Origin
In 2008, Iowa enacted S.F. 2386, which requires the Iowa Utilities Board (IUB) to create energy savings standards (electricity and natural gas) for all rate-regulated utilities. Utilities that are not rate-regulated (municipal and cooperative utilities) were required to establish their own energy efficiency goals. In 2019, Iowa also enacted S.F. 638, which disallows utilities from adopting energy efficiency plans that result in projected cumulative average annual costs that exceed 1.5% and 2% of gas and electric utilities' respective annual retail rate revenue from retail customers. These goals were filed in December 2009. All utilities (rate-regulated and otherwise) must submit plans with the IUB utility, administer customer energy efficiency programs in order to reach the efficiency goals, and submit annual reports to the IUB describing energy efficiency efforts. Utility efficiency plans, operating plans, and annual reports can be found here.
Electric Sales, Peak Demand, and Natural Gas Sales Reduction
A utility may reduce energy consumption through improvements to its infrastructure or through customer programs. Examples of customer programs include energy studies and audits, education, direct rebates and other financial assistance, research projects, time-of-use rates, tree planting, and hot water insulation distribution programs. In addition, utilities must target peak demand reductions.
The table below shows the required average energy savings levels during 2024-2028:
| Applicable Rate-Regulated Electric Utility |
Range of Average Target Reductions Relative to Baseline (2024-2028) |
|---|---|
| Interstate Power & Light (Alliant Energy) | 0.7% |
| MidAmerican Energy | 0.73-0.74% |
The table below shows the required target for peak demand reduction by 2023.
| Applicable Rate-Regulated Electric Utility | Target Reductions Relative to Baseline (By 2028) |
|---|---|
| Interstate Power & Light (Alliant Energy) | 291 MW |
| MidAmerican Energy | 581 MW |
The table below shows the required annual gas savings levels during 2019-2023:
| Applicable Rate-Regulated Natural Gas Utility |
Range of Average Target Reductions Relative to Baseline (2024-2028) |
|---|---|
| Interstate Power & Light (Alliant Energy) | 0.3% |
| MidAmerican Energy | 0.28-0.30% |
| Iowa Gas Utility Company (Black Hills Corp.) | 172,658 Dth |
Cost Effectiveness and Program Evaluation
Iowa uses the Societal Cost Test (SCT), one of the five “California tests” from the California Standard Practice Manual, as its primary cost-effectiveness test for evaluating energy efficiency programs.
Utility Cost Recovery Provisions
The costs of these programs are recovered through cost recovery factors on each customer's bill.
| Implementing Sector: | State |
| Category: | Regulatory Policy |
| State: | Iowa |
| Incentive Type: | Energy Efficiency Resource Standard |
| Web Site: | https://iub.iowa.gov/regulated-industries/energy-efficiency-programs |
| Administrator: | Utilities |
| Start Date: | |
| Eligible Renewable/Other Technologies: |
|
| Electric Sales Reduction: | Utility-specific standards set by IUB |
| Electric Peak Demand Reduction: | Utility-specific standards set by IUB |
| Natural Gas Sales Reduction: | Utility-specific standards set by IUB |
| Rate Impact Parameters: | All energy efficiency programs must be cost-effective for both customers and utilities |
| Name: | Iowa Code § 476.6.16(13) and (15) |
| Name: | IAC 199-35 |
| Name: | General Information |
| Organization: | Iowa Utilities Board |
| Address: |
1375 E. Court Avenue Des Moines IA 50319-0069 |
| Phone: | (515) 725-7300 |
| Email: | iub@iub.iowa.gov |
This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.
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