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New CDE Lightband Rates Aimed At Reducing Peak Energy Usage

February 21, 2011

Effective April 1, CDE Lightband will change the way it bills consumers for electricity. The Tennessee Valley Authority (TVA) is driving this change as it continues its effort to reduce peak power usage in the Tennessee Valley.

Effective April 1, CDE Lightband will change the way it bills consumers for electricity. The Tennessee Valley Authority (TVA) is driving this change as it continues its effort to reduce peak power usage in the Tennessee Valley.

TVA is the wholesale power provider that generates power and sells it to local power companies like CDE Lightband. TVA’s costs to provide power vary significantly, based on when customers are using electricity – both the times of year and times of day. The new rates will better reflect those cost differences. In the summer months, the demand for power is higher in the afternoon when the temperatures rise because consumers are running air conditioning at full power to keep cool. In the winter, the demand for power is higher in the morning because consumers begin turning on lights and heating systems and businesses start up their operations.

The new rates are designed to be revenue neutral for TVA. Consumers will be charged a little more for power when TVA’s costs are higher and a little less when TVA’s costs are lower. If consumers lower their electric usage during these high costs periods, TVA can avoid significant costs of operating expensive power plants for only a few hours a day. They can also defer building new generation facilities than can cost billions.

“Over the course of twelve months, our customers will see little difference in their bills,” said Walter Haynes, CDE Lightband manager of rates and contracts. “Beginning in April there will be slightly differing rates for the summer months, winter months, and for the spring and fall months. However, the biggest change involves the wholesale billing between TVA and its 155 power distributors.”

CDE Lightband estimates that the typical residential customer using 1240 kWh will see an increase of about 43 cents per month from June through September and about 28 cents per month from December

through March. In the months where less heating and cooling is required, April, May, October, and November, consumers will see a savings of about 51 cents per month.

“This is really just the first step,” Haynes added. “TVA will begin billing CDE Lightband and all other TVA distributors on a time-of-use rate in 2012. These rates will vary depending on the time of day and the season of the year. This type of rate will eventually be available to CDE Lightband consumers and those willing to change their electric usage patterns will benefit by paying less for electricity during off peak times of the day.”

CDE Lightband is prepared for time-of-use rates as it has been installing meters with the technology required to bill different rates at different times of the day for a while now. These meters are also advantageous as they improve outage management and offer remote meter reading, connection, and disconnection.

Even with this new rate structure, CDE Lightband still encourages consumers to practice efficient use of electricity to assist in peak power reduction. Turning the lights off when leaving the house or adjusting the thermostat a couple of degrees is still important …even if it is done with your smart phone.

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Media Contact:
Jim Manning
931-905-7213

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