Energy policy in Kentucky, 2007-2017

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Fracking in the U.S.
Energy policy in the U.S.
State fracking policy
State energy policy
Glossary of energy terms

Energy policy involves governmental actions affecting the production, distribution, and consumption of energy in a state. Energy policies are enacted and enforced at the local, state, and federal levels and may change over time. These policies include legislation, regulation, taxes, incentives for energy production or use, standards for energy efficiency, and more. Stakeholders include citizens, politicians, environmental groups, industry groups, and think tanks. A variety of factors can affect the feasibility of federal and state-level energy policies, such as available natural resources, geography, and consumer needs.

This article outlines state-level oil and gas regulations, renewable energy programs, oil and gas production, energy usage, energy and electricity prices, fuel taxes, and utilities in Kentucky.

See the tabs below for further information:

1. Policy: This tab provides information about state regulations on energy production and policies related to oil and gas production, fracking, renewable energy generation, energy efficiency, and net metering.
2. Production: This tab provides information about total energy production by energy source in Kentucky.
3. Usage: This tab presents information about electricity consumption by energy source.
4. Prices and taxes: This tab presents information about average energy and electricity prices, per capita spending on energy, and fuel taxes.
5. Utilities: This tab presents information about public and private utilities, electricity markets, the types of utilities in Kentucky, and the electric reliability organizations in Kentucky.
6. Background: This tab provides information about the types of nonrenewable and renewable energy sources produced and used in the United States, an energy profile of Kentucky, a state profile of Kentucky from the Almanac of American Politics (2016), and economic indicators in the state, such as median income.

Policy

State regulations

The Kentucky Division of Oil and Gas has regulatory authority over oil and natural gas operations in the state. State rules and regulations cover the drilling of all wells used for oil or gas exploration, the spacing of wells, permitting requirements for oil and gas operators, injection wells used to enhance oil and gas recovery or to dispose of wastewater, the cementing and plugging of wells, the underground storage of natural gas, the prevention of well blowout and leaks, well restoration, reporting requirements, and more. All Kentucky rules and regulations related to oil and gas operations are found in Title 805 of the Kentucky Administrative Regulations.

Fracking

See also: Fracking in Kentucky

According to the Chapter 353.6602 of the Kentucky Revised Statutes, oil and gas operators must conduct a baseline water quality test for each surface water impoundment or water supply from groundwater within 1,000 feet of a horizontal well at least 20 days before hydraulic fracturing (also known as fracking) can begin. These tests must be conducted in a laboratory certified by the state government. The test analysis must be submitted to the Division of Oil and Gas and all water supply owners within 30 days of the analysis.

Renewable energy policies

States have implemented funding and financial incentive programs to subsidize or otherwise increase investment in renewable energy resources such as wind, solar, and hydroelectric power. These programs include renewable portfolio standards, grants, rebate programs, tax incentives, loans, performance-based incentives, and more. The aim of the policies generally involves reducing the cost of renewable energy production for consumers, reducing regulatory compliance costs, reducing investment risks involving renewable energy, and/or increasing the adoption of renewable energy sources by individuals and businesses.

Renewable Portfolio Standard

See also: Renewable Portfolio Standard

A Renewable Portfolio Standard (RPS), also known as a renewable electricity standard, is a mandate intended to increase the amount of renewable energy production and use. Under these standards, a utility company can be required by a state to have a certain percentage of its electricity come from certain renewable energy resources. In addition, states may give tax credits to utility companies to fulfill these requirements.

As of February 2017, Kentucky was one of 20 states that did not have a Renewable Portfolio Standard or a voluntary renewable energy standard or target.

Grant programs

States, nonprofit organizations, and/or private utilities may operate grant programs for renewable energy. These programs may include state or private funding for energy installation costs, research and development, infrastructure and business development, system testing, and renewable energy feasibility studies (studies that look into the potential for renewable energy use in specific areas). Grants can be provided with or without requiring a recipient to match the grant. Additional incentives, such as lower interest loans, may be included with a grant.

