Last Updated: August 15, 2024

Overview

Located in the center of the continental United States, Nebraska is a Plains state with rolling hills that include about 20,000 square miles of ancient sand dunes beneath the prairie grasses. Those sandhills cover more than one-fourth of the state and sit on top of a vast, shallow aquifer that extends beneath parts of eight states and provides crucial groundwater for agriculture in the region.^1,2 The groundwater and the fertile soils of the prairie that cover much of Nebraska make it a leading agricultural state.^3,4,5 Nebraska produces the nation's third-largest corn crop, and, using corn as a feedstock, the state is the nation's second-largest producer of fuel ethanol.^6,7,8 The broad plains that occupy much of Nebraska also have some of the nation's best wind energy resources.⁹ The wide rivers that cross the state provide hydropower, and the abundant sunshine, especially in western Nebraska, offers a good solar resource.^10,11 Crop residues supply a plentiful biomass resource as well.¹² Nebraska has modest fossil fuel resources and production, primarily crude oil.¹³ The state also produces small amounts of natural gas.¹⁴ Uranium, the source for nuclear reactor fuel, was mined in northwestern Nebraska, but the state's only in-situ uranium mine suspended operations in 2018.^15,16

Industry, which includes agriculture, is the end-use sector that consumes the most energy in Nebraska. It accounts for about 45% of the state's total energy consumption.¹⁷ Nebraska is one of the world's major meatpacking centers, and the energy-intensive agricultural and food processing industries are leading contributors to the state's GDP. Other energy-intensive industries in Nebraska are chemical manufacturing—particularly of pharmaceuticals, pesticides, and fertilizers—and machinery manufacturing.^18,19 The transportation sector, Nebraska's second-largest energy user, accounts for about 24% of the state's total energy consumption. The residential sector accounts for 17% and the commercial sector accounts for 14%.²⁰ Nebraska's weather varies greatly from season to season. Hot summer temperatures occasionally exceed 110°F and harsh winter temperatures can fall to minus 30°F, which can result in high seasonal energy consumption for air conditioning and heating.²¹ The state's relatively small population, energy-intensive industries, and weather extremes contribute to Nebraska ranking among the 10 states with the highest per capita energy consumption.^22,23

Electricity

Coal provides the largest share of Nebraska's electricity generation, and 3 of the state's 10 largest power plants by capacity and 5 by actual generation are coal-fired. Although coal-fired power plants fueled 45% of the state's total net generation in 2023, the amount of electricity generated by coal was the lowest since 1999.^24,25 In 2023, wind, nuclear energy, natural gas, and hydroelectric power provided almost all the rest of Nebraska's in-state electricity generation. Wind surpassed nuclear power's contribution for the first time in 2019, and accounted for 30% of Nebraska's total net generation in 2023.²⁶ The smaller of the state's two nuclear power plants—Fort Calhoun Nuclear Station, which was located along the Missouri River on the state's eastern border—was powered down in 2016 after a flood and fire.²⁷ The state's remaining operating nuclear power plant, Cooper Nuclear Station, supplied 17% of the Nebraska's power in 2023, down from the 30% that the two nuclear plants provided in 2010.²⁸ Natural gas-fired generation was at a record high in 2023, and provided 6% of in-state generation. The state's nine hydroelectric power plants accounted for 2% of net generation in 2023, with the amount of the state's hydropower the lowest since 2009.²⁹

Nebraska is the only state in which all electricity providers are publicly-owned—either public power districts, municipal power systems, or rural electric cooperatives. Nebraska's average electricity price is among the 5 lowest states, while it is one of the top 10 states in per capita electricity sales.^30,31,32 The largest share of annual electricity sales go to the state's industrial sector, which accounts for about two-fifths of total sales.³³ Nebraska has the third-largest number of industrial electricity customers in the nation, after Texas and California.³⁴ A significant amount of Nebraska's industrial electricity consumption is seasonal demand from farms, where electricity is used to run irrigation systems. Large data centers also consume substantial amounts of power, and several of them rely on electricity generated from renewable resources.^35,36 Electricity sales to Nebraska's residential sector, where about 3 in 10 households rely on electricity for home heating, accounted for about one-third of the state total and are less than in 36 other states. However, Nebraska's per capita residential electricity sales are greater than in all but 15 other states. The commercial sector makes up the rest, about three-tenths, of the state's electricity sales.^37,38,39 Overall, more electricity is produced in Nebraska than is consumed there, with about one-tenth of the state's generation sent to other states over the regional grid.⁴⁰ In mid-2024, Nebraska had over 250 public electric vehicle charging locations. Most of these charging locations are located along Interstate 80 that stretches 455 miles across the state from Omaha to the Wyoming border.^41,42 The state plans to use $6 million a year in federal funds over five years to help pay for charging locations spaced no more than 50 miles apart along the state's Alternative Fuel Corridors, which include Interstate 80 and two other major highways.^43,44

