House Study Bill 742 SENATE/HOUSE FILE BY (PROPOSED GOVERNOR'S BILL) Passed Senate, Date Passed House, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to energy efficiency by establishing specified 2 standards and goals relating to energy production and 3 utilization, and establishing a commission on energy 4 efficiency standards and practices. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 5711XL 82 7 rn/rj/14 PAG LIN 1 1 Section 1. NEW SECTION. 103A.27 COMMISSION ON ENERGY 1 2 EFFICIENCY STANDARDS AND PRACTICES. 1 3 1. A commission on energy efficiency standards and 1 4 practices is established within the department of public 1 5 safety. The commission shall be composed of the following 1 6 members: 1 7 a. The state building code commissioner, or the 1 8 commissioner's designee. 1 9 b. The director of the office of energy independence, or 1 10 the director's designee. 1 11 c. A professional engineer licensed pursuant to chapter 1 12 542B. 1 13 d. An architect registered pursuant to chapter 544A. 1 14 e. Two individuals recognized in the construction industry 1 15 as possessing expertise and experience in the construction or 1 16 renovation of energy=efficient residential and commercial 1 17 buildings. 1 18 f. A member of a local planning and zoning commission or 1 19 county board of supervisors. 1 20 g. Three individuals representing gas and electric public 1 21 utilities within this state. 1 22 h. A local building official whose duties include 1 23 enforcement of requirements for energy conservation in 1 24 construction. 1 25 i. Two consumers, one of whom owns and occupies a 1 26 residential building in this state and one of whom owns and 1 27 occupies a building used in commercial business or 1 28 manufacturing. 1 29 2. The commissioner shall appoint all members to the 1 30 commission other than those members designated in subsection 1 31 1, paragraphs "a" and "b". Appointment of members are subject 1 32 to the requirements of sections 69.16 and 69.16A. Members 1 33 shall serve three=year terms beginning and ending as provided 1 34 in section 69.19. A vacancy on the commission shall be filled 1 35 for the unexpired portion of the regular term in the same 2 1 manner as regular appointments are made. Members appointed by 2 2 the commissioner shall be reimbursed for actual and necessary 2 3 expenses incurred in performance of their duties. Such 2 4 members may also be eligible to receive compensation as 2 5 provided in section 7E.6. A majority of the members shall 2 6 constitute a quorum. 2 7 3. Duties of the commission shall include but are not 2 8 limited to the following: 2 9 a. Evaluate energy efficiency standards applicable to 2 10 existing or newly constructed residential, commercial, and 2 11 industrial buildings and vertical infrastructure at the state 2 12 and local level and make suggestions for their improvement and 2 13 enforcement. 2 14 b. Develop recommendations for new energy efficiency 2 15 standards, specifications, or guidelines applicable to newly 2 16 constructed residential, commercial, and industrial buildings 2 17 and vertical infrastructure. 2 18 c. Develop recommendations for the establishment of 2 19 incentives for energy efficiency construction projects which 2 20 exceed currently applicable state and local building codes. 2 21 d. Develop recommendations for adoption of a statewide 2 22 energy efficiency building labeling or rating system for 2 23 residential, commercial, and industrial buildings and 2 24 complexes. 2 25 4. The commission shall be formed for the two=year period 2 26 beginning July 1, 2008, and ending June 30, 2010, and shall 2 27 submit a report to the governor and the general assembly by 2 28 January 1, 2011, regarding its activities and recommendations. 2 29 Administrative support shall be furnished by the department of 2 30 public safety, with the assistance of the office of energy 2 31 independence and the department of natural resources. 2 32 Sec. 2. Section 476.6, Code Supplement 2007, is amended by 2 33 adding the following new subsection: 2 34 NEW SUBSECTION. 23. ENERGY SAVINGS STANDARD. 2 35 The board shall establish an energy efficiency standard of 3 1 a one and one=half percent annual reduction in projected 3 2 energy use applicable to all gas and electric utilities as a 3 3 statewide average goal. In applying the standard, the board 3 4 shall collaborate with each utility to determine an 3 5 individualized and cost=effective energy efficiency goal, 3 6 taking into consideration the utility service area's historic 3 7 energy load, its projected demand, its consumer base, and 3 8 other relevant factors. The goal applicable to a gas and 3 9 electric utility may be implemented through modification of 3 10 the utility's energy efficiency plan submitted pursuant to 3 11 subsection 14, a plan developed and implemented by the board, 3 12 or pursuant to a third=party contract entered into by the 3 13 utility. Upon application, the board may establish an energy 3 14 efficiency goal for a group or groups of utilities to pool 3 15 their energy use reductions. 