Seven quick hits on Iowa energy policy

Election news is keeping me busy, but several reports related to energy policy in Iowa caught my eye during the last week.

Links and excerpts are after the jump.  

Last week the Environmental Protection Agency approved the use of the E-15 blend, consisting of 15 percent ethanol, in model 2007 and newer vehicles. Iowans who promote ethanol subsidies generally welcomed the decision, though some including Senator Chuck Grassley felt the EPA should not have excluded older vehicles.

“While I’m glad to see that at long last the EPA has finally made a decision, I am frustrated that the EPA is approving E15 only for vehicles that are model year 2007 and newer,” Sen. Charles Grassley (R-Iowa) said. “The announcement unnecessarily complicates the fuel-supply chain and undermines real progress that a waiver for all vehicles would have provided to America’s domestic renewable fuel producers.”  

Democratic candidate for Iowa secretary of agriculture Francis Thicke accused incumbent Bill Northey of misrepresenting his views on government support for ethanol:

“My opponent for secretary of agriculture distorts my position on corn ethanol when he says I want to ‘abandon’ corn ethanol,” Thicke says.  

“I have stated repeatedly and emphatically that I want to protect the large investment Iowa already has in the corn ethanol industry by making sure it survives, and that we do not have more bankruptcies.”

Thicke says he supports the federal volumetric ethanol excise tax credit (VEETC) and the import tariff on foreign ethanol but favors ending state tax credits for building new ethanol-production facilities.

Instead, he wants to put some of those efforts into developing next-generation energy systems.

Speaking of transitions, the non-profit organization Plains Justice published a report last Friday saying

that much of the coal currently burned in Iowa power plants and industrial boilers could be replaced with agriculture products and by-products that are currently unused or underused. Corn stalks, corn leaves, by-products from agricultural processing and even perennial grasses could be the clean and homegrown fuel for the future.

“Burning corn stover in power plants would give farmers an income boost while helping to keep Iowa’s air clean by reducing the amount of coal burned to produce electricity,” said Nicole Shalla, a Plains Justice attorney, referring to the corn stalks and leaves which are often considered a waste product of corn fields.

The report, which was written by author and Iowa State University researcher Mark Mba Wright for the environmental group, compares emissions from coal and various ag-based biomass, provides a discussion of biomass ash and discusses the technical aspects of using biomass as a replacement for fossil fuels.

“Iowa produces 68.3 million tons per year of corn stover, which could be made available to energy facilities,” Wright notes in the report. “Growth, harvest and conversion are the key stages in the biomass supply chain. Although there is a mature supply chain established for corn grain, there is still a lot of work needed to develop an industrial supply chain for biomass to energy applications.”

Even the state’s ethanol plants could reduce their use of fossil fuels and improve their environmental profile by replacing coal or natural gas with renewable biomass. In essence, ethanol production could further utilize the whole of the corn plant, in lieu of just portions of the kernel. They could also utilize the roughly 20.4 million tons of soybean residue that estimated to exist annually in the state. By doing so, they could open up a new economic opportunity for Iowa producers.

The sooner we start phasing out coal combustion in Iowa, the better. Iowa Physicians for Social Responsibility just published “a study of the impact reliance on coal has on health outcomes in the state.”

From the executive summary:

“This report represents a preliminary effort to correlate the known disease burden and costs to Iowans of relying on coal to produce energy. Information was drawn for correlation and analysis from a variety of publicly available scientific resources, databases, and recently published research pertinent to Iowa. Geographical mapping techniques were utilized to synthesize graphical views comparing the distributions of a group of index diseases with a variety of environmental pollution sources to facilitate visualization of these complex data sets. Qualitatively, results are provocative and strongly suggest correlations between coal combustion and health in Iowa.”

The report makes specific policy recommendations including:

Support funding to more comprehensively track and monitor adverse health events.

Tightened standards for energy efficiency and their enforcement.

A moratorium on new coal plants in Iowa & shuttering of the oldest burners.

Tightened standards for PM2.5.

Systematized clean-up and containment of coal ash waste at the state & federal level.

Elimination of coal subsidies and tax and financial incentives.

Blog for Iowa posted links to the full report and the executive summary.