Renewable energy

Renewable resources provided 32% of Nebraska's total electricity net generation in 2023.⁴⁵ Wind energy potential is excellent across the entire state, and wind powers almost all of the state's renewable generation.⁴⁶ In 2023, wind contributed 92% of the state's total renewable-sourced net generation.⁴⁷ Almost all of the state's wind farms are in eastern Nebraska. Since 2020, six new wind projects with a combined capacity of almost 1,400 megawatts came online. As of mid-2024, Nebraska had about 3,500 megawatts of installed wind capacity at nearly three dozen utility-scale (1 megawatt or larger) wind farms. A 396-megawatt wind farm, which would be the state's second-largest, is scheduled to come online at the end of 2025.^48,49

Hydroelectric facilities produce 7% of Nebraska's renewable electricity generation.⁵⁰ There are 10 utility-scale conventional hydroelectric power plants in Nebraska, including one at the federal Gavins Point Dam on the Missouri River. The power plant is the state's largest hydroelectric facility and has three generating units with 34 megawatts of capacity each.⁵¹ The Gavins Point Dam straddles the border between South Dakota and Nebraska, but the hydroelectric power plant is on the Nebraska side. Gavins Point Dam plays an important role in controlling the water flow on the 800 miles of open river between Nebraska and St. Louis, Missouri.⁵²

Western Nebraska has the state's greatest solar resources.⁵³ Although solar energy contributed about 1% of the state's renewable generation in 2023, solar-powered generation has nearly doubled since 2020.⁵⁴ The largest solar power plant in the state is an 81-megawatt facility that came online in May 2024 near Omaha.⁵⁵ As of mid-2024, Nebraska had nearly 160 megawatts of solar photovoltaic (PV) capacity, including about 34 megawatts of customer-sited, small-scale (less than 1-megawatt) capacity.⁵⁶ More utility-scale solar PV facilities are in development in the state.⁵⁷ What will be Nebraska's largest solar farm, which will have 100 megawatts of generating capacity northwest of Omaha, is scheduled to come online in the summer of 2025.⁵⁸ In April 2024, the Environmental Protection Agency awarded a $62 million grant to a nonprofit in Nebraska to help pay for 60 megawatts of small-scale solar power generating systems for more than 9,000 low-income and disadvantaged households in the state.⁵⁹

Nebraska has other renewable resources including biomass and geothermal energy. Power plants that use landfill gas and other waste biomass to generate electricity accounted for less than 1% of the state's total renewable electricity generation in 2023.⁶⁰ Moderate geothermal energy potential exists across much of the state, but there are only a few small areas in northern Nebraska with the high-temperature resources needed for power generation. Nebraska does not generate any utility-scale electricity from geothermal energy.^61,62 However, geothermal energy is used in the state to heat houses, commercial buildings, and schools.^63,64

Nebraska is a major biofuels manufacturer and is second only to Iowa in the production of fuel ethanol.⁶⁵ There are about two dozen ethanol production plants in the state that together can make about 2.3 billion gallons of ethanol annually.⁶⁶ Nebraska accounts for about 13% of the nation's fuel ethanol production. In 2022, the state's ethanol plants produced about 23 times more fuel ethanol than was consumed in Nebraska. Most of the ethanol produced in Nebraska is shipped to other states.^67,68 Nebraska no longer has any biodiesel plants.^69,70

Nebraska does not have a renewable energy standard that requires utilities to generate a specific amount of their electricity from renewable energy sources.⁷¹ However, utilities are required to provide net metering and interconnections to qualifying customer systems that put excess electricity on the grid from generating capacities of up to 25 kilowatts, unless the total net-metered electricity equals 1% of the utility's average peak demand for the year.^72,73 Customer generators must pay for the costs of the interconnection, but the utility provides the metering system at no cost to the customer. To encourage renewable generation, a number of utility, state, and federal financial incentives, rebates, loans, tax incentives, and technical resources are also available.⁷⁴

