Iowa’s national role as a leader in clean energy took a major hit thanks to a Republican-passed bill (SF 2311) in 2018. State Representative Gary Carlson spearheaded the effort, and Governor Reynolds signed it into law this past May.
The bill cripples Iowa’s 28-year history of energy efficiency programs with massive cuts. It also allows municipal utilities to penalize solar-generating customers. The new law cuts funds dedicated to rebates for energy efficiency appliances, retrofitting homes and energy efficiency initiatives by as much as two-thirds. The bill caps contributions at 2 percent of a customer’s electric or natural gas bill.
The Iowa utilities’ own analysis shows that their energy efficiency programs save customers $2 for every $1 that is invested. In 2016 Iowa utility energy efficiency programs produced over $400 million in net savings. The Republican-controlled legislature ignored the savings and rammed through a big gift to the Iowa’s utilities. Reynolds endorsed this consumer rip-off that will result in fewer jobs and higher utility bills.
The prime architect of this sweetheart deal for Iowa’s utilities is Muscatine’s Carlson. Iowa’s utilities supported the change while Iowa’s clean energy businesses and advocates opposed the legislation. The GOP law change jeopardizes over 20,000 Iowa jobs in the clean energy businesses.
Carlson and his Republican colleagues ignored the pleas from Iowa businesses that depend on energy efficiency funds, which include home weatherizes, lighting contractors, appliance contractors and engineers evaluating energy efficiency cost savings.
Carlson’s hometown of Muscatine has had the worst air quality in the state for years. It has been under scrutiny by the EPA for failing to improve air quality. Carlson’s bill will likely result in utilities building additional fossil fuel plants that will add to that pollution. The Environmental Law and Policy Center Action Fund is running ads in Muscatine in an attempt to educate the public about the detrimental effects of the Carlson legislation.
The American Council for an Energy Efficient Economy (ACEEE) just published a national energy efficient scorecard that dropped Iowa four places as a result of this GOP anti-energy efficiency bill. As other states are increasing investments in energy efficiency, Iowa had the largest drop in ranking as it cut investments in these energy saving programs.
By signing this law, Governor Reynolds betrayed her own advocacy for energy efficiency. Reynolds co-chaired the statewide energy planning effort that resulted in the Iowa Energy Plan. That energy blueprint identified investments in energy efficiency as one of the four essential pillars to maintain Iowa’s clean energy leadership. Her signature on this anti-energy efficiency law will set Iowa back for years to come. The result will be higher energy costs to consumers and less investment in the least costly energy resource.
The Iowa Energy Plan states: “Energy efficiency is often referred to as a ‘least-cost resource,’ meaning that it is the single most cost-effective tool within an energy portfolio. On the production-side, increased energy efficiency can result in reduced costs associated with the generation, transmission, and distribution of electricity or natural gas. On the consumer-side, energy efficiency improvements have the potential to generate customer savings that can be reinvested to further fund energy system upgrades.”
Amanda Zwanziger has been in the energy efficiency business for 20 years. She was also member of the Iowa Energy Plan working group that advised then Lt. Governor Reynolds on the plan. She asked Governor Reynolds to veto the bill.
“It contradicts every pillar of the Iowa Energy Plan,” Zwanziger said. “These cuts will essentially kill the potential impact we have to make energy efficiency improvements in our facilities and it guarantees rate increases for all in the long run. That, I can reassure you, was not the intent of the Iowa Energy Plan.”
Governor Reynolds, Rep. Carlson and their Republican allies are betraying Iowa’s long historical commitment to energy efficiency and clean energy alternatives. They are rewarding large utilities at the expense of consumers and damaging Iowa businesses dependent on an essential energy efficiency market. Predictions suggest that the loss of investment in energy efficiency programs from this GOP bill will require building four new 500 MW power plants in the next ten years at a cost of $2-3 billion by Iowa utilities.
Fred Hubbell has made improving Iowa’s energy efficiency programs a key priority. He specifically calls on the legislature to adopt policies that encourage energy efficiency. Contrast that with Reynolds cuts to these vital programs and the choice for Iowa Governor is clear.
by Rick Smith