TVA allows local power companies to generate power outside of their service territories

MARTIN, Tennessee -- Local power companies that have relied on the Tennessee Valley Authority for all of their power may soon turn to the sun for a portion of their electricity -- and some may opt to wheel such power into their service territory from solar farms built elsewhere.

Two years ago for the first time, TVA granted the 153 municipalities and power cooperatives in its seven-state service territory the flexibility to generate up to 5% of their power on their own or from power suppliers other than TVA. The flex power program was intended to spur more utility-scale solar generation by local power companies to supplement TVA's renewable energy. The 5% cap helped ensure such intermittent power generation was within manageable limits for TVA.

Doug Perry, senior vice president of commercial energy solutions, told TVA directors Wednesday that so far only about half the 153 local power companies in TVA's territory have signed the flexibility option and only about 100 megawatts of solar power have been approved for the local power companies -- or only about 5% of what could be allowed if all the local power companies maximized their flexibility.

"It should be a no-brainer with the economic and environmental advantages right now for solar generation," Stephen Smith, executive director for the Southern Alliance for Clean Energy in Knoxville, said in a phone interview. "I'm afraid there are just too many local power companies that rely totally upon TVA or don't see the need or opportunity with solar."

But some local power companies insist it is a matter of finding the right place to install a solar array to use the flexible option with TVA. Local power companies in urban areas are sometimes finding the land needed for a solar farm too scarce or too expensive within a city.

Perry said some of the flex options TVA initially offered may have been too restrictive to work for some local power companies.

To help the local power companies use that flexibility to generate their own solar power, TVA directors Wednesday agreed to amend the purchased power agreements with the local distributors to give them more flexibility in where they get their own power.

Under the new agreement with TVA, local power companies such as EPB could build solar farms in rural areas outside their service territory where land is cheaper. The new provisions also might encourage multiple local power companies to combine in a joint venture, Perry said.

TVA President Jeff Lyash said in an interview with the Chattanooga Times Free Press such local power generation could help meet what he projects will be a growing demand again for electricity as gas-powered cars are replaced with electric vehicles and more fossil-fuel-powered industrial operations shift to electric power.

Lyash said TVA adopted the flexibility option, in part, to boost solar and other renewable energy use to help meet the utility's decarbonization goals.

"We would love to have another 2,000 megawatts solar generation from our local power companies," Lyash said.

Contact Dave Flessner at or at 423-757-6340. Follow him on Twitter @dflessner1.