Nearly a century after the Tennessee Valley Authority was created to harness the power of the Tennessee River, an upstart power cooperative plans to use the sun to deliver electricity within part of TVA's service territory.
Organizers of the Jackson Sustainability Cooperative in West Tennessee insist they can deliver clean, cheap and sustainable power to help supplement TVA-generated electricity by building and operating their own $67 million solar farm and battery storage hub.
But the pioneering proposal has sparked a power battle. TVA and its local distributor, the Jackson Energy Authority, claim the new Jackson cooperative is illegal and a threat to TVA's integrated power model.
Supporters of the solar project said TVA and the Jackson Energy Authority want to maintain monopoly control.
The dispute is before a state regulatory agency. The Tennessee Public Utilities Commission is being asked to authorize the new power cooperative and either grant a certificate to allow the new energy system or grant it an exemption from regulations barring independent power distribution within TVA's service territory.
Such an exemption would help the Jackson Sustainability Cooperative secure financing and gain cooperative membership from manufacturers.
"The Jackson Solar Project will make solar energy available in areas where it is presently uneconomical," said Dennis Emberling, a consultant on solar energy projects who is president of the Jackson Sustainability Cooperative. "We want to help transition Jackson to a cleaner, smarter and more reliable energy future."
Emberling said the cooperative will be a nonprofit corporation that serves manufacturers in Jackson such as Toyota and Kellogg that have pledged to use more renewable energy to limit their carbon footprint. The co-op members would lease the solar farm from the developer, Community Development Enterprises, and make lease payments for the power that the solar array will generate.
"We hook them up at no capital cost to them, and we guarantee them a 5% reduction in the demand portion of their electricity bill," Emberling said. "This will deliver cleaner power and reduce the peak demand charge for both the co-op members and Jackson Energy Authority. Our members will get all benefits at no extra costs, so I don't think it will be hard to sign them to sign up."
The solar farm proposed to be built in East Jackson by the co-op would include about 35,000 solar panels capable of generating 17 megawatts of power or 26 gigawatt-hours of electricity a year. The project would include Kore Power lithium battery storage to help store and distribute power when it is needed.
Emberling said the developer has received a half dozen environmental approvals and the civil and engineering design and layout have been approved by the Jackson planning commission.
The Jackson Energy Authority will continue to serve the Jackson Sustainability Cooperative members, although the co-op members would get some of their power from the new solar installation.
TVA, Jackson Energy Authority and the Tennessee Municipal Electric Power Association have all filed objections to the proposal by the Jackson Sustainability Cooperative, questioning who is behind the cooperative and claiming it is illegally trying to compete with TVA and the Jackson Energy Authority for power delivery within the protected TVA service territory.
Teresa Cobb, general counsel for the Jackson Energy Authority, said the proposal violates state law that designates that electricity service in Jackson is provided by the municipal power utility owned by the city of Jackson which has a power purchase agreement with the Tennessee Valley Authority.
"The Tennessee General Assembly established the electric system service areas of electric providers decades ago," Cobb said in a four-page petition to the Tennessee Public Utilities Commission.
The proposed new co-op doesn't have any members, and its proposed electric service territory is granted under state and federal law to the Jackson Energy Authority exclusively, according to TVA lawyers.
TVA President Jeff Lyash said the network that generates and transmits power and partnerships among TVA and its existing 153 local power companies have been key to keeping rates affordable and power delivery working.
"The public power model has worked well for the Tennessee Valley," Lyash said.
Allowing startup energy suppliers to deliver power to multiple selected customers could weaken the TVA model, which is designed to serve all customers at all times across the TVA region, Lyash said.
The new co-op is proposing to go after up to 38 major industrial and commercial customers near the solar farm in Jackson, which would limit revenues paid to the Jackson Energy Authority and TVA, which must serve all customers in their service territory.
Jeremy Elrod, director of government relations for Tennessee Municipal Electric Power Association, said municipal electricity providers like Jackson Energy Authority "are really striving to be our customers' trusted energy providers in offering reliable and affordable power," and such local power companies provide the advantages of their services to all customers, not just a selected few industrial customers like what Jackson Sustainability Cooperative is proposing.
Doug Peters, president of the Tennessee Valley Public Power Association, said the Jackson Sustainability Cooperative "is attempting to use the cooperative statutes in a way that they were never intended to be used.
"It doesn't fit within the power supply model in the Tennessee Valley as the TVA Act prescribes," Peters said.
