Too soon to consider recovery?

Even economists point the immediate focus to public health — and keep recovery in the wider view.

What is needed in a pandemic is for citizens to stay home, and for public policy to assure access to unemployment insurance and health care, and push support to the health system.

Economists such as former Labor Secretary Robert Reich are making these points — that limiting the spread of the coronavirus is the top priority to save lives.[1] When even economists are pressing the point about public health, our leaders should pay attention. Now is not the time to talk about being “open for business” prematurely, as President Trump once suggested we do by Easter.

That is not to say a public health spotlight precludes steps in the coming weeks and months to set up recovery when that can be the main focus.

Now, jobs remain in critical services in hospitals and electric stations, and some in construction. Factories where people stand next to each other on a production line have different social distancing from workers who build things in the open air. We could expand more of the latter jobs right now where the materials are at hand.

Good examples: Wind turbines and solar installations and the power lines that connect them to the electric grid. Right now we could be constructing clean energy facilities that can be producing electricity in six months or a year when we all want demand to expand. It is an opportune moment to think ahead and start replacing older coal production plants, which have their own health problems.

Public policy has a role here. Just before the Iowa legislators recessed because of the COVID-19 pandemic, they passed — and Governor Kim Reynolds signed — a bill to stabilize the solar industry. It would do this by setting the price for the next seven years for the electricity that MidAmerican and Alliant buy from homeowners and businesses.[2]

Another step the Legislature could take is lifting the limit on the tax credit for businesses and homeowners when they install solar.

The annual amount that could be taken on the credit was not fully used in the first year, but in all years since 2013 installations exceeded the cap, now at $5 million per year, pushing installations completed later in the year to a waitlist.[3] The tax credit eventually comes but not until at least a year later. While an installation completed today will get a federal tax credit when taxes are filed in April 2021, the Iowa tax credit will not happen until 2022 or later.

Why make these Iowa investors wait? Extending the total amount eligible for the credit from $5 million to perhaps $20 million would further stimulate the construction of solar panels just when the economy needs the jobs.

There also is a federal role, as the amount of that credit for both solar and wind is phasing out. This would be a good time to stop the phaseout for the next several years. Tax credits of electric cars could also be enhanced.

COVID-19 has slammed the economy. We need to think about when we will recover but also how we will recover. Jobs in clean energy have been on a growth curve that can be re-established quickly. And these jobs are creating a new energy system that will help us with the next crisis, climate change.

Most agree we should follow science to confront the pandemic. We should also follow the science to prepare for the next crisis — climate change.

David Osterberg is an economist and lead environmental researcher at the nonpartisan Iowa Policy Project in Iowa City. Contact: dosterberg@iowapolicyproject.org.

A version of this column also ran in the April 1 Quad-City Times.

 

 

 

 

[1] MSNBC interview, March 17, 2020. https://www.msnbc.com/the-beat-with-ari/watch/-our-economy-is-shutting-down-clinton-wh-veteran-pushes-lives-over-dollars-in-covid-19-crisis-80868933847

[2] O. Kay Henderson. Iowa House and Senate give solar bill unanimous support. Radio Iowa March 4, 2020. https://www.radioiowa.com/2020/03/04/iowa-house-and-senate-give-solar-bill-unanimous-support/

[3] Iowa Department of Revenue. Solar Energy System Tax Credit Annual Report for 2019. https://www.legis.iowa.gov/docs/publications/DF/1126111.pdf

Missed opportunities combatting climate change

Solar could bring several benefits beyond power generation if installed on the campus of the University of Iowa, which is missing opportunities with recent decisions.

I recently watched part of the Hancher Auditorium parking lot ripped up and repaved at the University of Iowa. With the university community well aware of the impacts of flooding, I was surprised by the missed opportunity to rebuild the parking lot with more water retention features like bioswales or permeable pavers. We know that heavy rainfall impacts in Iowa will only grow as climate change accelerates.[1]

At the same time, I realized these types of interventions are expensive and perhaps outside the routine maintenance budget. So I turned my attention to other ideas for the campus: solar power opportunities and the university’s pledge to combat climate change through renewable power generation. Surely such an ambitious proposal would have resources enough to invest in solar power generation.

In 2017, UI President Bruce Harreld announced a goal to increase the university’s use of renewable resources for power and steam production and reduce coal firing for steam and energy production, and entirely phasing out coal by 2025.[2] This laudable goal addresses climate change, makes the university’s operations more sustainable, and improves air quality in Iowa City. Why not enhance this goal with solar panels?