3 16 Sec. 3. Section 476.44, subsection 2, Code 2007, is 3 17 amended to read as follows: 3 18 2.An electric utility subject to this division, except a 3 19 utility that elects rate regulation pursuant to section 3 20 476.1A, shall not be required to own or purchase, at any one 3 21 time, more than its share of one hundred five megawatts of 3 22 power from alternative energy production facilities or small 3 23 hydro facilities at the rates established pursuant to section 3 24 476.43. The board shall allocate the one hundred five 3 25 megawatts based upon each utility's percentage of the total 3 26 Iowa retail peak demand, for the year beginning January 1, 3 27 1990, of all utilities subject to this section. If a utility 3 28 undergoes reorganization as defined in section 476.76, the 3 29 board shall combine the allocated purchases of power for each 3 30 utility involved in the reorganization.3 31Notwithstanding the one hundred five megawatt maximum, the 3 32 board may increase the amount of power that a utility is 3 33 required to own or purchase at the rates established pursuant 3 34 to section 476.43 if the board finds that a utility, including 3 35 a reorganized utility, exceeds its 1990 Iowa retail peak 4 1 demand by twenty percent and the additional power the utility 4 2 is required to purchase will encourage the development of 4 3 alternate energy production facilities and small hydro 4 4 facilities. The increase shall not exceed the utility's 4 5 increase in peak demand multiplied by the ratio of the 4 6 utility's share of the one hundred five megawatt maximum to 4 7 its 1990 Iowa retail peak demand.The board shall establish 4 8 for each electric utility the goal of producing or purchasing 4 9 twenty=five percent of its total annual Iowa retail electric 4 10 sales from alternative energy production facilities by 4 11 December 31, 2025. 4 12 EXPLANATION 4 13 This bill relates to improving energy efficiency within 4 14 this state. 4 15 The bill provides for the establishment of an energy 4 16 efficiency standard of a 1.5 percent annual reduction in 4 17 projected energy use applicable to all gas and electric 4 18 utilities as a statewide average goal. The bill directs the 4 19 Iowa utilities board to collaborate with each utility to 4 20 determine an individualized and cost=effective energy 4 21 efficiency goal, taking into consideration the utility service 4 22 area's historic energy load, its projected demand, its 4 23 consumer base, and other relevant factors. The bill specifies 4 24 that the goal may be implemented through modification of a 4 25 utility's energy efficiency plan submitted pursuant to Code 4 26 section 476.6, subsection 14, a plan developed and implemented 4 27 by the board, or pursuant to a third=party contract entered 4 28 into by the utility. The bill provides that, upon 4 29 application, the board may establish an energy efficiency goal 4 30 for a group or groups of utilities to pool their energy use 4 31 reductions. 4 32 The bill also establishes a goal applicable to electric 4 33 utilities of producing or purchasing 25 percent of their total 4 34 annual Iowa retail electric sales from alternative energy 4 35 production facilities by December 31, 2025. 5 1 The bill provides for the establishment of a commission on 5 2 energy efficiency standards and practices within the 5 3 department of public safety, to be comprised of the state 5 4 building code commissioner or designee, the director of the 5 5 office of energy independence or designee, a licensed 5 6 engineer, a registered architect, two individuals recognized 5 7 in the construction industry as possessing expertise and 5 8 experience in the construction or renovation of 5 9 energy=efficient residential and commercial buildings, a 5 10 member of a local planning and zoning commission or county 5 11 board of supervisors, three representatives of gas and 5 12 electric public utilities, a local building official, and two 5 13 consumers. The commission's duties would include evaluating 5 14 energy efficiency standards applicable to buildings, 5 15 developing recommendations for new energy efficiency 5 16 standards, specifications, or guidelines applicable to new 5 17 construction, developing recommendations for incentives for 5 18 energy efficiency construction projects which exceed currently 5 19 applicable state and local building codes, and developing 5 20 recommendations for adopting a statewide energy efficiency 5 21 building labeling or rating system. The commission would 5 22 exist for a two=year period, with a report of recommendations 5 23 submitted to the governor and the general assembly by January 5 24 1, 2011. 5 25 LSB 5711XL 82 5 26 rn/rj/14.1