TVA opens pathway for local power companies to produce their own solar, CHP generation

The Tennessee Valley Authority has green-lighted a first-ever plan allowing the local distribution utilities within its service territory to develop some of their power generation, including renewable energy resources.

The TVA announced that an environmental assessment found no significant impact in the shift allowing local power companies (LPCs) to generate the portion of their own load. These potential, localized resources could include utility-scale solar, combined heat and power (CHP) and distributed energy.

TVA historically has produced all of the electricity—mainly hydro, nuclear and some coal—that was then transmitted and distributed to local power companies. The new agreement would allow the LPCs to reduce the amount they buy from TVA by producing their own generation up to five percent of average energy needs.

“This is very positive for our community, and we see a need for local generation right now,” said Jeff Dykes, CEO of BrightRidge, which serves the Johnson City, Tenn. region. “Customers demand additional solar power, and now we can have local solutions in place to quickly improve the competitiveness of our region by proactively meeting those demands.” 

Some 140 of 154 LPCs within the TVA territory are entered into 20-year long-term partnership agreements with the federal power authority. The final Environmental Assessment presents a revised preferred alternative that allows for 2.5 times more solar than was defined in the draft Environmental Assessment, which was open for public comment this spring.

“Up to 300 MW of flexible generation from solar, combined heat and power, and other applicable technologies has been available to LPCs under the FRP,” reads one of TVA’s impact statements. “An expanded option could match the 800 to 2,000 MW of flexible generation considered under the Flexibility Proposal.”

Read more PE stories on solar here.

Integrated battery storage resources are allowed under the plan and mostly count toward the local generation limit. Energy storage powered by TVA’s own power plants and utilized by the LPCs do not count against the generation cap.

TVA spokesman Scott Fiedler said the new program is designed to spur economic development in its region. The TVA territory’s average income has grown significantly through the years, but 19 percent of residents still live below the national poverty level, according to reports.

“The beauty is we are helping communities attain their sustainability goals,” Fiedler said in an interview with Power Engineering. “Local generation translates into jobs and investments. This is a C-suite change…TVA is looking at the market and moving forward and help 10 million residents compete in the global marketplace.”

Knoxville Utilities Board has already jumped into renewable agreements with the TVA, partnering under the Green Invest program—which offers Renewable Energy Credits to customers — to move toward producing eight percent of its annual load from carbon-free energy. That announcement three months ago is in addition to the five percent local generation agreement detailed this week.

“We are excited to see this announcement and pleased to see how TVA has reflected the value of solar in its approach to contract flexibility,” said Gabriel Bolas, Knoxville Utilities Board president and CEO. “Our investments in solar through the Green Invest program have allowed KUB to start making real improvements in our power supply mix, and this contract flexibility gives us another way to support our community’s climate goals in the years to come.”

The impact statement noted that from 8,625 to 17,250 acres of land would be required for the solar generation, depending on the capacity scenario adopted by the local utilities.

(Rod Walton is content director for Power Engineering and POWERGEN International. He can be reached at 918-831-9177 and

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