Senate File 2311 - Reprinted SENATE FILE 2311 BY COMMITTEE ON COMMERCE (SUCCESSOR TO SSB 3093) (As Amended and Passed by the Senate March 6, 2018 ) A BILL FOR An Act modifying various provisions relating to public 1 utilities. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 SF 2311 (5) 87 gh/rn/jh

S.F. 2311 Section 1. Section 28F.1, subsection 1, Code 2018, is 1 amended to read as follows: 2 1. This chapter provides a means for the joint financing 3 by public agencies of works or facilities useful and necessary 4 for the collection, treatment, purification, and disposal 5 in a sanitary manner of liquid and solid waste, sewage, 6 and industrial waste, facilities used for the conversion of 7 solid waste to energy, gasworks and facilities useful for 8 the delivery of natural gas service, and also electric power 9 facilities constructed within the state of Iowa, except that 10 hydroelectric power facilities may also be located in the 11 waters and on the dams of or on land adjacent to either side 12 of the Mississippi or Missouri river bordering the state of 13 Iowa, water supply systems, swimming pools or golf courses. 14 This chapter applies to the acquisition, construction, 15 reconstruction, ownership, operation, repair, extension, 16 or improvement of such works or facilities, by a separate 17 administrative or legal entity created pursuant to chapter 18 28E or chapter 389 . When the legal entity created under 19 this chapter is comprised solely of cities, counties, and 20 sanitary districts established under chapter 358 , or any 21 combination thereof or any combination of the foregoing with 22 other public agencies, the entity shall be both a corporation 23 and a political subdivision with the name under which it was 24 organized. The legal entity may sue and be sued, contract, 25 acquire and hold real and personal property necessary for 26 corporate purposes, adopt a corporate seal and alter the seal 27 at pleasure, and execute all the powers conferred in this 28 chapter . 29 Sec. 2. Section 28F.11, Code 2018, is amended to read as 30 follows: 31 28F.11 Eminent domain. 32 Any public agency participating in an agreement authorizing 33 the joint exercise of governmental powers pursuant to this 34 chapter may exercise its power of eminent domain to acquire 35 -1- SF 2311 (5) 87 gh/rn/jh 1/ 20

S.F. 2311 interests in property, under provisions of law then in effect 1 and applicable to the public agency, for the use of the entity 2 created to carry out the agreement, provided that the power of 3 eminent domain is not used to acquire interests in property 4 which is part of a system of facilities in existence, under 5 construction, or planned, for the generation, transmission 6 or sale of electric power , or for the transmission, 7 transportation, or sale of natural gas . In the exercise 8 of the power of eminent domain, the public agency shall 9 proceed in the manner provided by chapter 6B . Any interests 10 in property acquired are acquired for a public purpose, as 11 defined in chapter 6A , of the condemning public agency, and the 12 payment of the costs of the acquisition may be made pursuant 13 to the agreement or to any separate agreement between the 14 public agency and the entity or the other public agencies 15 participating in the entity or any of them. Upon payment of 16 costs, any property acquired is the property of the entity. 17 Sec. 3. Section 476.1, subsection 7, Code 2018, is amended 18 to read as follows: 19 7. The jurisdiction of the board under this chapter 20 shall include efforts designed to promote the use of energy 21 efficiency strategies by rate or service-regulated gas and 22 electric utilities required to be rate-regulated . 23 Sec. 4. Section 476.1A, subsections 1, 2, and 4, Code 2018, 24 are amended to read as follows: 25 1. Electric public utilities having fewer than ten 26 thousand customers and electric cooperative corporations 27 and associations are not subject to the rate regulation 28 authority of the board . Such utilities are subject to all 29 other regulation and enforcement activities of the board, 30 including , except for regulatory action pertaining to all of 31 the following : 32 a. Assessment of fees for the support of the division and 33 the office of consumer advocate, pursuant to section 476.10 . 34 b. Safety and engineering standards for equipment, 35 -2- SF 2311 (5) 87 gh/rn/jh 2/ 20

