Tennessee Gets A Major Economic Boost From Clean Energy

By Vance Cariaga
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Date Published: October 12, 2023

For those living outside the state, Tennessee might be best known for its music and mountains, but its been getting attention of a different sort recently because of a big move into clean energy. During a 12-month period ending in August 2023, Tennessee secured $7 billion in clean energy technology investments, according to an analysis from WPLN News.

The money will go toward 14 separate projects that will eventually produce electric vehicles (EVs), energy storage, and solar panel materials, WPLN reported. The dollar amount is worth three times more than any other industrial sector combined and represented nearly four-fifths of all capital investments during the preceding year based on the “Transparent Tennessee” business tracker. More than 5,600 jobs were expected to be created because of the deals.

The biggest project, announced in November 2022, involves a $3.2 billion cathode manufacturing plant being built in Clarksville by chemical conglomerate LG Chem.

That project is expected to create 850 new jobs and represents the largest foreign direct investment in Tennessee history, The Tennessean reported. When completed, the Clarksville plant will be the biggest cathode manufacturing facility in the U.S.

Photo Courtesy LG Chem

Much of Tennessee’s surge in clean energy manufacturing investments is linked to the Inflation Reduction Act (IRA), a major piece of climate legislation signed into law on Aug. 16, 2022. According to a report from McKinsey & Co., the bill commits roughly “$500 billion in federal funding and tax breaks to boost clean energy, reduce healthcare costs, and increase tax revenues.”

The investments in Tennessee are part of a broader nationwide movement to bolster renewables across the U.S. As of August 2023, U.S. solar and storage companies had announced more than $100 billion in new private-sector investments since the IRA was passed, according to the Solar Energy Industry Association (SEIA).

A total of 51 solar manufacturing facilities were announced or expanded in the U.S. over the same time period, the SEIA said, and 155 gigawatts of new production capacity were disclosed across the solar supply chain.

Even before the IRA was signed into law, Tennessee attracted significant investments in clean energy, WLPN reported. An example is the 2021 investment of $5.6 billion in Ford Motor’s Blue Oval City battery and vehicle production site near Memphis.

Photo Courtesy TN Office of the Governor

At least one of the Tennessee projects announced recently is tied to the 2021 Bipartisan Infrastructure Law, according to WPLN. That project was announced in October 2022 by Novonix, a Canadian battery and material technology company. In a press release, Novonix said it received a $150 million grant from the U.S. Department of Energy to expand its domestic production of high-performance, synthetic graphite anode materials at the company’s existing Riverside facility in Chattanooga.

Since 2019, companies have invested nearly $15 billion and created roughly 11,000 new jobs through EV-related projects, WLPN reported, citing data from the Tennessee Department of Economic and Community Development.

Photo Courtesy Novonix

“Tennessee is leading the future of American automotive manufacturing, thanks to our thriving business climate, record economic growth, and highly skilled workforce,” Tennessee Gov. Bill Lee said in a statement.

New clean energy projects are popping up throughout the state. Here’s a look at some of the projects announced following the passage of the IRA, according to WLPN. The list contains the company’s name, the city where the project is located, the total investment, the market being addressed, and the number of expected jobs.