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