As of March 2015, Kentucky was one of 18 states that offered a statewide commercial-oriented tax incentive program, though not grant program, for renewable energy. In 2007, the Kentucky State Legislature enacted the Incentives for Energy Independence Act, which established tax incentives for businesses to build or refurbish facilities with renewable energy sources. A renewable energy facility is defined by the law as a building that generates at least 50 kilowatts (kW) of electricity from solar energy or at least 1 megawatt (MW) of electricity from wind energy, biomass, landfill methane gas, or hydroelectric power. Companies must invest a minimum of $1 million in capital expenditures, including labor costs, before they can apply for a tax credit. Tax credits can include the following:

• A tax credit for up to 100 percent of Kentucky income tax or the limited liability entity tax
• A sales or use tax credit of up to 100 percent
• A wage assessment credit of up to 4 percent for associated employees

See the map below for grant programs by state.

States with grant programs for renewable energy as of March 2015 (Source: Environmental Protection Agency)

Loan programs

Loan programs may be used to offer lower interest loans or other financing options to individuals and businesses to reduce the upfront costs of purchasing and installing renewable energy technologies. Loan programs may include programs that use payments from earlier borrowers to provide loans for new borrowers, programs in which building owners reduce their energy consumption to pay their upfront costs for renewable energy technologies, and programs that allow individuals with a higher debt-to-income ratio to purchase homes that use less energy, among others.

As of March 2015, Kentucky was one of 34 states with a state-run loan program for renewable energy technologies and with locally run, utility-run, and/or privately run loan programs for renewable energy. The Green Bank of Kentucky distributes loans to executive branch state agencies to install energy conservation measures, including renewable energy technologies. Agencies submit an energy survey on their energy consumption to the Kentucky Finance and Administration Cabinet. Loans may be offered for projects costing up to and more than $600,000 if they achieve energy use reductions and undergo a cost-benefit analysis.

A complete list of state, local, and private incentive, loan, grant, and assistance programs for renewable energy and energy efficiency in Kentucky can be found here.

See the map below for renewable energy loan programs by state.

States with loan programs for renewable energy as of March 2015 (Source: Environmental Protection Agency (EPA)

Energy efficiency regulations

As of February 2017, Kentucky required all new residential and commercial buildings to meet energy efficiency standards. The 2013 Kentucky Building Code applies to commercial buildings. This code is based on the 2012 version of the International Energy Conservation Code (IECC), which can be accessed here. The IECC contains energy efficiency standards for heating, ventilating, air conditioning, water heating, and lighting in buildings. The 2013 Kentucky Residential Code, which also applies to all residential buildings, is based on the 2012 IECC.

Net metering

Net metering is a billing system in which customers who generate their own electricity, usually using renewable sources (such as solar panels) are able to sell their excess electricity back to the electric grid, which is an interconnected network that is used to deliver electricity. This requires electricity to be able to flow both to and from a consumer.

As of October 2016, Kentucky was one of 41 states with a statewide net metering policy. In 2008, the Kentucky State Legislature enacted legislation requiring investor-owned utilities and electric cooperatives to offer net metering to consumers that generate electricity with photovoltaic solar energy, wind energy, biomass, biogas or hydroelectric power facilities with up to 30 kilowatts (kW) in electric capacity. For a complete list of net metering programs by state, click here.

Recent legislation

The following is a list of recent energy policy bills that have been introduced in or passed by the Kentucky State Legislature. To learn more about each of these bills, click the bill title. This information is provided by BillTrack50 and LegiScan.

Note: Due to the nature of the sorting process used to generate this list, some results may not be relevant to the topic. If no bills are displayed below, no legislation pertaining to this topic has been introduced in the legislature recently.

Ballot measures

Energy policy ballot measures

See also: Energy on the ballot and List of Kentucky ballot measures

Ballotpedia has not covered any ballot measures relating to state and local energy policy in Kentucky.

Utility policy ballot measures

See also: Local utility tax and fees on the ballot

Ballotpedia has not covered any ballot measures relating to local utility tax and fees in Kentucky.

