The Cornhusker Conundrum: Is Nebraska’s Coal Habit Funding Other States?
There is a powerful and persistent argument circulating in Nebraska energy debates: the state’s continued reliance on coal may be serving the interests of its western neighbors more than its own residents. The core of the issue is simple: Nebraska has no significant coal reserves of its own, meaning the millions spent to fuel its power plants leave the state, month after month.
For decades, this arrangement seemed to make sense. Nebraska sits adjacent to Wyoming’s Powder River Basin, a colossal source of low-sulfur coal. The proximity and established rail infrastructure made coal a cheap and readily available energy source, and by 2024, coal still accounted for about 43% of the state’s electricity generation.
However, critics point out that this reliance means Nebraska is essentially exporting its energy budget. In the past, analyses showed the state sending hundreds of millions of dollars out of state annually to pay for imported coal and its transportation, mostly to Wyoming. That money, they argue, could be recirculating within the state economy by investing in local energy resources.
A Shifting Economic Reality
The economic logic for imported coal is rapidly eroding. Advancements in renewable technology have tipped the scales, making new wind and solar generation significantly cheaper to run than nearly all existing coal plants across the country. For a state that ranks fourth in the nation for untapped wind energy potential, this represents a huge missed opportunity to foster in-state jobs and create new tax revenue for local communities.
The transition is already underway for some. Wind power has become a major player in Nebraska’s energy mix, and one of the state’s largest utilities, the Omaha Public Power District or OPPD, had planned to retire or convert some of its aging coal units to natural gas.
The Data Center Dilemma
But the energy story in Nebraska is rarely straightforward, and a massive new complication has recently emerged. The skyrocketing demand for power, driven largely by the arrival of massive new data centers for tech giants like Google and Meta, has put a profound strain on the grid. This surge in energy use led OPPD to delay its planned coal phase-out at the North Omaha Station, sparking outrage from local communities who have suffered the health effects of air pollution for years.
The situation became a full-blown political flashpoint in late 2025 when the state’s Attorney General and Governor filed a lawsuit to stop the utility from moving forward with the conversion plan entirely. The state’s leaders argued that the publicly owned power providers must prioritize affordability and reliability, suggesting that a move away from coal would be “foolish” and undermine the state’s energy security, especially when major energy consumers like the new data centers need constant power.
The debate has become a battle over Nebraska’s energy future. On one side are those who see a path to greater economic independence and better air quality by leveraging the state’s own abundant wind and solar resources. On the other are those who insist that the proven affordability and reliability of imported Wyoming coal is necessary to meet growing demand and maintain the low utility rates Nebraskans expect. The only thing certain is that the outcome will have lasting consequences for the Cornhusker State’s economy, environment, and political landscape.