TVA Signs 10-Year PPA with Brookfield’s Facilities

Tennessee Valley Authority (TVA) together with Argo Infrastructure Partners, LP (Argo) and Brookfield Asset Management, with its listed affiliate Brookfield Renewable on Wednesday signed a landmark 10-year power purchase agreement (PPA) with power to be delivered by the Cheoah, Calderwood, Chilhowee and Santeetlah dams, which are known as Smoky Mountain Hydroelectric facilities (Smoky), which is jointly owned by Argo and Brookfield.

Smoky will begin delivering power through the PPA starting in 2025 and over the next decade, will supply more than 14 GWh of carbon-free energy to TVA customers, advancing TVA’s transition towards its 2050 net-zero goal.

Smoky currently owns and operates a 377 MW portfolio of four hydroelectric power facilities across east Tennessee and western North Carolina. This portfolio generates an annual average of 1.4 million MWh of carbon-free energy, equivalent to approximately 1.1 million tons of CO2 emissions avoided each year.

TVA Vice President for Origination and Renewables Solutions Chris Hansen said that this partnership enables more reliable, clean megawatts to be available when they’re needed. TVA has a long history of effectively using hydroelectric power to provide affordable, reliable energy to Tennessee region, and this agreement builds on that success, he said.

Brice Soucy, Argo Senior Director and Smoky Board member, said that this agreement supports the region’s energy transition goals, where unprecedented growth in data centres, manufacturing, and other industries has increased the demand for carbon reduction and renewable energy options.

Accelerating Energy Transition

Stephen Gallagher, CEO of Brookfield Renewable North America, said that the agreement with TVA will deliver clean power solutions at scale to accelerate the energy transition.

“We are well positioned to meet increasing demand for power from digitalisation and electrification with one of the largest renewable power platforms in the US, including our strategically important portfolio of hydro assets that can provide scale dispatchable clean power,” he added.

TVA manages 40,000 miles of rivers, streams and tributaries and supplies electricity to 10 million people. It has a team of scientists, experts and engineers that can move thousands of gallons of water up or downstream as needed.

Each fall, it lowers the water levels in preparation for the coming spring and during each spring, it collects water until the lakes reach a status known as “summer pool” which is ideal for recreation. In addition, the TVA now has three nuclear plants which represent more than 40% of the electricity generated by the TVA.

Hydroelectric generation already makes up approximately 9% of TVA’s total generation portfolio and about 56% of TVA’s power production is carbon-free.

Carbon Emissions

TVA and the Baker School of Public Policy and Public Affairs at the University of Tennessee, which conducted a study on carbon emissions in the region few years ago, looked across economic sectors such as transportation, industry, agriculture, and building emissions to evaluate potential paths for achieving a competitive and clean economy by 2050.

In 2019, the Valley region generated an estimated 200 million metric tons of carbon dioxide equivalent across all sectors of the economy, or about 3% of U.S. GHG emissions, which aligns to population percentage.  Transportation contributed the largest share at 36%, and the electricity sector represented 27% of the total emissions, the study said.