The President’s message noted that the university would rely on a combination of biomass firing for renewable resources to hit a target of 40 percent of energy production by 2020. The university has pursued various options of biomass to be fired alongside coal for the time being (and presumably to be fired by itself once coal is eliminated). These options are:

      • Oat hulls, the byproduct of industrial processes, currently sourced from Quaker Oats in nearby Cedar Rapids. This fuel source is readily available, and by reusing formerly discarded ingredients the UI can prevent methane emissions from decomposition while burning a carbon-neutral fuel.
      • Miscanthus grass,[3] a non-native, but non-invasive grass, is often used for biomass around the world due to its high energy content and quick growing nature. The university has planted a few collection areas and buys harvest from local producers.
      • Energy pellets, another industrial byproduct that can be fired alongside coal. Like oat hulls, adding another use to an already ongoing industrial process is more sustainable than burning a non-renewable fuel source.

On its face, this strategy seems like an innovative use of natural ingredients that are carbon neutral and close by, obtainable from regional industry and agriculture.

But it’s still only 40 percent of the plan. Where does the remaining 60 percent come from? Natural gas,[4] which is “cleaner” than coal firing for particulate matter and CO2 , is readily available, and adds a power predictability that is hard to get from some renewable resources. But should natural gas be 60 percent of the university’s energy portfolio, when renewables could play a bigger role?

The university’s Office of Sustainability mentions, but dismisses, greater use of wind power and solar power. Both are mentioned as being implemented in a limited fashion on campus as demonstration projects for research purposes, but said to be too resource intensive (land and money) to fully replace other energy production methods for campus uses.

The message is a concern. If a complete replacement strategy were a qualifying criteria, why would it not apply to biomass firing sources as well. If not, why would the UI not consider solar and wind as a smaller scale, partial contribution to the university’s energy portfolio?

Other universities, including Maryland and Michigan State[5] have both solved cost concerns with public-private partnerships and power purchasing agreements. Indeed, UI researchers already note that the kilowatt cost of solar is below that of more traditional production requirements in some states, with the implication that similar cost comparisons will become more attainable through the country.[6]

Given the similarities between the UI and Michigan State (MSU) — both large public universities in the Midwest with similar climates and both governed by a quasi-public Board or Regents — the MSU example with solar power may prove fruitful. MSU followed the lead of several U.S. universities (including UC San Diego[7]) in deploying solar panels above parking lots on campus.

Solar could bring several benefits if installed at the Hancher lot, beyond power generation. Besides vehicle protection, it could offer research opportunities on solar generation, grid distribution methods, and power storage mechanisms for engineering faculty and students.[8]

Indeed, the University of Iowa already has experience in similar solar deployments. Its Facilities Management department already operates a solar power charging station for university vehicles, just on a much smaller scale.[9] The university has many surface parking lots that could reduce ongoing university expenses by harnessing the air rights just 10 feet above existing lots.

If this isn’t incentive enough, the university is ranked eighth in the Big Ten Conference for green power generation by the U.S. Environmental Protection Agency.[10] Surely Hawkeye pride can carry us to be No. 1. Forget Hancher. Perhaps the lots around Kinnick Stadium could be ground zero for a Hawkeye solar project — with a slogan ready to go: America Needs Solar.

[1] https://www.iowapolicyproject.org/2019Research/190905-Floods-Climate.html
[2] https://now.uiowa.edu/2017/02/ui-announces-it-will-be-coal-free-2025
[3] https://www.facilities.uiowa.edu/sites/www.facilities.uiowa.edu/files/wysiwyg_uploads/hawkeyecampusmiscanthus.pdf
[4] https://www.facilities.uiowa.edu/energy-environment/renewable-energy
[5] https://msutoday.msu.edu/news/2019/msu-helps-big-ten-achieve-largest-collective-green-energy-use/
[6] https://dailyiowan.com/2018/03/19/solar-energy-lights-up-on-campus/
[7] https://www.borregosolar.com/commercial-solar-systems/university-of-california-san-diego
[8] https://msutoday.msu.edu/news/2017/construction-begins-on-msu-solar-array-project/
[9] https://www.facilities.uiowa.edu/sustainable-energy-discovery-district
[10] https://www.epa.gov/greenpower/college-and-university-challenge

Joseph Wilensky is a Master’s Degree candidate in the University of Iowa School of Urban and Regional Planning. He was an intern at the Iowa Policy Project during the fall semester 2019.

How home solar helps everyone

Solar power not only saves on current generation of high-cost power; it reduces the need for future generating capacity. My own home system shows that.

