Tennessee House Bill HB2463

Tennessee 2025-2026 Regular Session

• Introduced: 2/3/26
• Refer: 2/5/26

Caption

AN ACT to amend Tennessee Code Annotated, Section 39-17-1002; Section 67-6-102 and Title 68, relative to the Bring Your Own Generation (BYOG) Act.

Impact

HB2463 mandates that new data centers or artificial intelligence facilities meet specific requirements for energy consumption from renewable sources. Particularly, any facility with a peak load exceeding one hundred megawatts must derive fifty percent of its electricity from onsite or directly connected clean energy resources. This requirement seeks to enhance the state's energy resilience and reduce reliance on fossil fuel sources. The bill also prohibits utilizing state-subsidized fossil fuel energy for primary power loads, reinforcing Tennessee's shift towards a cleaner energy environment.

Summary

House Bill 2463, known as the Bring Your Own Generation (BYOG) Act, aims to amend existing Tennessee legislation related to energy and data centers. The bill implements a clean energy transition surcharge specifically targeting data centers with a peak demand of one hundred megawatts or more. This surcharge is designed to cover the costs associated with integrating new clean energy sources into the electricity grid while ensuring that these costs are not passed onto consumers. This act reflects a growing commitment to environmental sustainability within the state’s energy policies.

Contention

Discussions around HB2463 highlight a significant move towards stringent energy regulations concerning large data centers, which have a substantial impact on energy consumption. While supporters of the bill argue that it drives progress towards clean energy and reflects responsible energy management, critics may view it as a potential hindrance to the growth of data centers in the state due to the increased financial burdens associated with compliance. The financial implications and operational feasibility for existing and future data centers represent a central point of contention in the legislative discourse surrounding this bill.