Want solar panels? In Tennessee, only corporations and the wealthy can really afford them.

Rooftop and utility-scale solar is scarce in Tennessee, where less than 400 megawatts powered the electric grid in 2021.

But new solar additions are on the way via a popular alternative route to renewables: contracts with corporations, like Facebook, and major institutions.

The Tennessee Valley Authority, largely, controls this dynamic, according to Bryan Jacob, the solar program director at the Southern Alliance for Clean Energy, who recently released a report on solar in the Southeast.

“Quantitatively, TVA is a sun blocker, and that’s just the math,” Jacob said of the utility, which provides nearly all the state’s electricity.

For wealthy organizations, however, TVA has a program called “Green Invest,” which sets up long-term payment agreements between businesses and solar developers, with TVA acting as the go-between. In TVA’s words, the program is a “model that offers business and industry an effective, timely, and cost-competitive solution to aggressively meet their sustainability goals.”

The businesses purchase a “renewable energy certificate,” which represents the environmental, social and other non-power attributes of renewable electricity generation, according to the Environmental Protection Agency.

“Green Invest is a good program, but it really only offers that opportunity to the corporate and industrial customers – the big players who can sign those long-term contracts,” Jacob said.

Corporations pay money to satisfy claims of sustainability

In Nashville, Vanderbilt University is the biggest solar customer. The university partnered with the Nashville Electric Service to invest in two projects: a 125-megawatt farm in Tullahoma and a 35-megwatt farm in Bedford County. These projects will offset indirect climate pollution from purchased electricity for Vanderbilt, which has come under fire by its students for refusing to divest its endowment from fossil fuels.

Local power companies can also use the Green Invest program.

Knoxville Utility Board could become the solar leader for watts per customer in the Southeast by 2025. KUB is investing in 502 megawatts of solar, or about one-fifth of its total power load, to help clean Tennessee’s grid.

“Supply chain and other issues have delayed the start of some of these installations, but we continue to work with TVA through this process and look forward to seeing these resources start to come online in the next few years,” KUB CEO Gabriel Bolas said in an email.

The Nashville Electric Service has a 2-megawatt solar farm, called Music City Solar, in Madison. The company said it was “surveying options for building utility scale solar arrays, purchasing renewable power and avenues to install more rooftop solar.”

The climate law will boost solar

Local power companies might have more incentive, and ability, to add solar to the grid soon. The Inflation Reduction Act, the package to tackle high inflation that contains major climate provisions, passed the House on Friday. This will allow public utilities to access federal tax credits for renewables.

Power providers in Memphis, Nashville and Knoxville said they are still reviewing the bill but are excited about the prospective.

“We believe that it is imperative to take steps to address the impact of climate change. To the extent that this legislation assists in making this effort more feasible, we believe that it would be beneficial for our customers and the communities we serve,” said J.T. Young, MLGW president and CEO.

“Once the bill fully passes, we will determine the steps and processes to incorporate the funding into our initiatives,” NES said in a statement.

“We are looking forward to learning more about how it can support projects for our customers once it’s signed into law,” KUB said in a statement.

At the utility scale, TVA is planning more solar, though at a rate lower than the regional average, according to Jacob’s report.

TVA is planning to add 10,000 megawatts of solar throughout its seven-state territory by 2035, and the utility just issued a request for up to 5,000 megawatts of carbon-free energy that must be operational before 2029. At this time, about 1.5% of TVA’s total generation across its seven-state territory is from purchased solar.

On the rooftop scale, there is currently very little support in the state. TVA cut its program for rooftop solar a few years ago and said local power companies could create programs.

None of them are particularly solar-friendly and “others are actually hostile to solar,” Jacob said, between the lack of net metering and, for some, solar surcharges. The NES board recently proposed axing its surcharge, but the board had split votes.