Report: Tennesseans living near data centers see bigger jumps in electricity costs
A report by Think Tennessee indicates that residents near data centers in the state, particularly in Nashville, are bearing a disproportionate share of increased electricity costs. The findings have intensified local debate, with proposed zoning regulations and a data center moratorium undergoing public hearings at the Metro Council.
A new report from the nonpartisan think tank Think Tennessee reveals that residents living near data centers in Tennessee have experienced higher electricity bill increases (3.2% between 2023-2024) compared to commercial consumers, including data centers, whose bills decreased by 0.2%. The report, the first in a two-part series, highlights that areas with data centers saw a 1.6% increase, outpacing the statewide average of 1.3%, with households projected to face a 5.1% increase between 2022 and 2027.
Tennessee's appealing land, energy sources, and growing tech industry have attracted over 60 data centers, with 13 existing or under construction in Nashville alone. Data centers consumed over 9.2 million megawatts in the Tennessee Valley region in 2025, a sevenfold increase in five years, equating to the annual electricity needs of 1.3 million Tennessee homes. This growth raises concerns about grid strain, particularly after Nashville Electric Service customers experienced widespread outages during a January ice storm.
The report's findings have fueled local opposition, especially against proposed data centers near the Nashville Zoo and Fisk University. During a June Metro Planning Commission public hearing on new data center zoning regulations, 150 residents spoke, citing concerns about grid stability and the environmental impact. The debate is ongoing, with new zoning regulations and a proposed data center moratorium scheduled for public hearings at the Metro Council. Mayor Freddie O'Connell supports these measures and has filed legislation to commence the condemnation process for the property next to the Nashville Zoo, aiming to balance economic development with responsible land use.