IPP parody — apologies to Peanuts and the late Charles Shultz

It was a hot and sunny month. … No, this isn’t the opening line of a bad novel; it’s a story about electricity and climate change, and our backyard solar array.

July was indeed hot, which means it was a costly month for electric generation. When the heat index pushes over 100 degrees, and homes and businesses run their air conditioning full tilt, utilities have to purchase more expensive power, from less efficient generating stations, to meet the higher demand. Their costs, and the costs for every consumer, go up.

But here’s the good news. It was a sunny month, which means all those solar arrays at farms and businesses and in people’s back yards were generating power at a great rate. The recently installed array at our home generated 1,749 kilowatt hours of electricity from late June through late July. That was 510 kWh more than we used, for which we received a $14 credit from the utility. (When I use more electricity than I generate, I pay over 12 cents per kWh for the extra; when I generate more than I use, the utility pays me 2.8 cents per kWh.)

But all of that electricity we generated meant that the utility needed to purchase 1,749 kWh less power from the grid, power that was more expensive than average. That savings equates to about the amount of electricity used by two average residential customers in a month.

In the last session of the Iowa Legislature, MidAmerican Energy pushed a bill that would allow them to charge an extra monthly fee to future solar generators, people pretty much like us. That fee would have been enough to make installation of solar unattractive to many, which in turn would have devastated the growing solar installation industry in the state. Their rationale: People like me aren’t paying their share of costs for using the utility’s transmission facilities to sell our home-generated power back to the utility.

Every month I pay a $13.50 “facility charge” regardless of our usage or solar generation. The Iowa Utilities Board, which has to approve all changes in rates proposed by Iowa regulated utilities, is scheduled to undertake a study to see if these kinds of facility charges appropriately reflect the utilities’ cost of accommodating solar generation. But MidAmerican’s proposed bill would have pre-empted the normal rate-setting process with the utilities board and imposed the new fee by legislative fiat before the study was even undertaken to see if any fee was justified.

In pushing their bill, the utility or some unidentified group, sponsored TV advertising to try to get the average Iowan riled up by convincing them that they are subsidizing solar users.

But here’s the thing: Iowa is a summer peaking state. Despite the longer winter heating season, the summer air conditioning season is when electricity usage hits its daily or hourly maximum. All utilities use their most efficient, lower cost generating facilities first, and bring the higher cost facilities on line only when needed. So those high-cost facilities are brought into use just when solar power is doing its thing, when the hours of sunshine are greatest. That reduces the need for that high-cost power, which helps all utility customers.

More importantly, those summer peaks are likely to get worse as climate change worsens. Solar power not only saves on current generation of high-cost power; it reduces the need for future generating capacity by helping to reverse the trend of global warming. That is good not just for electricity consumers, but for the planet and for our grandchildren.

Peter Fisher is research director of the nonpartisan Iowa Policy Project. pfisher@iowapolicyproject.org

Monopolies strangling solar, small business

Monopolies would destroy small business who make their money at the local level by insulating homes or installing solar panels.

In times like these, it is helpful to recall what our nation learned from the leadership of Teddy Roosevelt, who went after trusts and monopolies because he knew they used their huge size to strangle other businesses.

Iowa could use that kind of leadership. Our Iowa monopoly electric companies are strangling small businesses again. As monopolies they are guaranteed profits, only because of efficiencies seen as a public benefit in the production and distribution of power. And to make sure they do not abuse that power, they are regulated by a fairly powerful state regulatory agency, the Iowa Utilities Board (IUB).

Solar energy gives citizens control over part of their lives. Small customers who could not operate a coal plant can put up solar panels. MidAmerican Energy (MidAm) sees that and feels threatened. Even though only 750 of their 770,000 customers have solar panels on their property, MidAm wants this market to itself.

So now, MidAm is trying to bypass its IUB regulators by going to the Iowa Legislature to get what they want. MidAm’s approach is a job-killer for solar contractors and a few manufacturers in the state. Legislation the company is pushing would strip those small competitors of most of their market, reducing or even removing the benefits to people who chose to install solar panels.

In short, MidAm wants to put a tax on the sun.

Its proposed changes greatly reduce the incentive to generate one’s own electricity. As it works now, customers with solar panels sometimes produce more electricity than they use. This is often during the middle of a sunny day in the summer when electric prices are at their highest.

Currently, these customers are compensated for the excess energy they provide back to the grid at the same price they pay the electric monopoly. HSB185 would allow MidAm or any investor-owned utility to charge extra fees, or cut compensation, to homeowners and businesses that have clean energy systems. This would discourage solar projects by making them cost-prohibitive.

