The U.S. Department of Energy awarded a $250 million grant to the Tennessee Valley Authority and 10 of its local power companies that will fund 84 projects aimed at strengthening the electric grid and building renewable energy.

The grant, announced Oct. 18 through the department’s Grid Resilience and Innovation Partnerships Program, brings TVA’s federal grant wins in recent years to more than half a billion dollars. It will help the utility add up to 2,400 megawatts of capacity to its grid, moving enough additional electricity to power 1.4 million homes, and speed development of solar and wind projects.

Although the federally-owned TVA has not received direct taxpayer funding since 1959, it has increasingly applied for federal grants to meet growing electricity demand while lowering carbon emissions. Before the latest grant, TVA already secured more than $300 million in federal grants shared with its local partners.

The $10.5 billion Grid Resilience and Innovation Partnerships Program is funded by the Bipartisan Infrastructure Law, one of two massive spending bills – joined by the Inflation Reduction Act – that established the Biden administration’s energy agenda as a bonanza of clean energy incentives.

The latest grant will help TVA shorten its interconnection queue, the line of energy projects waiting to hook up to the grid. It will allow the utility to create its first interconnection with the Southwest Power Pool, which manages much of the Midwest’s wind-heavy grid, adding 800 megawatts of wind to TVA’s system.

Updates to the grid could reduce the duration of local power outages by 94%, creating $250 million in economic benefits, according to a TVA news release.

“This investment will improve the way we deliver clean energy, while driving greater regional economic prosperity,” TVA CEO and President Jeff Lyash said. “This is an opportunity to work together with (local power company) partners to transform our systems and continue our mission of powering growth across the region.”

Union leaders celebrate TVA clean energy grant

Another benefit of the grant will be job creation. TVA anticipates the money will create around 800 jobs over five years, of which 99.7% will be union construction labor. Of TVA’s 10,900 employees, 58% are represented by unions.

Union leaders celebrated the news as a win for middle class workers in the Tennessee Valley.

“Electricity is America’s energy future, and the men and women of the (International Brotherhood of Electrical Workers) are ready to partner with TVA and local power companies to reduce carbon emissions and create good, middle-class jobs throughout the region,” said Kenneth W. Cooper, international president of the IBEW.

The federal utility applied in June for $350 million from the Grid Resilience and Innovation Partnerships Program, spread across two grants. It did not receive the additional $150 million, TVA spokesperson Elizabeth O’Connor confirmed to Knox News in an email.

Environmental groups have sparred with TVA over the low percentage of power it gets from solar and wind energy, around 4%, as well as its rapid construction of natural gas plants to replace coal. The utility has placed most of its clean energy hopes on costly small modular nuclear reactors, which may require additional federal finding and which critics argue are risky for ratepayers.

TVA, the nation’s largest power provider, makes money by selling electricity to 153 local power companies across seven states and directly to more than 60 large industrial customers.

It will share the latest grant, focused on uplifting hundreds of disadvantaged communities, with 10 rural local utilities in TVA’s service region:

• Aberdeen Public Utilities
• Amory Utilities
• Athens Utilities Board
• Franklin Electric Cooperative
• Mountain Electric Cooperative
• New Albany Light, Gas & Water
• Okolona Electric Department
• Philadelphia Utilities
• Water Valley Electric Department
• City of West Point Electric System

Daniel Dassow is a growth and development reporter focused on technology and energy. Phone 423-637-0878. Email daniel.dassow@knoxnews.com.

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