Petroleum

Nebraska's modest crude oil reserves account for about 0.03% of the nation's total.⁷⁵ Wells in Nebraska have produced commercial quantities of crude oil since 1939. The state's annual production peaked at nearly 25 million barrels in 1962, but declined in 2023 to about 1.5 million barrels, which was the lowest level since 1950.^76,77,78 Almost all the state's crude oil production is from wells in western and southwestern Nebraska.⁷⁹

Nebraska does not have any crude oil refineries, but pipelines that cross the state deliver crude oil to facilities in neighboring states.⁸⁰ A crude oil pipeline that crosses southern Nebraska transports crude oil, primarily from Wyoming, to refineries in the Midwest.⁸¹ A second pipeline crosses the southwestern corner of the state, bringing crude oil from Wyoming to Cushing, Oklahoma.⁸² A third pipeline runs south across eastern Nebraska to a location near the Kansas border, where it splits. One section moves crude oil from Canada and North Dakota south to the Cushing hub and from there to Texas refineries. The other branch brings crude oil east to refineries in Illinois.^83,84 A network of petroleum product pipelines and terminals supply refined products from refining centers in nearby states to Nebraska markets.⁸⁵

Nebraska consumes less total petroleum than three-fourths of the states. However, on a per capita basis, it uses more petroleum than more than two-thirds of the states.⁸⁶ The transportation sector accounts for about four-fifths of the state's petroleum use, and most of it is consumed either as motor gasoline or as distillate fuel oil.^87,88 Distillate fuel oil includes diesel fuel, used both on-highway for transportation fuel and off-highway by agricultural machinery.⁸⁹ Distillate fuel oil accounts for a larger share (42%) of Nebraska's petroleum consumption than in all other states, except for Wyoming and North Dakota.⁹⁰ Most gasoline sold in Nebraska and other states is blended with at least 10% ethanol, but conventional motor gasoline without ethanol added can be sold statewide in Nebraska.^91,92 In addition to the widespread availability of motor gasoline blended with 10% ethanol, the state has almost 120 fueling stations that sell E85, a blend of 85% ethanol and 15% motor gasoline.⁹³

The industrial sector is the second-largest petroleum-consuming sector in the state and accounts for about 16% of the state's petroleum use. Industrial use includes agriculture, where diesel fuel is used off-highway in farm equipment.⁹⁴ The residential and commercial sectors combined account for about 6% of the state's petroleum consumption. About 7 in 100 Nebraska households heat their homes with petroleum products, mainly propane.⁹⁵ Nebraska has about three dozen power plants with petroleum-fired generators, some of which are backup units, but electricity generation accounts for a small amount of the state's petroleum consumption.^96,97

Natural gas

Nebraska does not have significant natural gas reserves.⁹⁸ Production in the state declined from a peak of nearly 16 billion cubic feet of natural gas in 1961 to 295 million cubic feet in 2022.^99,100 Nebraska receives most of its natural gas from interstate pipelines, primarily from Kansas, Wyoming, and Colorado. About 93% of the natural gas that enters Nebraska leaves the state and continues on to markets elsewhere, primarily through Iowa and Colorado. Smaller amounts of natural gas go to Missouri and Kansas.¹⁰¹ Typically, some of the natural gas that remains in Nebraska is stored in the state's one natural gas storage field, which can hold about 35 billion cubic feet.^102,103

In 2023, Nebraska's industrial sector, which includes agriculture, accounted for half of the natural gas deliveries in the state.¹⁰⁴ The residential sector, where about six out of ten households use natural gas for heating, is the second-largest natural gas consumer and accounts for one-fifth of the state's natural gas deliveries.^105,106 The commercial sector makes up slightly less than one-fifth of Nebraska's natural gas use and the state's electric power sector, which consumed a record amount of natural gas in 2023, accounts for about one-tenth. A small amount of natural gas is used as vehicle fuel in the transportation sector.^107,108

Coal

Although coal fuels nearly half of Nebraska's total electricity generation, the state does not have any significant coal reserves and has no coal production.^109,110 Most of the coal consumed in Nebraska arrives by rail and truck from the nearby low-sulfur coal fields in Wyoming's Powder River Basin.^111,112 More than nine-tenths of the coal consumed in Nebraska is used for electricity generation.¹¹³ A small amount of coal goes to industrial plants in the state.¹¹⁴

