Local Government Resources for Utility-Scale Solar

Tennessee has one statewide law that directly addresses solar development. During the 2022 legislative session, the Tennessee General Assembly established the “Decommissioning Law,” Tenn. Code Ann. § 66-9-207, which imposes requirements on solar power facilities regarding decommissioning obligations and the required removal of solar power facilities upon or prior to the expiration or termination of the solar power facility agreement. The Decommissioning Law includes requirements that must be present in agreements between landowners and owners or operators of solar power facilities entered into on or after June 1, 2022, the effective date of the legislation.

The original Decommissioning Law addressed solar-generating devices or structures at least 10 MW in size. However, effective July 1, 2024, the law was amended to apply to solar-generating devices or structures at least 5 MW in size. “Solar power facilities,” as defined in the Decommissioning Law, do not include solar-generating devices or structures less than 5 megawatts (MW) in size, measured at the point of interconnection; however, parties to a solar power facility agreement may elect to apply the requirements of the Decommissioning Law to smaller structures.

The 2024 legislation also tasks the TDEC Office of Energy Programs (OEP) with the responsibility of receiving and storing solar power facility agreements. Learn more about this process on the Statutory Requirements for Solar Facilities page. 

The Tennessee Solar Energy Industries Association, TenneSEIA, has a list of Frequently Asked Questions regarding this legislation.

TenneSEIA, the state affiliate of the national Solar Energy Industries Association (SEIA), which represents the interest of the solar energy industry in Tennessee, created a Model Tennessee Solar Zoning Ordinance.  

The Institute for Public Service at the University of Tennessee also provides various model ordinances for Tennessee communities through its Municipal Technical Advisory Service (MTAS) and County Technical Assistance Services (CTAS). A Model Municipal Solar Ordinance is available from MTAS. It should be noted that, in accordance with Tenn. Code Ann. § 13-7-203, a public hearing is required whenever a zoning ordinance is proposed.  

As noted in the report Laws in Order: An Inventory of State Renewable Energy Siting Policies, released by Lawrence Berkeley National Laboratory, which examines the diversity of siting and permitting regulations, authorities, and processes for renewable energy across all 50 states and Puerto Rico, siting decisions in Tennessee are made at the local level.

The U.S. Department of Energy (DOE) Office of Energy Efficiency & Renewable Energy (EERE) offers resources on the siting of large-scale renewable energy projects, including solar, and has established the Renewable Energy Siting through Technical Engagement and Planning (R-STEP) program with the goal of expanding the decision-making capacity and expertise of state and local governments around large-scale renewable energy planning, siting, and permitting.

The U.S. DOE Solar Energy Technologies Office (SETO) also offers information on large-scale solar siting specifically.  

Permitting solar development is treated similarly to permitting for other types of development in Tennessee. A solar construction site will require a National Pollutant Discharge Elimination System (NPDES) Stormwater Permit, sometimes called a construction general permit, from the Tennessee Department of Environment and Conservation (TDEC) Division of Water Resources. The site will also need an electrical permit, which can be purchased through the Tennessee Department of Commerce and Insurance. Additional permitting may be required by county or local municipalities; contact the local code or zoning office to learn more.

Additional requirements will be placed on any project that utilizes federal funding, including requirements pertaining to the National Environmental Policy Act (NEPA), such as a potential need to prepare an Environmental Assessment, which determines whether or not a federal action has the potential to cause significant environmental effects, or an Environmental Impact Statement (EIS), if a proposed action is determined to significantly affect the quality of the human environment. The EIS process requires the publishing of a notice of intent and an opportunity for the public to provide input, to be followed by the release of a draft EIS for public comment. As a federal agency, TVA regularly prepares NEPA environmental reviews. An example Environmental Assessment is available from TVA’s Adamsville Solar Project, and the TVA Solar and Battery Programmatic EIS provides an example of the documentation and requirements under the EIS process.

For residential-scale solar specifically, the National Renewable Energy Laboratory created the application SolarAPP+, short for Solar Automated Permit Processing, to automate the plan review and process for issuing permits to qualified businesses or individuals to install code-compliant residential photovoltaic (PV) systems. SolarAPP+ provides a number of benefits to solar contractors and the authority-having-jurisdiction charged with ensuring code compliance. Learn the Five Easy Steps to SolarAPP+ Adoption. 

Licensing

Solar installers are required to have a business license with the State, which would be acquired through the Secretary of State and be registered with the Tennessee Department of Revenue. Additional licensing requirements may exist from the local county or city municipalities.

The Tennessee Department of Commerce and Insurance requires a contractor’s license to complete any job over $25,000. Additional information is available on the Contractors and Home Improvements page, the License Requirements, and Licensing Steps pages. Contractor application documents can be found on the Forms and Documents page. Additionally, information on the various codes can be found on the Tennessee Fire Service and Codes Enforcement Academy’s Codes Program page. 

