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State Energy Overview

Tennessee is home to extraordinary places such as the Smoky Mountains, Cumberland Plateau and the Tennessee River Valley that support some of the most naturally diverse areas in the world. Air pollution and climate change pose a serious risk to these treasured places, making it important that we act now to curb our reliance on fossil fuels through energy efficiency and renewable energy alternatives.

Tennessee, like many Southeastern states, sends more than a billion dollars out of state for energy resources annually to power the state and provide for its residents. But there are local opportunities that can help shift that equation. Our analysis shows Tennessee has a significant amount of commercially available and sustainable biopower capacity based on various biomass resources. Utilizing any of these resources will need to be done carefully and require thorough assessments of need, resource availability and other demands, water use, biodiversity, carbon, soil quality, air quality and other economic and environmental impacts. A few other projects have been proposed for the state, but the prospects for their development remain unclear, based on factors including resource availability, federal regulations and laws, financing and environmental impacts. You can read more about bioenergy by visiting our Learn About page, here.

There are a total of 7 coal plants in Tennessee operated by the Tennessee Valley Authority (TVA), the main energy provider in the state. Of those 7 units, TVA has committed to closing two coal plants; the John Sevier plant located in Hawkins County and the Johnsonville Plant located in Humphreys County. The other five plants in the state are operational and plan to be operational for the long term. TVA spends a total of about $1.21 billion on coal each year. Tennessee appears at number 11 in the list of the top 15 states for coal health impacts in 2010. There were 340 hospitalizations, 640 heart attacks and 499 deaths related to pollution from coal plants in Tennessee. In 2010, 53% of Tennessee’s energy came from coal. Although coal has declined over the past decade from 64.9% in 2000, it is still a dominant part of the state’s energy mix.

Even though Tennessee is the site of the devastating Kingston coal ash spill, the state still lacks many basic safeguards to protect communities and waterways. Tennessee’s 8 active coal-burning power plants produce over 3.2 million tons of coal ash every year. The ash is stored in 18 dumpsites across the state and many are unlined and located near waterways and communities. The EPA has rated three of these impoundments as posing a high hazard to nearby communities and infrastructure, while 11 are considered significant hazards.

Energy Efficiency
Tennessee currently uses more residential electricity per person than nearly every other state in the nation. The silver lining to this dismal statistic is that there is enormous potential for Tennesseans to achieve large savings in energy demand through cost-effective energy efficiency measures. In 2008, then Governor Bredesen convened the Governor’s Task Force on Energy Policy to develop recommendations for the State to become a leader in clean energy. John Noel, SACE’s Board President, played an active role as a member of this task force. As a result of this process, the Tennessee Clean Energy Future Act was enacted that requires state government to lead by example with improved energy management, encourage job creation in clean energy industries and promote improved residential energy efficiency with a statewide residential building code. Various aspects of this legislation will begin to have impacts on Tennessee’s energy use over the next several years. Other initiatives by the state and local governments, accelerated in part by the Recovery Act, are also improving the efficiency of Tennessee’s homes and businesses.

Unfortunately, the Tennessee Valley Authority (TVA), a federally owned utility that provides electricity to more than 99% of the state, has not been as aggressive in pursuing the economic and environmental benefits of energy efficiency. While TVA has recently ramped up its efforts on energy efficiency, (new efficiency programs were rolled out in 2011), we still have not seen the leadership we would expect from the largest publicly owned utility in the country. However, TVA’s most recent Integrated Resource Planning process, approved in April 2011, clearly demonstrates the value of energy efficiency to both TVA and its ratepayers. Now that TVA recognizes efficiency for what it is: the cleanest, cheapest and most readily available resource to meet future energy demand, we’re hopeful that TVA will continue to increase its efforts to develop this resource. You can read more about energy efficiency by visiting our Learn About Energy Efficiency page, here.

Tennessee is home to the Tennessee Valley Authority, the largest Federal Government-owned utility in the country. Its Board of Directors acts as a Public Service Commission-like entity. TVA operates in seven states, Alabama, Georgia, Kentucky, Mississippi, North Carolina and Virginia. Of its total generation of 35,000 MW, TVA’s solar generation amounts to about 0.3% or a little over 100 MW. In 2003, TVA introduced Generation Partners, a pilot program to support small-scale solar or wind generation. They offered participants 12 cents above the retail rate for 20 years for systems up to 200 kW. It has currently has reached 100 MW of installed capacity. Generation Partners is funded by the voluntary Green Power Switch, which enables customers to buy electricity generated by a renewable resource. It also has the effect of creating a dollar cap on the program. In 2012, TVA renamed the program “Green Power Providers” and changed it, so that while the contracts run up to 20 years, premiums expire at 10 years with a maximum project size of 50 kW. At about the same time, TVA introduced a two-year pilot for larger projects, the Solar Solutions Initiative within the Renewable Standard Offer program. Solar projects greater than 50 kW and no larger than 20 MW in size are eligible. SSI pilot projects may totaling no more than 10 MW of solar capacity per year (20 MW program total), a number which may be expanded if needed. Initial incentive levels will pay eligible projects an additional 6 cents per kWh for systems up to 200 kW or 4 cents per kWh for systems up to 1 MW. In addition, Tennessee has a sales tax credit, for purchases of machinery and equipment used to produce electricity in a certified green energy production facility. You can read more about solar by visiting our Learn About Solar page, here.

Tennessee is currently the only state in the Southeast with an operating, utility-scale wind farm. The Buffalo Mountain wind farm provides up to 29 megawatts of wind energy to Tennessee Valley Authority customers. The state has fairly good mountain and low land wind power resources. As wind turbine technology continually advances, wind development companies will become more interested in the state’s resource. Learn more about Tennessee’s wind energy potential here.

With all that has been accomplished in Tennessee over the past couple years, there is still much to do to ensure the successful development of Tennessee’s abundant energy efficiency and renewable energy resources. The Southern Alliance for Clean Energy continues to advocate for effective programs and policies that will bring economic and societal benefits to the citizens of Tennessee while protecting our natural resources for future generations.

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