Electricity is an amenity that most people in the country take for granted, yet in Arkansas, statewide electrification is actually a fairly recent thing.
Less than 100 years ago, in 1930, only 2.1 percent of Arkansas farms had electricity, and those that did paid more per kilowatt hour to cover the cost of supplying the power, the Encyclopedia of Arkansas states. Electrification would not begin in earnest until the late 1930s thanks to the formation of electric cooperatives in the wake of the federal Rural Electrification Act. Still, even as 18 such cooperatives popped up statewide, fewer than 7 in 10 farms had electricity by 1950.
It likely would have been hard for people living during that period to envision how electricity generation would grow into an industry where Arkansas shines. According to the 2026 Arkansas Advanced Energy State of the Industry Report, the state produced 61.5 million megawatt hours in 2023, of which 49.9 million were sold to 1.7 million ultimate customers across residential, commercial and industrial sectors.
Even with such robust electrical production, the state is actually a net energy importer, the report states. Arkansas’ total energy production from all sources was 671 trillion British thermal units, representing only about 40 percent of the state’s total consumption in 2023. The state’s electrical generation can only make up for so much of that deficit; the U.S. Energy Information Administration reported sales of electricity grew 7.4 percent from 2015 to 2024, while total generation capacity grew by 8.2 percent, statistically staying neck and neck. What is more, between 2020 and 2024, demand increased 8.1 percent while power generation grew only 6.7 percent.
The situation is presently complicated by the fact electricity usage in the United States as a whole is on a tear. The U.S. trails only China in total consumption of the world’s electricity, 43 percent to 16 percent, as reported by SolarTech.
After years of stagnant growth from 2008 to 2021, U.S. consumption bumped 3 percent in 2024 alone. Nearly 40 percent of that electricity is gobbled up by residential users, half of that going to power outdated and thus less efficient heating and cooling units. Other factors pushing demand include increased electrical vehicle adoption and the national economic recovery spurring expansion of business and industry — which, of course, also tracks directly to the rise of data centers and their enormous appetites for power.
In fact, experts warn that the recent bump is nothing compared to where the trendline is headed, due primarily to the rapid expansion and proliferation of data centers powering artificial intelligence development. A new BloombergNEF analysis projects U.S. data centers, which currently consume about 6 percent of the nation’s electricity, will roughly double that percentage in just four years and consume about 20 percent of the nation’s electricity by 2035.
All of that adds up to Entergy Arkansas and power companies like it being under more pressure than ever before to mitigate the impact on ratepayers and delivery systems. It also speaks to the larger issue of affecting the state’s desirability from an economic development perspective, of which affordable, reliable power is one of the most important incubators.
“Since energy is an input for almost all economic activity, we can safely conclude that the quality and cost of its provision will greatly impact economic output. Mounting evidence suggests energy consumption is a necessary enabler — and driver — of economic growth,” wrote Todd Moss and Jacob Kincer for Energy for Growth Hub. The duo went on to note that electricity shortages “were found to reduce the likelihood of an individual being employed in a high-skilled job by 35 to 41 percent and of being self-employed by 32 to 47 percent.”
To their credit, Entergy officials have not been timid in their approach or shy in touting the steps taken to meet the demands of the future. Appearing at the Arkansas Economic Development Foundation luncheon in May, Entergy Arkansas CEO Laura Landreaux and Entergy Corp. CEO Drew Marsh highlighted the investment being made to power a future landscape that includes data centers.
Landreaux noted that the company added almost 3 gigawatts of new power generation with construction of the Cypress Solar facility and Jefferson Power Station near Pine Bluff, as well as the construction of the Ironwood natural gas turbine at Lake Catherine near Hot Springs. She also said the utility is considering converting its White Bluff coal plant to a natural gas-fired power plant, in addition to other equipment upgrades systemwide, and would not rule out the possibility of additional capital expansion.
“This all-of-the-above approach helps us not only ensure that we’ve got the megawatts to serve all the growth, but we’re doing it in the most cost-effective way,” Landreaux told the audience. “We’re having to make some of those same hard decisions today in order to see what the next generation of Arkansas is going to look like.”
To delve deeper into Entergy’s vital role in economic development and the ramifications of forecasted higher demand, Arkansas Money & Politics sat down with Danny Games, former executive vice president, global business at the Arkansas Economic Development Commission, who, for the past 8 1/2 years, has served as vice president of business and economic development at Entergy Arkansas.
Danny Games
Arkansas Money & Politics: Any time the announcement is made introducing Company XYZ that is going to create hundreds of jobs and occupy all this square feet, an awful lot has happened leading up to that point. What does that process look like, and at what stage is somebody calling you, saying, “Hey, we’re really trying to court Company XYZ, and we’d like you to be in these discussions”?
Danny Games: It’s in what we call, in the economic development world, the “site-selection process.” You can think of it as a funnel; at the top of the funnel, a prospective company is working with internal resources and possibly engaging a site location consultant or a real estate broker or a combination thereof. They’re coming up with what their drivers are for making a decision about where to establish a facility for manufacturing, warehouse, distribution or otherwise.
