Julia Poska | February 28, 2019
The so-called “sunshine tax” might have a bright and cheery name, but the proposed fee could put a real damper on private solar power in Iowa.
Described in House Study Bill 185 and Senate Study Bill 1201, the “Solar Options Lead to Affordable Renewables (SOLAR) Act” would impose an over $300 annual fee on solar customers — property owners with small-scale solar panel setups who sell excess power back to the grid. The fee would cover the cost of using the electric grid and support Iowa’s energy infrastructure.
Currently, such customers can expect to pay off the high initial cost of solar panel installation in less than 10 years through savings on energy bills and sales of excess power. Cedar Rapids City Councilman Tyler Olson told the designated House subcommittee the fee would extend that period to as much as 20 years, as reported in the Gazette. This would greatly discourage private individuals from investing in home setups, which typically last about 25 years.
Supporters of the fee, including major Iowa utilities like MidAmerican and Alliant Energy, say it is unfair that customers who do not generate their own power absorb the cost of maintaining power infrastructure that is used by solar generators.
“Growth is possible when policies allow all customers to benefit from renewable energy,” MidAmerican Energy’s president and CEO said in a press release. “Common sense legislation focused on keeping costs low and affordable for everyone provides the best opportunity to grow solar in Iowa.”
Opponents say the fee would only allow solar to grow for large corporations, however, and that it would kill the future of Iowa’s growing solar industry, which largely develops and installs systems for private homes, businesses and farms.
On Tuesday, the Gazette reported that the the bill would soon move forward in the Iowa House, to the full House Commerce Committee. Yesterday, the Iowa Senate held a hearing on their version of the bill, and did the same. There is a push among some legislators to delay the conversation until the Iowa Utilities Board finishes an assessment of compensation for solar energy producers next year.