Iowa utilities offer energy efficiency proposals

DES MOINES – Environmental groups are challenging the energy conservation plans of Iowa’s largest gas and electricity providers, saying Interstate Power and Light and MidAmerican Energy are not doing as much as they could to help consumers use less electricity.

Iowa law requires state-regulated gas and electricity utility companies to file energy efficiency plans every five years. The law also allows other organizations to challenge the plans and seek changes.

IPL was first to submit its plan and go through the hearing process before the Iowa Utilities Board.

MidAmerican’s plan is next. The utilities board staggers the procedures because of the large volumes of paperwork, testimony, and hearings required.

The plan submitted by IPL, a division of Alliant Energy, has been challenged by the Environmental Law and Policy Center, the Iowa Environmental Council, and the Iowa Policy Project.

The groups contend that before IPL is granted permission to build a proposed $750 million power plant in Marshalltown, it should reduce electricity demand as much as possible through efficiency programs.

“The main point we’re making is before you build a new power plant you should do all the cost-effective energy conservation you can. That should be the first priority,” said Josh Mandelbaum, an attorney for the Environmental Law and Policy Center. “If you’re contemplating a new power plant, that’s not the time to be cautious with energy efficiency efforts. It’s the time to be most aggressive.”

In homes a significant reduction in demand can be accomplished simply by encouraging the use of lower-energy-consuming light bulbs, including compact fluorescent lights or newer light emitting diode, or LED, bulbs instead of the traditional globe-shaped incandescent ones. Those bulbs use significantly less electricity and can last much longer, but they cost more, with CFLs priced at $1 to $10 and LEDs at $18 to $50.

Energy providers like IPL and MidAmerican provide rebates for CFL and LED bulbs to help make up the price difference and encourage consumers to buy them. The utilities also offer rebates on energy efficient furnaces, air conditioners and other appliances.

Similar incentives are offered to industrial customers that replace older equipment, such as electric motors.

IPL’s five-year plan for 2014 through 2018, submitted to the board last November, costs $399 million, a price that would be passed on to the utility’s customers.

It represents more than 814,000 kilowatt-hours of electric savings. That’s about the equivalent of energy used by customers in Dubuque last year, said Justin Foss, a spokesman for Alliant Energy.

IPL’s efficiency plan also proposes to save 12 million therms of natural gas over five years, about the amount used by everyone in the city of Storm Lake, Foss said.

MidAmerican proposes to save 1.1 billion kilowatt-hours of electricity and 22 million therms of natural gas over its five-year plan, which is estimated to cost $512 million.

MidAmerican Energy is Iowa’s largest energy provider with nearly 645,000 electric and 555,864 natural gas customers in the state.

Alliant Energy serves about 484,000 electric and 223,000 natural gas customers in Iowa.

Foss said the challenge for utility companies is to devise an energy efficiency plan that balances the cost to customers with the need to ensure energy is used as efficiently as possible.

The environmental companies seek to have IPL pay more to encourage customers to buy high efficiency appliances and lighting and focus more rebate money on LED bulbs, which offer the largest savings. They also want increased use of a weatherization program and a behavior modification program that provides consumers with detailed reports of energy use and suggests ways to reduce it. And the groups want IPL to continue a pilot project started in 2011 that encourages customers to install solar power or small wind turbines.

IPL contends all of the environmental groups’ proposals would increase its cost to more than $1 billion.

Mandelbaum said that figure is inflated.

Testimony by witnesses for the environmental groups also have suggested MidAmerican should double its energy efficiency budget. Further details are to come as they proceed with the company’s case before the utilities board.

A hearing on MidAmerican’s plan is scheduled for Aug. 28 with all documents to be filed before Sept. 18.

“The company currently offers a variety of programs designed to put the power of energy efficiency in the hands of its residential and business customers,” spokeswoman Abby Bottenfield said in a statement. “If approved by the Iowa Utilities Board, the new plan would bring additional programs and opportunities for MidAmerican Energy customers to save on their bills and reduce their overall demand for energy.”

While the environmental groups pressure utilities to do more, large energy users such as John Deere & Co. also are pushing to keep costs down.

“You have these two diametrically opposed groups, one who wants us to force customers to pay a lot of money up front for environmental benefits and reduced energy use and another group which says we don’t want to be forced to pay all that extra money,” Foss said. “We try and work with everybody who has stake in this and we try to come up with a plan that comes to a balance.”

The Iowa Utility Board’s decision on the efficiency plans for the companies is expected by the end of the year.