. Gas prices in Chattanooga are 5.7 cents per gallon higher than a month ago but remain 27.3 cents per gallon lower than a year ago.
“Average gasoline prices continue to move higher in most areas as retail gas prices continue to follow the rising price of crude oil which remains near the highest level since COVID-19 began in March,” said Patrick De Haan, head of petroleum analysis for GasBuddy. “Seasonal factors have sat in the backseat compared to a modest recovery in demand and a healthy dose of optimism that a COVID-19 vaccine will bring normal demand levels in the coming year. For now, it’s not the best news for motorists as I expect gas prices may continue their ascent, but while it won’t last forever, its likely a sign of what’s to come in 2021- higher prices.”
Contact Dave Flessner at email@example.com or at 423-757-6340.