Listen to a crypto mine in Maynardville, Tennessee at night
This is what the cryptocurrency mine in Maynardville, Tennessee sounds like while running at night.
Brianna Paciorka, Knoxville News Sentinel
Melanie Faizer, a journalist and professor at the University of Tennessee at Knoxville, is suing the Tennessee Valley Authority for what she asserts are violations of the Freedom of Information Act, a federal law that empowers members of the public to gain access to a federal agency’s documents.
Faizer, a former interim news director at UT’s NPR member radio station WUOT, first requested access in April 2023 to documents related to TVA’s secretive economic incentive grants to cryptocurrency companies.
She was investigating cryptocurrency mining operations, giant computer systems that suck up electricity but don’t create many jobs.
Digital currencies like Bitcoin must be “mined” by a large network of computers that solve complex calculations to create coins and verify transactions. Mines have cropped up around East Tennessee, attracted by inexpensive power and loose zoning restrictions, a Knox News investigation found in 2022. They are noisy and often unpopular with nearby residents.
For her reporting, Faizer wanted to know what kind of incentives TVA gave a company called Bitdeer to build a mine at 5101 S. National Drive in East Knoxville in 2018.
The company used 9.4% of all Knoxville Utilities Board electricity in 2023 but employs just 30 people, Faizer reported. TVA stopped giving grants to crypto companies last year because of their small benefit to local economies.
Faizer’s report, published by WUOT in February, did not include specifics on incentives the federal utility gave Bitdeer as part of its economic development mission because TVA did not provide the information she requested. For nearly a year before her story published, Faizer appealed TVA’s decision to withhold records from her and its decision to ultimately provide heavily redacted documents.
In April, she took legal action against TVA as a last resort, enlisting attorney Paul McAdoo of the Reporters Committee for Freedom of the Press. The lawsuit, filed in the U.S. District Court for the Eastern District of Tennessee, asserts TVA maintains “pervasive secrecy” around its economic incentive grants in violation of federal law.
TVA withheld key information about its incentives to Bitdeer, citing competition with other economic development organizations to attract companies, as well as the privacy of Bitdeer employees. The lawsuit says the information should not be exempted and that it would benefit the public to know how TVA attracts certain companies.
On July 30, Bitdeer filed to join TVA in the lawsuit, arguing the utility could not adequately represent the company’s interests. In a response, McAdoo asserted the company’s interests were the same as TVA’s and that it would cause “undue delay and prejudice” to Faizer if Bitdeer joined the lawsuit.
McAdoo is fresh off a successful records lawsuit against TVA, representing Memphis journalist Marc Perrusquia. In September 2023, U.S. District Judge Ronnie Greer ordered TVA to disclose the salaries of four regional vice presidents, though the utility was allowed to redact their names. Perrusquia published the salaries in a report for Tennessee Lookout.
Faizer and McAdoo declined to comment on the ongoing lawsuit. The case is set to go to trial without a jury in November 2025. Nearly all FOIA lawsuits are resolved through summary judgment before trial, according to the Justice Department, since they rarely involve disputes over facts.
FOIA requests – and lawsuits – are familiar to TVA
In a statement to Knox News, TVA spokesperson Scott Fiedler said the agency takes seriously its obligation to comply with FOIA, but declined to comment on any ongoing litigation.
“TVA is a transparent organization, and we strictly adhere to FOIA guidelines to share information and keep the public informed about our actions,” Fiedler said.
Records requests are commonplace for the federally owned agency, which is one of only a few utilities subject to FOIA. Environmental groups and elected officials have long bemoaned what they say is a lack of transparency in TVA’s planning processes and limited salary disclosures.
TVA processed 177 records requests between October 2022 and September 2023, according to its most recent annual FOIA report. Of the 177 requests, eight were fully denied.
Lawsuits over FOIA requests also are familiar to the federal utility, the nation’s largest public power provider serving 10 million customers across Tennessee and parts of six bordering states.
Since 2019, TVA has defended itself against 11 FOIA lawsuits, including five that are ongoing. So far, five suits have been filed in 2024, the highest number in recent years. TVA spent $123,498 on records-related litigation in its most recent fiscal year.
Federal law allows nine exemptions to deny records requests. The most common reasons TVA denies requests, by far, are to protect trade secrets, personal privacy or communications shielded by legal privileges. All three are at play in its legal tussle with Faizer.
A report from the Government Accountability Office released in March showed the backlog of FOIA requests had piled up to over 200,000 in 2022 as federal agencies struggled to respond to requests in a timely manner.
Both TVA headquarters and its FOIA office are located in Knoxville.
Environmental group has four ongoing FOIA suits with TVA
Any member of the public, any organization or any advocacy group can request records from federal agencies, not just journalists or news outlets.
The Nashville-based Southern Environmental Law Center filed four successive FOIA lawsuits against TVA earlier this year on behalf of climate groups Appalachian Voices, the Center for Biological Diversity and the Sierra Club. A spokesperson for the law center said the four suits “represent a small fraction of the number of unanswered FOIA requests.”
The suite of lawsuits seek documents related to TVA’s multibillion-dollar buildout of 7,000 megawatts of natural gas plants, enough to produce electricity for about 4 million homes. While natural gas emits between 50% and 60% fewer carbon emissions than coal, the fossil fuel is unpopular with environmental groups.
TVA has signed precedent agreements with pipeline operators before getting public input on gas plants. That includes the gas plant set to replace the Kingston coal plant, the subject of a separate Southern Environmental Law Center lawsuit against TVA filed on Oct 10.
In its FOIA suits, the Southern Environmental Law Center wants to see communication between TVA and pipeline companies, as well as studies TVA conducted to justify the gas expansion.
Like many records lawsuits, the four lawsuits filed by the law center could drag on for years.
“Unfortunately, we have had to sue to get these documents to make them available to people throughout the Valley so we can understand these important decisions that affect everybody,” Trey Bussey, staff attorney at the Southern Environmental Law Center, told Knox News.
“This sort of information should be public from the start.”
Daniel Dassow is a growth and development reporter focused on technology and energy. Phone 423-637-0878. Email daniel.dassow@knoxnews.com.
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