Last Updated: August 21, 2025

Overview

Arkansas has a diverse geography, with mountains, lakes, forests, and river valleys. The state is rich in natural resources, with abundant natural gas, coal, oil, and timber. Arkansas is home to the only active diamond mine in the United States, the Crater of the Diamonds State Park, which is represented by the large diamond in the center of the state's flag.^1,2,3 The Mississippi River flows along the state's eastern border, the northern edge of the Gulf Coastal Plain occupies southern Arkansas, and rugged highlands cover the state's north and west.⁴ The fertile Arkansas River Valley separates the Ouachita Mountains from the Ozark Plateau in western Arkansas. Most of the state's natural gas production comes from the Arkoma Basin, which underlies the Arkansas River Valley. Coal resources are found in the valley near the state's western border, and coal resources also cover most of the eastern half of the state.^5,6,7,8 To the south, the lowlands of the Gulf Coastal Plain contain the state's crude oil-producing area.^9,10

Arkansas has considerable hydropower from rivers that flow generally east and south from the state's highland regions toward the Mississippi River.¹¹ The Mississippi River Valley and the upper reaches of its delta occupy the eastern third of Arkansas.¹² That area, part of the Mississippi River Alluvial Plain, has rich soils that, along with the state's hot, humid summers and mild, slightly drier winters, provide excellent growing conditions for agriculture.^13,14 Agricultural wastes and the forests that cover almost three-fifths of the state supply Arkansas with significant biomass resources.^15,16,17

Arkansas consumes nearly 60% more energy than it produces, and its per capita energy consumption ranks among the top one-third of the states.^18,19 The industrial sector, which includes agriculture, accounts about two-fifths of the state's total energy use, the most of any end-use sector.²⁰ Poultry, soybeans, and rice are the state's top three agricultural products in terms of cash farm receipts.^21,22 Several energy-intensive manufacturing industries also are major contributors to Arkansas's gross domestic product. They include food, beverages, and tobacco; the manufacture of primary metal and fabricated metal products; paper products; chemicals; plastics; and natural gas and crude oil extraction and mining.²³ The transportation sector accounts for over one-fourth of the state's energy consumption, followed by the residential sector at one-fifth and the commercial sector at one-sixth.²⁴

Natural gas

Arkansas holds about 1% of the nation's proved natural gas reserves, and the state accounted for nearly 1% of total U.S. marketed gas production in 2024.^25,26 The Arkoma Basin in west-central Arkansas produces most of the state's natural gas, although there are also gas wells in the southern part of the state. Most of the natural gas produced in southern Arkansas comes from crude oil production that contains some heavier hydrocarbons, such as propane.^27,28 The state's coal formations produce minor amounts of coalbed methane, mostly from the Lower Hartshorne coalbed located in west-central Arkansas along the state's border with Oklahoma.^29,30,31 Arkansas accounts for 0.1% of total U.S. coalbed methane output.³²

Marketed natural gas production in Arkansas increased significantly beginning in 2008. Output more than doubled and peaked by 2012 because of horizontal drilling and hydraulic fracturing in the Fayetteville Shale, which accounts for most of the state's natural gas production.^33,34,35 However, natural gas production in Arkansas decreased every year since 2012. The state's natural gas output in 2024 was less than one-third of what it was at its peak in 2012 and fell to its lowest level since 2007.³⁶

More than a dozen natural gas pipelines, mostly from Louisiana, Oklahoma, Mississippi, and Texas, pass through Arkansas on the way to markets in the Midwest and Northeast.^37,38 Large volumes of natural gas flow into the state and even larger volumes move out, with supplies mostly going through Mississippi, Missouri, and Louisiana.³⁹ The state has two natural gas storage fields that together can hold nearly 22 billion cubic feet of gas, which is about 0.2% of U.S. total underground storage capacity.^40,41

