July 9, 2020
Iowa

End of Iowa’s wind boom? Renewable rules spark fears

Jeffrey Tomich, E&E News reporter | Published: Wednesday, July 8, 2020 | www.eenews.net

Iowa, a national leader in wind energy, is weighing new rules for siting renewable energy projects – regulations that could shake up a system that’s enabled billions of dollars of investment in the state over the past two decades.

The Iowa Utilities Board initiated the rulemaking in May after denying a developer’s petition to site four large solar projects in the same manner as wind farms – by putting local government in control.

Debate over siting of renewable energy has been brewing in Iowa for the past two years, including a case at the state Supreme Court last year and in the Legislature. Now, with utility-scale solar poised to take off, too, the board said it’s looking to create a more streamlined, consistent process for renewables across the state’s 99 counties.

The proposed rules would require wind projects to get approval from the state when traditionally they only needed county approval. The rules also raise the specter of eminent domain and create uncertainty for wind projects currently in development.

Groups including the Iowa Farm Bureau Federation, counties, utilities, landowners, and labor and environmental groups have weighed in. So have the big wind companies, which have urged the board to tread carefully when changing policy that’s enabled an economic boom.

“This is a major change to wind energy siting policy in Iowa,” said Jeff Danielson, central region director for the American Wind Energy Association and a former Iowa state senator. “This would have a significant impact.”

Some companies like GE Renewable Energy and EDF Renewables have urged regulators not to mess with success, saying the new rules could increase development time and cost.

Warren Buffett’s MidAmerican Energy Co. said in a statement that the rules should be dropped and will have “a significant chilling effect on renewable generation development.”

According to AWEA, Iowa has more than 10,000 megawatts of installed wind capacity and 11 wind-related manufacturing plants. The industry employs 9,000 people in the state, directly and indirectly, and generates tens of millions of dollars in local taxes and in payments to landowners.

While the proposed rules are unique to Iowa, tension over local versus state siting of wind and solar projects is a prevalent theme in the renewable energy world.

Ohio has grappled with the issue in recent years (Energywire, Dec. 4, 2019). More recently, New York’s Legislature approved a statewide permitting process for large wind and solar projects despite strong pushback from groups in rural upstate who complained the process would “trample” local input (Energywire, April 3).

The changes in New York are meant to alleviate a backlog of project applications.

No such backlog exists in Iowa, where the consideration of how to site renewables seems to be prompted by the emergence of utility-scale solar.

The same story is playing out in other states across the Midwest, and the issue has exposed nuanced differences between siting wind and solar projects – ones that can be thorny issues for policymakers and regulators.

“States are now just trying to grapple with ‘How do we treat these [utility-scale solar projects]?'” said Sarah Mills, a professor at the University of Michigan, who studies the impact of renewable energy development in rural areas. “They do have different land use applications.

“Everybody assumes solar would be way less contentious than wind, and that’s not the case.”

Since 1997, Iowa wind projects have not been required to get state approval because even sprawling wind farms, which today can cover 80 square miles with turbines a quarter-mile apart, are considered individual sites each with less than 25 MW on a single gathering line, meaning they can be zoned at the county level.

While some consider the system to be making use of a loophole, it’s one backed up by case law – most recently a 2019 state Supreme Court decision affirming the Iowa Utilities Board’s decision not to regulate a large wind project.

Less clear is how the board will treat big solar projects, the first few of which were proposed in Iowa last year. Those proposals signal that the next 20 years could do for solar expansion what the last 20 years did for wind development in Iowa.

There’s currently almost 2,500 MW of solar projects under development in Iowa seeking to connect to the Midcontinent Independent System Operator’s interconnection queue. Solar generation is considered a complement to Iowa’s wind, which tends to produce more energy at night, and is viewed as a cost-effective way to further wean the state off fossil fuel.

Developer Invenergy LLC proposed four large solar projects last year, each between 150 and 300 MW, and asked that it be allowed to take advantage of the same “gathering line standard” used by the wind industry. But regulators denied the request, noting the issues raised are “significant legal and policy issues that affect the state as a whole.”

Chicago-based Invenergy said last month in response to the proposal that utility-scale solar projects shouldn’t face a tougher regulatory burden than wind, which is chiefly zoned at the county level, or fossil energy plants, which are sited at the state level.

Each of the four large solar projects approved in 2019 had to get both county zoning approval and obtain a certificate from the state.

“Solar – despite fulfilling the same state public policy wind does, and despite having no emissions and lower noise than traditionally-fueled generation … was the only kind of generation that had to run a gauntlet of two separate levels of basic permitting,” the company argued.

The board’s initial proposed rule would require renewable energy developers to get a certificate of necessity and public convenience from the state for any project with aggregate capacity greater than 25 MW.

But AWEA and other parties contend the rule leaves unanswered a key question about who has the final say on siting – the state or counties. It’s unclear whether “the IUB takes over the process whole cloth or whether they would still defer to some level of county decisions,” Danielson said.

The wind industry has also raised concerns about a provision in the rule that would let existing wind projects move forward without a certificate from the board if they have begun construction.

AWEA said the “grandfathering” provision is troublesome because it excludes projects in the final stages of the local permitting process but haven’t begun construction, which could lead to delays and increased costs.

Among the projects that would be affected is Apex Clean Energy’s Great Pathfinder wind farm, a 225-MW project north of Des Moines, Iowa.

Virginia-based Apex said the Great Pathfinder project won approval from an Iowa county last month. The company is meeting with landowners to get transmission easements and has met with potential lenders, customers and turbine suppliers. The company is worried that new siting rules could be finalized before construction begins, requiring it to “start over” under a new permitting process.

Environmental groups, usually allies of the renewable energy industry, have expressed somewhat different positions.

In general, they don’t oppose consolidating approval of renewable energy projects at the Iowa Utilities Board, even if that means eliminating the current gathering line standard used to site wind projects.

“As long as it doesn’t end up being a more burdensome process and it’s done in a fair way, we don’t oppose that,” said Kerri Johannsen, energy program director for the Iowa Environmental Council. “We believe the law allows counties to weigh in.”

But the council and the Chicago-based Environmental Law and Policy Center on Monday urged the board to withdraw the proposed rules out of concern they could stymie projects currently in development, such as Great Pathfinder.

The Sierra Club, meanwhile, recommended the board move forward with the rules, saying they “strike a balance” between renewable energy opponents and supporters.

The Sierra Club said the public is too often excluded from participating in a meaningful way under the existing county-level siting process.

“County officials too often yield to the siren song of jobs, economic development, and tax revenue, and do not give appropriate consideration to the environment and proper land use policies,” the group said.

Not surprisingly, the proposed rules have stoked the passion of dozens of Iowa landowners. Many of their comments center on a provision giving the power of eminent domain to renewable energy developers that obtain a state permit.

Invenergy, which has built several wind farms in Iowa, said concern about the provision overlooks the fact that eminent domain authority is already available to developers that obtain a state permit and that 5,000 turbines have been constructed in the state without a request by a developer to take private property for that purpose.

The company suggested the board establish two tracks for approving renewable energy projects, and those with developers that forgo the right to use eminent domain should be streamlined.

Similarly, Des-Moines based MidAmerican said in its statement that “the story of renewable energy in Iowa has been a success story.”

“The last thing the board should want now is a plot twist that leaves the ending in doubt,” the company said.