Iowa community leaders discuss options to meet clean energy targets, including franchise agreements and municipalization

January 20, 2022 - DES MOINES, IA -- Iowa community leaders from across the state joined clean energy advocates Thursday to learn more about options cities can engage to meet their community’s clean energy goals, including how to leverage energy franchise agreements or consider municipalization. 

Unlike individual Iowans who have no choice in their utility service, cities do have limited authority over the agreements they make for utility service. When their residents demand clean energy options, community leaders can leverage the franchise agreement process to communicate these demands. If a utility remains seriously off track, then a committed city can move to the next phase and consider forming a municipal utility. 

"When utilities like MidAmerican Energy are using confusing - even misleading - clean energy metrics that keep communities from achieving true 100% 24/7 carbon-free energy, cities should know they do have options if they are seeking clean energy commitments," said Steve Guyer, Energy and Climate Policy Specialist with the Iowa Environmental Council. "In addition to environmental benefits, homegrown carbon-free energy keeps costs low for residents and is a critical economic development tool for attracting and retaining a vibrant business community."

Recent analysis filed with the Iowa Utilities Board shows that MidAmerican Energy could save Iowans nearly $1.2 billion by retiring all of its coal plants by 2030. With monopoly service territories, what opportunities for change exist when investor-owned utilities are putting profits before the needs of customers?

“MidAmerican Energy claims to have a 100% renewable energy vision, but still operates one of the largest coal fleets in the country,” said Guyer. “The City of Des Moines has committed to ambitious goals to lower its carbon footprint and needs to have critical discussions with MidAmerican Energy during its franchise agreement negotiations to ensure its citizens get the clean energy they are demanding.” 

During the event, Guyer outlined the franchise agreement process and options available to community leaders. "Franchise agreements are not static, one size fits all agreements, and have evolved over time. The latest evolution is the recognition that franchise agreements should reflect mutually agreed upon terms to allow municipalities to meet their clean energy objectives." 

Tyler Poulson, former Senior Energy & Climate Program Manager, City of Salt Lake City, shared his experience crafting a new franchise agreement for the City of Salt Lake City, as well as his role in engaging other communities in Utah in the regulatory process. "The compelling economics of clean energy along with the urgency of climate change create a need for communities and energy utilities to partner and deliver outcomes better aligned with prevailing values and concerns," said Poulson. "Fortunately, local governments across the U.S. are increasingly seeing this opportunity and seeking a more proactive role in negotiations and defining their energy future."

The webinar concluded with Andy Johnson, Executive Director, Clean Energy Districts of Iowa, on the municipalization option available to Iowa cities. "Iowa’s 136 municipal electric utilities provide great rates and reliability, and are true prosperity engines for their communities. Creating a new municipal electric utility is not an easy process, but is clearly authorized in Iowa law," explained Johnson. "Whether interested in economics and local control, or stewardship and resilience, cities can keep the option open only if they avoid signing long-term, binding franchise agreements."

Community leaders interested in learning more about the franchise process are invited to view the webinar recording on YouTube and reach out to IEC staff anytime for more information or useful resources. 

1. clean energy
2. renewable energy