S.F. 2311 operations, and procedures. 1 c. Assigned area of service. 2 d. Pilot projects of the board. 3 e. Assessment of fees for the support of the Iowa energy 4 center created in section 15.120 and the center for global and 5 regional environmental research established by the state board 6 of regents. This paragraph “e” is repealed July 1, 2022. 7 f. Filing alternate energy purchase program plans with the 8 board, and offering such programs to customers, pursuant to 9 section 476.47 . 10 g. Filing energy efficiency plans and energy efficiency 11 results with the board. The energy efficiency plans as a 12 whole shall be cost-effective. The board may permit these 13 utilities to file joint plans. The board shall periodically 14 report the energy efficiency results including energy savings 15 of each of these utilities to the general assembly. The board 16 may waive all or part of the energy efficiency filing and 17 review requirements for electric cooperative corporations and 18 associations and electric public utilities which demonstrate 19 superior results with existing energy efficiency efforts. 20 2. However, sections 476.20 , subsections 1 through 4, 21 476.21 , 476.41 through 476.44 , 476.51 , 476.56 , 476.62 , and 22 476.66 and chapters 476A and 478 , to the extent applicable, 23 apply to such electric utilities. 24 4. The board of directors or the membership of an electric 25 cooperative corporation or association otherwise exempt 26 from rate regulation may elect to have the cooperative’s 27 rates regulated by the board. The board shall adopt rules 28 prescribing the manner in which the board of directors or the 29 membership of an electric cooperative may so elect. If the 30 board of directors or the membership of an electric cooperative 31 has elected to have the cooperative’s rates regulated by the 32 board, after two years have elapsed from the effective date of 33 such election the board of directors or the membership of the 34 electric cooperative may elect to exempt the cooperative from 35 -3- SF 2311 (5) 87 gh/rn/jh 3/ 20

S.F. 2311 the rate regulation authority of the board , provided, however, 1 that if the membership elected to have the cooperative’s rates 2 regulated by the board, only the membership may elect to exempt 3 the cooperative from the rate regulation authority of the 4 board . 5 Sec. 5. Section 476.1B, subsection 1, paragraph l, Code 6 2018, is amended to read as follows: 7 l. Filing energy efficiency plans and energy efficiency 8 results with the board. The energy efficiency plans as a whole 9 shall be cost-effective. The board may permit these utilities 10 to file joint plans. The board shall periodically report the 11 energy efficiency results including energy savings of each of 12 these utilities to the general assembly. 13 Sec. 6. Section 476.2, subsection 6, Code 2018, is amended 14 by striking the subsection. 15 Sec. 7. Section 476.4, subsection 1, Code 2018, is amended 16 to read as follows: 17 1. Every public utility shall file with the board tariffs 18 showing the rates and charges for its public utility services 19 and the rules and regulations under which such services were 20 furnished, on April 1, 1963, which rates and charges shall be 21 subject to investigation by the board as provided in section 22 476.3 , and upon such investigation the burden of establishing 23 the reasonableness of such rates and charges shall be upon the 24 public utility filing the same. These filings shall be made 25 under such rules as the board may prescribe within such time 26 and in such form as the board may designate. In prescribing 27 rules and regulations with respect to the form of tariffs 28 and any other regulations , the board shall, in the case of 29 public utilities subject to regulation by any federal agency, 30 give due regard to any corresponding rules and regulations of 31 such federal agency, to the end that unnecessary duplication 32 of effort and expense may be avoided so far as reasonably 33 possible. Each public utility shall keep copies of its tariffs 34 open to public inspection under such rules as the board may 35 -4- SF 2311 (5) 87 gh/rn/jh 4/ 20

