News | October 31, 2017

Corporate demand for clean renewable energy stymied by TVA policies

As Tennessee’s renewable energy economy experiences great growth, the roadblocks to continuing that growth trajectory are looming large, especially as manufacturing and other industries increasingly demand more access to clean renewable energy.

In Tennessee, the economy benefits from having major manufacturers like General Motors, Mars, and VF Corporation in their midst, all companies who have set target dates to source 100 percent renewable energy. Unfortunately, Tennessee consistently lags behind other areas of the country in providing industrial facilities access to renewable energy due to policies and rates imposed by the Tennessee Valley Authority.

“TVA’s mission includes providing affordable electricity, fostering economic development, and protecting the environment. Granting manufacturers access to renewable energy would meet all three of these goals, but TVA continues to fall short on implementing solutions that industrial customers can easily take advantage of,” said Amanda Garcia, staff attorney in SELC’s Tennessee office. “TVA needs to step up. Tennessee doesn’t want to be left behind the rest of the country in reaping triple benefits from clean energy.”

It’s not just companies with a current presence in Tennessee. Consider Amazon’s search for a new headquarters and Facebook and Google’s recent efforts to expand data centers. These companies join the many who are prioritizing clean, renewable energy sources as they look to the future. A new study by David Gardiner and Associates documents the increasing interest from global manufacturers with a U.S. footprint for access to clean, renewable energy. According to the 160 companies researched, commitments to renewable energy and greenhouse gas reduction targets are top-of-mind in strategic corporate decision-making. These commitments are made for a variety of reasons but a primary driver is to reduce energy costs, as renewable energy – particularly wind and solar – is now among the cheapest and cleanest energy generation resources in the U.S.

Yet, of the ten states that host the largest number of facilities for manufacturers with 100 percent renewable targets, Tennessee and three others (North Carolina, Michigan and Missouri) rank in the bottom 25 states that offer favorable policies to corporate customers sourcing renewable energy. The implications are that more than 50 manufacturing facilities planning to be powered by 100 percent renewable energy are located in states that limit corporate access to this power source.

In light of the clear disparity between demand for clean renewable energy and supply, economic developers and the business community need to consider how to help expand energy options as global manufacturers and corporations, like Amazon and Facebook, seek sustainable energy choices for production. Working together, business developers and energy providers, need to make sure policies are in place so barriers imposed by the Tennessee Valley Authority don’t stall Tennessee’s manufacturing growth.