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- Des Moines, Iowa
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- Contact: Ms. Roya Stanley
- Chief, Energy Bureau
- Iowa Department of Natural Resources
- Wallace State Office Building
- Des Moines, IA 50319-0034
- Tel: (515) 281-8681
- Fax: (515) 281-6794
- Scope: Statewide
- Inception Date: 1985
- Participants: Iowa's Department of Natural Resources;
government
- facilities, schools, hospitals, local governments and other
non-profit
- organizations; utilities
- Project type: Energy management, renewable resource
development,
- alternative financing
- Methods used: Innovative energy legislation and financing
arrangements,
- marketing and public education, development of comprehensive
energy
- plans
- Lessons learned: Importance of state and federal legislation
for
- comprehensive energy planning. Necessity of innovative
financing systems
- and marketing. Value of modelling education and utility
leadership.
- Background
- In 1985 Iowa began an ambitious series of innovative
legislative program
- and planning strategies aimed at improving the state's economy
and
- decreasing its dependence on external energy resources. Its
goal was to
- reduce overall energy use, develop "home-grown" renewable
energy
- sources, and to build a local renewables industry.
- Using energy more efficiently
- The goal of the Building Energy Management Programs of Iowa's
Department
- of Natural Resources is to achieve annual energy savings of
$50-60
- million on a capital investment of $300 million in all state
facilities,
- schools, hospitals, and local government and other nonprofit
- organizations through the implementation of cost-effective
building
- energy management improvements that have a payback period of
six years.
- Improvements range from caulking and weather-stripping to
replacing
- boilers and chillers.
- Traditionally, lack of capital has limited investments in
energy
- efficiency. To overcome this problem, the State of Iowa has
developed
- several innovative financing programs. In 1985 a state law was
passed
- authorizing state agencies to use lease-purchase financing for
- improvements and setting up a non-profit corporation to
facilitate
- implementation. Savings that result from these improvements go
to
- meeting the lease payments. A School Energy Bank, set up in
1986,
- assists schools with energy audits, engineering analyses (paid
for with
- six-month interest-free loans), and lease financing for
improvements.
- Additional enabling legislation, passed in 1987, allows all
school
- districts to get the same low interest rate regardless of
credit rating.
- Other legislation set up similar programs for hospitals,
private
- colleges, and local governments. By the end of 1993, $113
million in
- improvements had been identified and about 16% of these
installed.
- Future programs will focus on industrial and commercial
facilities, as
- well as promotion to other states.
- Increasing "home-grown" energy resources
- Iowa's Comprehensive Energy Plan , developed in 1990 by the
Department
- of Natural Resources, calls for 10% of Iowa's energy usage to
be
- composed of renewables by 2010. Due to the large number of
highly-rated
- wind sites in Iowa, wind energy will be the primary resource
used. A
- study by the Union of Concerned Scientists estimated that wind
turbines
- could generate more than two trillion kilowatt-hours per year
in the
- state. Additional sources will be biomass, including ethanol,
wood
- waste, methane, and municipal solid waste.
- As with the Building Facilities Program , legislation has made
- development of this capacity possible. In 1992 the Iowa
Utilities Board
- set guidelines requiring purchase by utilities of 105
megawatts of
- electricity generated by alternative power producers. A 1993
law
- exempted wind generation equipment from state sales tax and
allowed
- local governments to exempt landowners from paying additional
property
- taxes on the value of wind conversion systems. In addition
renewable
- energy projects by cities, counties, and school districts
became
- eligible for low-cost financing through the Iowa Energy Bank
Program,
- operated by the Iowa Department of Natural Resources.
- The Spirit Lake Community School District in northwestern Iowa
was one
- of the first institutions to benefit from this program. Using
funds from
- the U.S. Department of Energy's Institutional Conservation
Program and
- low-cost financing from Iowa's Energy Loan Bank Program, the
school
- district built a 250-kilowatt wind turbine in 1993. In the
first year of
- operation the district saved $26,000 which, according to
Superintendent
- Harold Overman, "will provide a computer lab a year for our
students."
- The 1990 legislation requiring investor-owned utilities to
purchase 105
- megawatts of independently produced energy provides an added
economic
- benefit to the school district. They can sell excess
electricity to Iowa
- Electric at a guaranteed rate. Because this mainly occurs
during the
- summer when school is closed, this supply serves to meet the
utility's
- additional seasonal needs.