S.F. 2311 prescribe. 1 Sec. 8. Section 476.6, subsections 1, 8, and 13, Code 2018, 2 are amended to read as follows: 3 1. Filing with board. A public utility subject to rate 4 regulation shall not make effective a new or changed rate, 5 charge, schedule, or regulation until the rate, charge, 6 schedule, or regulation has been approved by the board, except 7 as provided in subsections 8 , and 9 , and 22 . 8 8. Automatic adjustments permitted . 9 a. This chapter does not prohibit a public utility from 10 making provision for the automatic adjustment of rates and 11 charges for public utility service provided that a schedule 12 showing the automatic adjustment of rates and charges is first 13 filed with the board. 14 b. A public utility may automatically adjust rates and 15 charges to recover costs related to transmission incurred by 16 or charged to the public utility consistent with a tariff or 17 agreement that is subject to the jurisdiction of the federal 18 energy regulatory commission, provided that a schedule showing 19 the automatic adjustment of rates and charges is first filed 20 with the board. 21 13. Energy efficiency plans. Electric and gas public 22 utilities shall offer energy efficiency programs to their 23 customers through energy efficiency plans. An energy 24 efficiency plan as a whole shall be cost-effective. In 25 determining the cost-effectiveness of an energy efficiency 26 plan, the board shall apply the societal test, total resource 27 cost test, utility cost test, rate-payer impact test, and 28 participant test. Energy efficiency programs for qualified 29 low-income persons and for tree planting programs, educational 30 programs, and assessments of consumers’ needs for information 31 to make effective choices regarding energy use and energy 32 efficiency need not be cost-effective and shall not be 33 considered in determining cost-effectiveness of plans as a 34 whole. The energy efficiency programs in the plans may be 35 -5- SF 2311 (5) 87 gh/rn/jh 5/ 20

S.F. 2311 provided by the utility or by a contractor or agent of the 1 utility. Programs offered pursuant to this subsection by gas 2 and electric utilities that are required to be rate-regulated 3 shall require board approval. 4 Sec. 9. Section 476.6, subsection 15, paragraphs a and b, 5 Code 2018, are amended to read as follows: 6 a. (1) (a) Gas and electric utilities required to be 7 rate-regulated under this chapter shall file five-year energy 8 efficiency plans and demand response plans with the board. 9 An energy efficiency plan and budget or a demand response 10 plan and budget shall include a range of energy efficiency 11 or demand response programs, tailored to the needs of all 12 customer classes, including residential, commercial, and 13 industrial customers, for energy efficiency or demand response 14 opportunities. The plans shall include programs for qualified 15 low-income persons including a cooperative program with any 16 community action agency within the utility’s service area to 17 implement countywide or communitywide energy efficiency or 18 demand response programs for qualified low-income persons. 19 Rate-regulated gas and electric utilities shall utilize 20 Iowa agencies and Iowa contractors to the maximum extent 21 cost-effective in their energy efficiency plans and demand 22 response plans filed with the board. 23 (b) A rate-regulated gas or electric utility customer 24 may request an exemption from participation in any energy 25 efficiency plan or demand response plan offered by a gas or 26 electric utility. Upon receipt of a request for exemption 27 submitted by a customer, the gas or electric utility shall 28 grant the exemption and, beginning January 1 of the following 29 year, the customer shall no longer be assessed the costs of the 30 plan and shall be prohibited from participating in any program 31 included in such plan. An exemption shall be permanent and 32 shall exempt the customer from any subsequent five-year plan 33 offered by the gas or electric utility, provided, however, 34 that a customer granted an exemption may request to enroll 35 -6- SF 2311 (5) 87 gh/rn/jh 6/ 20

