MEMPHIS, Tenn. (localmemphis.com) – A new report by an energy and environmental consulting firm estimates Memphis, Light, Gas and Water customers could see their rates go up between 8% and 22% by 2026 – if the company continues to buy its power from the Tennessee Valley Authority.
The study, sponsored by Friends of the Earth and delivered by Synapse Energy Economics, said its rate increase estimates were tied to their belief of increased costs for fossil fuels, coal ash cleanup, and repairs to older power plants in the TVA system.
The study comes the same time MLGW leaders commissioned a different study and developed an Integrated Resource Plan to consider seeking alternative power sources other than the TVA, including a proposal by Nuclear Development LLC.
We reached out to TVA who sent the following statement:
Our most recent long-term financial plan, approved by the TVA Board, includes keeping rates flat over the next decade, and the proposal for 20-year agreements with local power companies also includes a reduction in the wholesale rate.
TVA has not reviewed the report, but we are working directly with MLGW and members of the community to provide accurate information as the utility makes decisions on its relationship with TVA.
We are confident that, after a thorough and accurate review, TVA is still the best option for the people of Memphis and Shelby County.
The risks mentioned in the comments are generally part of our capital expenditures and are included in the long term financial plan. Those costs are not necessarily passed on in rates, but are often absorbed in the annual budget, which is passed by the TVA board.
TVA makes decisions on assets and costs, including the future of coal combustion residuals, based on potential impacts to the 10 million consumers we serve.
Local 24 News reporter Brad Broders is gathering reaction and response from MLGW and TVA leaders, along with Memphis City Council members. You can follow Brad’s live updates throughout the day on his Twitter account, @Local24Brad.