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Senate File 2311, Energy Efficiency and NIPCO

  • Posted: 10.23.2018

This past spring, the Iowa Legislature passed Senate File (SF) 2311 which made some significant changes to legal requirements on energy efficiency for IOUs, cooperatives, and municipals. One of these changes requires that IOUs include line-item billing of any energy efficiency investment. While this requirement does not apply to Iowa’s electric cooperatives, there is some concern about the impact these charges showing on the IOU billings will have on cooperatives. SF2311 goes into effect on January 1, 2019, but NIPCO and its member cooperatives will continue to support energy efficiency programs and ensure that they remain a good value.

Homeowners review houseplans inside thier home, which is under construction
Whether building or remodeling, NIPCO member cooperatives offer rebates and incentives on energy efficienct products and equipment.

Iowa’s locally owned electric cooperatives have a long history of supporting energy efficiency. In fact, NIPCO’s load management system (Switch Makes Cents) was developed in 1983 to reduce electric demand by shedding load during peak times of use. NIPCO also established programs to promote the use of energy efficient products for members living in the NIPCO system through rebates on the purchase of efficient electric equipment and incentivizing the removal of old and inefficient units.

Switch Makes Cents logo

NIPCO’s commitment to demand-side management and the wise use of energy is as strong, today, as it was 35 years ago. Nearly 18,000 load-control switches have been installed in homes and businesses served by NIPCO’s member distribution cooperatives and municipal utilities through the Switch Makes Cents program. This has resulted in more than $47 million in member savings since 1983 and over $3.6 million in savings in 2017, alone. Incentivizing energy efficiency in residential, commercial, agricultural, and industrial applications in the NIPCO system, through rebates and incentives, contributes to an additional $600,000 in avoided costs and saves approximately 69,000 kWh every year.

NIPCO regularly participates in joint energy efficiency studies with neighboring G&Ts (generation and transmission cooperatives), with the next study slated for 2019. These studies calculate the cost-effectiveness of each program by applying four “tests”.

  1. The participant cost test determines whether the program is cost-effective from the perspective of the participant in the program.
  2. The utility cost test determines whether the program is cost-effective from the perspective of the cooperative.
  3. The ratepayer impact cost test, also referred to as the RIM test, determines whether the program is cost-effective from the perspective of co-op members who do not participate in the program.
  4. The societal test determines whether the program is cost-effective from the perspective of society, in general.

The last joint study was conducted in 2014, with the next study being slated for 2019.

During 2019, NIPCO’s member cooperatives will reinforce the message that Iowa’s electric cooperatives remain committed to energy efficiency as a valuable part of providing safe, reliable, affordable, and environmentally responsible power to members.