In the middle of Iowa, in the state capital of Des Moines, lies MidAmerican Energy (PINK: MDPWK), the state’s largest energy and utility company. It is a subsidiary of MidAmerican Energy Holdings and owned by Warren Buffett’s Omaha, Nebraska based Berkshire Hathaway Inc. (NYSE: BRK.A).
It has positioned itself throughout the region, servicing customers in Iowa, Illinois, Nebraska, and South Dakota.
The MidAmerican Energy company website states:
At the end of 2011, MidAmerican Energy had 7,685 megawatts of owned and contracted generating capacity. Approximately 47 percent was fueled by coal; 26 by wind; 20 percent by natural gas and oil; and 7 percent by nuclear, hydroelectric and other.
It also adds:
At MidAmerican Energy, our commitment to you, the customer, is to deliver the exceptional personal service you deserve. If you aren’t satisfied, neither are we. That’s a promise.
And actions are being taken to support that statement. In a lawsuit brought on by the Sierra Club several years ago, accusing MidAmerican with expelling too much pollution into the atmosphere, the company was ordered to cease the burning of coal in four of its units and one generator, the Des Moines Register reports.
“Coal’s days are numbered here in Iowa,” Pam Mackey Taylor, chairwoman of the Iowa chapter of the Sierra Club told the Register.
As a result of that lawsuit, MidAmerican will be rebuilding the units to run on cleaner natural gas. But it's not just because of the lawsuit.
“We probably didn’t agree to do anything that we wouldn’t have done anyway,” William Fehrman, President of MidAmerican, told the Register.
And MidAmerican is acting on its own volition, too. It is slated to cease the burning of coal at seven Iowa power plants and restrict emissions at two other coal plants, according to the SFGate.
A vow has also been made to stop the burning of coal by April 2016 in four of its boilers, and the company will convert three additional boilers to natural gas; large investments have also been made to create 2,200 megawatts of wind power capacity, SFGate reports.
The use of coal is shrinking in the U.S. due to cheap natural gas and a focus on the climate. And while competitors and the rest of the industry are vastly positioning themselves for a future in natural gas, MidAmerican is trying to keep all of it’s bases covered. The company isn't quite ready to close the door on nuclear power.
For the past two years, MidAmerican has been lobbying to pass a bill that would propel the use of nuclear power. But the bill has thus far due to environmental opposition.
But nuclear power works. And it’s proven, a fact that can’t be denied. Natural gas may very well lead the U.S. back to the promised land of wealth and prosperity, but what if it doesn't?
Hydraulic fracturing is still a controversial undertaking, and there’s no telling what the future holds. The complaints of contaminated water and wells have created a large opposition group. The EPA is still investigating the implications of the process, and if environmental groups find ways to shut hydraulic fracturing operations down, it will be vital to have a fall back plan.
The price is also an issue. Right now, natural gas is cheap, but any number of factors can lead to a growth in price: exports, colder winters causing higher demand, or a slowdown in production.
The Des Moines Register states:
Fehrman has been less eager to turn to natural gas. His reasoning: Natural gas looks good now when it sells for less than $3.50 per thousand cubic feet. But five years ago, gas sold for $10 per thousand cubic feet, and Fehrman said he has been unable to persuade natural gas companies to offer him long-term contracts.
Having a nuclear power plant could be like having an ace in the hole for MidAmerican.
There is currently just one nuclear power plant in Iowa—one nuclear power plant that couldn’t possibly supply the region with energy if it was ever depended on.
Right now the idea of building a nuclear power plant is just that, an idea. At this time, as it sits on the table, MidAmerican will continue to appease the public and provide energy in a more fashionable manner.