Solar Installation Certification

Currently, the State of TN does not require installers to be certified, though it is recommended. The North American Board of Certified Energy Practitioners (NABCEP) offers Solar Installation Certification. 

Electrical Code

The current, adopted electrical code for the State is the 2017 National Electrical Code (NEC). Article 110.3(B) of the 2017 NEC states that listed and labeled equipment shall be installed and used in accordance with any instructions included in the listing and labeling. For example, the installation instructions for Generac power cells state that Power cell batteries may be installed in dwelling units in the following locations only:

• Attached garages, separated from dwelling unit habitable spaces in accordance with local building code.
• Detached garages and accessory structures.
• Utility closets and storage or utility spaces.
• Basements.
•  Other locations not categorized as habitable space in a dwelling unit.

The Tennessee Advisory Commission on Intergovernmental Relations (TACIR) released a report in 2023 on Managing Solar Energy Development to Balance Private Property Rights and Customer Protection with the Protection of Land and Communities to address common concerns about solar development in Tennessee.

The U.S. DOE SETO webpage Solar Energy Resources for Government Officials aims to assist local government officials and stakeholders in boosting solar deployment.

The International City/County Management Association (ICMA) created Solar@Scale: A Local Government Guidebook for Improving Large-Scale Solar Development Outcomes, which is now in its third edition.

The National Community Solar Partnership (NCSP) is an initiative of the U.S. DOE SETO and a coalition of community solar stakeholders working to expand access to affordable distributed solar.

Land trusts, such as the Land Trust for Tennessee, work with landowners to create conservation easements that permanently limit land development and subdivision.

The State's Heritage Conservation Trust Fund, with a $30 million appropriation for fiscal year 2023-24, supports public-private partnerships to conserve land for tourism, outdoor recreation, natural and cultural resources, and "working landscapes."

Local governments can use zoning to encourage solar development in specific areas while protecting prime farmland and undeveloped land. For example, Bedford County has established a "renewable energy development zone" to streamline the approval process for solar projects within the zone and to set stricter standards outside the zone.

The state's new Brownfield Redevelopment Area Fund, created by the General Assembly in 2023, aims to encourage the identification, investigation, and remediation of potential brownfield sites for redevelopment, which could include solar facilities.

Farmland

U.S. DOE has created the Farmer’s Guide to Going Solar to address questions that farmers may have about solar and agrivoltaics.

The University of Tennessee Institute of Agriculture released the report, Evaluating Potential Land Use of Utility-Scale Photovoltaics (Solar Panels) on Farmland in Tennessee in 2023. The report attempts to quantify the amount of land currently used for utility-scale solar energy production in Tennessee and to project the amount likely to be used under different scenarios for future growth as well as providing information on the extent of farmland being converted to other uses, PV development considerations for agricultural communities, and the potential for collocation of PV power generation and agricultural production, known as agrivoltaics.

The American Farmland Trust provides resources for solar on farmland, including a Farmland Information Center with resources on solar.

The National Agricultural Law Center has resources available on the topic of renewable energy on agricultural lands. A Farmland Owner’s Guide to Solar Leasing provides specific information for Ohio; however, other information about solar leasing in the guide is relevant for farmland owners in any state.

The U.S. Large-Scale Solar Photovoltaic Database (USPVDB) provides the locations of ground-mounted PV facilities with capacities of 1 MW or more.

The State and Local Planning for Energy (SLOPE) Platform is a collaboration between U.S. DOE and the National Renewable Energy Laboratory (NREL) designed to support data-driven state and local energy planning by delivering modeled energy data at state and local jurisdictional levels. Users can explore energy data potential and projections to better understand opportunities and options in energy planning. SLOPE includes two distinct tools to support jurisdictions’ planning needs: a Scenario Planner to compare scenarios for the future of energy, costs, and emissions for counties and states, and a Data Viewer to explore city, county, and state data on renewables, efficiency, and transportation.

The Distributed Generation Market Demand (dGenTM) model created by NREL simulates customer adoption of distributed energy resources for residential, commercial, and industrial entities in the United States or other countries through 2050.

NREL also offers the System Advisor Model (SAM), a free desktop application designed to assist in answering questions about the technical, economic, and financial feasibility of renewable energy projects, including solar. Additionally, NREL offers the Renewable Energy Potential Model (reV), an assessment tool that can be coupled with SAM and that allows users to calculate renewable energy capacity, generation, and cost based on geospatial intersection with grid infrastructure and land-use characteristics.

Lastly, NREL offers Technical Support Services related to energy use and future scenarios for local jurisdictions when federally supported programs are not available. Technical assistance offers include data-driven, actionable energy decision support tools and expert-guided analysis to inform renewable energy, energy efficiency, and sustainable transportation projects.

TenneSEIA, the state affiliate of the national SEIA, represents the interest of the solar energy industry in Tennessee and aims to promote the development of solar energy and complementary technologies, including storage.