Production

The sections below include statistics on total energy production in Kentucky, oil and natural gas production in Kentucky, oil and gas production in Kentucky over time (2004-2014), and oil and gas production on federal land, including the amount of federal land leased in Kentucky for production.

Total energy production

The table below provides information regarding energy production in Kentucky in British thermal units (Btu). A British thermal unit is used to measure the heat contained in different fuels. The U.S. Department of Energy defines a Btu as "the quantity of heat required to raise the temperature of 1 pound of liquid water by 1 degree Fahrenheit." Fuels are discussed in terms of Btu to compare fuels with different energy content and prices. For example, one gallon of gasoline equals 120,524 Btu.

Energy production, 2014 (in billion Btu)
State	Biomass	Coal	Crude oil	Nuclear energy	Natural gas	Renewable	Total*
Kentucky	5,046	1,869,335	19,581	0	90,908	75,298	2,060,168
Tennessee	32,073	21,711	1,914	289,401	6,021	180,455	531,575
Virginia	6,011	393,225	81	316,081	137,292	133,100	985,790
West Virginia	0	2,858,022	43,639	0	1,202,865	49,537	4,154,063
U.S. average	38,759	404,181	307,301	160,980	585,731	187,132	1,684,085
*Total figures were computed by Ballotpedia. Source: U.S. Energy Information Administration, "Google Sheets API"

Nonrenewable energy production

The table below provides information regarding nonrenewable energy production in Kentucky. For coal data, the phrase productive capacity refers to the maximum amount of coal that could be expected to be produced in 2014. The natural gas and crude oil production data refer to the amounts of natural gas and crude oil produced in December 2014 and April 2016, respectively.

Nonrenewable energy production
State	Coal, productive capacity (short tons)	Natural gas (million cubic feet)	Crude oil (thousand barrels)
Date	2014	December 2014	April 2016
Kentucky	97,860,978	6,432	167
Tennessee	951,722	416	23
Virginia	18,508,868	11,170	1
West Virginia	138,821,855	100,730	601
U.S. average	24,874,314	43,350	4,388
Source: U.S. Energy Information Administration, "Google Sheets API"

Oil and gas production (2004-2014)

Note: This section provides information about oil and gas production on private and state-owned lands. Information on oil and gas production on federal lands is accessible here.

The graph and table below provide information about crude oil production in Kentucky. Information from select surrounding states is provided for comparative purposes.

Crude oil production in Kentucky and select surrounding states, in thousand barrels
State	2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	Percent of total 2014 production	2014 Rank
Kentucky	2,548	2,535	2,340	2,666	2,645	2,609	2,519	2,326	3,198	2,893	3,376	0.11%	21
Tennessee	361	324	192	284	338	268	350	350	371	334	330	0.01%	27
Virginia	19	26	17	19	16	11	12	11	9	9	12	0.0%	31
West Virginia	1,735	1,696	1,726	1,992	2,126	1,501	1,842	2,146	2,573	7,564	9,872	0.31%	15
United States	1,991,394	1,891,227	1,857,044	1,853,166	1,830,002	1,952,670	2,000,861	2,060,398	2,377,806	2,722,171	3,180,813	--	--
Source: U.S. Energy Information Administration, "Crude Oil Production" Note: The data above are field production data.

The graph and table below provide information about natural gas production in Kentucky. Information from select surrounding states is provided for comparative purposes.

Natural gas production in Kentucky and select surrounding states, in million cubic feet (MMCF)
State	2003	2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	Percent of total 2013 production	2013 rank
Kentucky	87,608	94,259	92,795	95,320	95,437	114,116	113,300	135,330	124,243	106,122	94,665	0.32%	20
Tennessee	1,803	2,100	2,200	2,663	3,942	4,700	5,478	5,144	4,851	5,825	5,400	0.02%	26
Virginia	143,644	85,508	88,610	103,027	112,057	128,454	140,738	147,255	151,094	146,405	139,382	0.46%	18
West Virginia	187,723	197,217	221,108	225,530	231,184	244,880	264,436	265,174	394,125	539,860	717,892	2.39%	10
United States	24,118,978	23,969,678	23,456,822	23,535,018	24,663,656	25,636,257	26,056,893	26,816,085	28,479,026	29,542,313	30,005,254	--	--
Source: U.S. Energy Information Administration, "Natural Gas Gross Withdrawals and Production" The data presented above are gross withdrawals in million cubic feet (MMCF). Production data for 2014 were estimated for some, but not all, states; "--" indicates data were not available.

