House Amendment to Senate File 2311 S-5256 Amend Senate File 2311, as amended, passed, and reprinted by 1 the Senate, as follows: 2 1. By striking everything after the enacting clause and 3 inserting: 4 < Section 1. Section 28F.1, subsection 1, Code 2018, is 5 amended to read as follows: 6 1. This chapter provides a means for the joint financing 7 by public agencies of works or facilities useful and necessary 8 for the collection, treatment, purification, and disposal 9 in a sanitary manner of liquid and solid waste, sewage, 10 and industrial waste, facilities used for the conversion of 11 solid waste to energy, gasworks and facilities useful for 12 the delivery of natural gas service, and also electric power 13 facilities constructed within the state of Iowa, except that 14 hydroelectric power facilities may also be located in the 15 waters and on the dams of or on land adjacent to either side 16 of the Mississippi or Missouri river bordering the state of 17 Iowa, water supply systems, swimming pools or golf courses. 18 This chapter applies to the acquisition, construction, 19 reconstruction, ownership, operation, repair, extension, 20 or improvement of such works or facilities, by a separate 21 administrative or legal entity created pursuant to chapter 22 28E or chapter 389 . When the legal entity created under 23 this chapter is comprised solely of cities, counties, and 24 sanitary districts established under chapter 358 , or any 25 combination thereof or any combination of the foregoing with 26 other public agencies, the entity shall be both a corporation 27 and a political subdivision with the name under which it was 28 organized. The legal entity may sue and be sued, contract, 29 acquire and hold real and personal property necessary for 30 corporate purposes, adopt a corporate seal and alter the seal 31 at pleasure, and execute all the powers conferred in this 32 chapter . 33 Sec. 2. Section 28F.11, Code 2018, is amended to read as 34 follows: 35 -1- SF2311.5500.H (2) 87 md 1/ 13 #1.
28F.11 Eminent domain. 1 Any public agency participating in an agreement authorizing 2 the joint exercise of governmental powers pursuant to this 3 chapter may exercise its power of eminent domain to acquire 4 interests in property, under provisions of law then in effect 5 and applicable to the public agency, for the use of the entity 6 created to carry out the agreement, provided that the power of 7 eminent domain is not used to acquire interests in property 8 which is part of a system of facilities in existence, under 9 construction, or planned, for the generation, transmission 10 or sale of electric power , or for the transmission, 11 transportation, or sale of natural gas . In the exercise 12 of the power of eminent domain, the public agency shall 13 proceed in the manner provided by chapter 6B . Any interests 14 in property acquired are acquired for a public purpose, as 15 defined in chapter 6A , of the condemning public agency, and the 16 payment of the costs of the acquisition may be made pursuant 17 to the agreement or to any separate agreement between the 18 public agency and the entity or the other public agencies 19 participating in the entity or any of them. Upon payment of 20 costs, any property acquired is the property of the entity. 21 Sec. 3. Section 476.1, subsection 7, Code 2018, is amended 22 to read as follows: 23 7. The jurisdiction of the board under this chapter 24 shall include efforts designed to promote the use of energy 25 efficiency strategies by rate or service-regulated gas and 26 electric utilities required to be rate-regulated . 27 Sec. 4. Section 476.1A, subsections 1, 2, and 4, Code 2018, 28 are amended to read as follows: 29 1. Electric public utilities having fewer than ten 30 thousand customers and electric cooperative corporations 31 and associations are not subject to the rate regulation 32 authority of the board . Such utilities are subject to all 33 other regulation and enforcement activities of the board, 34 including , except for regulatory action pertaining to all of 35 -2- SF2311.5500.H (2) 87 md 2/ 13
