The Tennessee Valley Authority Board of Directors on Aug. 20 approved updates to TVA’s wholesale rate structure to increase transparency, be more aligned to cost and protect residential and manufacturing customers from subsidizing the expenses associated with the significant growth of data center load in the Valley.
This action reaffirms TVA’s dedication to affordability through its recent signing of the Ratepayer Protection Pledge, a national initiative designed to ensure data center and other major power users cover the full cost of the energy and infrastructure their facilities require, shielding ordinary household and business consumers from rising electricity bills.
“Maintaining low rates and high reliability for customers is our first priority,” said TVA Chair Mitch Graves. “As AI and advanced industries consume more electricity, TVA’s Board is making sure that hardworking American families and small businesses aren’t left carrying the cost. By modernizing our rate structure and strengthening American-made energy, we’re advancing our nation’s AI and energy dominance while safeguarding the people we serve.”
American Public Power Association President & CEO Scott Corwin on July 23 participated in a White House event to reaffirm public power utilities’ commitment to ensuring customers are not burdened with costs caused by infrastructure investment to meet growing data center demand.
TVA Roadmap for Reliability
To meet the Valley’s expanding power demands, the Board also approved the recommendations in the Final 2026 Integrated Resource Plan that provides a long-term resource strategy balancing reliability, affordability, sustainability and flexibility.
Between now and 2040, the IRP suggests that the region will need 11 to 32 gigawatts of additional generation capacity.
"Approving the IRP is an important step in energy security because the study identifies a host of diverse generation mixes that could be needed to serve a rapidly growing region and maintain dependable year-round service.
FY 2027 Budget
To meet the region’s rising electricity demand -- driven by population growth, advanced manufacturing and rapidly expanding data processing and AI needs -- the Board also approved TVA’s FY 2027 budget.
"The FY 2027 budget puts affordability and reliability squarely in focus, aligning TVA’s financial planning with the strategic direction outlined in the 2026 Integrated Resource Plan," TVA said.
Major FY 2027 investments include:
• More than $13 billion planned through FY29 to maintain reliability and expand capacity, including more than $1 billion annually to maintain and strengthen TVA’s existing generation fleet and transmission system.
• Construction of 4,120 megawatts of new TVA-owned capacity and 3,000 megawatts currently under evaluation.
“Affordability and reliability remain at the center of every budget decision we make,” said TVA Chief Financial Officer Tom Rice. “As electricity demand grows, the FY 2027 budget strengthens TVA’s ability to add new capacity, support America’s energy and innovation leadership, and ensure Valley families and businesses continue to have reliable, affordable power for decades to come.”
