South Dakota


South Dakota ranks among the six largest ethanol-producing states in the nation.

South Dakota’s vast prairie stretches from the lowlands in the east to the Black Hills in the west. Modest crude oil and natural gas production is concentrated in western South Dakota, and substantial renewable resources are found statewide. Nine-tenths of the state’s landscape is covered by crops or pastureland, and high winds that blow unobstructed across South Dakota’s prairie provide a significant wind energy resource. South Dakota also has solar resources that are greatest in the southwestern part of the state and geothermal potential that is present across much of the state’s western two-thirds. The Missouri River and its many tributaries cut across the prairie, contributing to the state’s hydroelectric resources. Along the Missouri River’s course through South Dakota are several large hydroelectric dams. Uranium has been found in western South Dakota, although there is currently no production of that energy resource.

Industry is South Dakota’s leading energy-consuming end-use sector, and agriculture is the state’s leading industry. South Dakota has more livestock than people, and one-third of the state’s agricultural economy comes from raising beef cattle. South Dakota is also one of the nation’s top 10 corn producers. The abundant corn crop is used, in part, to supply the state’s ethanol-refining industry. The industrial sector includes several manufacturing industries in addition to South Dakota’s many farms. Food processing and the manufacture of farm and construction machinery, fabricated metal products, transportation equipment, and computers are the state’s leading manufacturing activities. Although gold mining on a large scale ceased in January 2002 with the closing of the Homestake mine after almost 40 million ounces of gold had been produced there, other energy-intensive mining activities continue, including the extraction of granite, gravel, petroleum, and precious metals.

South Dakota has one of the smallest populations of any state, and its total energy consumption is among the lowest in the nation. Nevertheless, with its energy-intensive industries and a climate typified by hot summers, exceptionally cold winters, and periodic droughts, South Dakota is one of the top 10 states in total energy consumption per capita.

Renewable Energy

Quick Facts

  • South Dakota ranked sixth in the nation in ethanol production capacity in 2016, with 6.8% of the U.S. total.
  • In 2016, hydroelectric power provided the largest share (39.9%) of South Dakota’s net electricity generation.
  • Wind power provided about 30% of South Dakota’s total net electricity generation in 2016.
  • South Dakotans’ price for electricity averaged 9.79 cents per kilowatthour in 2016 across all sectors, compared to the national average of 10.28 cents per kilowatthour.
  • The National Renewable Energy Laboratory estimates that about 94% of South Dakota’s land area is suitable for wind resource development using current technology.

South Dakota has one of the largest wind resources in the nation.

South Dakota uses its renewable energy resources extensively. The state generates seven-tenths of its electricity from hydroelectric power and wind, with more generation from hydroelectric power than from any other source. South Dakota is among the top seven states in wind potential. In 2016, South Dakota ranked second in the nation after Iowa in the share of its net electricity generation provided by wind. Even with more than 580 wind turbines statewide, and almost 1,000 megawatts of installed capacity, South Dakota’s wind potential is just beginning to be developed. Almost nine-tenths of the state has been identified as suitable for utility-scale wind projects.

South Dakota has other undeveloped renewable energy resources. Geothermal energy has been used in direct heat applications, including district heating, geothermal heat pumps, spas, and for heating swimming pools, residences, barns, and other buildings. The state has no utility-scale electricity generation from geothermal energy or from biomass. As an agricultural state, South Dakota has abundant agricultural waste that can be processed into biofuels. South Dakota is among the nation’s leading producers of corn and of ethanol. Sixteen ethanol plants are in operation in South Dakota, and all of them use corn as a feedstock. The state has only modest amounts of solar photovoltaic (PV) electricity generation and most of it is distributed (customer-sited, small-scale) generation. Moderate solar PV potential exists across most of the state, with the greatest solar potential in the state’s southwest corner.

In February 2008, South Dakota’s legislature established a voluntary renewable portfolio objective with the goal of obtaining 10% of all retail electricity sales from renewable and recycled energy sources by 2015. In 2009, the policy was amended to allow conserved energy as a component. The legislation applied to all retail providers of electricity in the state. Most of the electricity providers in the state have met the goal. Other providers noted barriers that limited their ability to meet the objective. Those barriers included lack of transmission capacity for renewable projects, intermittent supply, availability of low- cost natural gas, and physical location. South Dakota has additional regulatory policies, financial incentives, and technical resources aimed at encouraging energy efficiency and the expanded use of renewable sources for electricity generation in the state.


Hydroelectric power is the primary source of South Dakota’s net electricity generation.

South Dakota uses a variety of resources for electricity generation, but hydroelectric power is the primary supplier of electricity in the state, accounting for two-fifths of the state’s net generation. Four of the state’s largest hydroelectric power plants are on the upper Missouri River and are operated by the U.S. Army Corps of Engineers. The northernmost dam in South Dakota is the Oahe Dam. Forming the fourth-largest man-made reservoir in the nation, the Oahe began generating hydroelectric power in 1962. Downstream are the Big Bend Dam, which went into operation in 1964, and the Fort Randall Dam, just north of the Nebraska state line. The Fort Randall Dam first produced power in March 1954. The Gavins Point Dam, completed in 1957, straddles the border between South Dakota and Nebraska and is the smallest of the Upper Missouri River Basin dams. However, it plays an important role in controlling the water flow downstream on the 800 miles of open river between Gavins Point and St. Louis, Missouri. Water released from upstream dams is stored at the Gavins Point Dam in Lewis and Clark Lake for production of hydroelectric power. The hydroelectric power produced in South Dakota is marketed and delivered throughout the central and western United States by the Western Area Power Administration.

South Dakota’s remaining net electricity generation is supplied almost entirely from wind and coal. Wind power supplies more than three-tenths of South Dakota’s net generation. In 2015, wind powered 5 of the 10 largest electricity generating plants in the state. In contrast, coal’s contribution has fallen from more than half the state’s net electricity generation in 2008 to one-fifth in 2016. One-tenth of South Dakota’s electricity generation is natural gas-fired.

Per capita retail electricity sales in South Dakota are above the national average. The residential and commercial sectors together account for more than three-fourths of retail electricity sales in the state. Retail sales to the commercial sector are slightly greater than to the residential sector where about three-tenths of the state’s households use electricity as their primary energy source for home heating.

Natural Gas

Like crude oil, natural gas production in South Dakota is modest, and the state does not have appreciable proved natural gas reserves. Gross withdrawals of natural gas in the state have experienced a steady increase over the past 25 years, but South Dakota accounts for only about 0.05% of U.S. natural gas production. Most of South Dakota’s natural gas production is from wells in the northwestern part of the state.

Although South Dakota, with its small population, uses relatively little natural gas, more natural gas is consumed in the state than is produced. A handful of major interstate pipelines bring natural gas into South Dakota. Almost all the natural gas that enters the state comes from North Dakota. More than nine-tenths of the natural gas received in South Dakota is shipped on to Minnesota and other states. South Dakota does not have any underground natural gas storage facilities.

Industry, including agriculture, is South Dakota’s largest natural gas-consuming sector. The residential sector is the second-largest consumer in the state, but it uses only about one-fourth as much as the industrial sector. Nearly half of South Dakota households use natural gas as their primary fuel for home heating.

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

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