- The students benefit by learning about energy conservation and
other
- environmental concepts, e.g, the wind turbine will keep 1800
pounds of
- pollutants and 650,000 pounds of carbon dioxide from entering
the
- atmosphere. They are monitoring the wind speeds and turbine
production
- data with classroom computers and sharing this and other
information
- with other schools through the Iowa Communication Network.
- The success at Spirit Lake has inspired other initiatives. A
local
- manufacturer in Adair, Iowa installed a wind turbine early in
1995. The
- system is expected to provide 70-80% of the company's
electrical needs
- and to pay back within eight years. It also prompted a gift
from two
- philanthropists of two generators to the Nevada County School
District
- and a third to a community hospital.
- Integrated resource planning: Waverly, Iowa
- In 1990 Iowa required municipal utilities to report their
energy
- efficiency plans by 1992. Waverly was the first utility to
submit its
- comprehensive plan, which has become a model for others in the
state.
- Waverly is a small, growing farm town of 9,000 in northeastern
Iowa. Its
- publicly-owned electric utility, Waverly Light and Power,
serves roughly
- 4,000 customers in a 33-square mile service area. It generates
45% of
- its power while the rest is purchased from Midwest Power
Systems (MPS).
- During the late 1980's energy demand grew at a rate of 4.2%
annually
- from an increase in population and small businesses, Faced
with a
- contract termination with MPS in 1999 and steady growth in
demand, it
- became increasingly concerned about future energy supplies. It
looked to
- Osage, Iowa, where an impressive set of demand-side management
programs
- had achieved 100% participation and significant savings for
the city.
- In 1990, the board of Waverly Light and Power hired a new
general
- manager and energy efficiency expert, Glenn Cannon, who
prepared the
- utility's first integrated resource plan in 1992. It
identified fifteen
- environmental and conservation goals which provided
cost-effective
- strategies and rationales for increasing customer efficiency
and
- conservation in the use of energy and for investing in
renewable
- resources.
- The demand-side programs involve residential, commercial, and
industrial
- customers. They include energy efficiency in new building
construction;
- residential audit and appliance rebate programs; commercial
audit,
- lighting and HVAC programs; home loan programs; and a
demonstration
- electric vehicle program.
- On the renewable supply side, after extensive research Waverly
Power and
- Light installed an 80 kilowatt wind turbine on an acre of land
leased
- from a local farmer. Although it is the costliest source of
energy in
- its current supply, the utility foresees that wind will play a
permanent
- part in its future mix. It is also a source of local pride
among
- residents.
- With the University of Northern Iowa, Waverly has also
established the
- Midwest Wind Energy Program to provide evaluation,
demonstration, and
- dissemination of wind energy information. In the words of Mr.
Cannon,
- "We have a moral obligation to our customers and society as a
whole to
- provide electrical service in the most responsible manner, and
that's
- got to include the environment."
- By developing an integrated energy plan, implementation has
come at
- minimal cost for Waverly Power and Light. Careful planning
ensures that
- energy-efficient appliances and other equipment were available
before
- the plan was implemented. Effective communication and public
education
- through radio spots and newspaper advertisements and public
meetings
- reduced the need for expensive promotions and incentives.
- In addition the success of the program was a boost for the
local
- economy, making it possible for the utility to make an
interest-free
- loan available to buy land for an industrial park.
Administration
- commitment, efficient use of resources, credible messengers,
long-term
- strategic planning have all been distinctive elements in this
effort.
- For more information contact: Glenn Cannon, General Manager,
Waverly
- Light and Power, 1002 Adams Parkway, P.O. Box 329, Waverly, IA
(319)
- 352-6251 Fax: (319) 352-6254.
- Key elements for success statewide
- Favorable legislation and state assistance in research have
been key to
- the success of Iowa's energy programs. In the case of wind
generation
- technological innovations in turbine design and efficiency
have greatly
- reduced costs and increased technical reliability. As a
result, there is
- far more public support for renewable energy projects.
- The programs of both the State of Iowa and the town of Waverly
- demonstrate that careful, integrated, long-term resource
planning
- addressing all sides of the energy equation can succeed and
bring
- economic, environmental and educational benefits to
communities as well
- as a sense of civic pride and the opportunity to be a model
for others
- to follow. Energy efficiency and renewable sources result in a
cleaner
- environment and fewer environmental and health costs.
Dependence on
- supplies of fossil fuels is reduced and new industries,
products,
- markets, and jobs created. Education has a significant role in
teaching
- sustainable energy use and development to future generations.
- Case Study Source: Sustainability in Action: Profiles of
Community
- Initiatives Across the United States-- EPA / ---- CONCERN,
Inc.. 1995
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