Data Centers Could Fuel a New ‘Gold Rush’ in Tennessee
Region’s existing energy infrastructure could play a growing role in determining where major technology investments are made.
WASHINGTON, Sept. 8, 2026 – The Tennessee Valley could emerge as a major hub for artificial intelligence data centers as growing demand for electricity and computing infrastructure reshapes the U.S. economy.
In a Sept. 3 column, Craig Fuller, CEO and owner of the Times Free Press argued that the region's access to electricity through the Tennessee Valley Authority gives it an advantage as technology companies invest heavily in data centers and the infrastructure needed to operate them.
“This is a gold rush, and the evidence is no longer limited to construction sites,” Fuller said. He argued that the investment surrounding data centers could spread beyond the facilities themselves, benefiting utilities, manufacturers, construction companies, transportation providers, and local communities
Electricity is the central factor in Fuller's argument for the Tennessee Valley. The region's ability to produce large amounts of power, combined with TVA's access to capital for new generation and transmission infrastructure, could give it an advantage in competing for data center investment.
AI data centers require substantial amounts of power, and Fuller said TVA's generation fleet allows the region to attract large facilities. TVA's portfolio includes nuclear, hydropower, solar, and natural gas generation.
Fuller compared the opportunity to the role the Permian Basin in West Texas and southeastern New Mexico plays in the U.S. oil industry, arguing that the Tennessee Valley could become a major source of reliable electricity for hyperscale data centers.
“[The Tennessee Valley] has the equivalent advantage in power,” Fuller said, describing the region's opportunity to become the “Permian Basin of electricity.”
The construction boom surrounding AI data centers is already generating demand for workers and materials across the country, Fuller wrote. The facilities require large amounts of steel, copper, piping, generators, transmission equipment and other infrastructure, while their construction creates work for electricians, HVAC technicians, pipe fitters, steelworkers, and other skilled trades.
Fuller cited estimates that construction of a 500-megawatt data center can generate roughly 30,000 truckloads of freight. He also pointed to growing demand for rail transportation and American-made industrial materials as evidence that the data center buildout is affecting industries beyond technology.
TVA's status as a federal corporation could also give it an advantage in financing the generation and transmission investments needed to accommodate additional electricity demand, Fuller said.
The utility has been advancing nuclear development as part of its efforts to expand generation. Fuller pointed to TVA's work on small modular reactors at the Clinch River site as one example.
The growth of data centers has also generated opposition in communities concerned about electricity costs, grid reliability and other local impacts. Fuller argued that those concerns should be addressed by ensuring that large data center customers pay for the additional costs they impose on the electric system.
TVA recently created a dedicated rate class for data centers, including capacity-commitment charges. Fuller described the move as a way to ensure that large facilities do not shift their incremental costs onto residential and small-business customers.
Fuller also argued that data centers should provide direct benefits to communities hosting the facilities. Possible approaches include special taxes dedicated to local services, community funds, payments to residents or reduced electricity bills for households near major facilities.
The broader opportunity, Fuller said, is to use the data center buildout to attract investment while ensuring that communities retain some of the economic benefits.
The Tennessee Valley's combination of available electricity, industrial infrastructure and skilled labor could make the region particularly attractive as AI companies expand their physical infrastructure, Fuller wrote.
“The AI boom is already underway,” Fuller said. “Regions that hesitate will watch the capital, jobs and opportunities to fund public services located somewhere else.”
