Overview

Resources and Consumption

Iowa has few conventional fossil energy resources but is rich in renewable energy potential. Iowa leads the Nation in production of both corn and ethanol made from corn. The wind power potential harnessed in northwest Iowa places the State among the leading wind producers. The industrial sector leads State energy consumption. Iowa’s population is low and its economy is relatively energy intensive, resulting in high per-capita energy consumption.

Petroleum

Iowa relies on petroleum products brought in by pipeline from other States. Total petroleum consumption in Iowa is low and is led by the transportation sector. The State ranks disproportionately high in LPG consumption, due to the heavy use for agricultural purposes and for residential heating.

Iowa grows the most corn of any State in the Nation, and is also the leading producer of ethanol, accounting for approximately one-fourth of the Nation’s ethanol supply. Iowa produces over double the ethanol volume of Illinois, the next highest producing State. Iowa has over three dozen operating ethanol plants, with one under construction and several planned expansions to existing plants. Although Iowa’s ethanol production is high, consumption is low, in part because Iowa is one of the few States in the Nation that allow the statewide use of conventional motor gasoline. (Most States require the use of specific gasoline blends in non-attainment areas due to air-quality considerations.) Iowa delivers much of its ethanol to U.S. fuel markets that require motor gasoline blended with ethanol. Currently, ethanol must be transported by tanker, truck, or rail but a proposed 1,800-mile pipeline, if built, could deliver ethanol from South Dakota, Iowa, Minnesota, Illinois, Indiana, and Ohio to distribution terminals in the northeastern U.S.

Natural Gas

Natural gas, which supplies nearly one-fifth of the State’s energy demand, reaches Iowa through pipelines from Canada via Minnesota and from the Texas and Oklahoma panhandle area that extend to other Midwestern U.S. consumption markets. Iowa ships over three-fourths of the natural gas it receives to Illinois. About two-thirds of Iowa’s households use natural gas as their primary home heating fuel. Natural gas is also used to generate a small amount of electricity and to make fertilizer products such as anhydrous ammonia.

Coal, Electricity, and Renewables

Electricity generation and consumption in Iowa are relatively low, and coal-fired plants produce about three fourths of the electricity generated in the State. Due largely to air-quality concerns, approximately nine-tenths of the coal used in Iowa is low-sulfur coal brought in by rail from Wyoming. The State’s one nuclear plant, Duane Arnold, is located just northwest of Cedar Rapids and generates roughly one-tenth of the State’s electricity. Since 2004, electricity generated from natural gas has increased from less than 2 percent to 6 percent of total generation in Iowa. Wind turbines, primarily located in northwest and north-central Iowa, place Iowa among the leading States in wind power generation, and have helped to increase the share of the State’s electricity generated from wind from under 3 percent in 2004 to 6 percent in 2007.

In 1983, Iowa passed the Iowa Alternative Energy Production Law, which requires the State’s two investor-owned utilities to generate a total of 105 megawatts of their electricity from renewable-energy sources.