the following : 1 a. Assessment of fees for the support of the division and 2 the office of consumer advocate, pursuant to section 476.10 . 3 b. Safety and engineering standards for equipment, 4 operations, and procedures. 5 c. Assigned area of service. 6 d. Pilot projects of the board. 7 e. Assessment of fees for the support of the Iowa energy 8 center created in section 15.120 and the center for global and 9 regional environmental research established by the state board 10 of regents. This paragraph “e” is repealed July 1, 2022. 11 f. Filing alternate energy purchase program plans with the 12 board, and offering such programs to customers, pursuant to 13 section 476.47 . 14 g. Filing energy efficiency plans and energy efficiency 15 results with the board. The energy efficiency plans as a 16 whole shall be cost-effective. The board may permit these 17 utilities to file joint plans. The board shall periodically 18 report the energy efficiency results including energy savings 19 of each of these utilities to the general assembly. The board 20 may waive all or part of the energy efficiency filing and 21 review requirements for electric cooperative corporations and 22 associations and electric public utilities which demonstrate 23 superior results with existing energy efficiency efforts. 24 2. However, sections 476.20 , subsections 1 through 4, 25 476.21 , 476.41 through 476.44 , 476.51 , 476.56 , 476.62 , and 26 476.66 and chapters 476A and 478 , to the extent applicable, 27 apply to such electric utilities. 28 4. The board of directors or the membership of an electric 29 cooperative corporation or association otherwise exempt 30 from rate regulation may elect to have the cooperative’s 31 rates regulated by the board. The board shall adopt rules 32 prescribing the manner in which the board of directors or the 33 membership of an electric cooperative may so elect. If the 34 board of directors or the membership of an electric cooperative 35 -3- SF2311.5500.H (2) 87 md 3/ 13
has elected to have the cooperative’s rates regulated by the 1 board, after two years have elapsed from the effective date of 2 such election the board of directors or the membership of the 3 electric cooperative may elect to exempt the cooperative from 4 the rate regulation authority of the board , provided, however, 5 that if the membership elected to have the cooperative’s rates 6 regulated by the board, only the membership may elect to exempt 7 the cooperative from the rate regulation authority of the 8 board . 9 Sec. 5. Section 476.1B, subsection 1, paragraphs f and l, 10 Code 2018, are amended by striking the paragraphs. 11 Sec. 6. Section 476.2, subsection 6, Code 2018, is amended 12 by striking the subsection. 13 Sec. 7. Section 476.4, subsection 1, Code 2018, is amended 14 to read as follows: 15 1. Every public utility shall file with the board tariffs 16 showing the rates and charges for its public utility services 17 and the rules and regulations under which such services were 18 furnished, on April 1, 1963, which rates and charges shall be 19 subject to investigation by the board as provided in section 20 476.3 , and upon such investigation the burden of establishing 21 the reasonableness of such rates and charges shall be upon the 22 public utility filing the same. These filings shall be made 23 under such rules as the board may prescribe within such time 24 and in such form as the board may designate. In prescribing 25 rules and regulations with respect to the form of tariffs 26 and any other regulations , the board shall, in the case of 27 public utilities subject to regulation by any federal agency, 28 give due regard to any corresponding rules and regulations of 29 such federal agency, to the end that unnecessary duplication 30 of effort and expense may be avoided so far as reasonably 31 possible. Each public utility shall keep copies of its tariffs 32 open to public inspection under such rules as the board may 33 prescribe. 34 Sec. 8. Section 476.6, subsections 8 and 13, Code 2018, are 35 -4- SF2311.5500.H (2) 87 md 4/ 13
amended to read as follows: 1 8. Automatic adjustments permitted . 2 a. This chapter does not prohibit a public utility from 3 making provision for the automatic adjustment of rates and 4 charges for public utility service provided that a schedule 5 showing the automatic adjustment of rates and charges is first 6 filed with and approved by the board. 7 b. A public utility may automatically adjust rates and 8 charges to recover costs related to transmission incurred by 9 or charged to the public utility consistent with a tariff 10 or agreement that is subject to the jurisdiction of the 11 federal energy regulatory commission, provided that a schedule 12 showing the automatic adjustment of rates and charges is first 13 filed with and approved by the board. The board shall adopt 14 rules regarding the reporting of transmission expenses and 15 transmission-related activity pursuant to this paragraph. 