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The Iowa State Capitol in Des Moines.

Iowa Energy Center relaunches with smaller staff, possible shift in focus

In its new incarnation as part of the state’s economic development office, the Iowa Energy Center will operate with a much smaller staff and a focus that remains unclear.

The center, created by the Iowa Legislature in 1990 to encourage more renewable energy and efficiency, was previously housed at Iowa State University and has recently faced numerous obstacles.

Three years ago, then-Gov. Terry Branstad refused to accept a $1 million Department of Energy grant that the center helped to acquire. It would have financed work aimed at reducing the “soft costs” of solar installations.

The Iowa Utilities Board then for a time withheld funds that support the center’s work, almost forcing the director to eliminate staff. And last summer, director Mark Petri resigned because, he told news media at the time, the center was under pressure from the state’s major utilities, Alliant Energy and MidAmerican Energy, to back off from its work.

The center is funded by a surcharge imposed on utility customers, and much of the work of the center – aimed at reducing total energy use and at growing the renewable sector – could potentially pose a threat to utility revenue. A bill passed by the state legislature in the spring terminates the utility surcharge as of July 1, 2022.

When the reformation of the center was announced last spring, officials at Iowa State and the economic development authority provided no clear explanation for the move, which took effect on Oct. 1.

The center now answers to a board of directors appointed by Gov. Kim Reynolds in September. Previously, it was run by a paid director and an advisory board.

The new board is little changed from the advisory board. It includes representatives from each sector of the utility industry, several from higher education, and a few from other offices of state government.

However, no one speaking specifically on behalf of clean energy is on the board, as was the case with the advisory board.

The new board will hold its first meeting on Oct. 31.

Shift in focus?

Going forward, the center will focus on energy as an economic development tool, said Brian Selinger, who heads the energy team for the Iowa Economic Development Authority. He said it will be the prerogative of the new board to decide on a particular emphasis, but he added that grant money “will largely go to support the identified strategies of the Iowa Energy Plan.”

That plan, which was released to the public in December, stressed the vast potential in several budding technologies, such as electric vehicles, bioenergy and biofuels. The economic development department has assembled a committee that is considering how to exploit the energy potential in the state’s prodigious agricultural waste.

Selinger said the energy center will maintain the grant funding level of recent years, but may change the types of projects it supports.

A grant administrator has been hired and will begin work in mid-November. Last week, a new loan administrator assumed the task of running the center’s revolving loan fund, which provides money for energy-efficiency upgrades and other clean-energy projects.

Between 1997 and 2017, the center loaned out about $47 million and leveraged an additional $303 million, according to Bill Haman, who ran the program for Iowa State. He said that the money supported 485 energy projects.

The loan program “will stay in its entirety” and at its current level of funding, according to Selinger.

“We’ve inherited 300 active loans,” he said. “We’ll continue to administer new loans.”

Although the staff of the center was dramatically reduced – from 14 to two – Selinger maintains that two employees are “very adequate for right now.” He pointed out that a number of the former employees performed tasks that can be carried out by current staff of the economic development agency.

Haman, one of the center’s long-term employees until a few months ago, said he expects the operations of the center will cease once the utility funding is terminated in 2022.

“They’ll tell you, ‘We didn’t eliminate the energy center, we just moved them.’ ” he said. “It will die a slow quiet death, because no one will care in five years.”

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