Iowa policy advocates are battling over a so-called “sunshine tax.”
House Study Bill 185 would impose a new payment structure on customers of Iowa’s rate-regulated utilities who generate their own electricity to supplement the energy they get from the power companies. The bill, sponsored by House Commerce Committee chairman Rep. Gary Carlson, R-Muscatine, advanced out of an Iowa House subcommittee last week.
Since solar panels only produce electricity when they are exposed to sunlight, many users rely on utility providers at night, and then produce excess power when the sun is shining to make up some of the difference. At issue in the Legislature is how those users should be credited for the energy they transfer back through the power grid, a policy known as net metering.
It’s not quite accurate to call it a tax on sunshine, since people who generate electricity off the grid would be unaffected. It is only those who are connected to existing utility infrastructure who would see changes, and potentially see their electricity costs rise.
Some business groups and power providers support the bill, arguing people who use the electric grid should pay their fair share for its upkeep.
Renewable energy advocates, however, say the new pricing scheme is an undue burden on solar customers, and worry it would diminish property owners’ incentives to adopt clean energy.
Distributed energy policy is complicated stuff. It may be difficult for Iowans to discern the pros and cons of legislation like this, in part because so many of the voices in the conversation have a financial stake in the issue — utility companies trying to protect their bottom lines, and renewable energy consultants ensuring solar installations remain economical.
Luckily, there is an separate body that gives the Legislature guidance. The Iowa Utilities Board is overseeing a net metering pilot project through next year, directing Iowa’s investor-owned utilities, Alliant Energy and MidAmerican, to provide a robust set of data about the costs and benefits of distributed energy production.
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If on-site power producers are indeed creating significant costs for utility companies, those companies owe it to policymakers and ratepayers to show us the figures. Renewable energy is too important an issue to simply take their word for it.
For now, any measure to change net metering policy is premature. Iowa should wait until the pilot program expires next year, and evaluate the rules based on all the available evidence.
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