Growing with South Dakota

By Erin Madison

As the area south of Sioux Falls continues to grow, NorthWestern Energy is expanding its natural gas service to offer affordable energy to more residents and businesses.

Several years ago, NorthWestern Energy saw an opportunity to expand its natural gas service to the rapidly growing area south of Sioux Falls, South Dakota. Residents and businesses in these areas did not previously have access to natural gas and instead relied on propane.

“Natural gas is extremely affordable compared to propane,” explained Tom Glanzer, Community Relations Manager for South Dakota and Nebraska. “Propane prices are very volatile.”

Even with the commodity price of natural gas rising in the past six months, natural gas is still a less-expensive heating option than electric and propane in most situations. Natural gas prices tend to be much more stable than propane and other alternative fuels.

While natural gas offers many benefits to residential customers, it can also help communities with economic development. Large manufactures and many other large businesses need natural gas for their operations and will only consider locating in communities that have natural gas.

“Some communities struggle to attract large industrial businesses because they don’t have natural gas,” said Paul Mantz, key accounts and economic development specialist for NorthWestern Energy. “Many developers and potential businesses won’t even look at a town or a piece of land if it doesn’t have natural gas or a gas line readily available.”

NorthWestern Energy’s natural gas expansion has helped businesses such as the Jack Links jerky plant in in Alpena, South Dakota, to switch from propane to natural gas, and several ethanol plants in the service territory needed the gas service agreement prior to agreeing to move to various communities.

NorthWestern Energy also supports community growth and economic development by being an active corporate citizen. NorthWestern Energy offers grants to nonprofit organizations in the communities we serve. We also contribute to local United Ways, service clubs, chambers of commerce and other local entities.

Around 2008, we built a natural gas pipeline to serve an ethanol plant in Marion, a small town located about 30 miles southwest of Sioux Falls. We found residents in nearby developments who relied on propane were interested in converting to natural gas.

In 2019, we signed a franchise agreement with Harrisburg and Tea, growing areas south of Sioux Falls, to begin serving customers in those communities. A new elementary school that opened in Harrisburg in 2021 has natural gas provided by NorthWestern Energy.

“We already had some existing natural gas infrastructure in the ground from a project to serve an ethanol plant, and that line goes directly through the area near Harrisburg and Tea that is currently being developed,” Tom said. “We wanted to be in front of the growth to support it, so it made sense to offer affordable and stable natural gas to the development plan for business and residential expansion.”

Last year, the Sioux Falls City Council approved a franchise agreement that allows us to serve natural gas to customers inside the city limits of Sioux Falls.

Going forward, NorthWestern Energy will continue to look for opportunities to expand natural gas service where it can benefit residents and businesses.

“Down the line, there may be the possibility for expansion in other parts of the state,” Paul said.

Benefits of natural gas

• Affordable: Annual energy costs for residential customers using natural gas has been lower than the cost for propane, fuel oil or electricity since 2010, and it's projected to stay low through 2040. U.S. consumers who use natural gas save an average of $874 on energy bills each year compared to homeowners who use electricity. https://www.aga.org/natural-gas/affordable/

• Convenient: Since natural gas is stored in pipes underground, you’ll always have a supply of natural gas. No need to worry about checking your meter and requesting delivery.

• Safe: Natural gas is safe to use, provided you use it appropriately and follow the recommended safety precautions. An odorant that we add to natural gas makes gas leaks easy to detect, and natural gas utilities spend $22 billion annually to help enhance the safety of natural gas distribution and transmission systems.

• Energy-efficient: Natural gas appliances produce more heat than traditional appliances.

• Environmentally friendly: Natural gas is the cleanest burning fossil fuel. It produces 50% less carbon dioxide than coal and 20-30% less carbon than heating oil.

• Abundant: It’s estimated that our nation has enough natural gas to meet our ever-growing energy needs for the next 100 years.

We are expanding our natural gas service to Sioux Falls, Tea and Harrisburg, South Dakota.