S.F. 2311 in a subsequent five-year energy efficiency plan or demand 1 response plan at any time prior to the commencement of such 2 plan. The gas or electric utility shall grant the enrollment 3 and, beginning at the commencement of the subsequent plan, the 4 customer shall be assessed the costs of the plan and shall be 5 allowed to participate in any program included in such plan. 6 (2) Gas and electric utilities required to be 7 rate-regulated under this chapter may request an energy 8 efficiency plan or demand response plan modification during the 9 course of a five-year plan. A modification may be requested 10 due to changes in funding as a result of public utility 11 customers requesting exemptions from the plan or for any other 12 reason identified by the gas or electric utility. The board 13 shall take action on a modification request made by a gas or 14 electric utility within ninety days after the modification 15 request is filed. If the board fails to take action within 16 ninety days after a modification request is filed, the 17 modification request shall be deemed approved. 18 (3) Before any energy efficiency plan or demand response 19 plan is filed with the board pursuant to this subsection, the 20 board shall adopt rules pursuant to chapter 17A establishing 21 reasonable processes and procedures for utility customers to 22 request exemptions from energy efficiency plans or demand 23 response plans pursuant to this subsection. The rules adopted 24 by the board shall only apply to rate-regulated gas or electric 25 utilities and shall, at a minimum, do all of the following: 26 (a) Prohibit a customer from obtaining an exemption from 27 an energy efficiency plan or demand response plan if the 28 customer has participated in any energy efficiency program or 29 demand response program included in a plan during the course 30 of the plan, or has redeemed any rebate pursuant to an energy 31 efficiency program or demand response program included in a 32 plan during the course of the plan. 33 (b) Require utilities to provide notification to customers 34 regarding the ability to request an exemption from an energy 35 -7- SF 2311 (5) 87 gh/rn/jh 7/ 20

S.F. 2311 efficiency plan or demand response plan, or the ability to 1 enroll in a subsequent five-year plan if the customer received 2 an exemption, and establish requirements regarding the content 3 and form of such notification provided to customers. The 4 notification provided to customers shall inform the customer 5 that participation in any energy efficiency program or demand 6 response program included in a plan during the course of 7 the plan, or redemption of any rebate pursuant to an energy 8 efficiency program or demand response program included 9 in a plan during the course of a plan, shall preclude the 10 customer from receiving an exemption from the plan until the 11 commencement of the next five-year plan. Such information 12 included in the notification shall also be included in any 13 rebate provided to customers relating to an energy efficiency 14 program or demand response program included in a plan. 15 (c) Provide reasonable time for utilities to develop any 16 billing or administrative systems required to implement the 17 rules adopted by the board pursuant to this subparagraph. 18 (d) Provide that if more than ninety percent of the total 19 number of customers in a particular customer class request an 20 exemption from an energy efficiency plan or demand response 21 plan pursuant to this subsection, the utility may discontinue 22 such plan for that particular customer class. 23 (e) Specify how costs that have not been fully recovered 24 from customers during a plan period, including costs of 25 discontinued plans, are to be recovered from customers. 26 (f) Allow a customer to request an exemption during the 27 first plan year of a five-year energy efficiency plan or demand 28 response plan that takes effect on or after January 1, 2019, 29 within a time period of sixty days or more after the date such 30 plan takes effect, which exemption shall become effective at 31 the end of the time period allowed for customers to request an 32 exemption. 33 (g) Allow a customer that moves into the service area of a 34 gas or electric utility during the course of a five-year energy 35 -8- SF 2311 (5) 87 gh/rn/jh 8/ 20

S.F. 2311 efficiency plan or demand response plan to request an exemption 1 from such plan within sixty days after the commencement of gas 2 or electric service, which exemption shall become effective at 3 the end of the sixty-day time period from which gas or electric 4 service commenced. 5 b. (1) A gas and electric utility required to be 6 rate-regulated under this chapter shall assess potential energy 7 and capacity savings available from actual and projected 8 customer usage by applying commercially available technology 9 and improved operating practices to energy-using equipment 10 and buildings. The utility shall submit the assessment to 11 the board. Upon receipt of the assessment, the board shall 12 consult with the economic development authority to develop 13 specific capacity and energy savings performance standards 14 goals for each utility. Such goals, except as provided for in 15 subsection 13, shall only include cost-effective plans. The 16 utility shall submit an energy efficiency plan which shall 17 include economically achievable programs designed to attain 18 these energy and capacity performance standards goals . The 19 board shall periodically report the energy efficiency results 20 including energy savings of each utility to the general 21 assembly. 22 (2) For purposes of this paragraph, “cost-effective” means 23 the total resource cost test result for a plan is greater 24 than one. In applying the total resource cost test, benefits 25 to be considered include avoided capacity and energy costs 26 and federal tax credits, and costs to be considered include 27 incremental costs of equipment, operation, and maintenance, 28 utility costs, and administration costs. 29 Sec. 10. Section 476.6, subsection 15, paragraph c, 30 subparagraphs (1) and (3), Code 2018, are amended to read as 31 follows: 32 (1) Gas and electric utilities that are not required to 33 be rate-regulated under this chapter shall assess maximum 34 potential energy and capacity savings available from actual 35 -9- SF 2311 (5) 87 gh/rn/jh 9/ 20

