Tombigbee Electric Power Association strives to be a good steward of its members money and does not take any thought of a rate increase lightly.  Tombigbee purchases 100% of its wholesale power from the Tennessee Valley Authority “TVA.”  Over the last year, Tombigbee purchased $91,050,000.00 of electricity from TVA.  Our electric sales to you our members amounted to $119,830,000.00 for the same period.   What that means is that Tombigbee operates on about twenty-four cents out of each dollar it bills.

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As with each of you, Tombigbee has faced rising costs in bringing service to you over the last several years.  Pricing on poles, equipment, materials and supplies utilized to bring you electricity have all increased, and in some cases more than doubled.  Accordingly, Tombigbee has no choice but to implement a rate increase of ½ of one percent this year (.0050).   For an average bill of $150.00 per month, this rate change will result in a $.75 increase.   For a $300.00 monthly bill, the increase will be $1.50 per month.  Nothing about this rate increase relates to Tombigbee’s fiber infrastructure or the operation of Tombigbee Fiber, LLC.

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All of the rate volatility you have seen throughout the year, and most recently in August, is based upon TVA’s pricing model.  TVA charges a fixed wholesale rate for kilowatt hours.   However, TVA also charges a variable fuel cost adjustment on top of the base rate.  The adjustment amount varies monthly depending on the actual cost of energy TVA generates and delivers to us on a wholesale basis.  That adjustment has been large of late and has resulted in an increase of approximately 40% on your September billings, for your August usage.   Tombigbee does nothing but pass along this fuel cost adjustment to you.  Tombigbee does not profit from these additional charges, nor does Tombigbee get to keep any of the increased amounts once charged.   The October fuel cost adjustment will be less than the previous month and is predicted to be more stable for the remainder of 2022.   We hope that to be the case.  However, please understand that the fuel cost adjustment is not the same as a rate increase.  Tombigbee does not have any control over the TVA rate or the TVA fuel cost adjustment.  Tombigbee does its best to maintain stable rates.  Tombigbee is the second least expensive TVA cooperative in the State of Mississippi.

 

Tombigbee’s historic rate increases are set out below:

• 10/01/03 - 2.31%

• 10/01/05 - 1.55%

• 10/01/06 - 2.01%

• 10/01/08 - 2.46%

• 10/01/09 - 1.32%

• 10/01/18 - 1.51%

• 10/01/22 - 0.50%