Arkansas has a diverse geography with abundant natural resources. The Mississippi River flows along the state’s eastern border, the northern edge of the Gulf Coastal Plain occupies southern Arkansas, and in the state’s north and west are rugged highlands. The fertile Arkansas River Valley separates the Ouachita Mountains from the Ozark Plateau in western Arkansas. Most of the state’s natural gas production is from the natural gas-rich Arkoma Basin, which underlies the Arkansas River Valley. Coal resources also have been found in the Arkansas River Valley near the state’s western border. To the south, the lowlands of the Gulf Coastal Plain contain a historically significant crude oil-producing area.

Forests cover more than half of Arkansas and provide significant biomass resource potential.

Rivers that flow generally east and south from the highland regions toward the Mississippi River provide Arkansas with considerable hydroelectric resources. The Mississippi River Valley and the upper reaches of its delta occupy the eastern third of Arkansas. The Mississippi River’s alluvial plain has rich soils that, along with the state’s hot, humid summers and mild, slightly drier winters, provide excellent conditions for agriculture. Agricultural wastes and the forests that cover more than half of the state supply Arkansas with significant biomass resource potential.

Arkansas produces more total energy than it consumes, primarily because of its abundant natural gas resources, but the state’s per capita total energy consumption is in the top one-third of all of the states in the nation. The electric power sector consumes the most energy in Arkansas, followed by the industrial sector, which includes agriculture. Rice and poultry are two of the state’s most important agricultural products, and food production leads the manufacturing sector in terms of revenue. Several energy-intensive industries are major contributors to the state’s gross domestic product and the industrial sector’s energy use. They include natural gas and crude oil extraction; the forest products industry, encompassing everything from harvesting timber to making wood and paper products; and the manufacture of fabricated metal products, primary metals, chemicals, petroleum products, and plastics.

Arkansas has a relatively mild climate, but changes in terrain and increases in elevation from the coastal plain to the state’s northern highlands can cause weather extremes. Per capita energy use by the residential sector is higher in Arkansas than in more than three-fourths of the states. Most households heat with electricity or natural gas, although more than one in nine use liquefied petroleum gas or wood for heating.

Renewable Energy

Quick Facts

  • Marketed natural gas production in Arkansas was nearly five times greater in 2015 than in 2005. In 2015, Arkansas produced 3.5% of the nation’s marketed natural gas.
  • Arkansas, the top rice-producing state in the nation, typically experiences an increase in natural gas consumption in the industrial sector (which includes agriculture) in the fall when natural gas is used to dry rice after harvest.
  • Coal-fired electric power plants in Arkansas supplied 39% of the state’s net electricity generation in 2015, down from 54% in 2014.
  • Independent power producers and the industrial sector provided almost 29% of net electricity generation in Arkansas in 2015, primarily from natural gas, coal, and biomass.
  • Biomass supplied all of Arkansas’ non-hydroelectric renewable energy resources for utility-scale electricity generation in 2015.
  • Last Updated: February 16, 2017

Hydroelectric and biomass-fueled facilities provide nearly one-tenth of net electricity generation in Arkansas.

Hydroelectric power is the most commonly used renewable resource in Arkansas, providing more than two-thirds of the state’s renewable power generation. Almost all the hydroelectric generation is supplied by electric utilities. Biomass supplies nearly all the nonhydroelectric renewable electricity generation in the state, almost all from wood and wood-derived fuels. Solid biomass residues, including crop residues and methane from livestock, are other potential sources. Arkansas has a small but increasing amount of installed solar generating capacity.Overall, renewable resources provide almost one-tenth of the state’s net electricity generation.

There are three wood pellet plants in Arkansas and more in development. The state also has three facilities that produce biofuels from animal fats and vegetable oils. Arkansas does not generate electricity from utility-scale wind energy projects; however, a number of manufacturers of components used by wind generators are located in the state.

