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Lights out in the heartland?

In late June, Alliant, an energy company based in Cedar Rapids, IA, began seeking bids to build a new generating plant to supply power for its 460,000 Iowa customers. The Iowa Utilities Board said electricity consumers could see a squeeze on supply as early as 2003.

At approximately the same time, Coleman Manufacturing, maker of Powermate home generators, launched a public awareness campaign filled with alarming statistics about the frequency of power outages throughout the country. The headline on the company's press release read: Blackouts Aren't Limited to California.

California. Though last winter's rolling blackouts in the Golden State had been largely created by a poorly contrived deregulation policy, it didn't take much imagination to start wondering whether the West Coast was setting yet another trend that would sweep across the nation. Politicians, environmentalists, energy company executives and advocates of alternative fuels all smelled fear — and opportunity. Depending on the person you asked, we would have to drill for oil in a pristine wildlife refuge, build more power plants, loosen environmental regulations, develop alternative energy sources or buy products to prepare for brownouts and life “off the grid.”

Still going

Despite chiding from Vice President Dick Cheney, Californians set a different agenda for themselves. They conserved energy and sued the energy companies for market manipulation. The expected summer of rolling blackouts never materialized. Instead, an apparent price — fixing conspiracy came to light. The New York Times reported that three different power plants had been shut down simultaneously for “maintenance.” Former employees of Enron testified that the company had withheld electricity from the market in order to drive prices higher. Consumer groups such as the Union of Concerned Scientists leveled similar accusations at El Paso Natural Gas, which controlled crucial pipelines serving California. The group pointed out that, when El Paso's lease on those pipelines expired, supply went up and prices went down. Meanwhile, the state's litigation against the power companies continues, and fear remains that a bigger, meaner energy crisis lurks just around the corner.

Worried farmers

According to the California agriculture newsletter Field Talk, many California dairy and vegetable farmers still think energy prices may keep going up enough to force them either to get out of farming or move their operations to another state.

In the heartland, Jerry Warner, executive vice president of Farmers National Company, says farmers are worried about the price of fuel and fertilizer. “As heavy users of energy, farmers are aware of the impact of higher prices on their operation, and they are very concerned about being able to carve out any kind of return this year, given low commodity prices.”

When Farm Industry News asked members of our farmer advisory panel, Team FIN, about their top concerns for the future, they ranked energy prices second, just behind low grain prices. Their number-three concern was availability of ethanol and biodiesel alternative fuels. Indiana farmer Steve Webb's comments were fairly typical of those of the group: “It will be interesting to see how the government's energy program plays out. President Bush is putting more emphasis on production, and not quite so much on conservation. I'd like to see more emphasis on conservation and renewable resources.”

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