Solar installations expected to grow in Iowa
Falling cost, court ruling seen boosting sector
When Mike Bates was seeking to reduce operating costs for his Washington County farm, 400-foot turkey sheds provided the perfect fit for installation of a 100-kilowatt solar array.
“I already had the existing buildings at the right angle to the sun to take advantage of all of that energy from the sun,” Bates said. “For me to take better care of my turkeys, I needed to use more fans and more electricity.
“With the solar panels, I feel really comfortable that I can have a lot of fans running to keep those birds comfortable during the heat of the summer.”
Ankeny-based CB Solar installed the solar array on Bates's farm in June 2013. The photovoltaic modules convert the sun's energy to electricity through an inverter, which changes the direct current to alternating current.
That powers the ventilation systems in Bates's turkey barns, feeders, lights and waterers, as well as his grain dryer. He also added a solar array to the roof of his machine shop to further reduce his electric bill.
Solar arrays, while not as well known as the wind turbines that have dotted Iowa's landscape in recent years, are steadily growing in numbers and size across the state. Apartment complexes, farmers, electrical equipment suppliers, beer distributors, cities, school districts, rural electric cooperatives and many other energy consumers are embracing the technology as a clean, renewable source of electricity.
A report by the Iowa Environmental Council contends that 20 percent of the state's annual electricity needs could be met using rooftop solar installations. Iowa's overall potential for solar energy production ranks 16th nationally, according to the report.
The competitive cost of solar energy continues to be a barrier to widespread adoption, but that is changing. From an average of 21.4 cents per kilowatt-hour in 2010 for a utility grade photovoltaic project, the cost had fallen to 11.2 cents per kilowatt-hour in 2013, according to the U.S. Department of Energy.
The federal agency has set a target of 6 cents per kilowatt-hour by 2020. By comparison, the average U.S. electricity cost is 12 cents per kilowatt-hour, according to the U.S. Energy Information Administration.
On July 30, Farmers Electric Cooperative in Kalona marked the completion of the largest solar farm in the state. The 2,900 solar panels on four and half acres of land are expected to generate up to 1.1 million kilowatt hours of electricity per year — enough energy to power about 120 homes.
Eagle Point Solar of Dubuque constructed and owns the Kalona solar farm. Farmers Electric will purchase the power and take possession of the array after 10 years.
Earlier this summer, what is believed to be the largest private solar energy system in Iowa was installed at the Kirkwood Courts Apartments in Cedar Rapids.
Haverkamp Properties of Ames, the owner of the 400-unit student housing complex, invested $1.8 million to have All Energy Solar of St. Paul, Minn., install 2,000 solar panels on 27 buildings and interconnected with 247 electric meters,
Brent Haverkamp, CEO of Haverkamp Properties, said the 502-kilowatt system is expected to generate some 14 million kilowatt hours of electricity over the next 25 years.
“We pay 100 percent of the utilities for our tenants at Kirkwood Courts Apartments. As such, we are a heavy electrical user,” Haverkamp said. “With the federal and state incentives as well as a lucrative Alliant Energy rebate, we were able to make the project work for us.”
Haverkamp said the Kirkwood Courts solar array produces more electricity than the complex consumes each day.
“Alliant Energy essentially has a bucket, and when you overproduce, the company gives you a credit to your account,” Haverkamp said. “At night, when you are not producing electricity, the company works off the credit on a one-to-one basis.”
Haverkamp would like to pursue solar energy installations at student apartment complexes he owns in Ames. However, a number of details need to be worked out, including the pricing structure for surplus electricity sold (wholesale) versus electricity consumed (retail) during nighttime hours.
Lack of uniform utility interconnection, solar planning, zoning and permitting processes across Iowa have slowed the development of solar energy installations. The Iowa Economic Development Authority (IEDA) received a $1 million, three-year grant in November from the U.S. Department of Energy to help meet its goal of reducing barriers to solar installation and, as the department said, “evaluate policy options at the local and state jurisdictions to reduce soft costs” that make installation more expensive.
In January, Mark Douglas, president of the Iowa Utility Association — which includes Alliant Energy and MidAmerican Energy — wrote to IEDA general counsel Rita Grimm to suggest that the grant not be used to evaluate solar energy policies. When the change was submitted to the federal agency, it was rejected as “deviating beyond the original intent of the award” — to promote solar energy adoption.
The IEDA contended that it needed to revise the grant proposal because “it would be premature and inappropriate” to evaluate solar energy policies while the Iowa Utilities Board was investigating those issues.
The agency also said it did not want to appear to be taking sides in an Iowa Supreme Court case involving utilities seeking to prohibit solar energy businesses from selling electricity to customers.
IEDA Director Debi Durham in April approved a decision to negotiate terminating the grant.
On July 11, the Iowa Supreme Court ruled that Eagle Point Solar of Dubuque was not acting as a utility when it entered into a third-party purchase power agreement with the city of Dubuque. The company wanted to install, own and operate solar panels on a city-owned building.
The city would purchase the electricity that the panels produced.
The Iowa Utilities Board ruled that the company was acting as a public utility and violating Iowa code because the city was located within the exclusive service territory of Alliant Energy. A district court ruled that Eagle Point Solar's proposed arrangement did not constitute acting as a utility.
In a 4-2 ruling, the Iowa Supreme Court affirmed the district court's decision.
Barry Shear, president of Eagle Point Solar, said the ruling will clear the way for other third-party purchase power agreements, speeding the installation of more solar energy projects across the state.
“Solar energy is part of distributed power generation, which is happening and should happen, regardless of your belief in climate change,” Shear said. “Expanding solar options means jobs — the kind of jobs that can't be outsourced to another state or country.
“Some of the billions of dollars we now send to other states to buy coal to generate electricity will stay in Iowa instead, developing and generating clean, local solar power. With distributed solar generation we are keeping the economics local within the state, not sending our energy dollars elsewhere.”