16 13. Energy efficiency plans. Electric and gas public 17 utilities shall offer energy efficiency programs to their 18 customers through energy efficiency plans. An energy 19 efficiency plan as a whole shall be cost-effective. In 20 determining the cost-effectiveness of an energy efficiency 21 plan, the board shall apply the societal test, total resource 22 cost test, utility cost test, rate-payer impact test, and 23 participant test. Energy efficiency programs for qualified 24 low-income persons and for tree planting programs, educational 25 programs, and assessments of consumers’ needs for information 26 to make effective choices regarding energy use and energy 27 efficiency need not be cost-effective and shall not be 28 considered in determining cost-effectiveness of plans as a 29 whole. The energy efficiency programs in the plans may be 30 provided by the utility or by a contractor or agent of the 31 utility. Programs offered pursuant to this subsection by gas 32 and electric utilities that are required to be rate-regulated 33 shall require board approval. 34 Sec. 9. Section 476.6, subsection 15, paragraph a, Code 35 -5- SF2311.5500.H (2) 87 md 5/ 13
2018, is amended to read as follows: 1 a. (1) (a) Gas and electric Electric utilities required 2 to be rate-regulated under this chapter shall file five-year 3 energy efficiency plans and demand response plans with the 4 board. Gas utilities required to be rate-regulated under 5 this chapter shall file five-year energy efficiency plans 6 with the board. An energy efficiency plan and budget or a 7 demand response plan and budget shall include a range of energy 8 efficiency or demand response programs, tailored to the needs 9 of all customer classes, including residential, commercial, 10 and industrial customers, for energy efficiency opportunities. 11 The plans shall include programs for qualified low-income 12 persons including a cooperative program with any community 13 action agency within the utility’s service area to implement 14 countywide or communitywide energy efficiency programs for 15 qualified low-income persons. Rate-regulated gas and electric 16 utilities shall utilize Iowa agencies and Iowa contractors to 17 the maximum extent cost-effective in their energy efficiency 18 plans or demand response plans filed with the board. 19 (b) The board shall allow a customer of an electric utility 20 that is required to be rate-regulated to request an exemption 21 from participation in any five-year energy efficiency plan 22 offered by an electric utility if the energy efficiency plan 23 and demand response plan, at the time of approval by the board, 24 have a cumulative rate-payer impact test result of less than 25 one. Upon receipt of a request for exemption submitted by 26 a customer, the electric utility shall grant the exemption 27 and, beginning January 1 of the following year, the customer 28 shall no longer be assessed the costs of the plan and shall be 29 prohibited from participating in any program included in such 30 plan until the exemption no longer applies, as determined by 31 the board. 32 (2) Gas and electric utilities required to be 33 rate-regulated under this chapter may request an energy 34 efficiency plan or demand response plan modification during the 35 -6- SF2311.5500.H (2) 87 md 6/ 13
course of a five-year plan. A modification may be requested 1 due to changes in funding as a result of public utility 2 customers requesting exemptions from the plan or for any other 3 reason identified by the gas or electric utility. The board 4 shall take action on a modification request made by a gas or 5 electric utility within ninety days after the modification 6 request is filed. If the board fails to take action within 7 ninety days after a modification request is filed, the 8 modification request shall be deemed approved. 9 (3) The board shall adopt rules pursuant to chapter 17A 10 establishing reasonable processes and procedures for utility 11 customers from any customer class to request exemptions 12 from energy efficiency plans that meet the requirements of 13 subparagraph (1), subparagraph division (b). The rules adopted 14 by the board shall only apply to electric utilities that are 15 required to be rate-regulated. 16 Sec. 10. Section 476.6, subsection 15, paragraphs c and d, 17 Code 2018, are amended by striking the paragraphs. 