Arkansas does not have a renewable portfolio standard. In 2009, the Arkansas Alternative Energy Commission was created to study the need for and impact of various forms of alternative energy in Arkansas. In addition, the state has adopted several policies to encourage energy efficiency. In 2009, the Sustainable Energy-Efficient Buildings Program was enacted, directing the Arkansas Energy Office to develop a plan for reducing energy use in all major existing state-owned facilities by 30% from 2008 levels by 2017. In December 2010, the Arkansas Public Service Commission (APSC) announced a Sustainable Energy Resource Action Plan requiring implementation of energy efficiency measures by the state’s investor-owned utilities. In 2015, the APSC extended the program and increased the savings target to 1% of 2015 sales in 2019.


Coal is the primary fuel used for electricity generation in Arkansas.

Coal is the primary fuel used for electricity generation in Arkansas and accounts for about two-fifths of the state’s net generation. The state’s two-reactor nuclear generating station provides about one-fourth of the state’s net generation. Although 5 of the 10 largest power plants by capacity in Arkansas use coal, the largest power plant in the state is natural gas-fired. Natural gas volumes used for electricity generation peaked in 2012, when natural gas fueled more than one-fourth of the state’s net generation. After a decrease in 2013 and 2014, natural gas again supplied more than one-fourth of the state’s net generation in 2015. Two-thirds of the natural gas-fueled generation in Arkansas is provided by independent power producers. Almost all the rest of the net electricity generation in the state is from hydroelectric power and biomass. The industrial sector accounts for almost all the state’s biomass-fueled electricity generation.

The average price of electricity to ultimate customers in Arkansas is among the lowest in the nation. Retail sales to the residential sector are greater than sales to the industrial sector or to the commercial sector. Almost half of the households in the state use electricity as their primary energy source for home heating.

Natural Gas

Arkansas is one of the top 10 natural gas-producers among the Lower 48 states.

Arkansas holds almost 3% of the nation’s natural gas reserves and is one of the top 10 natural gas producers among the Lower 48 states. Most of the state’s production is dry natural gas from the Arkoma Basin in west-central Arkansas, although there are several wells in the southern part of the state. Most of the natural gas produced in southern Arkansas is wet natural gas, containing some heavier hydrocarbons. Coalbed methane is also produced in the state. The development of that resource began in 2001. Arkansas is not a major producer of coalbed methane. Coalbed gas wells yielded about 28 billion cubic feet of natural gas from 2001 to 2015, much less than 1% of the state’s total natural gas production.

Gross withdrawals of natural gas in Arkansas increased dramatically between 2005 and 2012. Horizontal drilling and hydraulic fracturing in the Fayetteville Shale, the current focus of shale gas exploration in Arkansas, was responsible for some of the increase in production. However, because of a decline in drilling activity driven by lower natural gas prices, natural gas production in Arkansas has decreased by about 13% since peaking in 2012. Proved natural gas reserves in the state have fallen by a much larger amount since peaking in 2011. By 2015, natural gas reserves in Arkansas were at half their 2011 level.

Arkansas produces more than three times as much natural gas as its residents consume. The state has no natural gas market centers, and only two natural gas storage fields. More than a dozen natural gas pipelines, mostly from Louisiana, Oklahoma, and Texas, pass through Arkansas on the way to markets in the Midwest and Northeast. Large volumes of natural gas flow into the state and even larger volumes move out, mostly through Mississippi and Missouri on their way east and north.

Typically, about two-thirds of the natural gas delivered to consumers in Arkansas is used by the industrial and electric power sectors. Consumption for electric power generation rose sharply in the past decade, peaking in 2012. The electric power sector was the state’s leading natural gas-consumer from 2009 through 2013, and again in 2015. In 2014, the industrial sector briefly regained its status as the leading consumer of natural gas in the state. The commercial sector uses more natural gas than the residential sector, where two-fifths of Arkansas households use natural gas as their primary source for home heating.

Source: U.S. Energy Information Administration (Feb 2017)

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