KNOXVILLE, Tenn. — The average Athens Utilities electric customer – who uses 1,320 kilowatt hours per month – will see a $21 increase on his or her November bill, says Electric Department Manager Gary Scroggins.

The Tennessee Valley Authority on Wednesday approved its largest electric rate increase in more than 30 years, citing skyrocketing fuel costs and a three-year drought that has sharply reduced its ability to generate cheap hydroelectric power.

Directors for the nation’s largest public utility adopted a 20 percent rate increase worth about $2 billion. The increase is expected to be passed along by TVA’s 159 distributors to some 8.8 million consumers in Tennessee and parts of Alabama, Georgia, Kentucky, Mississippi, North Carolina and Virginia.

Scroggins said Athens Utilities had to pass the 20 percent hike on to its residential, business and industrial customers because it cannot absorb such an increase.

“We have no control over it, it’s a TVA rate increase,” Scroggins said.

Some customers have criticized the size of TVA’s rate hike in light of TVA board members and some employees receiving millions in bonuses over the past three years. TVA says the rate increase will raise monthly electric bills between $15.80 and $19.80 beginning Oct. 1 for the average residential customer, based on the use of 1,320 kilowatt hours a month.

Most of the rate hike is a temporary fuel-adjustment charge that varies quarterly, though TVA officials predicted the charges will continue to grow through smaller increases in the future. A smaller portion of the hike is a base rate increase taking affect under a $12.6 billion budget adopted Wednesday.

The combined rate increase is the largest at Knoxville-based TVA since a 20.2 percent hike in 1974, and follows a 7 percent increase in April. TVA officials said similar increases are being implemented throughout the utility industry.

“My message to the typical homeowner is the same thing to my wife,” TVA President and Chief Executive Officer Tom Kilgore said. “And that is: prepare to live with this until something changes.”

The drought has reduced the flows of rivers and the level of lakes that feed hydroelectric power plants, forcing the agency to buy expensive additional power from other producers. The utility also has been burdened by the rising cost of coal, which supplies about 60 percent of TVA’s generation mix.

The utility will spend about $4.3 billion this year on fuel and purchased power. It expects to spend $6.3 billion next year.

TVA’s distributors were resigned about the increase.

“If the cost of fuel is going up, there is not much we can do about it. That is just reality,” said Jerry Collins, president and CEO of Memphis Light, Gas and Water Division.

But Collins, who represents TVA’s biggest distributor, urged TVA directors to delay a base rate increase, especially because of the impact on the poor.

Bobby Glenn, general manager of a 300-employee Panasonic aluminum foil operation in Knoxville, told the TVA board the increases will add about $3 million to his plant’s annual power bill and “threatens the very survival of our business.”