S.F. 2311 and projected customer usage through cost-effective energy 1 efficiency measures and programs, taking into consideration the 2 utility service area’s historic energy load, projected demand, 3 customer base, and other relevant factors. Each utility shall 4 establish an energy efficiency goal based upon this assessment 5 of potential and shall establish cost-effective energy 6 efficiency programs designed to meet the energy efficiency 7 goal. Separate goals may be established for various customer 8 groupings. Gas and electric utilities that are not required to 9 be rate-regulated shall allow customers to request exemptions 10 from participation in any energy efficiency programs or demand 11 response programs offered by the utility, and shall establish 12 reasonable processes and procedures for customers to request 13 such exemptions. Such processes and procedures established 14 by non-rate-regulated gas and electric utilities shall not be 15 subject to the regulatory authority of the board. 16 (3) Each utility shall commence the process of determining 17 its cost-effective energy efficiency goal on or before July 1, 18 2008, shall provide a progress report to the board on or before 19 January 1, 2009, and complete the process and submit a final 20 report to the board on or before January 1, 2010. The report 21 shall include the utility’s cost-effective energy efficiency 22 goal, and for each measure utilized by the utility in meeting 23 the goal, the measure’s description, projected costs, and the 24 analysis of its cost-effectiveness. Each utility or group 25 of utilities shall evaluate cost-effectiveness using the 26 cost-effectiveness tests in accordance with subsection 13 of 27 this section . Individual utilities or groups of utilities may 28 collaborate in conducting the studies required hereunder and 29 may file a joint report or reports with the board. However, 30 the board may require individual information from any utility, 31 even if it participates in a joint report. 32 Sec. 11. Section 476.6, subsection 15, paragraph d, Code 33 2018, is amended by striking the paragraph. 34 Sec. 12. Section 476.6, subsection 15, paragraphs e, f, and 35 -10- SF 2311 (5) 87 gh/rn/jh 10/ 20

S.F. 2311 g, Code 2018, are amended to read as follows: 1 e. (1) The board shall conduct contested case proceedings 2 for review of energy efficiency plans , demand response plans, 3 and budgets filed by gas and electric utilities required to 4 be rate-regulated under this chapter . Notwithstanding the 5 goals developed pursuant to paragraph “b” , the board shall not 6 require a gas utility to adopt an energy efficiency plan or 7 a demand response plan that results in projected cumulative 8 average annual costs that exceed one and one-half percent of 9 the gas utility’s expected annual rate revenue from customers 10 participating in such plans, and shall not require an electric 11 utility to adopt an energy efficiency plan or demand response 12 plan that results in projected cumulative average annual costs 13 that exceed two percent of the electric utility’s expected 14 annual rate revenue from customers participating in such 15 plans. For purposes of determining the one and one-half or 16 two percent threshold amount, the board shall exclude from a 17 gas or electric utility’s expected annual rate revenue the 18 revenues expected from customers that have received exemptions 19 from energy efficiency plans or demand response plans pursuant 20 to paragraph “a” , subparagraph (1), subparagraph division 21 (b). A gas or electric utility may voluntarily propose an 22 energy efficiency plan or demand response plan that results in 23 projected average annual costs that exceed one and one-half 24 percent, on a cumulative basis, of a gas utility’s expected 25 annual rate revenue from customers participating in such plans, 26 or two percent, on a cumulative basis, of an electric utility’s 27 expected annual rate revenue from customers participating in 28 such plans. The board may approve, reject, or modify the 29 plans and budgets. Notwithstanding the provisions of section 30 17A.19, subsection 5 , in an application for judicial review of 31 the board’s decision concerning a utility’s energy efficiency 32 plan or budget, the reviewing court shall not order a stay. 33 Whenever 34 (2) Notwithstanding paragraph “a” , subparagraph (2), if, on 35 -11- SF 2311 (5) 87 gh/rn/jh 11/ 20