Oil and gas production on federal land

See also: Oil and natural gas extraction on federal land

The federal government leases federally managed land to private individuals and companies for energy development, including crude oil and natural gas drilling, solar energy development, and geothermal energy development. Approximately 166 million acres of federal land were available to be leased for energy development as of December 2014. The U.S. Bureau of Land Management (BLM) is responsible for regulating oil and gas drilling on federal lands in the United States.

The table below provides information about oil and natural gas production on federal lands in Kentucky in 2014. Information from select surrounding states is provided for comparison.

Oil and natural gas production on federal land, 2014
State	Oil production (in thousands of barrels)	Natural gas production (in million cubic feet)
Kentucky	11	79
Tennessee	0	0
Virginia	0	127
West Virginia	0	153
U.S. average	2,976.06	49,996.92
Source: Office of Natural Resource Revenue, "Statistical Information"

Land leased

Private oil and natural gas companies apply for leases from the U.S. Bureau of Land Management (BLM) to develop energy resources on federal lands. After a lease is approved, the company must submit information to the BLM about how it will conduct its drilling and production operations. The BLM also inspects a company’s operations during production.

The table below provides information about oil and gas producing leases and acres on federal lands in Kentucky from 2013 to 2015. Information from select surrounding states is provided for comparison.

Oil and gas producing leases and acres on federal land by state, 2013-2015
State	FY 2015		FY 2014		FY 2013
	Producing leases	Producing acres	Producing leases	Producing acres	Producing leases	Producing acres
Kentucky	54	32,916	54	32,916	55	33,240
Tennessee	2	736	2	736	2	736
Virginia	16	14,491	16	14,491	16	14,491
West Virginia	153	55,810	153	55,810	153	55,810
U.S. average	485	257,505	483	258,996	480	262,870
Source: U.S. Bureau of Land Management, "Oil and Gas Statistics"

Energy usage

The section below includes statistics on electricity consumption in the state by energy type (in 2014).

Consumption

The table below provides information about energy consumption by source in Kentucky in 2014. Information from select surrounding states is provided for comparison.

Energy consumption in Kentucky, 2014 (in billion Btu)
State	Coal	Crude oil and petroleum products	Natural gas	Nuclear energy	Solar	Wind	Geothermal	Hydropower	Wood and wood waste	Biomass
Kentucky	913,452	597,274	261,233	0	189	0	2,712	29,895	37,456	57,195
Tennessee	427,509	698,891	311,966	289,401	774	486	213	84,645	62,265	101,449
Virginia	278,183	818,022	437,322	316,081	1,206	0	1,701	9,084	115,098	150,362
West Virginia	816,460	191,515	161,661	0	127	13,803	32	11,811	23,764	30,091
U.S. average	359,931	716,746	544,353	172,585	20,739	531,323	16,555	61,397	65,345	101,581
Source: U.S. Energy Information Administration, "Google Sheets API"

Prices and taxes

The sections below include information on energy prices and spending in Kentucky, fuel taxes and state taxes in Kentucky and in neighboring states, and an overview of the federal tax on gasoline.

Energy prices

The price of electricity is affected by supply and demand. The supply of electricity is affected by fuel prices, environmental and energy regulations, power plant capacity, weather, and other factors. Demand for electricity also affects the price. Because electricity cannot be stored for long periods of time, it must be produced and used when it is needed. As demand for electricity increases, the price also generally increases.

The table below provides information about energy prices in Kentucky as of April 2016. Information from select surrounding states is provided for comparison.

