Implementation of SF 2311 Causes Job Loss Throughout Iowa

Iowa Solar Industry Could Face Same Fate

DES MOINES - After the Iowa Utilities Board approved drastically-reduced energy efficiency plans this spring for the state’s rate-regulated utilities as a result of Senate File 2311 passed in 2018, job loss was immediate. A sample of just four businesses in the energy efficiency industry showed a loss of 54 jobs and total salary losses of $2.5 million.

“Our business has become everywhere but Iowa,” said Chad Palmer, President and CEO of Energyficient Systems. “Iowa is not as welcoming to energy renovation projects as other states. Eventually we won’t be in Iowa at all.”

Energyficient Systems, located in Burlington, specializes in commercial lighting improvements and has provided services at locations such as Two Rivers Bank and John Deery Collision Center in Burlington, saving each of these businesses tens of thousands of dollars per year in energy costs, reducing maintenance costs, and improving customer and employee comfort. Following final approval of Alliant’s efficiency plans, four employees and $280,000 in salaries have left the state and the company is doing limited business here.   

Industry representatives warned the 2018 legislature about the harmful impacts of SF 2311. The same fate could fall upon Iowa’s growing solar industry if the legislature passes House File 669/Senate File 583. 

“The Sunshine Tax legislation is not only the wrong direction for Iowa, it comes at an especially bad time when utilities are slashing energy efficiency options for consumers and raising rates,” said Kerri Johannsen, Energy Program Director for the Iowa Environmental Council. “Iowa farmers, businesses, and homeowners need an option to control ever-escalating energy costs.” 

Iowa’s solar industry employs about 850 people. Across the country, 86 percent of solar jobs are serving residential and commercial customers while just 14 percent of solar jobs work on utility-scale solar. Utility investments in solar are likely unable to make up for the significant job loss that would occur if the legislation passes.  

“Policy choices have consequences. Gutting energy efficiency programs means fewer engineers working on building efficiency, fewer employees at a lighting small business, and fewer jobs for an insulation contractor, and in turn less savings for businesses and consumers looking to control costs” said Josh Mandelbaum, an attorney with the Environmental Law and Policy Center. “The Sunshine Tax will mean fewer solar installers, and fewer opportunities for businesses, farmers, and consumers to control the way they use energy.”

Following the passage of SF 2311, a survey conducted by Iowa State University on behalf of the Iowa Environmental Council in December 2018/January 2019 found that energy efficiency contractors surveyed overwhelmingly predicted future losses. Seventy-five percent of the energy efficiency employers surveyed in Iowa expected the severe cuts to utility efficiency programs adopted by the legislature in the 2018 Legislative Session to hurt their business. At the time of the survey, 19% of companies surveyed had already laid off employees and 23% saw skilled employees leave the company to look for other opportunities because of SF 2311.

SF 2311 cut electric efficiency programs by almost 50% and gas efficiency programs by 80% for customers of MidAmerican, Alliant Energy, and Black Hills Energy. 

HF669/583, currently under consideration by the Iowa legislature this year would add additional, arbitrary fees to solar customers, lengthening the payback period for solar projects and discouraging private energy investment. 

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1. clean energy
2. energy efficiency
3. iowa legislature
4. solar power
5. solar tax credits