Led by the Interstate Renewable Energy Council (IREC) and the ICMA, SolSmart provides no-cost technical assistance to help local governments follow national best practices to expand solar energy use in their jurisdictions.

The NCSP is an initiative of the U.S. DOE SETO and a coalition of community solar stakeholders. NCSP offers free, rolling technical assistance to member organizations deploying community solar to help them accelerate implementation, improve the performance of their program or project, and build capacity for future community solar development. Learn more about how to join NCSP.

The Interconnection Innovation e-Xchange (i2X) is a program led by U.S. DOE that enables simpler, faster, and fairer interconnection of clean energy resources. The i2X program facilitates collaboration by conducting four key activities: stakeholder engagement, data collection and analysis, strategic roadmap development, and technical assistance. 

In February 2020, the TVA Board of Directors approved a set of principles to guide local power companies (LPCs) interested in adding locally sourced energy for their customers. Among the principles developed, up to 5% of an LPC’s average energy needs can be met by new distributed energy solutions built in their own service territory. This provides LPCs with the autonomy to build, own, or procure a percentage of their generation rather than sourcing all generation from TVA.

 In 2023, TVA adopted the Expanded Generation Flexibility Program, or Flexibility 2.0, which made three major changes. First of all, it will allow multiple LPCs to aggregate the capacity allotted to them into one project. In other words, a single Generation Flexibility project will be permitted to supply power to more than one LPC. This will allow for more efficient economies of scale for Flexibility projects, especially with respect to utilities with smaller energy demands. Secondly, LPCs will be allowed to contract TVA interconnected projects that are off the LPC’s system and outside of its service jurisdiction. This measure has particularly salient implications for land-constrained utilities and municipal utilities that would not otherwise have the necessary available land within their service area for a Flexibility project. Whereas formerly Generation Flexibility projects required that the solar projects be interconnected to the respective LPC’s distribution system, this new measure brings the benefits of Flexibility outlined above to a whole new set of LPCs in the Valley. Lastly, the modified program guidelines will allow over-generation (also known as backfeed) onto the TVA generation system.  This will allow for generation to exceed the substation load, with any over-generation treated by TVA as credit to the benefit of the LPC tied to the project.  View TVA’s Local Power Company Partners and contact the local power company to obtain more information.

The TDEC Office of Energy Programs (OEP) will administer the Solar for All Program to accelerate the deployment of solar infrastructure to benefit low-income households and disadvantaged communities while supporting Tennessee’s varied urban, suburban, and rural communities. TDEC intends to operate a statewide Program, and the scope of work is to provide financial assistance for residential rooftop and residential-serving community solar infrastructure, storage, and associated enabling upgrades in conjunction with preexisting, complementary programs (e.g., the TVA’s Flexibility 2.0 Program, Dispersed Power Production program, and community solar programs such as Nashville Electric Service's Music City Solar program). The Program will also provide project-deployment technical assistance focused on workforce development opportunities, as well as siting, permitting, and interconnection assistance, as needed.

A variety of Tennessee Valley Renewable Energy programs are offered by TVA, with an emphasis on solar opportunities. TVA offers dedicated pages about renewable resource opportunities for its Residential, Business, and Large Business and Industry customers. 

Under Tenn. Code Ann. § 67-6-346 [Pollution control credit], a taxpayer may take a credit, apply for a refund of taxes paid, or apply for authority to make tax-exempt purchases of machinery and equipment used to produce electricity at a “certified green energy production facility,” as defined in Tenn. Code Ann. § 67-4-2004. A  Certified Green Energy Production Facility is a facility certified by the TDEC as producing or storing electricity for use and consumption using clean energy technology.  See also, Tenn. Code Ann. Section 67-4-2108 relative to exempt property.

Federal Solar Tax Credits are available for businesses and other tax-exempt entities (e.g., nonprofits and local governments) that purchase solar energy systems. Tax-exempt entities (e.g., nonprofits and local governments) can also take advantage of solar tax credits through the elective pay provisions under the Inflation Reduction Act (IRA). Elective pay makes certain clean energy tax credits and the CHIPs manufacturing credit effectively refundable to tax-exempt entities; the entity can receive the full value of the credit because the IRS treats the elective payment amount as a tax payment. The first tax credit is the investment tax credit (ITC), which reduces the federal income tax liability for a percentage of the cost of a solar system that is installed during the tax year. This credit is available for projects that begin construction before January 1, 2025, and projects that begin construction after this date are eligible for the clean energy investment tax credit. The second is the production tax credit (PTC), a per kilowatt-hour (kWh) tax credit for electricity generated by solar and other qualifying technologies for the first ten years of a system’s operation, which reduces the federal income tax liability and is adjusted annually for inflation.

The Database of State Incentives for Renewables and Efficiency (DSIRE) provides a catalog of available incentives for renewable energy and energy efficiency across the U.S.