Endnotes

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² Nebraska Corn Board, What is the Ogallala Aquifer?, accessed July 1, 2024.
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⁶ U.S. Department of Agriculture, National Agricultural Statistics Service, Crop Production, 2023 Summary (January 2024), p. 10.
⁷ U.S. Ethanol Plants, Ethanol Producer Magazine, updated July 1, 2024.
⁸ U.S. Energy Information Administration (EIA), State Energy Data System, Table P4B, Primary Energy Production Estimates, Biofuels, in Thousand Barrels, Ranked by State, 2022.
⁹ U.S. Department of Energy, Energy Efficiency and Renewable Energy, WINDExchange, Maps & Data, accessed July 1, 2024.
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¹¹ Roberts, Billy J., Global Horizontal Solar Irradiance, National Renewable Energy Laboratory (February 12, 2018).
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⁶⁸ U.S. EIA, State Energy Data System, Table F25, Fuel ethanol consumption estimates, 2022.
⁶⁹ U.S. EIA, State Energy Data System, Table P4B, Primary Energy Production Estimates, Biofuels, in Thousand Barrels, Ranked by State, 2022.
⁷⁰ U.S. EIA, U.S. Biodiesel Plant Production Capacity (August 7, 2023), Detailed annual production capacity by plant is available in XLSX.
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⁷² NC Clean Energy Technology Center, DSIRE, Nebraska, Interconnection Guidelines, updated June 10, 2024.
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⁷⁸ U.S. EIA, Crude Oil Production, Annual-Thousand Barrels, 2023.
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⁸⁷ U.S. EIA, State Energy Data System, Table F16, Total Petroleum Consumption Estimates, 2022.
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⁹² Larson, B. K., U.S. Gasoline Requirements as of January 2018, ExxonMobil.
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⁹⁷ U.S. EIA, State Energy Data System, Table F16, Total Petroleum Consumption Estimates, 2022.
⁹⁸ U.S. EIA, U.S. Crude Oil and Natural Gas Reserves, Year-end 2022 (April 29, 2024), Table 8.
⁹⁹ U.S. EIA, Natural Gas Gross Withdrawals and Production, Nebraska, Annual-Million Cubic Feet, 2017-22.
¹⁰⁰ U.S. EIA, State Energy Data System: 1960-2022, Production, Ranked by State, Primary energy production in physical units - fossil fuels and nuclear, 1960-2022, XLSX, Natural Gas, Nebraska.
¹⁰¹ U.S. EIA, International and Interstate Movements of Natural Gas by State, Nebraska, Annual, 2017-22.
¹⁰² U.S. EIA, Underground Natural Gas Storage Capacity, Total Number of Existing Fields, Annual, 2022.
¹⁰³ U.S. EIA, Underground Natural Gas Storage Capacity, Total Storage Capacity, Annual, 2022.
¹⁰⁴ U.S. EIA, Natural Gas Consumption by End Use, Nebraska, Annual, 2018-23.
¹⁰⁵ U.S. Census Bureau, Nebraska, House Heating Fuel, American Community Survey, 2022: ACS 1-Year Estimates Detailed Tables, Table B25040, Occupied Housing Units.
¹⁰⁶ U.S. EIA, Natural Gas Consumption by End Use, Nebraska, Annual, 2018-23.
¹⁰⁷ U.S. EIA, Natural Gas Consumption by End Use, Nebraska, Annual, 2018-23.
¹⁰⁸ U.S. EIA, Nebraska Natural Gas Deliveries to Electric Power Consumers, 1967-2023.
¹⁰⁹ U.S. EIA, Electricity Data Browser, Net generation for all sectors, Nebraska, All fuels, Annual, 2001-23.
¹¹⁰ U.S. EIA, Annual Coal Report 2022 (October 3, 2023), Table 1, Coal Production and Number of Mines by State and Mine Type, 2022 and 2021, and Table 15, Recoverable Coal Reserves at Producing Mines, Estimated Recoverable Reserves, and Demonstrated Reserve Base by Mining Method, 2022.
¹¹¹ U.S. EIA, Annual Coal Distribution Report 2022 (October 3, 2023), Domestic distribution of U.S. coal by: Destination State, Nebraska, Table DS-23, Domestic Coal Distribution, by Destination State, 2022.
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¹¹³ U.S. EIA, Annual Coal Report 2022 (October 3, 2023), Table 26, U.S. Coal Consumption by End Use Sector, Census Division, and State, 2022 and 2021.
¹¹⁴ U.S. EIA, Annual Coal Distribution Report 2022 (October 3, 2023), Domestic distribution of U.S. coal by: Destination State, Nebraska, Table DS-23, Domestic Coal Distribution, by Destination State, 2022.