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TVA’s local solar program is about to get its biggest project yet

The huge public utility has built little solar capacity so far. Now the region’s local power companies are driving a buildout with help from developer Silicon Ranch.
By Julian Spector

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(Silicon Ranch)

The Tennessee Valley Authority, the nation’s largest public power utility, has yet to fully jump on the solar trend that’s sweeping the nation. But it has allowed communities within its seven-state service territory to buy some solar power for themselves. Now Tennessee-based developer Silicon Ranch has signed a contract to build the largest community-driven solar plant the region has ever seen.

Silicon Ranch will construct the multimillion-dollar, 110-megawatt Copeland Solar Farm in Cumberland County, Tennessee, the company announced Monday. The farm’s output will benefit customers of Middle Tennessee Electric, the largest cooperative to receive power from the TVA. This arrangement will provide Middle Tennessee Electric’s 750,000 customers with cleaner power, insulate them from rate increases affecting TVA power, and help TVA grapple with the rapidly rising demand for electricity, which elsewhere has prompted the utility to greenlight massive and controversial new fossil gas plants.

TVA has one of the more paradoxical approaches to clean energy of any major utility. Created by the federal government during the New Deal, it is governed by a board appointed by the president. But the arrival of Joe Biden’s handpicked board members has not yet prompted the public monopoly to align its power plant investments with Biden’s own climate goals. TVA’s electricity is cleaner than the national average, thanks to decades-old construction of hydropower and nuclear plants, but it gets just 3 percent of its power from wind and solar.

In 2022, TVA did put out a call for 5 gigawatts of clean energy projects, to be online by 2029; this was easily one of the country’s largest ever utility requests for proposals exclusively seeking clean energy. So far, TVA has signed five power purchase agreements from that process, totaling nearly 800 megawatts of solar generation and 20 megawatts of battery storage, spokesperson Scott Fiedler told Canary Media. But those projects have not been built yet, he noted, and the winning developers still have not publicized the details of their projects.

In the meantime, TVA has enthusiastically pursued new fossil gas plants, much to the chagrin of climate and ratepayer advocates. The board has repeatedly delegated power to CEO Jeff Lyash to approve large new gas investments; this happened most recently with the multibillion-dollar, 1.5 gigawatt Kingston project, as documented by Nashville public radio station WPLN.

They keep saying, We’re going to do 10 gigawatts of solar by 2035,’ and they put out the 5-gigawatt RFP, but nothing is getting done,” said Daniel Tait, the research and communication manager at utility watchdog Energy and Policy Institute. Meanwhile, all the gas plants keep getting approved.”

Amid these murky dealings, TVA’s Generation Flexibility program offers a ray of light for anyone seeking cleaner, cheaper energy.

TVA is structured so that it generates power for everyone in its service territory, then sells it to so-called local power companies, or LPCs, which handle the retailing of power to customers. Of the 153 such companies that exist today, many operate as municipal utilities (like those in Nashville, Memphis, and Chattanooga), but some are run as cooperatives, like Middle Tennessee Electric. When TVA launched Generation Flexibility in June 2020, it gave these entities the right to generate up to 5 percent of their annual sales from local solar power. The program functions like community solar programs in other states, but here the customers aren’t households or businesses but community-level power providers.

Generation Flexibility marked a historic shift, since TVA had generated all the power for the region since 1933, noted Silicon Ranch Chief Commercial Officer Matt Beasley.

We’re excited about the LPCs playing an active role and really leaning into this deployment of renewables,” Beasley said. TVA has empowered them to play a more direct role in this work.”

It’s a rare power sector innovation in which everyone seems to come out ahead. Customers get cleaner and cheaper power, and a little protection from TVA’s recent rate increases. Local power companies get to make their customers happy and encourage investment into their communities, boosting the local tax base: It’s not only distributed energy, but distributed economic impact,” Beasley said. And TVA gets a little breathing room to deal with the massive increase in electricity demand that it needs to serve (it also loses no profits, because it’s a nonprofit, and has no Wall Street shareholders to coddle).

Load is ramping up so quickly, so anything that can enable adding on new generation efficiently and cost-effectively is a good thing to benefit the whole system,” Beasley noted.

Until now, 40 companies have actively engaged in planning or operating” such projects, said Fiedler. Those efforts have produced 15 operating projects thus far, with a total of 48 megawatts of solar capacity, he added. (Silicon Ranch told Canary Media that the company built and operates 15 solar plants under the original rules.)

But last fall, TVA updated the program to help it grow. The expanded version allows different power companies to buy power from a single project, meaning companies can band together to get better rates on larger systems. Those projects no longer have to be located within the territories of the companies buying the power, giving more communities access to solar in more prime development locations (try finding a wide-open field in the middle of Nashville).

The Copeland project is the first to make use of these new provisions, and will produce more than double the power of all the currently operating Generation Flexibility projects. It serves customers in the counties surrounding Nashville. But meeting close to 5 percent of Middle Tennessee Electric’s ample energy needs required a 1,000-acre project site. It’s an extremely meaningful scale” for the region, Beasley said. Silicon Ranch secured that land in Cumberland County, a more agrarian area to the east of Middle Tennessee’s jurisdiction. The project is expected to come online in late 2027.

Beasley hopes that the new rules will allow more power companies to explore large-scale projects, and that smaller companies with lower electricity demand will band together to get favorable rates on bigger, aggregated projects. If these companies max out on the initial 5 percent allowance for locally contracted solar, then they could ask TVA to raise the limit.

No one at TVA has said that 5 percent is a permanent cap,” Beasley said. There is a hope among LPCs that the 5 percent figure will grow — hopefully that 5 percent could become 10 percent.”

Julian Spector is a senior reporter at Canary Media. He reports on batteries, long-duration energy storage, low-carbon hydrogen and clean energy breakthroughs around the world.