S.F. 2311 the effective date of this Act, a gas or electric utility’s 1 currently approved energy efficiency plan or demand response 2 plan includes projected average annual costs that exceed 3 one and one-half percent, on a cumulative basis, of the gas 4 utility’s expected annual rate revenue received from customers 5 participating in such plan for service within the previous 6 calendar year, exclusive of recovery of energy efficiency 7 costs, or two percent, on a cumulative basis, of the electric 8 utility’s expected annual rate revenue received from customers 9 participating in such plan for service within the previous 10 calendar year, exclusive of recovery of energy efficiency 11 costs, the gas or electric utility may file a request to 12 modify its approved energy efficiency plan or demand response 13 plan to achieve projected average annual costs at one and 14 one-half or less, on a cumulative basis, of the gas utility’s 15 expected annual rate revenue from customers participating in 16 such plan, or two percent or less, on a cumulative basis, 17 of the electric utility’s expected annual rate revenue from 18 customers participating in such plan. In such case, or 19 whenever a request to modify an approved plan or budget is 20 filed subsequently by the office of consumer advocate or a 21 gas or electric utility required to be rate-regulated under 22 this chapter , the board shall promptly initiate a formal 23 proceeding if the board determines that any reasonable ground 24 exists for investigating the request. The formal proceeding 25 may be initiated at any time by the board on its own motion. 26 Implementation of board-approved plans or budgets shall 27 be considered continuous in nature and shall be subject to 28 investigation at any time by the board or the office of the 29 consumer advocate. 30 f. Notice to customers of a contested case proceeding for 31 review of energy efficiency plans , demand response plans, and 32 budgets shall be in a manner prescribed by the board. 33 g. (1) A gas or electric utility required to be 34 rate-regulated under this chapter may recover, through an 35 -12- SF 2311 (5) 87 gh/rn/jh 12/ 20

S.F. 2311 automatic adjustment mechanism filed pursuant to subsection 8 , 1 over a period not to exceed the term of the plan, the costs of 2 an energy efficiency plan or demand response plan approved by 3 the board , including amounts for a plan approved prior to July 4 1, 1996, in a contested case proceeding conducted pursuant to 5 paragraph “e” . The board shall ensure that costs are recovered 6 from all customers on a reasonably comparable basis, including 7 customers who utilize alternate energy production facilities as 8 defined in section 476.42. Customers that have been granted 9 exemptions from energy efficiency plans or demand response 10 plans pursuant to paragraph “a” , subparagraph (1), subparagraph 11 division (b), shall not be charged for recovery of energy 12 efficiency or demand response costs beginning January 1 of the 13 year following the year in which the customer was granted the 14 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 utility shall not represent energy efficiency or demand 30 response in customer billings as a separate cost or expense 31 unless the board otherwise approves . 32 Sec. 13. Section 476.6, subsection 17, Code 2018, is amended 33 by striking the subsection. 34 Sec. 14. Section 476.6, subsection 20, Code 2018, is amended 35 -13- SF 2311 (5) 87 gh/rn/jh 13/ 20