As they begin to go through their priorities and criteria, one part of that is geography. They may narrow it down to, “Well, we’re going to do business in Asia, so we want to be on the West Coast,” or “We’re purely exporting to Europe; we want to be on the East Coast,” or “The central U.S. is more conducive to our customers or suppliers or both,” so there are some geographical considerations. They also go about determining how big of a facility they will need, how many acres they will need, what are the cost drivers? Obviously, if you’re in the steel industry right now, being in close proximity to the Mississippi River, high-voltage transmission lines and rail are the three biggest drivers. Any state or a community that doesn’t have those doesn’t have a competitive site.
Once that company determines what sites meet most or all of their criteria, they reach out, and Entergy is usually involved at the very beginning of most initial requests for information.
AMP: Obviously, power is critical to successful operations, but it is not the only consideration. How often are electricity considerations the deciding factor among a much longer list of needs?
Games: We are a bigger driver than we’ve ever been before. I would say up until a few years ago, it was workforce, workforce, workforce, and companies just assumed all the others, including electricity, would be a given.
Then you saw some of the developments over the past several years where geopolitical interests, particularly in Europe right now, see North America as the best place in the world to locate, and within North America, it’s the United States. The decision of companies to grow and expand here on the basis of it being much safer to export from the United States and from North America than it is elsewhere has attracted a lot of foreign direct investment.
So what has that done? It gets back to electricity because it’s really accelerated demand in the United States, and obviously, data centers have played a part in that, as well. As a result, we are brought to the table much sooner, and the questions are much more direct about timing, about capacity and about cost.
Arkansas has always been very affordable on the cost equation, so that is rarely an issue for us. It’s more about do you have enough power, and can you get it to me soon enough?
AMP: To what degree does that process run both ways, meaning how valuable are these discussions for internal Entergy audiences in determining how to do things better or in long-range planning to meet what these companies are looking for?
Games: That’s a good question. I would go back to the comments from the Arkansas Economic Development Foundation luncheon when Drew Marsh, our chairman and CEO, and Laura Landreaux, Entergy Arkansas president and CEO, sat on the stage and said we’ve been very open to our customers and our state about embracing the opportunity to go after the growth that parts of the United States are seeing right now. To do that, you have to evaluate everything within your company that enables you to pursue that kind of growth. What we were doing five years ago doesn’t solve the puzzle, and it doesn’t secure the wins for our state.
AMP: How has Arkansas’ political leadership weighed in to help make the state more attractive for internal growth or external company recruitment from an infrastructure perspective, including utilities?
Games: That’s been huge, and it resulted in a different dynamic pursuing large-load customers that we didn’t have five years ago. Along with other utilities, we went to the state legislature and to the governor and presented them a construct that allows us to be able to be more responsive and take what was an 18-month or longer timeline and compress it down to six months. That became the Generating Arkansas Jobs Act that put a regulatory structure in place that’s also a philosophical viewpoint. Not just within Entergy, but among our state’s leaders, the message is, “OK, here’s Arkansas’ opportunity. Let’s enable that.”
AMP: What do you say to the ratepayers today who are worried about what attracting new large-load users, especially data centers, will do to their monthly bill, capacity and reliability of service?
Games: I would make one other point about how we’ve built a framework that allows us to contract for large loads in a way that protects other customers and helps generate revenue and savings that not just protects customers but actually benefits customers. Our Fair Share Plus pledge, which sounds kind of soft because it’s actually a commitment, shows up in our contracts in the way that we contract with those [large, corporate] customers in terms of monthly billing provisions, securitization and even upfront capital.
That formula is proving itself out. We already have two projects contracted under those terms that are going to spin off $1.7 billion in savings for all of our customers. Those are decisions that are made internally that basically say, “What does it take to win on behalf of our customers and our company and the states that we serve?” I would like to say I’m very proud of our leadership and our approach to some of those things.
AMP: What are companies looking for besides being able to reliably flip that light switch, and what is it going to cost me? What other definitions of value do these users have, and what are some expectations today that maybe were not talked about just 10 years ago?
Games: It should not surprise you to hear the one thing that has elevated to the top more than anything is that of certainty. The geopolitical state of affairs and some of the dynamics in business and industry that I never expected we would be dealing with means companies are having to learn to work in an environment where predictability is less and less of a given. There’s this phrase, “Capital is a coward,” meaning capital wants to go where it’s going to be safe. From our standpoint, that means they want reliable, affordable electricity, and they want to know there’s going to be stability in our cost and regulatory environment.
That’s not a given in other states, and if Arkansas can provide that environment and capitalize on that, then the message that we send to companies is you are welcome in Arkansas, and you’re going to be treated well. It used to be we were one of 45, maybe 46 states known as welcoming to business, and as that list has gotten smaller, Arkansas needs to stay near the top.
