Huge TVA electric rate increase takes effect

KNOXVILLE, Tenn. (AP) - The Tennessee Valley Authority's largest electric rate increase in more than three decades takes effect Wednesday.

The 20 percent hike is expected to add about $16 to $20 a month to the average residential bill. It's TVA's biggest rate boost since 1974 and its second in 2008.

Virtually all of TVA's 159 distributors in Tennessee, Alabama, Mississippi, Kentucky, Georgia, North Carolina and Virginia were expected to pass the higher rates on to their customers.       TVA blames the increase on skyrocketing fuel costs for its power plants and a three-year drought that's hurt hydroelectric power production.

But it comes as Tennessee distributors say consumers already are struggling to pay their power bills on time and avoid service cutoffs.

(Copyright 2008 by The Associated Press.  All Rights Reserved.)