S.F. 2311 to read as follows: 1 20. Electric power generating facility emissions. 2 a. It is the intent of the general assembly that the state, 3 through a collaborative effort involving state agencies and 4 affected generation owners, provide for compatible statewide 5 environmental and electric energy policies with respect 6 to regulated emissions from rate-regulated electric power 7 generating facilities in the state that are fueled by coal. 8 Each A rate-regulated public utility that is an owner of one 9 or more electric power generating facilities fueled by coal 10 and located in this state on July 1, 2001, shall develop a 11 multiyear plan and budget may, in its sole discretion, file for 12 advanced review of projects for managing regulated emissions 13 from its facilities in a cost-effective manner. 14 (1) The initial multiyear plan and budget shall be filed 15 with the board by April 1, 2002. Updates to the plan and budget 16 shall be filed at least every twenty-four months. 17 (2) Copies of the initial plan and budget, as well as 18 any subsequent updates, shall be served on the department of 19 natural resources. 20 (3) The initial multiyear plan and budget and any subsequent 21 updates shall be considered in a contested case proceeding 22 pursuant to chapter 17A . The department of natural resources 23 and the consumer advocate shall participate as parties to the 24 proceeding. 25 b. A rate-regulated public utility shall file an application 26 for advanced review of a project at least one hundred twenty 27 days before the anticipated start of construction. Where an 28 electric power generating facility is owned by two or more 29 rate-regulated public utilities, the operator of the electric 30 power generating facility may file the application on behalf of 31 the rate-regulated public utilities. 32 (4) c. The department of natural resources shall state 33 whether the plan or update project meets applicable state or 34 federal environmental requirements for regulated emissions , 35 -14- SF 2311 (5) 87 gh/rn/jh 14/ 20

S.F. 2311 including requirements related to air, water, or solid waste . 1 If the plan project does not meet these requirements, the 2 department shall recommend amendments that outline actions 3 necessary to bring the plan or update project into compliance 4 with the environmental requirements. 5 b. d. The board shall not approve a plan or update project 6 that does not meet applicable state or federal environmental 7 requirements and federal ambient air quality standards for 8 regulated emissions from electric power generating facilities 9 located in the state. 10 c. e. The board shall review the plan or update project 11 and the associated budget, and shall approve the plan or update 12 project and the associated budget if the plan or update project 13 and the associated budget are reasonably expected to achieve 14 cost-effective compliance with applicable state or federal 15 environmental requirements and federal ambient air quality 16 standards . In reaching its decision, the board shall consider 17 whether the plan or update project and the associated budget 18 reasonably balance costs, environmental requirements, economic 19 development potential, and the reliability of the electric 20 generation and transmission system. 21 d. f. The board shall issue an order approving or rejecting 22 a plan, update, or budget project within one hundred eighty 23 ninety days after the public utility’s a filing is deemed 24 complete; however, upon good cause shown, the board may 25 extend the time for issuing the order as follows: for approval 26 pursuant to this subsection. 27 (1) The board may grant an extension of thirty days. 28 (2) The board may grant more than one extension, but each 29 extension must rely upon a separate showing of good cause. 30 (3) A subsequent extension must not be granted any earlier 31 than five days prior to the expiration of the original 32 one-hundred-eighty-day period, or the current extension. 33 e. g. The reasonable costs incurred by a rate-regulated 34 public utility in preparing and filing the plan, update, or 35 -15- SF 2311 (5) 87 gh/rn/jh 15/ 20

S.F. 2311 budget project and in participating in the proceedings before 1 the board and the reasonable costs associated with implementing 2 the plan, update, or budget project shall be included in its 3 regulated retail rates. 4 f. It is the intent of the general assembly that the board, 5 in an environmental plan, update, or associated budget filed 6 under this section by a rate-regulated public utility, may 7 limit investments or expenditures that are proposed to be 8 undertaken prior to the time that the environmental benefit to 9 be produced by the investment or expenditure would be required 10 by state or federal law. 11 Sec. 15. Section 476.6, Code 2018, is amended by adding the 12 following new subsections: 13 NEW SUBSECTION . 22. Voluntary rates and tariff filings. 14 a. A rate-regulated public utility may file at any time for 15 expedited approval of a new tariff or rate that is optional for 16 customers and all costs associated with the tariff or rate are 17 borne by customers who elect to participate in the new tariff 18 or rate. 19 b. A tariff or rate approved under this subsection may not 20 change any existing rates or charges. 21 c. The board shall review the tariff or rate filing within 22 sixty days of filing. If the board fails to review the tariff 23 or rate filing within sixty days of filing, the tariff or 24 rate filing shall be deemed approved. The board shall not be 25 required to hold a hearing to review a tariff or rate filing 26 made pursuant to this subsection. 27 NEW SUBSECTION . 23. Preapproval of cost recovery for natural 28 gas extensions —— rules. The board may adopt rules which 29 provide for a preapproval process for cost recovery for natural 30 gas extensions. 31 Sec. 16. Section 476.20, subsection 5, paragraph a, 32 unnumbered paragraph 1, Code 2018, is amended to read as 33 follows: 34 The board shall establish rules which shall be uniform with 35 -16- SF 2311 (5) 87 gh/rn/jh 16/ 20

