New Iowa Senate bill would decrease energy efficiency incentives

This energy efficient home, built by Don Otto of DPO Construction in Iowa City, is estimated to heat and cool for around $150 per year. (Photo courtesy Don Otto)

There is a surcharge on Iowans' energy bills - one that you don't see. A new bill passed by the Senate Tuesday night would get rid of it. Here's why it's creating controversy.

The surcharge supports utility companies' energy efficiency programs, like rebates for people who buy energy efficient appliances, and educating builders on renewable energy. Critics say decreasing the fund will cause energy rates to increase, jobs lost, and the environment to be damaged.

Don Otto is the owner of DPO Construction in Iowa City. He specializes in energy efficient homes. He says he could build any type of house, but he chooses to go green.

"It sure makes me feel a whole lot better about what I do," Otto said. "If I can make a home that's more comfortable, more efficient, costs less to operate, more durable, healthier on the environment."

It's that exact reason he feels uncomfortable about a new bill which allows customers to opt out of a surcharge on their utility bill that funds rebates to customers for making energy efficient choices.

"There's going to be less incentive to spending a little extra money on the things that will pay the client back over time."

Republican senator Michael Breitbach has a problem with the current surcharge.

"This tax is actually hidden inside the bill and is not a separate line item on the bill," said Breitbach.

He says people should have a choice to support the programs.

"If you're gonna be paying a tax and it's gonna be going to a utility, the government, or anyone else, you should be aware of that tax," said Breitbach. "You should know how much it's costing you."

Energy policy centers like Midwest Energy Efficiency Alliance say people shouldn't look at the short term cost, but the benefit in the long run. By decreasing financial support for energy efficiency, they say, there'll be a higher demand for traditional sources of energy, causing rates to skyrocket. Without everyone pitching in, Iowans' bills will increase.

Alliant Energy is one of the advocates for the bill. They say that undoing the surcharge is only one of many sections of the bill, and Alliant's focused on supporting other parts of the bill, like saving customers money on natural gas services.

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