18 Sec. 11. Section 476.6, subsection 15, paragraphs e, f, and 19 g, Code 2018, are amended to read as follows: 20 e. (1) The board shall conduct contested case proceedings 21 for review of energy efficiency plans , demand response plans, 22 and budgets filed by gas and electric utilities required to be 23 rate-regulated under this chapter . 24 (2) Notwithstanding the goals developed pursuant to 25 paragraph “b” , the board shall not require a gas utility to 26 adopt an energy efficiency plan that results in projected 27 cumulative average annual costs that exceed one and one-half 28 percent of the gas utility’s expected annual Iowa retail rate 29 revenue from retail customers in the state, shall not require 30 an electric utility to adopt an energy efficiency plan that 31 results in projected cumulative average annual costs that 32 exceed two percent of the electric utility’s expected annual 33 Iowa retail rate revenue from retail customers in the state, 34 and shall not require an electric utility to adopt a demand 35 -7- SF2311.5500.H (2) 87 md 7/ 13
response plan that results in projected cumulative average 1 annual costs that exceed two percent of the electric utility’s 2 expected annual Iowa retail rate revenue from retail customers 3 in the state. For purposes of determining the two percent 4 threshold amount, the board shall exclude from an electric 5 utility’s expected annual Iowa retail rate revenue the revenues 6 expected from customers that have received exemptions from 7 energy efficiency plans pursuant to paragraph “a” . This 8 subparagraph shall apply to energy efficiency plans and demand 9 response plans that are effective on or after January 1, 2019. 10 (3) The board may approve, reject, or modify the plans and 11 budgets. Notwithstanding the provisions of section 17A.19, 12 subsection 5 , in an application for judicial review of the 13 board’s decision concerning a utility’s energy efficiency plan 14 or budget, the reviewing court shall not order a stay. 15 (4) The board shall approve, reject, or modify a plan filed 16 pursuant to this subsection no later than March 31, 2019. If 17 the board fails to approve, reject, or modify a plan filed by a 18 gas or electric utility on or before such date, any plan filed 19 by the gas or electric utility that was approved by the board 20 prior to the effective date of this Act shall be terminated. 21 The board shall not require a gas or electric utility to 22 implement an energy efficiency plan or demand response plan 23 that does not meet the requirements of this subsection. 24 (5) Whenever a request to modify an approved plan or budget 25 is filed subsequently by the office of consumer advocate or a 26 gas or electric utility required to be rate-regulated under 27 this chapter , the board shall promptly initiate a formal 28 proceeding if the board determines that any reasonable ground 29 exists for investigating the request. The formal proceeding 30 may be initiated at any time by the board on its own motion. 31 Implementation of board-approved plans or budgets shall 32 be considered continuous in nature and shall be subject to 33 investigation at any time by the board or the office of the 34 consumer advocate. 35 -8- SF2311.5500.H (2) 87 md 8/ 13
f. Notice to customers of a contested case proceeding for 1 review of energy efficiency plans , demand response plans, and 2 budgets shall be in a manner prescribed by the board. 3 g. (1) A gas or electric utility required to be 4 rate-regulated under this chapter may recover, through an 5 automatic adjustment mechanism filed pursuant to subsection 8 , 6 over a period not to exceed the term of the plan, the costs of 7 an energy efficiency plan or demand response plan approved by 8 the board , including amounts for a plan approved prior to July 9 1, 1996, in a contested case proceeding conducted pursuant to 10 paragraph “e” . Customers that have been granted exemptions from 11 energy efficiency plans pursuant to paragraph “a” , shall not 12 be charged for recovery of energy efficiency costs beginning 13 January 1 of the year following the year in which the customer 14 was granted the exemption. 