MidAm — like all utilities — charges a fixed, mandatory fee each month to all customers, which proves false MidAm’s principal argument that the clean-energy customers aren’t paying their share for lines, transformers and billing expenses of the company. Already, they pay.

But MidAm at least is consistent in its attempts to undermine smart-energy choices and the role of small users and businesses in providing it. We saw it last year as well, when MidAm and Alliant Energy successfully bypassed the IUB by dismantling Iowa’s requirement that they help their customers be more efficient. Previously, electric monopolies rewarded a customer who bought a more efficient refrigerator, or efficient light bulbs, or put in more insulation. No more.

Now MidAm is using the same game plan. Go to the Legislature and convince the members to allow monopolies to destroy small business who make their money at the local level by insulating homes or installing solar panels.

What would Teddy Roosevelt have done? He would stand up to stop utilities’ bullying of fair competition and the freedom of citizens to generate their own electricity. Small businesses, conservationists and citizens who just want more control of their lives are looking for that kind of champion.

David Osterberg is lead environment/energy researcher, founder and former executive director of the nonpartisan Iowa Policy Project in Iowa City.

dosterberg@iowapolicyproject.org

Tax cuts vs. clean energy

The Midwest, and especially Iowa, has invested in wind and solar power. Both wind and solar are under attack in the new plan.

Much is being written about the effects of the House Republican tax proposal on different states. By excluding or limiting deductions for state taxes, the proposed tax plan favors states with no income tax — which often is the tax most fair to all of a state’s residents.

Another way states will be affected differently is in energy development.

The Midwest, and especially Iowa, has invested in wind and solar power. There is a production tax credit for wind and an investment tax credit for solar. Both wind and solar are under attack in the new plan.

The wind tax credit already is scheduled to phase out over the next five years but the Republican plan would both speed up the date and cut the present amount of the tax credit. Authors of the bill may not succeed because of something obvious to everyone in Congress, and noted in one news report:

“A report released by Morgan Stanley last week said the Senate is unlikely to pass changes to the tax credit, noting that 85 percent of wind projects are in Republican jurisdictions.

“Sen. Chuck Grassley (R-Iowa) issued a statement last week saying he’s working to block the proposed changes. He told reporters last year that he would fight to preserve the PTC, saying President Trump will ‘have to get a bill through Congress, and he’ll do it over my dead body.’”

As someone who ran against Senator Grassley in 1998, I can tell you we agree on this issue. Proponents of the tax plan claim wind has to get a reduced tax benefit so that taxes on business can be cut overall.

Oddly, they do not see the same need to rein in all tax credits for all energy industries. The state of Georgia where a two-unit nuclear plant is way over budget and way late being finished gets the benefit of extending a tax credit for its big utility company. I bet our Senator Grassley will point that out if and when the tax plan gets to the Senate.

The Trump Administration ignores climate change and wants to subsidize coal plants. But now the U.S. House tax plan would add to the problem of warming our atmosphere by helping to cut back on the cleanest, safest, cheapest new energy source.

It turns out the skewing of benefits to the wealthy, clearly evident in this plan, may not be the plan’s only problems.

David Osterberg, founder of the Iowa Policy Project

dosterberg@iowapolicyproject.org

 

Osterberg to the Climate Marchers: State action works

State government can work to improve the economy of Iowa and at the same time reduce the effects of climate change.

David Osterberg — People’s Climate March Iowa 2017
David Osterberg
David Osterberg

I’m pleased to be the Master of Ceremonies at the People’s Climate March in Des Moines on April 29. The event begins at 1 p.m.

I plan to make the point that state government can work to improve the economy of Iowa and at the same time reduce the effects of climate change.

Way back in 1983, Democrats and Republicans together passed a law — signed by Governor Terry Branstad — that required the state’s investor-owned electric utilities to try renewable energy.

Utilities hated the idea and fought complying with the law for years. Yet now, 35 percent of the electricity generated in the state comes from wind power. Once we changed the direction that utility executives were looking, they found that renewables would work. They found that those who said that the intermittent nature of solar and wind could not be easily integrated into a production system. They were wrong.

The paper the Iowa Policy Project released March 30 shows that even though more than one-third of Iowa electricity comes from wind, our overall electric rates were lower in 2015 (latest data) than when the wind industry really got started in 1998.