S.F. 2311 respect to all public utilities furnishing gas or electricity 1 relating to deposits which may be required by the public 2 utility for the initiation or reinstatement of service. This 3 subsection shall not apply to municipally owned utilities, 4 which shall be governed by the provisions of section 384.84 5 with respect to deposits and payment plans for delinquent 6 amounts owed. Municipally owned utilities and electric 7 utilities that are not required to be rate-regulated shall not 8 be subject to the board’s rules in regards to deposits and 9 payment plans for delinquent amounts owed and repayment of past 10 due debt. Municipally owned utilities and electric utilities 11 that are not required to be rate-regulated shall be subject to 12 the board’s rules in regards to payment plans made prior to the 13 disconnection of services. 14 Sec. 17. NEW SECTION . 476.26A Right to construct, own, and 15 maintain electric transmission lines. 16 1. As used in this section, unless the context otherwise 17 requires: 18 a. “Electric transmission line” means a high-voltage 19 electric transmission line with a capacity of one hundred 20 kilovolts or more and any associated electric transmission 21 facilities. 22 b. “Electric transmission owner” means an individual or 23 entity who, as of the effective date of this Act, owns and 24 maintains an electric transmission facility including electric 25 transmission lines, wires, or cables that are capable of 26 operating at an electric voltage of one hundred kilovolts or 27 more that are required for rate-regulated electric utilities, 28 municipal electric utilities, and rural electric cooperatives 29 in this state to provide electric service to the public for 30 compensation. 31 c. “Incumbent electric transmission owner” means any of the 32 following: 33 (1) A public utility or a municipally owned utility that 34 owns, operates, and maintains an electric transmission line in 35 -17- SF 2311 (5) 87 gh/rn/jh 17/ 20

S.F. 2311 this state. 1 (2) An electric cooperative corporation or association or 2 municipally owned utility that owns an electric transmission 3 facility in this state and has turned over the functional 4 control of such facility to a federally approved authority. 5 (3) An “electric transmission owner” as defined in paragraph 6 “b” . 7 d. “Municipally owned utility” means a “city utility” as 8 defined in section 362.2, or an “electric power agency” as 9 defined in section 390.9 which is comprised solely of cities or 10 solely of cities and other political subdivisions. 11 2. An incumbent electric transmission owner may construct, 12 own, and maintain an electric transmission line that has 13 been approved for construction in a federally registered 14 planning authority transmission plan and which connects to an 15 electric transmission facility owned by the incumbent electric 16 transmission owner. Where an electric transmission line 17 connects to electric transmission facilities owned by two or 18 more incumbent electric transmission owners, each incumbent 19 electric transmission owner whose facilities connect to the 20 electric transmission line may construct, own, and maintain the 21 electric transmission line individually and equally. If an 22 incumbent electric transmission owner declines to construct, 23 own, and maintain its portion of an electric transmission line 24 that connects to electric transmission facilities owned by 25 two or more incumbent electric transmission owners, then the 26 other incumbent electric transmission owner or owners that own 27 the electric transmission facilities to which the electric 28 transmission line connects may construct, own, and maintain the 29 electric transmission line individually and equally. 30 3. This section shall not modify the authority of the board 31 under chapter 478 or the requirements, rights, and obligations 32 relating to the construction, maintenance, and operation of 33 electric transmission lines pursuant to chapter 478. 34 Sec. 18. Section 476.33, subsection 4, Code 2018, is amended 35 -18- SF 2311 (5) 87 gh/rn/jh 18/ 20