A summary of Iowa clean energy policy challenges and opportunities as of May 2023, including outcomes of the legislative session, and major issues at the Iowa Utilities Board.
On the Scandinavian judgement scale that runs from “could be better” to “not so bad” to “pretty good”, the status of clean energy policy in Iowa could be categorized as somewhere in the “not so bad” range, though with risks to the downside.
Given the headwinds that have been building against clean energy across the Heartland, we are fortunate to have not yet slipped into “could be better” territory. Clean energy is holding ground in Iowa thanks to dedicated advocates and organizations from across the spectrum, and Iowa’s 12 clean energy districts have played no small role in this accomplishment. Thank you … and keep those sleeves rolled up!
Briefly, we’ll summarize the 2023 legislative session, then discuss key Iowa Utilities Board issues, and finally a forward-looking combination of the two. The Clean Energy Districts of Iowa (CEDI) actively advocates for a just clean energy future, with prosperity and a liveable climate for all.
Iowa’s 2023 Legislative Session
Coming into 2023, there was a great deal of worry around bills that could significantly restrict the siting of utility-scale solar and wind projects. This has been a trend at the county level around Iowa and the Midwest (as we discussed in February), and the level of statewide siting restrictions proposed in SSB1077 and SF2 would have effectively killed most new large-scale renewable energy development.
These bills did not advance, thanks to opposition from utilities, the solar industry, and clean energy advocates such as many of you. Thank you, and thanks to my colleague Brian Krambeer of MiEnergy for joining me in this guest column in the Register. These bills/efforts could return next session, so we’ll need to remain vigilant … and work for better solutions in the interim.
Additional bills with significant potential downsides that did not pass include an effort to provide “innovative rates” to via community-solar-only-for-big-business but excluding all others (HF600/SSB1173), an effort to freeze Iowa’s building energy code at the 2012 standard (SF479), and an effort to change “advanced ratemaking” rules without requiring integrated resource planning (SSB1149).
On the flip side, some legislation detrimental to clean energy did make it through. HF248 unfortunately guts much of the current regulatory authority of the Iowa Utilities Board over emissions from fossil fuel generation sources. SF514 – the government re-organization bill – exposes the Office of the Consumer Advocate to political interference through removing merit protection for employees, and other changes.
Both of those bills represent harmful utility deregulation at the expense of Iowa ratepayers and communities, as we wrote about recently in The Electric Monopoly’s Company Store.
Good bills that didn’t make it through are worth noting too, in part because they’re worth continued advocacy for next year. SF332 would establish a limited community solar program, allowing virtual net metering and meter aggregation. And SSB1059 would establish an integrated resource planning process for Iowa’s investor-owned electric utilities.
Iowa Utilities Board and Iowa Supreme Court
These are interesting times at the Iowa Utilities Board (IUB), in part because this spring brought about a significant change in composition. Board Chair Geri Huser resigned, and Sarah Martz was appointed to serve out her term until April, 2027. Board member Dick Lozier’s term ended, and Erik Helland was appointed to the seat, and named Chair. Josh Byrnes was appointed in 2020, and remains serving.
There is always much happening at the IUB, and three major topics deserve special mention right now.
The five-year energy efficiency plan dockets are in full swing for each of Iowa’s investor-owned energy utilities – Alliant, MidAmerican, and Black Hills. CEDI is intervening and submitting extensive comments and testimony in all three dockets, which is a very significant undertaking.
CEDI priorities in the efficiency plans include 1) complementarity with the efficiency and electrification incentives in the Inflation Reduction Act (especially heat pumps for heating/cooling), 2) the funding of high quality, in-person technical assistance to all ratepayers through qualified local providers such as energy districts, and 3) increased funding and more effective assistance for lower-income households, that face energy burdens often 3-4 times those of moderate and upper income households.
In early 2022, MidAmerican Energy filed its “Wind Prime” application for advanced ratemaking principles (or ARP docket) on roughly 2 gigawatts of new wind and 50 megawatts of solar. Environmental groups intervened, filing extensive testimony demonstrating that investments in much larger quantities of solar with storage, combined with the retirement of the company’s aging coal plants, would be better for ratepayers.
The Board’s final order approved Wind Prime ratemaking principles but with severe limitations, consumer protections, and significant requirements for resource planning, that together bode well for future cases. CEDI applauds the work of intervenors, and the courage of the Board in the face of extreme levels of corporate and political pressure.
Another docket related to MidAmerican’s failure to consider coal plant retirements reached the Iowa Supreme Court recently. When company filed their required emission plan and budget in 2020, both the Office of Consumer Advocate and environmental groups criticized the company’s plan for failing to consider the coal plant retirement, and presented evidence demonstrating at least two plants were uneconomical for ratepayers, and should be retired.
The Utilities Board rejected the intervenor’s evidence and approved the company’s plan, the environmental groups appealed, and the Iowa Supreme Court recently ruled that the Board must consider the evidence on coal plant economics provided by intervenors. This is a landmark ruling that could support the relevance of poor coal plant economics (relative to renewable energy and storage) in multiple future Board dockets.
The Study Docket … and Looking Ahead
A study docket, sounds pretty dry doesn’t it? Maybe only clean energy nerds get excited over a study, but thankfully, there are a great many such folks in the energy districts and our clean energy colleagues across the state.
Faced with a flurry of energy related bills, the Legislature wisely punted on some, in favor of a common tactic – directing the relevant regulatory agency to study the issues and report back. HF617 states
The utilities board shall initiate and coordinate an independent review of current Iowa Code provisions and ratemaking procedures. The review shall take into account the policy objectives of ensuring safe, adequate, reliable, and affordable utility services provided at rates that are nondiscriminatory, just, reasonable, and based on the utility’s cost of providing service to customers within the state.
We anticipate that the Board will soon open a Notice of Inquiry (NOI) docket, and likely issue an RFP for a consulting firm to coordinate the study. All stakeholders will have the opportunity to submit comments and testimony on a broad range of topics related to energy rates in the state.
We anticipate the investor-owned utilities will vigorously promote policy changes that further the interests of their investors, and their largest customers. Conversely, clean energy and localism advocates have an opportunity to build the case for a broad set of policies that would achieve a just, affordable, reliable, and resilient clean energy future that generates local prosperity and climate stewardship for generations.
CEDI (and we expect numerous member districts) will be fully engaged in this process, always working hard to move from “not so bad” to “pretty good” Iowa energy policy and reality.
Posted: May 26, 2023