Note: In comparing dollar amounts across the states, it is important to note that the cost of living can from state to state and within a state. The amounts given on this page have not been adjusted to reflect these differences. For more information on "regional price disparities" and the Consumer Price Index, see the U.S. Department of Commerce, Bureau of Economic Analysis.

Energy prices in Kentucky
State	Natural gas Dollars per thousand cubic foot	Electricity Cents per kilowatthour
Date	April 2016	April 2016
Kentucky	$10.37	8.0
Tennessee	$9.55	8.8
Virginia	$10.63	9.2
West Virginia	$9.35	8.7
U.S. average	$11.20	10.41
Source: U.S. Energy Information Administration, "Google Sheets API"

Electricity prices can vary depending on the type of consumer; consumer categories include residential, commercial, industrial, and in some cases, transportation. The rate-making process is both political and economic. The table below presents information about electricity prices by consumer type in Kentucky in April 2016. Information from select surrounding states is provided for comparison.

Electricity prices in Kentucky by sector (in cents per kilowatthour)
State	Commercial	Industrial	Residential	Transportation	Average (all sectors)
Date	April 2016	April 2016	April 2016	April 2016	April 2016
Kentucky	9.5	5.4	10.4	0.0	8.4
Tennessee	9.6	5.4	10.2	0.0	6.3
Virginia	8.2	6.7	12.0	8.1	8.8
West Virginia	9.5	6.5	11.3	0.0	6.8
U.S. average	10.48	7.45	13.05	10.47	10.36
Source: U.S. Energy Information Administration, "Google Sheets API"

Energy spending

The table below provides information about energy spending in Kentucky as of 2014. Information from select surrounding states is provided for comparison.

Energy spending in Kentucky, 2014 (in millions of dollar except per capita spending)
State	Petroleum	Coal	Natural gas	Nuclear	Per capita spending
Kentucky	$14,309	$2,178	$1,762	$0	$5,092
Tennessee	$17,831	$1,128	$2,233	$210	$4,523
Virginia	$21,127	$962	$3,280	$194	$4,080
West Virginia	$5,363	$2,031	$678	$0	$4,736
U.S. average	$17,267	$1,322	$3,786	$574	$5,304
Source: U.S. Energy Information Administration, "Google Sheets API"

Fuel taxes

Click to enlarge.

Revenue collected by federal, state, and local governments from fuel taxes is usually used to fund transportation infrastructure such as roads and bridges. Some states may charge an excise tax based on how much gas or diesel is purchased. Some states may charge retail tax based on the average price of gas over a certain period. Additionally, some states may charge an environmental tax to be used for environmental projects. The Tax Foundation, which created the map to the right, used data from the American Petroleum Institute, which converted each state's different tax structure into cents per gallon to compare each state's gas taxes. In 2016, gas taxes accounted for 23 percent of the price of gasoline. Crude oil accounted for 40 percent of the price of gasoline, refining accounted for 24 percent of the price, and distribution and marketing accounted for 13 percent of the remainder.

The table below provides information about state fuel taxes by type (excluding the federal gas taxes) in Kentucky as of January 2016. As of January 2016, Kentucky levied a 26 cent state gasoline tax and a 23 cent state diesel tax. Kentucky ranked 30th highest in total gasoline taxes (federal and state) and 35th highest in total diesel fuel taxes as of January 2016.

State motor fuel taxes in cents per gallon, January 2016
State	State gasoline tax	Total gasoline tax	Rank	State diesel tax	Total diesel tax	Rank
Kentucky	26.0	44.4	30	23.0	47.4	35
Tennessee	21.4	39.8	39	18.4	42.8	44
Virginia	22.3	40.7	36	26.0	50.4	32
West Virginia	34.6	53.0	9	34.6	59.0	9
U.S. average	30.29	48.69	N/A	30.01	54.41	N/A
Source: American Petroleum Institute, "Motor Fuel Taxes"

