HB 2463, the "Bring Your Own Generation Act," targets large data centers in Tennessee with a peak demand of 100 megawatts or more. It requires these facilities to source 50% of their electricity from new onsite carbon-free energy (like solar or wind) and imposes a 100% surcharge on them to fund clean energy grid upgrades. The surcharge revenue funds the Tennessee Environmental Protection Fund, while prohibiting fossil fuel power contracts from qualifying for state economic incentives. This bill directly affects major data center operators and aims to accelerate clean energy integration without shifting costs to residential customers.
SB 2681, the "Bring Your Own Generation Act" (BYOG), requires large data centers and AI facilities in Tennessee with peak demand over 100 megawatts to generate 50% of their electricity from new onsite clean energy sources. It imposes a 100% surcharge on these facilities to fund grid upgrades for clean energy, with the revenue deposited into the Tennessee Environmental Protection Fund. The bill also prohibits using fossil fuel power purchase agreements for state economic incentives or state-subsidized fossil fuels for primary power at qualified data centers. This bill directly affects major data center operators and aims to accelerate clean energy integration without shifting costs to other utility customers. The bill is pending in the Senate Commerce and Labor Committee as of March 2026.
SB 1999 creates a "Clean Transition Tariff" (CTT) requiring large data centers, AI facilities, and other energy-intensive operations (with 25+ megawatts of demand or focused on data/AI/cloud computing) to pay for new clean energy infrastructure and grid upgrades needed to support their growth. The bill ensures these costs are borne solely by the large users, preventing rate increases for residential and small business customers. It establishes a voluntary tariff system approved by the Tennessee Public Utility Commission, mandating that new clean power for these facilities must be "additional" and not funded through general ratepayers. The law also requires local utilities to enforce this cost responsibility and report on large-load impacts annually.
HB 2054 establishes a "Clean Transition Tariff" (CTT) requiring large energy users - such as data centers, AI facilities, and crypto operations consuming 25 megawatts or more - to pay a voluntary premium for new clean energy infrastructure. This ensures these facilities fund their own grid upgrades and new clean power generation, preventing costs from being shifted to residential and small business customers. The bill mandates that large users cover all proportional costs for transmission, distribution, and reliability upgrades needed to serve their new electricity demand. It also requires utilities to enforce this tariff structure and report annually on cost allocations, protecting smaller ratepayers while supporting grid reliability. The CTT must provide 100% clean power for the facility’s new demand without impacting other customers’ rates.
HB 951, the "Clean Energy and Jobs Act," creates two main programs to support renewable energy and sustainable business practices in Tennessee. It establishes a Clean Energy Workforce Training Grant Fund to provide grants for workforce development programs in clean energy, administered by the Department of Environment and Conservation. Additionally, it offers a 30% tax credit for renewable energy businesses (like solar or wind companies) and small businesses (with 50 or fewer employees) that purchase systems or equipment to develop renewable energy or implement eco-friendly practices (such as recycling or energy-efficient manufacturing). The bill takes effect January 1, 2026, and is currently under review by the Agriculture & Natural Resources Committee.
SB 1246, the "Clean Energy and Jobs Act," creates two key programs to support clean energy growth in Tennessee. It establishes the Clean Energy Workforce Training Fund to provide grants for job training in clean energy fields (like solar or wind), administered by the Department of Environment and Conservation. The bill also creates a 30% tax credit for renewable energy businesses (e.g., solar installers) and small businesses (50 or fewer employees) to offset sales/use tax paid on qualifying systems, devices, or sustainable practices - such as eco-friendly materials or recycling equipment. These provisions directly affect renewable energy companies and small businesses seeking to adopt greener operations.
SB 885 amends Tennessee's tax code to allow nuclear energy production facilities to qualify for pollution control tax credits, expanding eligibility beyond existing wind and solar sources. This change directly affects nuclear energy facilities in Tennessee by enabling them to claim tax credits for certain machinery and equipment used in pollution control. The bill modifies Section 67-4-2004(9)(A) of the Tennessee Code to explicitly include nuclear energy production facilities in the list of eligible energy sources. The policy change takes effect July 1, 2025, and is part of a broader tax incentive framework for clean energy projects.
