H.F. _____ Section 1. Section 474.1, subsections 3 and 4, Code 2026, 1 are amended to read as follows: 2 3. The utilities commission shall regulate and supervise 3 public utilities operating in the state. The commission shall 4 enforce and implement chapters 476 , 476A , 476E, 477C , 478 , 479 , 5 479A , and 479B and shall perform other duties assigned to it 6 by law. 7 4. As used in this chapter and chapters 475A , 476 , 476A , 8 476E, 477A, 477C , 478 , 479 , 479A , and 479B , “commission” and 9 “utilities commission” mean the Iowa utilities commission. 10 Sec. 2. NEW SECTION . 476E.1 Definitions. 11 For purposes of this chapter: 12 1. “Customer-based energy storage company” means a company 13 that provides power to a customer through an energy storage 14 system. A customer-based energy storage company shall not be 15 considered an electric utility or any other type of public 16 utility if it meets all of the following criteria: 17 a. Does not use energy from the electric grid during peak 18 energy times as defined by the commission. 19 b. If the company produces electricity, a portion of 20 the electricity is stored for use during peak energy times 21 such that the company can demonstrate to the commission that 22 the use of such electricity produces an overall benefit to 23 nonparticipating customers. 24 c. Is certified by the commission. 25 2. “Customer-based power plant” means a system that 26 aggregates, manages, and optimizes distributed energy 27 resources, including but not limited to solar panels, wind 28 turbines, battery storage, and controllable loads, to operate 29 collectively as a single entity within the electric grid for 30 the purposes of energy supply, demand response, and ancillary 31 services. 32 3. “Distributed energy resource” means any 33 electricity-producing resource or controllable load that is 34 interconnected at the distribution level of the electric grid 35 -1- LSB 6839YC (1) 91 sb/js 1/ 6

H.F. _____ of a public utility, including renewable energy systems, energy 1 storage devices, and demand response capabilities. 2 4. “Operator” means any individual, entity, or organization 3 that owns, operates, or manages a customer-based electric 4 generating facility within the state of Iowa. 5 5. “Public utility” means the same as defined in section 6 476.1. 7 Sec. 3. NEW SECTION . 476E.2 Customer-based power plants. 8 1. The purpose of this section is to facilitate the 9 deployment and operation of customer-based power plants within 10 the state of Iowa, to establish a clear and comprehensive 11 regulatory framework, to safeguard the interests of all 12 stakeholders, and to promote innovation and grid resilience 13 through distributed energy resources. 14 2. a. Customer-based power plant operators shall 15 maintain ongoing coordination with public utilities regarding 16 scheduling, dispatch, and emergency protocols. 17 b. The commission shall establish operational protocols for 18 customer-based power plants, including requirements for system 19 reliability, demand response participation, and provision of 20 ancillary service. 21 3. A customer-based power plant shall only operate within 22 the geographic territory of a public utility subject to rate 23 regulation under chapter 476. 24 4. Customer-based power plant operators shall implement 25 safeguards to protect consumer data against unauthorized 26 access, disclosure, or misuse. The commission shall promulgate 27 minimum cybersecurity standards for customer-based power 28 plant operators to ensure the integrity and resilience of 29 customer-based power plant systems and associated data. 30 Customer-based power plant operators must obtain informed 31 consent from consumers before collecting, using, or sharing 32 consumer data, and must provide mechanisms for consumers to 33 access and correct their data. 34 5. a. The commission shall establish a process to certify 35 -2- LSB 6839YC (1) 91 sb/js 2/ 6

H.F. _____ a customer-based power plant. The process shall demonstrate 1 technical competence, financial stability, cybersecurity 2 measures, and an ability to comply with all relevant laws and 3 regulations. 4 b. The commission may approve and oversee pilot programs 5 to evaluate innovative customer-based power plant models and 6 technologies, and shall report any findings to the general 7 assembly. 8 c. The commission shall adopt rules necessary to implement 9 this chapter. The rules adopted shall include the following: 10 (1) Technical standards and reporting requirements of 11 customer-based power plants. 12 (2) Penalties, including suspension or revocation of a 13 certification for noncompliance. 14 Sec. 4. NEW SECTION . 476E.3 Customer-based energy storage. 15 1. A customer-based energy storage company may do any of the 16 following: 17 a. Purchase power during nonpeak times through a 18 market-based tariff to compensate for any distribution or 19 transmission use. 20 b. Sell power during peak times through a market-based 21 tariff to compensate for any distribution or transmission use. 22 c. Notwithstanding section 476.25, provide any portion of 23 power to a customer located in the geographic territory of a 24 public utility subject to rate regulation under chapter 476. 25 2. A public utility shall not discriminate against a 26 customer who is a customer of a customer-based energy storage 27 company. 28 3. The commission may approve and oversee pilot programs 29 to evaluate innovative customer-based energy storage models 30 and technologies, and shall report any findings to the general 31 assembly. 32 4. The commission shall adopt rules necessary to implement 33 this section. The rules adopted shall include the following: 34 a. Determination of peak energy times, technical standards, 35 -3- LSB 6839YC (1) 91 sb/js 3/ 6