15 (2) The board shall periodically conduct a contested case 16 proceeding to evaluate the reasonableness and prudence of the 17 utility’s implementation of an approved energy efficiency 18 or demand response plan and budget. If a utility is not 19 taking all reasonable actions to cost-effectively implement 20 an approved energy efficiency plan, the board shall not allow 21 the utility to recover from customers costs in excess of those 22 costs that would be incurred under reasonable and prudent 23 implementation and shall not allow the utility to recover 24 future costs at a level other than what the board determines 25 to be reasonable and prudent. If the result of a contested 26 case proceeding is a judgment against a utility, that utility’s 27 future level of cost recovery shall be reduced by the amount 28 by which the programs were found to be imprudently conducted. 29 The Beginning January 1, 2019, a gas or electric utility 30 shall not represent energy efficiency and demand response in 31 customer billings as a separate cost or expense unless the 32 board otherwise approves . 33 Sec. 12. Section 476.6, subsection 17, Code 2018, is amended 34 by striking the subsection. 35 -9- SF2311.5500.H (2) 87 md 9/ 13
Sec. 13. Section 476.6, Code 2018, is amended by adding the 1 following new subsection: 2 NEW SUBSECTION . 22. Preapproval of cost recovery for natural 3 gas extensions —— rules. The board may adopt rules which 4 provide for a preapproval process for cost recovery for natural 5 gas extensions. 6 Sec. 14. Section 476.6, Code 2018, is amended by adding the 7 following new subsection: 8 NEW SUBSECTION . 23. Federal tax reduction —— customer 9 benefits. Customers of gas and electric utilities subject to 10 rate regulation by the board shall receive the full benefits 11 of the utilities’ reduced federal corporate income taxes as 12 provided in the federal Tax Cuts and Jobs Act of 2017, Pub. 13 L. No. 115-97, 131 Stat. 2054. Notwithstanding any other 14 provision of law or rule to the contrary, the board shall, 15 no later than June 1, 2018, approve any proposal filed by a 16 rate-regulated gas or electric utility to pass such benefits 17 on to customers. The board may approve rates with provision 18 for adjustments to ensure that the rates are accurate and that 19 customers receive the full benefits. 20 Sec. 15. Section 476.20, subsection 5, paragraph a, 21 unnumbered paragraph 1, Code 2018, is amended to read as 22 follows: 23 The board shall establish rules which shall be uniform with 24 respect to all public utilities furnishing gas or electricity 25 relating to deposits which may be required by the public 26 utility for the initiation or reinstatement of service. This 27 subsection shall not apply to municipally owned utilities, 28 which shall be governed by the provisions of section 384.84 29 with respect to deposits and payment plans for delinquent 30 amounts owed. Municipally owned utilities and electric 31 utilities that are not required to be rate-regulated shall not 32 be subject to the board’s rules in regards to deposits and 33 payment plans for delinquent amounts owed and repayment of past 34 due debt. Municipally owned utilities and electric utilities 35 -10- SF2311.5500.H (2) 87 md 10/ 13
that are not required to be rate-regulated shall be subject to 1 the board’s rules in regards to payment plans made prior to the 2 disconnection of services. 3 Sec. 16. Section 476.21, Code 2018, is amended to read as 4 follows: 5 476.21 Discrimination prohibited. 6 A municipality, corporation or cooperative association 7 providing electrical or gas service shall not consider the 8 use of renewable energy sources by a customer as a basis for 9 establishing discriminatory rates or charges for any service 10 or commodity sold to the customer or discontinue services or 11 subject the customer to any other prejudice or disadvantage 12 based on the customer’s use or intended use of renewable energy 13 sources. As used in this section , “renewable energy sources” 14 includes but is not limited to solar heating, wind power and 15 the conversion of urban and agricultural organic wastes into 16 methane gas and liquid fuels. 17 Sec. 17. Section 476.33, subsection 4, Code 2018, is amended 18 to read as follows: 19 4. The board shall adopt rules that require the board, in 20 rate regulatory proceedings under sections 476.3 and 476.6 , to 21 utilize either a historic test year or a future test year at 22 the rate-regulated public utility’s discretion. 23 a. For a rate regulatory proceeding utilizing a historic 24 test year, the rules shall require the board to consider the 25 use of the most current test period possible in determining 26 reasonable and just rates, subject only to the availability of 27 existing and verifiable data respecting costs and revenues, and 28 in addition, to consider verifiable data that exists within 29 nine months after the conclusion of the test year, respecting 30 known and measurable changes in costs not associated with a 31 different level of revenue, and known and measurable revenues 32 not associated with a different level of costs, that are to 33 occur at any time within twelve months after the date of 34 commencement of the proceedings. Parties proposing adjustments 35 -11- SF2311.5500.H (2) 87 md 11/ 13