Federal tax

The first federal tax on gasoline was proposed by Secretary of the Treasury Ogden L. Mills under President Herbert Hoover (R) as a revenue generating measure to balance the budget during the Great Depression. A 1-cent tax per gallon of imported gasoline and fuel oil was passed as part of the Revenue Act of 1932 and signed by President Franklin D. Roosevelt (D). The 1-cent tax continued until 1951 when the tax was increased to 2 cents in part to raise revenue during the Korean War. In 1956, the tax was raised to 3 cents to fund the Interstate Highway System. During this time, the Highway Trust Fund was created as a means to fund highway construction. Since 1956, there have been increases to the tax. As of April 2016, the gas tax was last raised by President Bill Clinton (D) in 1993 to 18.4 cents per gallon.

Utilities

The sections below include general information on utilities, an overview of utilities and electricity markets, information on the types of utilities in Kentucky, an overview of electricity reliability organizations (EROs), and the EROs that oversee electricity in Kentucky.

Background

Utilities are firms that own and/or operate facilities to generate, transmit, and/or distribute electricity, gas, and/or water to the public. Electric utilities are commercial entities that own and operate facilities to generate, transmit, and distribute electricity to the public and/or the industrial sector. State and local regulators oversee transmission and distribution charges. Local utilities read electric meters and bill individuals or businesses, generally on a monthly basis.

Utilities are defined differently in each state and in federal legislation. Two general types of utilities are private and public utilities. Private utilities, commonly known as investor-owned utilities, provide stocks to investors and sell bonds. These utilities are regulated by state regulatory agencies. State agencies are also responsible for setting retail rates charged by investor-owned utilities, overseeing utility infrastructure, and ensuring that investor-owned utilities respond to customer service demands. Public utilities include government or municipally owned utilities. Another type of utility is an electric cooperative. Cooperatives are nonprofit businesses voluntarily owned and managed by the individuals and businesses that use their services. They are commonly used in rural areas that do not have access to a larger state or region-wide electric grid.

Electricity markets

Electricity markets in each state are defined as regulated or deregulated. A regulated market includes utilities that own and manage the power plants that generate the electricity, the electricity transmission lines, and the distribution equipment (such as wires and electric poles). In addition, the utilities rates are approved and regulated by local and state agencies. A deregulated market requires utilities to divest ownership in the generation and transmission of electricity. In this market, utilities oversee the interconnection from a meter at a household or business to the power grid and is responsible for billing ratepayers.

Depending on the state and/or area, public utilities may provide most or all energy services to homes and businesses, or a state may allow other private electricity providers to transmit and distribute electricity in addition to other utilities. For example, one type of private provider is a retail energy provider, which sells electricity in areas with retail competition. The provider purchases wholesale electricity and the delivery services (such as transmission lines) and can price electricity to particular consumers.

As of February 2017, Kentucky was one of 40 states with a regulated electricity market. The Kentucky Public Service Commission is responsible for regulating investor-owned utilities and electric cooperatives in the state. The commission sets electricity rates and utility service boundaries, resolves consumer complaints, enforces compliance with safety and service regulations, and oversees the construction and operation of utility facilities.

Electric reliability organizations

The Energy Policy Act of 2005 required the Federal Energy Regulatory Commission (FERC) to designate an electric reliability organization (ERO) for the United States. An ERO oversees the reliability of a nation's electric grid. In 2006, FERC granted authority to the North American Electric Reliability Corporation (NERC) to develop and enforce grid reliability standards for the United States. NERC, a self-regulated nonprofit corporation, is authorized to enforce grid reliability standards for all users, owners, and operators of the U.S. electrical system.

NERC works with eight regional reliability organizations to oversee the U.S. electrical system. These organizations, known as regional entities, are composed of officials from investor-owned utilities, federal power agencies, electric cooperatives, and state and municipal utilities. Regional entities enforce NERC and regional reliability standards. Further, they forecast electricity demand and coordinate operations with other regional entities.

Kentucky EROs

As of February 2017, the SERC Reliability Corporation was the NERC-affiliated corporation that oversees electricity in Kentucky. SERC conducts studies and assessments of the electricity grid, conducts long-term planning, and develops regional standards for electricity reliability.

