By Stephanie Enloe, former staff member
The Center has long advocated for national legislation that benefits rural Iowans. Now we have relocated our Iowa office and we have become more involved with Iowa state policy advocacy. Check out the information below to learn more about our legislative priorities for the 2017 session.
Like the majority of Iowans, the Center for Rural Affairs strongly supports continued expansion of renewable energy. We value the economic, environmental and public health benefits of wind and solar power, which bring a new wave of opportunity and innovation to rural Iowa. We advocate for the following pro-renewable policies:
Solar Tax Credits
The solar tax credit is a temporary incentive created to generate market growth and competition within Iowa’s solar sector. The credit is having the intended effect – increasing solar investment and jobs, helping drive down the cost of solar through competition, and providing access to Iowans in almost every Iowa county. Iowa farmers are one of the primary users of solar energy and have benefited greatly from this tax credit.
We support further expansion of the tax credit, which is now capped at $5 million per year. Senate File 97 would increase the tax credit from $5 million to $10 million per year.
Production Tax Credit
The Iowa Production Tax Credit is set to expire at the end of this year. We support extending the tax credit an additional year to allow community and school solar programs that are currently under consideration or development to take advantage of the credit.
Under the Iowa Production Tax Credit program, an eligible solar, wind, biomass or other renewable generation facility can qualify for one of two credits: (1) $0.015/kWh for facilities of less than 60 megawatt nameplate capacity (Iowa Code § 476C) or, (2) $0.01/kWh for 2 to 30 megawatt facilities or smaller facilities at schools and hospitals (Iowa Code § 476B). The tax credit lasts for 10 years after the facility begins producing energy.
Net Metering and Rate Design
“Net metering” is a system that allows a private energy producer (such as a farmer with solar panels) to transfer excess electricity back to the grid and receive fair compensation from his or her utility. This type of policy decreases the payback time on solar investments, enabling more Iowans to afford solar energy systems.
When a solar customer reduces electricity to the grid, they provide more than just the kilowatt hours they are passing along to their neighbors. For example, because that energy flows to the nearest electricity user rather than utilizing transmission infrastructure, solar customers help reduce strain on our transmission system. And, because solar produces energy at a predictable, stable cost, solar systems can help hedge against fluctuations in the cost of natural gas or coal energy. Advocates, utilities and grid operators are still determining how to account for the full value of solar energy when additional system benefits are taken into account. A Value of Solar study in Minnesota estimated the real economic value of a kilowatt hour (kWh) of solar at 11.5 cents. That estimation rose to 13 cents per kWh when environmental benefits were included. Most net-metering programs pay substantially less than that amount, meaning many solar customers return more value to the grid than they are compensated for.
By now, most Iowans - and especially rural Iowans - are aware of the water quality crisis facing our state. Many of our surface and groundwater resources contain dangerous levels of nitrate, sediment, bacteria and/or phosphorous. These pollutants endanger human health and decrease recreational opportunities such as fishing and swimming. Agricultural and urban actors must work together to solve this problem. We support the following policy approaches to facilitate this collaboration and help farmers engage with voluntary water management efforts.
Fund the Trust
In 2010, Iowans voted in favor of creating the Natural Resources and Outdoor Recreation Trust Fund. However, that vote did not create the revenue stream for the trust – which will consist of three-eighths of a cent of our next sales tax increase. Once funded, the trust will generate $150 to $180 million per year in dedicated funding for water quality management and outdoor recreation programs and infrastructure.
We support raising the sales tax three-eighths of a cent to finally “fund the trust.” Learn more about the trust fund design here.
A number of water quality bills have been introduced or are expected to be introduced in 2017. Legislators from both sides of the aisle are seeking comprehensive legislation and funding opportunities to achieve the goals set out in the Iowa Nutrient Reduction Strategy. As these bills emerge, we are looking and advocating for certain elements we believe are vital to the creation of successful water quality programming and funding.
When we review water quality legislation, we look for the following positive elements:
- A dedicated source of long-term funding.
- A system for multi-scale monitoring and evaluation that protects farmer privacy.
- An oversight committee to create accountability for taxpayer dollars and track progress toward water quality goals.
- Dedicated funds and technical assistance for watershed planning and targeting.
- Grant and loan programs that prioritize high-risk watersheds as well as collaborative, locally-led watershed management initiatives.
- Prioritization of management practices that provide multiple conservation benefits beyond just nutrient reduction.
Each of these priorities is part of a “watershed approach.” Our goal is to help pass legislation that uses limited resources in a way that provides the highest return on public investment and leads to improved water quality across Iowa.
You also can learn more about how to advocate for policy you care about by visiting our Iowa Policy Advocacy 101 blog.