that are not verifiable at the commencement of the proceedings 1 shall include projected data related to the adjustments in 2 their initial substantive filing with the board. For purposes 3 of this subsection paragraph , a proceeding commences under 4 section 476.6 upon the filing date of new or changed rates, 5 charges, schedules, or regulations. This subsection does not 6 limit the authority of the board to consider other evidence in 7 proceedings under sections 476.3 and 476.6 . 8 b. For a rate regulatory proceeding utilizing a future test 9 year, the rules shall require the board to consider the use 10 of any twelve-month period beginning no later than the date 11 on which a proposed rate change is expected to take effect 12 in determining just and reasonable rates. The rules shall 13 also require the board to conduct a proceeding subsequent to 14 the effective date of a rate resulting from a rate regulatory 15 proceeding utilizing a future test year to determine whether 16 the actual costs and revenues are reasonably consistent with 17 those approved by the board. If the actual costs and revenues 18 are not reasonably consistent with those approved by the 19 board, the board shall adjust the rates accordingly. For a 20 rate regulatory proceeding utilizing a future test year, the 21 board may adopt rules regarding evidence required, information 22 to support forecasts, and any reporting obligations. The 23 board may also adopt rules regarding the conditions under 24 which a public utility that utilizes a future test year may 25 subsequently utilize a historic test year. A public utility 26 shall not be precluded from filing a rate regulatory proceeding 27 utilizing a future test year prior to the adoption of any rules 28 pursuant to this subsection. 29 c. This subsection does not limit the authority of the board 30 to consider other evidence in proceedings under sections 476.3 31 and 476.6. 32 Sec. 18. Section 476.53, subsection 3, paragraph a, 33 subparagraph (1), subparagraph division (a), Code 2018, is 34 amended by adding the following new subparagraph subdivision: 35 -12- SF2311.5500.H (2) 87 md 12/ 13
NEW SUBPARAGRAPH SUBDIVISION . (v) Repowering of an 1 alternate energy production facility. For purposes of this 2 subparagraph subdivision, “repowering” shall mean either the 3 complete dismantling and replacement of generation equipment at 4 an existing project site, or the installation of new parts and 5 equipment to an existing alternate energy production facility 6 in order to increase energy production, reduce load, increase 7 service capacity, improve project reliability, or extend the 8 useful life of the facility. 9 Sec. 19. STUDY OF ELECTRIC VEHICLE INFRASTRUCTURE 10 SUPPORT. The economic development authority, in collaboration 11 with the department of transportation and the Iowa utility 12 industry, shall conduct a study of electric vehicle 13 infrastructure support for both commercial and noncommercial 14 vehicles and make recommendations to the general assembly 15 regarding electric vehicle charging infrastructure. The study 16 shall evaluate the relative costs and benefits associated with 17 various options for electric vehicle infrastructure support. 18 The economic development authority shall submit a report to the 19 general assembly containing the results of the study no later 20 than June 30, 2019. 21 Sec. 20. EFFECTIVE DATE. The following, being deemed of 22 immediate importance, takes effect upon enactment: 23 1. The section of this Act amending section 476.6, 24 subsection 15, paragraphs “e”, “f”, and “g”. 25 2. The section of this Act enacting section 476.6, 26 subsection 23. > 27 2. Title page, line 2, by striking < utilities > and 28 inserting < utilities, providing for a study of electric 29 vehicle infrastructure support, and including effective date 30 provisions > 31 -13- SF2311.5500.H (2) 87 md 13/ 13