In 2024, Arkansas delivered more natural gas to consumers than the state produced for the first time in nearly two decades.^42,43 The electric power sector consumed half of the natural gas delivered to consumers in Arkansas, as generation from natural gas-fired power plants provided 38% of total in-state electricity in 2024.^44,45 The industrial sector, which includes agriculture, accounted for three-tenths of the state's natural gas deliveries. The industrial sector typically increases natural gas use during the fall months to dry the nation's largest harvested rice crop.^46,47,48 The commercial sector accounted for 14% of the state's gas deliveries. The residential sector, where almost 4 in 10 Arkansas households use natural gas as their primary source for home heating, consumed 7%.^49,50

Petroleum

Arkansas's proved crude oil reserves are small, accounting for about 0.1% of the U.S. total, and the state produces about 0.1% of the nation's total crude oil output. Oil production has remained steady at between 11,000 and 12,000 barrels per day since 2020.^51,52 Arkansas once played a larger role in the U.S. oil sector, leading the nation's crude oil production in the mid-1920s from its large Smackover oil field in the southern part of the state. Smackover remains the state's biggest crude oil-producing field.⁵³ However, many oil wells in the state are now stripper wells that produce less than 10 barrels of crude oil per day.⁵⁴ Arkansas's crude oil production continues to be concentrated along the state's southern border.⁵⁵

Arkansas has two oil refineries that have a combined processing capacity of almost 91,000 barrels of crude oil per calendar day, which is less than 1% of U.S. total refining capacity. The larger refinery in El Dorado can process about 83,000 barrels of crude oil per calendar day into motor gasoline, diesel fuel, propane, solvents, and asphalt products. The smaller refinery in Smackover processes about 7,500 barrels per calendar day and produces lubricants and process oils for the tire, electrical, asphalt, and roofing industries.^56,57,58

The transportation sector accounts for over four-fifths of the petroleum consumed in Arkansas, and the industrial sector uses about one-eighth. The commercial and residential sectors account for most of the state's remaining petroleum use.⁵⁹ About 6 out of 100 Arkansas households use petroleum products, mostly propane, for home heating.⁶⁰ Arkansas allows statewide use of conventional motor gasoline without ethanol, although almost all U.S. gasoline contains at least 10% ethanol.^61,62 Arkansas does not have any ethanol production plants, but does have two biodiesel manufacturing plants with a combined production capacity of 75 million gallons per year, nearly 4% of U.S. total capacity. Arkansas consumes about 156 million gallons of fuel ethanol and 23 million gallons of biodiesel annually.^63,64,65,66

Electricity

In 2024, natural gas remained the leading fuel used to generate electricity in Arkansas and accounted for 38% of the state's total electricity net generation. Natural gas-fired generation exceeded the state's coal-fired generation in 2020 for the first time. Coal accounted for 26% of the state's generation in 2024.⁶⁷

Natural gas fuels 5 of the 10 largest power plants by capacity in Arkansas, including the 2,031-megawatt Union Power Station, which is the largest power plant in the state. Coal fuels 4 of Arkansas's 10 largest power plants. The second-largest power plant is the state's one nuclear power plant—with two reactors—that provided about 25% of in-state net generation in 2024. The 1,822-megawatt nuclear power plant is located on Lake Dardanelle about 60 miles northwest of Little Rock. Almost all the rest of the state's electricity net generation came from renewables, mainly hydroelectricity, solar power, and biomass-fueled generating facilities.^68,69,70,71

Arkansas ranks 11th among the states in total electricity sales per capita and 5th in residential electricity sales per capita.⁷² In 2024, the industrial sector accounted for the largest share of electricity use in Arkansas, with 39% of the state's total power sales, followed closely by the residential sector at 37%. Slightly more than half of the households in the state use electricity as their primary energy source for home heating, and nearly all households use air conditioning. The commercial sector accounts for 23% of the state's electricity use. Arkansas ranks among the 10 states with the lowest average electricity price.^73,74,75,76 As of June 2025, Arkansas had 369 public electric vehicle charging locations, mostly clustered around Little Rock and Fayetteville.^77,78