Background

The sections below include an overview of the types of renewable and nonrenewable energy produced and consumed in the United States, an energy profile of Kentucky (from the U.S. Energy Information Administration), a general profile of Kentucky (from the 2016 edition of the Almanac of American Politics), and various economic indicators in Kentucky.

Background on energy resources

Nonrenewable energy sources, such as coal, oil, and natural gas (sometimes known as fossil fuels), and renewable sources, such as hydropower, wind, biofuels, and solar energy, are produced in each state, though at different levels depending on a state's geography, energy consumption, and the raw materials available in a particular state. For example, several states do not have coal, oil, and/or natural gas resources. States that lack these resources import these fuels.

According to the U.S. Department of Energy, oil, coal, and natural gas comprise the majority of the resources used to generate power in the United States. In 2014, the top five energy-producing states were the top five fossil fuel-producing states—Texas, Wyoming, Pennsylvania, Louisiana, and West Virginia. These states' fossil fuel production accounted for approximately 42 percent of U.S. energy production in 2014. States with fewer coal, oil, and natural gas resources generally consume less energy. In 2014, the bottom five energy-producing states—Rhode Island, Delaware, Hawaii, Nevada, and New Hampshire—produced 0.2 percent of U.S. energy and consumed approximately 2 percent of total U.S. energy.

The production of biofuels (liquid fuels created from plant or plant-derived materials) is generally concentrated in the Midwest—states such as Illinois, Iowa, Nebraska, and South Dakota) given the region's agricultural production of crops such as corn, which is used to make ethanol, a biofuel that can be blended with gasoline and used as a transportation fuel.

Other renewable sources are used to generate power in the states include hydroelectric power, which accounted for about half of all renewable energy production in the United States in 2014.

Kentucky energy profile

As of 2013, Kentucky was in the top 10 states in terms of energy use per dollar of a state's gross domestic product (GDP). The state's industrial sector, which includes agriculture and manufacturing, was the largest energy consumer in Kentucky. Given its coal production, Kentucky was a net energy supplier in 2013.

Crude oil is produced in western and south-central Kentucky. From 2010 to 2015, annual crude oil production in Kentucky was approximately 3 million barrels, which represented around 3 percent of total demand in the state. The state also has interstate pipelines that deliver crude oil and petroleum products. As of 2014, Kentucky had two oil refineries with a capacity to refine around 246,000 barrels of oil per day.

As of 2014, Kentucky was the third-largest coal producer after Wyoming and West Virginia and accounted for around 8 percent of total U.S. coal production. Around 25 percent of all U.S. coal mines were found in Kentucky in 2014; the state had more coal mines than any other state. As of 2014, the state had the fifth-largest total recoverable coal reserves in the United States.

In 2014, Kentucky produced approximately 80 billion cubic feet of natural gas, the majority of which was produced in eastern Kentucky. The state has interstate natural gas pipelines that deliver gas from the Gulf Coast and Tennessee. In 2014, Kentucky began receiving natural gas through pipelines from Ohio and West Virginia. As of 2014, Kentucky had 23 underground natural gas storage facilities, which accounted for 2.5 percent total U.S. storage capacity.

State profile

Demographic data for Kentucky
	Kentucky	U.S.
Total population:	4,424,611	316,515,021
Land area (sq mi):	39,486	3,531,905
Race and ethnicity**
White:	87.6%	73.6%
Black/African American:	7.9%	12.6%
Asian:	1.3%	5.1%
Native American:	0.2%	0.8%
Pacific Islander:	0%	0.2%
Two or more:	2.1%	3%
Hispanic/Latino:	3.3%	17.1%
Education
High school graduation rate:	84.2%	86.7%
College graduation rate:	22.3%	29.8%
Income
Median household income:	$43,740	$53,889
Persons below poverty level:	22.7%	11.3%
Source: U.S. Census Bureau, "American Community Survey" (5-year estimates 2010-2015) Click here for more information on the 2020 census and here for more on its impact on the redistricting process in Kentucky. **Note: Percentages for race and ethnicity may add up to more than 100 percent because respondents may report more than one race and the Hispanic/Latino ethnicity may be selected in conjunction with any race. Read more about race and ethnicity in the census here.