H.F. _____ and reporting requirements. 1 b. A market-based tariff pursuant to this chapter. The 2 tariff shall be constructed to benefit nonparticipating 3 ratepayers. 4 c. A process to certify customer-based energy storage 5 companies. The process shall demonstrate technical competence, 6 financial stability, cybersecurity measures, and an ability to 7 comply with all relevant laws and regulations. 8 d. Penalties, including suspension or revocation of a 9 certification for noncompliance. 10 Sec. 5. NEW SECTION . 476E.4 New tariffs —— demand 11 management. 12 1. If more than thirty months have passed since the 13 commission has entered an order in a rate-review proceeding, 14 the following parties may request a new tariff: 15 a. The office of consumer advocate. 16 b. A user or aggregation of users with a generating capacity 17 of at least fifteen megawatts. 18 2. A request for a new tariff under this section must meet 19 both of the following criteria: 20 a. Encourages the reduction of peak energy demand. 21 b. The value of the potential reduction of peak energy 22 demand for nonparticipating customers exceeds the cost in 23 projected lost revenue. 24 EXPLANATION 25 The inclusion of this explanation does not constitute agreement with 26 the explanation’s substance by the members of the general assembly. 27 This bill relates to customer-based energy, including power 28 plants and energy storage. 29 The bill defines “customer-based energy storage company” as 30 a company that provides power to a customer through an energy 31 storage system and provides that the company is not considered 32 an electric utility or any other type of public utility if it 33 meets certain criteria. The bill defines “customer-based power 34 plant” as a system that aggregates, manages, and optimizes 35 -4- LSB 6839YC (1) 91 sb/js 4/ 6

H.F. _____ distributed energy resources to operate collectively as a 1 single entity for purposes that may include energy supply, 2 demand response, and ancillary services. 3 The bill requires operators of customer-based power plants 4 (CPPs) to maintain ongoing coordination with public utilities 5 regarding scheduling, dispatch, and emergency protocols. The 6 bill requires the Iowa utilities commission (commission) 7 to establish operational protocols for CPPs, including 8 requirements related to system reliability, participation in 9 demand response programs, and provision of ancillary services. 10 The bill requires CPPs to operate only within the geographic 11 territory of a public utility subject to rate regulation. 12 The bill requires CPP operators to implement safeguards to 13 protect consumer data from unauthorized access, disclosure, 14 or misuse. The bill requires the commission to adopt minimum 15 cybersecurity standards to ensure the integrity and resilience 16 of CPP systems and associated data. The bill requires 17 operators to obtain informed consent from consumers before 18 collecting, using, or sharing consumer data and to provide 19 mechanisms for consumers to access and correct their data. 20 The bill requires the commission to establish a process 21 to certify CPPs, requiring a demonstration of technical 22 competence, financial stability, cybersecurity measures, and 23 compliance with applicable laws and regulations. The bill 24 authorizes the commission to approve and oversee pilot programs 25 to evaluate innovative CPP models and technologies and requires 26 the commission to report the findings to the general assembly. 27 The bill authorizes a customer-based energy storage company 28 to purchase power during nonpeak times and sell power during 29 peak times through market-based tariffs to compensate for 30 distribution or transmission use. The bill provides that a 31 customer-based energy storage company may provide any portion 32 of power to a customer regardless of assigned service area 33 laws and regulations, provided the customer is located in the 34 geographic area of a public utility subject to rate regulation. 35 -5- LSB 6839YC (1) 91 sb/js 5/ 6

H.F. _____ The bill prohibits a public utility from discriminating against 1 a customer who is served by a customer-based energy storage 2 company. The bill authorizes the commission to approve and 3 oversee pilot programs to evaluate innovative customer-based 4 energy storage models and technologies and requires reporting 5 of the findings to the general assembly. 6 The bill requires the commission to adopt rules necessary 7 to implement the bill. The rules must address technical 8 standards and reporting requirements for CPPs, determination of 9 peak energy times, a market-based tariff designed to benefit 10 nonparticipating ratepayers, certification of customer-based 11 energy storage companies, and the establishment of penalties 12 for noncompliance, including suspension or revocation of 13 certifications. 14 The bill provides that if more than 30 months have passed 15 since the commission entered an order in a rate-review 16 proceeding, the office of consumer advocate or a user or 17 aggregation of users with a generating capacity of at least 18 15 megawatts may request a new tariff. The bill requires a 19 requested tariff to encourage the reduction of peak energy 20 demand and the value of the potential reduction of peak energy 21 demand for nonparticipating customers to exceed the cost of 22 projected lost revenue. 23 -6- LSB 6839YC (1) 91 sb/js 6/ 6