Coal

Coal was Arkansas's most valuable mineral resource from its first commercial production in the mid-19th century until the discovery of oil in the 1920s. ^79,80,81 Arkansas has 227 million tons of recoverable coal reserves, which is about 0.1% of the U.S. total. However, the state's last coal production occurred in 2017.^82,83 Arkansas is the 18th-largest coal-consuming state. The electric power sector uses almost all the coal consumed in the state and it arrives by rail primarily from Wyoming. Industrial plants in the state also receive small amounts of coal by rail and truck from Utah, Illinois, Colorado, and Alabama.^84,85

Renewable Energy

Renewable sources of energy provided 11% of the total electricity generated in Arkansas in 2024. Conventional hydroelectric power accounted for nearly half of the state's renewable generation. The state has 18 utility-scale (1 megawatt or larger) conventional hydroelectric power generating facilities and 1 hydroelectric pumped storage plant.^86,87 Pumped storage plants pump water from a lower reservoir to an upper reservoir during periods of low demand for electricity, which is usually at night, when electricity is less costly. The upper reservoir releases water during periods of higher power demand and electricity prices, usually during the day, to turn turbines on its way to the lower reservoir, producing electricity. Although the pumped storage plant uses more power than it generates, it supplies power during periods of peak demand.⁸⁸

In 2024, the total amount of electricity generated in Arkansas by solar energy accounted for two-fifths of the state's renewable generation.⁸⁹ Arkansas's largest solar farm, Long Lake Solar with 200 megawatts of generating capacity, began operating in April 2025 in the east-central part of the state near the Mississippi River. Two other solar farms with 200 megawatts of capacity each are scheduled to come online in the second half of 2025.⁹⁰

Biomass supplied one-eighth of Arkansas's total in-state renewable electricity in 2024, almost all of it from wood and wood-derived fuels.⁹¹ Solid biomass residues, including crop residues and methane from livestock manure, are other potential resources for electricity generation in the state.^92,93 Arkansas's biomass resources also provide feedstock for the state's two wood pellet manufacturing plants. The biggest plant has a production capacity of 744,000 tons per year, which is the third-largest wood pellet plant in the nation. The smaller plant can produce 165,000 tons of wood pellets annually.⁹⁴ Wood pellets are used for heating and electricity generation.⁹⁵

Arkansas's best wind energy resources are in the Ozark Mountains in the northwest corner of the state.⁹⁶ The state's first utility-scale wind powered-generating facility, the 135-megawatt Crossover Wind Farm with 32 turbines located in west-central Arkansas about 40 miles from Memphis, began operating in June 2025. The 183-megawatt Nimbus Wind Farm located in the Ozark Mountain region plans to come online in the spring of 2026.^97,98 In April 2025, Arkansas enacted a law to limit the location of future wind farms, which requires the base of wind turbines to be at least 2,500 feet from a neighbor's property or 3.5 times the height of the turbine's blade when it points straight up, whichever is greater. The base of a turbine also must be at least one mile away from schools, churches, nursing homes, airports, parks, and city limits.^99,100

Arkansas does not have a renewable portfolio standard that requires the state's electricity providers to generate a certain amount of electricity from renewable energy sources.¹⁰¹ However, the state does have net metering, allowing households with small, customer-sited solar panels, wind turbines, or other renewable power generating installations no larger than 25 kilowatts in size to receive credits from utilities for excess electricity sent to the grid. Businesses with renewable electric generating systems that are up to 5 megawatts in capacity are also eligible for net metering. Municipal utilities can limit net metering to commercial customers with generating systems that are less than 300 kilowatts. In 2023, Arkansas amended the net-metering law for new residential and business customers who install generating systems after September 2024, reducing the credit they receive for their surplus power. Customers with net metering agreements in place before October 2024 were grandfathered in and will continue to receive the higher credits for excess power through June 2040.^102,103

In 2010, the Arkansas Public Service Commission (APSC) implemented an energy efficiency resource standard that required the state's investor-owned electric and natural gas utilities to undertake energy efficiency measures. Through 2026, the APSC extended the standards to reduce both utility electricity sales by 1.2% and utility natural gas sales by 0.5% compared with 2018 levels.^104,105

Endnotes

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