Presidential voting pattern

See also: Presidential voting trends in Kentucky

Kentucky voted Republican in all seven presidential elections between 2000 and 2024.

Pivot Counties (2016)

Ballotpedia identified 206 counties that voted for Donald Trump (R) in 2016 after voting for Barack Obama (D) in 2008 and 2012. Collectively, Trump won these Pivot Counties by more than 580,000 votes. Of these 206 counties, one is located in Kentucky, accounting for 0.5 percent of the total pivot counties.

Pivot Counties (2020)

In 2020, Ballotpedia re-examined the 206 Pivot Counties to view their voting patterns following that year's presidential election. Ballotpedia defined those won by Trump won as Retained Pivot Counties and those won by Joe Biden (D) as Boomerang Pivot Counties. Nationwide, there were 181 Retained Pivot Counties and 25 Boomerang Pivot Counties. Kentucky had one Retained Pivot County, 0.55 percent of all Retained Pivot Counties.

More Kentucky coverage on Ballotpedia

• Elections in Kentucky
• United States congressional delegations from Kentucky
• Public policy in Kentucky
• Endorsers in Kentucky
• Kentucky fact checks
• More...

Economic indicators

See also: Economic indicators by state

Kentucky's GDP increased by 1 percent in 2014. Click the image to view a larger version.

Broadly defined, a healthy economy is typically one that has a "stable and strong rate of economic growth" (gross state product, in this case) and low unemployment, among many other factors. The economic health of a state can significantly affect its healthcare costs, insurance coverage, access to care, and citizens' physical and mental health. For instance, during economic downturns, employers may reduce insurance coverage for employees, while those who are laid off may lose coverage altogether. Individuals also tend to spend less on non-urgent care or postpone visits to the doctor when times are hard. These changes in turn may affect the decisions made by policymakers as they react to shifts in the industry. Additionally, a person's socioeconomic status has profound effects on their access to care and the quality of care received.

In 2013, Kentucky had the highest percentage of residents that earned incomes below the federal poverty level among its neighboring states. Between 2011 and 2013, the state had a median annual household income of $42,260, which was lower than any of its neighboring states. The state's September 2014 unemployment rate was higher than the national rate at 6.7 percent.

Note: Gross state product (GSP) on its own is not necessarily an indicator of economic health; GSP may also be influenced by state population size. Many factors must be looked at together to assess state economic health.

Various economic indicators by state
State	Distribution of population by FPL* (2013)				Median annual income (2011-2013)	Unemployment rate		Total GSP (2013)†
	Under 100%	100-199%	200-399%	400%+		Sept. 2013	Sept. 2014
Kentucky	20%	22%	30%	28%	$42,260	8.3%	6.7%	$183,373
Tennessee	18%	20%	34%	28%	$42,785	8.2%	7.3%	$287,633
Virginia	11%	15%	26%	48%	$65,635	5.5%	5.5%	$452,585
West Virginia	18%	22%	33%	27%	$43,361	6.4%	6.6%	$73,970
United States	15%	19%	30%	36%	$52,047	7.2%	5.9%	$16,701,415
* Federal Poverty Level. "The U.S. Census Bureau's poverty threshold for a family with two adults and one child was $18,751 in 2013. This is the official measurement of poverty used by the Federal Government." † Median annual household income, 2011-2013. ‡ In millions of current dollars. "Gross State Product is a measurement of a state's output; it is the sum of value added from all industries in the state." Source: The Henry J. Kaiser Family Foundation, "State Health Facts"

See also

• Energy policy in the U.S.
• Fracking in Kentucky
• Net metering
• Renewable Portfolio Standard
• Environmental policy in Kentucky

Recent news

The link below is to the most recent stories in a Google news search for the terms Kentucky energy policy. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.

Energy policy in Kentucky, 2007-2017 - Google News

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