Vanderbilt anticipates placing up to 260 faculty, staff and students at the Institute for Quantum Innovation in Chattanooga, EPB CEO David Wade told the board of directors on Wednesday. The board approved $750,000 over the next three years in start-up funding for the center, which Vanderbilt will match.
EPB, Chattanooga's electricity and Internet provider, is home to America's most complete commercial quantum infrastructure, the utility said in a press release.
While EPB partners with the University of Tennessee at Chattanooga on quantum technology, Vanderbilt fills a gap highlighted repeatedly by Kelly because it is an R1 institution, a designation for universities that spend at least $50 million on research and graduate at least 70 research doctorate students in an average year.
"The race for quantum supremacy is a hot, real race, and time is of the essence," Kelly said in a phone call. "The missing piece of the puzzle in a healthy economic ecosystem for Chattanooga has been a top-tier research university, period. Full stop. I'm thrilled that Vanderbilt has seen this opportunity and stepped up, because that's exactly what we needed."
The connection began when Kelly and Bob Corker, former Chattanooga mayor and former U.S. senator, met separately with Vanderbilt Chancellor Daniel Diermeier in 2023 to discuss opportunities for research using EPB's unique fiber optics and quantum networks, Kelly said. Kelly and Corker attended Wednesday's EPB meeting to witness the board approve the institute, which the utility described in the press release as an "academic research and innovation campus."
Vanderbilt is often ranked among the top 20 universities in the U.S. The university announced in November it would open a campus in New York City in fall 2026, expanding beyond its original campus in Nashville. It has also explored a campus in West Palm Beach, Florida.
Kelly had previously said that inviting an R1 university to open a center in Chattanooga would be a drastic step as UTC works to beef up its research output.
"We have an alternative, which is to solicit other universities to establish research institutes here," Kelly said in a State of the City address in September 2024. "If we have to do that, we'll do that. But that would be kind of silly. We'll do it if we have to."
The announcement of the quantum institution came almost exactly one year after Vanderbilt officials toured the quantum center at EPB on Dec. 13, 2024. Vanderbilt was one of more than 100 companies or institutions to tour the center, EPB officials said.
'MAINTAIN OUR STATUS'
UTC sent out its own press release on Wednesday shortly after the EPB board approved the partnership with Vanderbilt. The release touted UTC's position as the first university connected to EPB's quantum network in 2023. UTC has committed $9.6 million to quantum research and infrastructure, including $6.6 million of external funding, the university said.
"We look forward to continuing our strong partnership with EPB as we bring more economic and workforce development to the Tennessee Valley Corridor and maintain our status as the higher education leader in quantum science in the region," the UTC release said.
EPB officials said the utility needed multiple partners to create a quantum hub.
"One university is simply not in a position to provide all the support that's needed in this area," Vicky Gregg, chair of the EPB board, said at the meeting.
LOOKING FOR SPACE
EPB and Vanderbilt are looking at possible spaces for the institute in downtown Chattanooga, EPB spokesperson J.Ed. Marston said in an interview. All EPB funding for the institute will come from grant or fee revenue raised by the utility's quantum center and will not cause electricity rates to rise, Marston said.
The city-owned utility and Vanderbilt did not announce a timeline for opening the institute. The independent campus will not be owned by EPB or Vanderbilt and will not exclude other institutions, Wade said.
The EPB board also approved a quantum incentive program that will give matching funds to qualifying academic and research institutions that have a presence or commitment in Chattanooga. The program has up to $9 million of funding available, and all grants must receive board approval.
"I'm excited about where this could take us," Wade told the board. "Having more of a cluster of activity is extremely important to our community."
WHAT ABOUT UTC?
Kelly has bemoaned that Chattanooga is the only major city in Tennessee without an R1 institution, a designation from the Carnegie Classification of Institutions of Higher Education. Kelly has repeatedly said the lack of an R1 university in Chattanooga is an impediment in attracting businesses to the area.
But UT System President Randy Boyd has questioned the significance of the R1 designation, a title the system's flagship campus in Knoxville and the Health Science Center in Memphis have earned. Boyd said UTC could garner the lesser designation of R2, with at least $5 million spent on research and 20 doctoral graduates per year, by 2027.
Quantum is an area within which Chattanooga and UTC could excel without having to reach a certain threshold, Boyd said in the previous interview.
"This could be the thing that Chattanooga can own," Boyd said. "You're not going to outdo Vanderbilt in health sciences, but here's something that we could actually own. ... Whether it's R1 or R2 doesn't matter, but if you're the world leader in quantum, that means something."
EPB has partnerships with the UTC Quantum Center, which the university launched in 2022. UTC added a quantum physics concentration to its physics degree in 2024, which it said is the first program of its kind in Tennessee. The university also offers an undergraduate certificate in quantum information science and engineering.
Mina Sartipi, a UTC professor and founding director of the UTC Center for Urban Informatics and Progress, sits on the EPB board. Sartipi told the board and EPB leaders she was concerned that it would be challenging for another institution to join the quantum institute, even though it's not exclusive.
Sartipi abstained from voting on the quantum institute and the economic incentive program to avoid the appearance of a conflict of interest. The four remaining board members voted in favor of the resolutions.
Vanderbilt offers an interdisciplinary minor in quantum information science and engineering. Daniel Diermeier, chancellor of Vanderbilt, celebrated the EPB partnership.
"From cybersecurity to energy distribution to medicine and science of all kinds, the potential for quantum innovation to improve our lives is enormous," Diermeier said in the EPB press release. "We are grateful to the leaders, businesses and residents of the Chattanooga area who have supported EPB's expansive vision."
QUANTUM RELEVANCE
EPB launched the first commercially available quantum network in 2023, and its board approved the purchase of a $22 million quantum computer from Maryland-based IonQ. The computer will become operational in February or March, EPB officials said.
Quantum computing and networking take advantage of the unique behavior of atomic and subatomic particles, which can exist in multiple states at once, to move or compute information faster than classical computers or networks.
EPB has around 203,000 electrical customers and 133,000 Internet customers. Some of them may wonder how quantum technology will improve their lives, and that's not an unreasonable question, Gregg said.
Quantum is expected to improve cybersecurity and power outages, and it could lead to more stable electricity rates, Gregg said.
"At EPB, we have our customers first and foremost in our minds," Gregg said at the meeting.
Quantum technology will have a local economic impact between $688 million and $1.1 billion by 2035, according to a peer-reviewed study led by professor Bento Lobo, department head of finance and economics at UTC.
As EPB pairs the quantum network with a quantum computer available for other companies to use, it has generated broad interest, said EPB CEO-elect Janet Rehberg.
"Nvidia, which we never thought would have even known what EPB was, reached out to us and wanted a partnership with us," Rehberg told the board.
EPB has five employees working on quantum technology, including a quantum physicist named Alexander Miloshevsky, who joined from Oak Ridge National Laboratory.
The quantum technology is attracting more early attention from outside entities than EPB's gig-speed Internet, which launched in 2011, said Jon Kinsey, former Chattanooga mayor and current EPB board member.
"We need to make sure the world knows we're looking for more partners," Kinsey said. "This isn't an exclusive with Vanderbilt. It's a great opportunity for our city."
The institution is pending approval from an accrediting agency before Vanderbilt faculty and students can work there, EPB said in the press release.
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