Mississippi: A Reliable Energy State
When making substantial investments in new production or distribution facilities, companies must take a multi-decade view. The world is ever-changing due to technology development, emerging economies and politics, which cause uncertainty for future planning. So naturally, investors are attracted to areas with some predictability, perceived stability and resource reliability.
Mississippi, as a reliable energy state, can leverage its energy and natural resources strengths to attract investment. In a 2013 Area Development survey, executives ranked energy availability and costs number 10 among site selection factors. In previous years, energy was ranked higher, but presumably, the dramatic increase in U.S. natural gas production from shale formations, which has lowered both natural gas prices and price volatility and profoundly affected electric power markets, has reduced anxiety over future energy supply.
However, as more uncertainty emerges concerning the impacts of U.S. EPA regulations, and world energy demand grows, Mississippi should stand out as resource rich. In a 2012 analysis of energy-related opportunities, Ohio-based Battelle observed the following:
In some regards, Mississippi faces an ’embarrassment of riches,’ having so many energy-related assets and opportunities that it is a challenge to understand them all, prioritize them based on development potentials, and formulate strategies to optimize their enhancement and growth to benefit Mississippi and Mississippians.
Located in the center of the energy-rich and industry-friendly South, supply and stability are Mississippi’s strengths. Both in terms of production and deliverability, Mississippi boasts a surplus of electric power, natural gas, transportation fuel infrastructure and water, which will become an increasingly important siting criterion.
Some of Mississippi’s unique energy characteristics include the following:
- Abundance of natural gas infrastructure – In addition to ample geologic storage, Mississippi has more natural gas flowing both into and out of the state than any other state through 10,000 miles of natural gas pipelines. (Source: ANGA)
- Carbon dioxide pipeline system – The presence of naturally occurring CO2 encouraged heavy capital investment in CO2 pipelines to develop the enhanced oil recovery industry. While enhanced oil recovery has doubled the state’s oil output, the pipeline system is also enabling the first case of commercial scale carbon capture from a U.S. power plant.
- Electric power capacity – Abundant and diverse electric power generation assets, along with adequate transmission and distribution capacity, make Mississippi a reliable electricity state with competitive rates.
- Political stability – Energy is frequently mentioned as a growth priority among many state and local development leaders, and policy leaders have avoided making the poor, yet trendy, policy decisions that other states have enacted. With strong location incentives and a focus on customized workforce development programs, Mississippi and its substantial asset and natural resource base should attract interest from a variety of energy-based companies.