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Iowa’s solar compromise serves as national model

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Policy associate

After a lengthy fight during the 2019 Iowa legislative session, a unique coalition of agriculture and environmental groups joined forces with MidAmerican Energy, the state’s largest investor-owned utility, to negotiate a consensus agreement to expand solar energy in Iowa. A year later, the product of these conversations was signed into law—creating a gold standard for solar energy across the nation.

This agreement—Senate File 583—protects investments in solar energy from farmers, small businesses, and others by writing net metering into state code. Net metering is a system where solar panel owners are fairly compensated for the excess energy they send back to the grid.

Also authorized is an independent study overseen by the state’s utility regulator that will set the rate panel owners receive by analyzing the costs and benefits of private, small-scale solar to the grid. This study will set a “value of solar” rate and authorize protections that prohibit its fluctuation by more than 5 percent, up or down, annually.

The negotiated language replaced the original wording of the 2019 bill. That version of the bill would have added a “sunshine tax” of more than $300 per year on customers who generate their own energy with solar panels, stifling solar growth in the state. In 2019, the bill passed the state senate, but remained there until the stakeholder negotiations informed this new language.

In a unique display of cooperation between agriculture, utility, and environmental stakeholders, this unlikely coalition has created a national model to unleash the potential of solar energy in the U.S.

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Established in 1973, the Center for Rural Affairs is a private, non-profit organization working to strengthen small businesses, family farms and ranches, and rural communities through action oriented programs addressing social, economic, and environmental issues.

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