House File 2100 - Introduced HOUSE FILE 2100 BY HEATON A BILL FOR An Act relating to electric utility rates applicable to net 1 metering agreements. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5526YH (4) 86 rn/sc

H.F. 2100 Section 1. Section 476.42, Code 2016, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 2A. “Net metering” means the 3 interconnection of an alternate energy production facility 4 or small hydro facility with an electric utility whereby 5 electricity produced by the facility and consumed on site 6 offsets electricity that would otherwise be purchased from 7 the electric utility, and excess electricity produced by the 8 facility is transferred to the utility’s electrical grid. 9 Sec. 2. Section 476.43, subsection 2, Code 2016, is amended 10 to read as follows: 11 2. Upon application by the owner or operator of an alternate 12 energy production facility or small hydro facility or any 13 interested party, and subject to subsection 5A, the board shall 14 establish for the affected public utility just and economically 15 reasonable rates for electricity purchased under subsection 16 1 , paragraph “a” . The rates shall be established at levels 17 sufficient to stimulate the development of alternate energy 18 production and small hydro facilities in Iowa and to encourage 19 the continuation of existing capacity from those facilities. 20 Sec. 3. Section 476.43, Code 2016, is amended by adding the 21 following new subsection: 22 NEW SUBSECTION . 5A. a. A rate-regulated electric utility 23 that purchases electricity from an alternate energy production 24 facility or small hydro facility pursuant to a net metering 25 agreement shall compensate the facility at a rate that is 26 based upon, and does not exceed, the rate applicable to 27 the rate-regulated electric utility’s wholesale purchase of 28 electricity. 29 b. Net metering agreements entered into prior to July 1, 30 2016, with an applicable rate that exceeds the rate-regulated 31 electric utility’s wholesale rate shall be subject to a 32 graduated rate reduction whereby the difference between the 33 applicable rate in the agreement and the wholesale rate shall 34 be reduced by twenty-five percent annually over a four-year 35 -1- LSB 5526YH (4) 86 rn/sc 1/ 2

H.F. 2100 period. 1 EXPLANATION 2 The inclusion of this explanation does not constitute agreement with 3 the explanation’s substance by the members of the general assembly. 4 This bill restricts rates applicable to a net metering 5 agreement between an alternate energy production facility or 6 small hydro facility and a rate-regulated electric utility to a 7 level that does not exceed the utility’s wholesale rates. 8 The bill defines “net metering” as the interconnection of an 9 alternate energy production facility or small hydro facility 10 with an electric utility whereby electricity produced by the 11 facility and consumed on site offsets electricity that would 12 otherwise be purchased from the electric utility, and excess 13 electricity produced by the facility is transferred to the 14 utility’s electrical grid. 15 The bill provides that net metering agreements in existence 16 prior to July 1, 2016, with an applicable rate that exceeds 17 the rate-regulated electric utility’s wholesale rate shall be 18 subject to a graduated rate reduction whereby the difference 19 between the applicable rate in the agreement and the wholesale 20 rate shall be reduced by 25 percent each year over a four-year 21 period. 22 -2- LSB 5526YH (4) 86 rn/sc 2/ 2