MidAmerican Energy study outlines 20 years of power generation needs

Nov 05, 2024

(This article was updated to correct information.)

MidAmerican Energy, Iowa’s largest electric utility, says it expects to invest heavily in solar energy, natural-gas power plants and a small modular nuclear facility over the next two decades to meet the state’s increasing energy needs, driven in part by the growing data center industry.

Owned by Warren Buffett’s Berkshire Hathaway, MidAmerican, anticipates adding 6,890 megawatts of generation plus 155 megawatts of storage, according to a resource evaluation study it filed with state regulators Friday.

The increased generation would be in addition to the Des Moines-based utility’s $3.9 billion WindPrime plan to build 2,042 megawatts of wind and 50 megawatts of solar energy generation.

"Even as MidAmerican continues to develop projects associated with WindPrime, real-world demand coupled with forecasted growth, including large loads under contract, shows a generation capacity need," the company said in the report.

Over the next five years, the company said it needs to build two natural gas plants that would add 233 megawatts each to meet peak demand. The so-called “peaker plants” are small, only about 40% the size of MidAmerican’s natural gas plant in Pleasant Hill. They wouldn't likely come online until 2028 and 2029, the report says.

Just how much more energy MidAmerican customers need is unclear. The company redacted demand forecasts from its report, providing only data showing that its Iowa and South Dakota customers' energy use climbed nearly 40% over the past 12 years.

Iowa has attracted massive Facebook, Google, Microsoft and other tech data centers that have helped drive the state's increased demand. NextEra Energy, for example, is weighing reopening its Duane Arnold nuclear power plant near Palo to meet growing demand from data centers developing artificial intelligence, as well as the nation's push toward electric cars and trucks.

MidAmerican expects to need to build an additional three peaker plants from 2031 to 2035 and four large natural gas plants, ranging in size from 466 megawatts to 699 megawatts, from 2040 to 2044. The company, the nation's leader in wind power generation, also expects to develop 2,300 megawatts of solar energy from 2033 to 2044 — a big step up from the 141 megawatts its says it currently generates.

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Altogether, MidAmerican anticipates adding 3,495 megawatts of natural gas-fired generation, 3,050 megawatts of solar energy, and 345 megawatts of modular nuclear energy, which would pair with 155 megawatts of molten salt power storage. The small-scale nuclear plant likely wouldn't be added until 2036, the report says.

MidAmerican spokeswoman Tina Hoffman said the company will look to lessons learned by PacifiCorp., a Berkshire Hathaway sister company that's partnering with Microsoft billionaire Bill Gates' TerraPower to build a modular nuclear reactor pilot project in Wyoming.

Hoffman said MidAmerican won't have an estimate on the cost for the new power generation until it's ready to make a request to the Iowa Utilities Commission for regulatory approval.

The report outlines shutting down most of the company's coal-fired power plants over the next 20 years, but environmental groups have urged it to adopt a more aggressive plan while adding renewable energy.

The Iowa Environmental Council said it and other partners "identified lower-cost paths forward that would also reduce the air pollution that is making asthma and (chronic obstructive pulmonary disease) worse in places like Sioux City," near two of MidAmerican's coal power plants, Kerri Johannsen, the group's energy program director, said in an email.

The company's plan, she said, "prioritizes the company's profits over the health and financial well-being of the Iowans."

Josh Mandelbaum, an Environmental Law & Policy Center senior attorney and Des Moines City Council member, said he disagrees with the model MidAmerican used to forecast its needs, saying it's doesn't fairly weigh renewable energy's benefits. It means “you leave cost-effective, more economic, cheaper renewable options on the table because your model won't select them,” said Mandelbaum, whose group plans to pursue its own analysis.

MidAmerican said in a statement that the analysis ensures the company will generate "long-term reliable power for customers while maintaining its position as one of the lowest-cost electricity providers in the United States." It said the plan reflects its "all-of-the-above strategy that combines a strong, continued commitment to renewable energy with proven, on-call power sources to meet the significant projected growth in customers’ electric demand."

Over the past 20 years, MidAmerican says, it's developed more than 3,400 wind turbines across 32 Iowa counties, making it the nation's largest rate-regulated owner of wind energy generation. Iowa gets nearly 60% of its energy from wind, the largest share nationally.

MidAmerican agreed to the resource evaluation as part of a settlement with consumer groups concerned about the effect of the WindPrime proposal on rates, according to trade news website Daily Energy Insider. The company said several people and groups participated in the company's analysis, including the Environmental Law & Policy Center, Iowa Utilities Commission members, the Iowa attorney general's consumer advocate, the Iowa Business Energy Coalition, the Sierra Club, Microsoft and Google.

This article has been updated to correct that Iowa and South Dakota MidAmerican customers' energy use climbed nearly 40% over the past 12 years.

Donnelle Eller covers agriculture, the environment and energy for the Register. Reach her at [email protected].