Natural gas rates, heatwave cause power bills to spike
Aug. 9—TUPELO — At $191, Tupelo's Beth Anne Ellzey said her power bill this month is — by far — the highest she's ever received.
"It was $10 short of doubling," she said, comparing her Tupelo Water & Light bill from 2022 to the one from the same period the year before.
On average, Ellzey estimates she pays around $100 a month for water and power to her one-room apartment, where she's lived for eight years. Her previous watermark bill was $135.
Without help, she said the sudden jump in the monthly expense could have been devastating.
"My sisters had to help me pay (the bill), so I am blessed I had family to turn to," she said. "If not, that was my grocery money."
Ellzey isn't alone in her sticker shock. Tupelo residents can expect higher power bills for the next few months, local officials warn, noting the cost of natural gas and recent extreme weather will affect utility bills exponentially. Some residents, like Ellzey, are reporting their monthly power bills more than doubling from the same time last year.
Tupelo Water and Light Director Johnny Timmons said every resident can expect price increases in their next few bills, if they haven't already. He noted the spikes in Tupelo residents' bills result from a "perfect storm" of factors that affect utilities rates, including an increase in natural gas costs globally and a sweltering summer.
"It has been a terrible summer for power costs," Timmons said.
Tupelo Water and Light buys its power wholesale from Tennessee Valley Authority, which generates its power primarily through natural gas turbines and nuclear power. Timmons said there was planned maintenance on one of TVA's nuclear power plants, which caused the company to compensate with more gas-powered turbines.
According to Scott Brooks with TVA, the money TVA spends on natural gas is passed on to the customer through regular fuel cost adjustments, which fluctuate depending on how much natural gas the company has to purchase.
In the past two months, Brooks said, the wholesale monthly fuel cost adjustment has more than doubled, jumping from two cents per kilowatt-hour to 4.6 cents.
"Basically, the cost of natural gas has gone up by more than 140% in the last year, and coal prices have risen as well," Brooks said.
He added that Tupelo customers aren't alone in facing this increase. Nationwide, people are opening their mail to find far higher power bills.
"This is not isolated to one power company," he said. "We are all facing the same issues."
It's not just the rate people pay that has caused the spike in power bills. Usage is also up.
Brooks said the cost of gas and usage are the two major influences affecting a person's power bill; June, July and August are peak usage months in summer, and usage was up significantly this year, which can largely be attributed to the summer's extended heatwave.
According to data provided by Tupelo Light and Water, usage rates increased steadily from the end of May to 54 million kilowatts per hour to almost 68 million kilowatts per hour in July. These are up from last year's usages by an average of about 5 million kilowatts per hour for each month.
Timmons also chalked the increased usage up to it being hotter this summer than last year. Timmons said in June and July, there were 14 days that clocked in over 100 degrees and 30 days that were more than 90 degrees at its hottest. He said the more power used, the more spent in natural gas to provide that power, which translates to higher bills.
When asked why natural gas prices have risen exponentially, Brooks said there were many factors putting pressure on the global economy. Although he couldn't pinpoint when bills would be back to normal, prices are trending down.
"The price of gas is the variable that is least certain," he said. "We do expect to see natural gas start coming down at some point."
Timmons said residents should expect similarly hefty bills in September.
For Ellzey, bracing for another high power bill means watching her spending closely and saving what she can.
"You have to take the punch," she said. "Everybody needs electricity."