Emberling said his group offered to work to supply peak power to help the Jackson Energy Authority and TVA, but not under the current wholesale solar rates paid by TVA, which he said would amount to only 2.1 cents per kilowatthour. Emberling said such rates are below what most other utilities are paying for such power and are less than a fourth of the retail delivered price of power in the region.
"We offered to work and cooperate with TVA, but they wouldn't even talk with us and their attitude seems to be that "this is our city and we're not letting any foreigners in,'" Emberling said.
Turning to the sun
The Jackson Energy Authority, which recently signed a long-term wholesale power purchase agreement to get nearly all of its electricity from TVA, is developing plans to add 25 megawatts of its own solar power generation under the flexibility provision granted to local power companies under the new long-term power purchase agreements with TVA.
Monte Cooper Sr., vice president of electric distribution at the Jackson Energy Authority, said there are also 25 to 30 solar projects being developed by customers from multiple vendors in the authority's service area.
"TVA has a pretty wide array of solar programs for private entities, even for for-profit vendors," he said. "There are plenty of opportunities in different ways to participate [in renewable power], and we have profitable solar vendors that are already taking advantage of the program."
Jackson One LLC owns a 10-year-old, 1-megawatt solar array that has been in Jackson for the past decade and Silicon Ranch recently developed a 2-megawatt solar farm to offer a Community Solar program through TVA and the Jackson authority. Silicon Ranch is also building the biggest solar project in the region, a 70-megawatt solar farm to serve Meta (formerly Facebook) under TVA's Green Invest program.
"We have a history of developing renewable power that we hope to continue to grow," Cooper said.
Michael Miner, a former West Point analytics instructor and senior partner at SynEnergy Inc. in Hampton, Virginia - who is serving as the chief operating officer for the Jackson Sustainability Cooperative - said such projects can help boost renewable generation even more. Miner said such efforts are needed to battle global warming and, in the process, will also aid industry and jobs in Jackson, where Miner was born and raised.
Miner said TVA and the Jackson Energy Authority don't like their monopoly control threatened, even when it may benefit local industry and the environment.
"When you are encroaching on their turf even when you have a sustainable and renewable project, there is going to be stonewalling by JEA and TVA," he said. "Any competitor to their monopoly will cause them consternation, and that's a battle we are continuing to fight."
Environmental groups eager to see more renewable power generation in the Tennessee Valley also object to the attempt by TVA and the Jackson Energy Authority to limit new solar cooperatives like the Jackson Sustainability Cooperative.
"To me, it is devastating and makes no sense that TVA and the incumbent utility entities are opposing this sustainability cooperative which plans to come in and provide clean, renewable energy, storage and a microgrid that actually supports lowering the energy costs for industry in the Jackson area," said Stephen Smith, executive director for the Southern Alliance for Clean Energy.
Smith said the type of microgrid and solar array proposed by the Jackson Sustainability Cooperative represents a significant part of the future of America's power generation as electricity moves away from central source generation from major coal or nuclear power plants and more to a distributed model with smaller renewable energy generation and storage.
Smith said TVA and its local power companies like the Jackson Energy Authority are philosophically opposed to other players or competition.
Emberling said his group is comprised of a group of manufacturers and commercial operators and the project "has strong support from the Jackson community and its businesses." As proposed, the system will include smart meters that will be separate from the Jackson Energy Authority meters, which will remain in place and be connected to the authority's electrical grid.
He said members will draw power seamlessly from both the co-op and the authority.
When demand is average or below, members will primarily use electricity from the local authority, as they do now. When demand rises or an outage occurs, members will draw the extra electricity needed from the co-op's solar facility.
Emberling said for some commercial customers in Jackson, demand charges represent 44% to 66% of their electricity bills, and by limiting the peak demands by providing backup and extra power when it is needed, the project can cut costs for both customers and the Jackson Energy Authority, Emberling said.
Developers of the project also said its construction and operations will help create 511 jobs the first year and 22 permanent jobs once the facility is in operation.
"It's a win for the environment, a win to power reliability and costs and a win for economic development in Jackson," Emberling said of the proposed solar cooperative.
Attorneys for TVA and the Jackson authority want the proposed cooperative to disclose more details about the proposal for the Public Utilities Commission to determine if the group qualifies as a cooperative and if it has a legal basis to operate.
Emberling's group filed its initial petition for the new power cooperative in May. On Dec. 23, state regulators asked both supporters and opponents of the new cooperative to try to reach an agreement on what the applicant must submit in support of the proposed development before the Public Utilities Commission begins to hear the case.
Contact Dave Flessner at email@example.com or 423-757-6340.