Ramping up energy-efficiency programs would be the fastest and cheapest way to make sure Iowa can meet its baseload needs for electricity. The last few years, bills containing more aggressive efficiency targets have languished in the Iowa legislature. Despite lawmakers’ lack of vision (or political will), Iowa has made progress in this area:

A scorecard just released by the American Council for an Energy-Efficient Economy’s (ACEEE) now ranks Iowa 12th in the nation on its efforts to promote energy efficiency in the state.  This is an improvement from 18th a year ago.  The fourth-annual ACEEE report benchmarks the progress of states, through their policies and programs, in improving energy efficiency for homes, businesses, industry, and transportation. […]

Two categories which contributed significantly to Iowa’s improved ranking are “State Government Initiatives,” which includes the governor’s Green Government Initiative and the “Lead by Example” subcategory.  In the “State Government Initiatives Iowa ranked eighth-best in the country and in “Lead by Example” subcategory Iowa was one of only 15 states having both energy efficiency standards for state buildings and energy efficiency monitoring of those state buildings.  Iowa also scored high in the category of building energy codes as one of only 17 states with a statewide code that meets or exceeds the latest International Energy Conservation Code standards for both residential and commercial buildings.

Another ranking category in which Iowa excelled is “Utility and Public Benefits Programs and Policies.” These include the energy efficiency programs overseen by the Iowa Utilities Board (IUB).  Iowa is one of just six states that scored the maximum number of points for its Energy Savings Targets, which are quantitative and long-term energy savings achieved primarily through utilities’ effective customer-use energy efficiency programs.  These programs typically enable utilities to meet a portion of their electricity and natural gas needs through efficiency savings, while also lowering costs for consumers.  A majority of Iowa electric and natural gas customers are served by investor-owned utilities that are rate-regulated by the IUB and must follow policies and programs contained in IUB approved energy efficiency plans.  

Iowa imports 100 percent of the coal used to produce electricity in this state, but boosting renewable production could make our state a major electricity exporter. On October 21, Senator Tom Harkin and Office of Energy Independence Director Roya Stanley will headline a forum on “Expanding and Modernizing the Electrical Grid: Essential Infrastructure for the Midwest’s Clean Energy Future.” Details are in IowaEnvironmentalCouncil’s diary.

Improving the electrical grid is a worthwhile long-term investment, but the up-front costs will be significant. At the Des Moines Register blog, Dan Piller reported yesterday,

A study commissioned by MidAmerican Energy of Des Moines and its partner in a proposed transmission line to ship wind energy from Iowa eastward says that an 8,000 mile line could be built between central North Dakota into Ohio at a cost between $20 billion and $25 billion.

When completed by the year 2025, the transmission line would be able to ship up to 56.8 gigawatts (1 gigawatt equals 1 billion watts) of wind generation within the study area that includes Iowa, North Dakota, South Dakota, Minnesota, Wisconsin, Illinois, Indiana, Nebraska, Missouri, Michigan and Ohio.

This translates into enough energy to power more than 15 million households.

A final note on the intersection of politics and energy policy: a representative for Iowa ethanol baron Bruce Rastetter finally confirmed that Rastetter provided the “seed money” for the American Future Fund in 2008. In their must-read New York Times article on the 510(c)4 group, Jim Rutenberg, Don Van Natta Jr and Mike McIntire noticed a common thread in the organization’s political agenda:

At its formation, the American Future Fund proclaimed a broad mission “to provide Americans with a conservative and free market viewpoint.”

At times, its activities also seemed to dovetail with the interests of the ethanol industry.

Among the first politicians it supported with advertising was Senator Norm Coleman, Republican of Minnesota and a co-chairman of the Senate Biofuels Caucus, during his losing 2008 re-election campaign.

Later that November, it focused on an unexpected target: the Indy Racing League.

In a radio advertisement, the fund attacked a deal the racing association struck to power Indy cars with sugar-based ethanol from Brazil, portraying it as a slight to American producers.

The campaign may have seemed odd for a group promoting free-market principles. But days earlier, ethanol executives, including Mr. Rastetter, had met with racing officials to unsuccessfully demand that they abandon the Brazilian deal.

“Free markets” is good for a sound bite, but as they say, business is business.

The New York Times article also noted,

Most of [the American Future Fund’s] advertisements this year have focused on generic fare like stimulus spending and health care. But suggestions of an energy-related agenda have peeked through.

Of the 14 “liberal” politicians singled out in a list it released last month, nearly every incumbent sits on a panel with a say over energy or agriculture policy. Five sit on the Agriculture Committee; four others are on related committees with say. One candidate was a staff member on a related panel.

The American Future Fund is spending up to $1 million to defeat Representative Bruce Braley in Iowa’s first Congressional district. I think this spending is primarily designed to damage Braley ahead of a future run for statewide office, but reading the New York Times piece, it occurred to me that Braley serves on the House Energy and Commerce Committee.

Share any thoughts about energy policy or politics in this thread.

About the Author(s)