 

 

 

 

 

 

 

 

IPP Co-founder David Osterberg was a member of the Iowa House of Representatives from 1983-94. Contact: dosterberg@iowapolicyproject.org

Solar power shines when most needed

Distributed solar is good for the environment because the electricity produced is clean. It also is likely to come just when it is needed. Let’s make sure we have the policies in place to encourage more solar.

By David Osterberg and Nathaniel Baer

The hot sun we experienced this August not only caused the local electric grid to experience high use, but it also powered solar systems distributed around Eastern Iowa.

The middle of a hot summer day is a time when almost any U.S. electric utility expects to see highest demands during the year. Aug. 11 was going to be one of those days in Eastern Iowa. Peak demands of high electricity use translate to high costs.

So, a day in advance, MidAmerican Energy asked the University of Iowa’s Facilities Management team to cut back the university’s electric load from 12:30 p.m. to 5 p.m. on Aug. 11, 2016.

The university has an arrangement with the electric utility to decrease its electric load by cutting back on air conditioning and other usage, when called upon, in exchange for a reduced electric rate. The goal is to reduce costs for all utility customers by encouraging some customers to reduce their electricity use at the highest and most expensive times.

This type of arrangement is a win-win not only for UI and MidAmerican, but also other MidAmerican customers. Utilities often make these arrangements available to large customers as well as residential customers with air conditioning.

The university has two small solar energy systems that produce electricity. The data for one of them, a 38-kilowatt solar array, showed energy production varying during the morning of Aug. 11 (below). During the utility’s predicted peak period of energy use, the solar array’s production rose quickly and continued to be strong for the remaining period.

Basic RGB

Similarly, the solar arrays at Johnson County’s Secondary Roads and SEATS campus began producing much higher levels of solar energy shortly after the 12:30 p.m. high-use period started. These panels also continued with strong production through 5 p.m., when the period ended. (below)

160822-solar-timeofday

The hot sun caused the MidAmerican system to experience a peak day but also powered distributed solar systems in the area to help meet those higher energy needs.

Distributed solar is good for the environment because the electricity produced is clean. It also is likely to come just when it is needed. Let’s make sure we have the policies in place to encourage more solar.

2016-osterberg_5464David Osterberg is an energy and environment researcher at the Iowa Policy Project. dosterberg@iowapolicyproject.org

 

OLYMPUS DIGITAL CAMERANathaniel Baer is the energy program director at the Iowa Environmental Council. baer@iaenvironment.org.

 

A version of this column ran in the Sept. 6 Cedar Rapids Gazette.

Spreading a friend’s message

“At 93 I am nearing the end of my life on this planet. As a parting message, I want to encourage you in the strongest terms to use your influence to make distributed solar energy a major source of electricity. … Please use your influence.” — Don Laughlin, in his letter to Warren Buffett

I visited an old friend, Don Laughlin, in a nursing home before he died. A stroke had paralyzed half of his body but certainly had not affected his mind. Even with his impending death he was looking toward the future as he spoke with Nathan Shepherd of IPP and me.

Our conversation was about renewable energy, which he had promoted for decades. He told us that one of his many unfinished projects was a letter to Warren Buffett, the owner of MidAmerican Energy, to ask him to be more supportive of rooftop solar power. Nathan suggested to Don that he dictate a letter and that we would send it to the billionaire. And we did.

160810-CLIP-dmr-openletterBut we realized that with probably hundreds of letters every day, Warren Buffett might never hear of Don’s letter. We spoke with the Des Moines Register’s opinion editor, who loved the idea of publishing Don’s letter as an open letter to Buffett. So, two days after we spoke to Don, a third of the Register’s op-ed page was Don’s letter, an introduction by Nathan and me, and a huge picture of solar panels. (Click on image.)

Within several days, Don Laughlin would be gone at the age of 93.

At a celebration of Don’s life at Scattergood School near West Branch August 27, my neighbor Deborah Dakin suggested that while she was sure Don was happy to do one last act to encourage solar power and reduce the effect of climate change, more could be done.

Basic RGBShe suggested that everyone who reads this write to Warren Buffett to ask him to pull his company back from efforts to reduce the return to homeowners from their own rooftop solar. That is because MidAmerican is trying to kill net metering, the ability of a homeowner or business to receive retail rates for any excess electricity they generate beyond their own usage.

Your letter would honor Don Laughlin’s last public activity, and, if it succeeds, each of us will be doing our part to stave off the worse and worst effects of climate change.

IPP-osterberg-75David Osterberg, Co-Founder and Environmental Researcher, IPP

dosterberg@iowapolicyproject.org