Last updated: August 2016
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Utilities currently don't offer rate-assistance programs funded by customer surcharges. The Iowa Utilities Board (IUB) refers to Iowa Code 476.5 as the reason. The code states utilities cannot "make or grant any unreasonable preferences or advantages as to rates or services to any person or subject any person to any unreasonable prejudice or disadvantage."
On the other hand, the Iowa Administrative Code does mandate utilities to promote voluntary contributions by customers to funds supplementing LIHEAP. Iowa Administrative Code 199-19.15 and 199-20.4 require utilities to notify customers twice a year about supporting such funds. Many utilities forward these voluntary contributions to local community action agencies.
Black Hills Energy, Mid-American Energy Company, Liberty Utilities and Interstate Power and Light provide weatherization measures for low-income customers in Iowa. These utilities collect ratepayer funds for low-income weatherization programs (LIWAP). Since 1992, all but Liberty Utilities’ program have been delivered by the Iowa Department of Human Rights in conjunction with the state's WAP.
While Black Hills, Mid-American, and Interstate Power follow the eligibility used by Iowa WAP (200 percent of federal poverty guidelines), Liberty Utilities' LIWAP uses a stricter eligibility level for household income. With eligibility set at 150 percent of federal poverty guidelines, Liberty contracts with the Southeast Iowa Community Action Organization to administer its program.
During 2015, the four utilities contributed almost $6.4 million for LIWAP services provided to about 7,200 homes.
The 2007 Iowa Legislature passed House File 918 which required the IUB to conduct two studies: (1) to determine the status and effectiveness of all natural gas and electric utilities' energy efficiency programs and (2) to determine consumer knowledge of energy use and energy efficiency.
In January 2008, the IUB reported back to the legislature in both areas. The study on the effectiveness of efficiency programs reported that investor-owned utilities (IOUs) spent 3.36 percent of electric revenues and 2.80 percent of natural gas revenues on energy efficiency. It also said that the Consortium for Energy Efficiency ranked Iowa's IOUs among the top ten states for per capita spending on efficiency. Meanwhile, municipal utilities and cooperatives spent between 0.3 percent and 2.7 percent of their revenues on energy efficiency.
The IUB created a list of recommendations to the legislature. It suggested the legislature establish goals for energy efficiency that would apply to all Iowa utilities. It also announced some new requirements for the efficiency plans and reports filed by IOUs. It told the legislature it would research the feasibility of increased funding for LIWAP in both rate-regulated and non-rate-regulated utilities' energy efficiency plans.
The IUB also submitted its survey of Iowa residential customers about energy efficiency to the legislature. Among the findings was that almost one quarter of respondents said they had completed a home energy audit, with insulation and switching to CFLs the most frequently reported changes resulting from the audit. The survey also found that low-income respondents tended to receive information about energy efficiency measures from direct mailings by electric companies and state agencies and through bill inserts.
The 2008 Iowa Legislature passed Senate File 2386 that directed natural gas and electric municipal and rural electric cooperative utilities to establish energy efficiency goals. The utilities were then supposed to create cost-effective efficiency programs to meet their goals. In January 2011, the IUB reported back on these efforts. In its reports, the Iowa Association of Municipal Utilities committed to developing additional low-income efficiency programs, and 11 of the 40 cooperatives offered some form of LIWAP rebates. Currently, municipal and cooperative utilities file energy efficiency plans, but the IUB does not review or approve them like it does for IOUs.
For More Information
Iowa Utilities Board, 2007 Iowa Residential Energy Survey, December 2007
Iowa Utilities Board, Energy Efficiency Plans and Programs in Iowa, January 1, 2008
Iowa Utilities Board, Evaluations of Energy Efficiency Goals and Programs, Municipals and Cooperatives