The concept of the City of Decorah becoming its own municipal electrical utility (MEU) was presented to the Decorah City Council’s utility committee last Monday night.
The presentation was made by Decorah Power, a new non-profit comprised of Decorah area residents formed to explore the option.
“This is about opportunities”, stated Decorah Power President Larry Grimstad in his introduction.
“There are significant economic and sustainability opportunities for a community like Decorah in owning an electric utility. There are also significant challenges, and we want to learn more about those challenges and opportunities through a feasibility study.”
Andy Nelson, legal counsel for Decorah Power, then gave the core presentation to the committee. He explained that the majority of Decorah’s electricity is provided by Alliant Energy, an investor-owned electric utility headquartered in Madison, Wis. This power arrangement is currently being provided under a 25-year franchise agreement between the city and Alliant. The current agreement expires in May of 2018. But Iowa code allows all municipalities the right to apply for the creation of their own MEU, which is what Decorah Power is urging the city to consider before they renew the franchise agreement.
Nelson went on to explain that Decorah Power is developing an RFP (request for proposal) for an MEU feasibility study. If the Council is supportive, the study will be funded with private donations, and the Council will remain fully informed. If the study identifies positive opportunities for the community, either the Council or Decorah Power (via petition) could eventually place the issue up for community vote. If a vote were positive an application would be made to the Iowa Utilities Board for an MEU to service local customers.
Grimstad further explained that city ownership of an MEU can provide a competitive edge for a community when it comes to attracting new businesses and jobs. In addition, an MEU can provide the community flexibility in developing community renewable energy projects as well as a broader scope of individual projects. Consumer-owned solar options are becoming increasingly restricted under the incumbent utility, and community or “shared” renewables are not available.
Andy Johnson, also with Decorah Power, explained that there are already 136 MEU’s in Iowa, which on average provide rates competitive with or more affordable than those offered by Alliant, which appears to be on the verge of another increase in 2017. Johnson also explained that an MEU could increase local self-reliance, just like our local food and fiber network initiatives. And he said it could provide for added security and resilience in the face of climate, internet and other potential threats.
“Rural communities throughout the Midwest are struggling, and the future belongs to those that innovate, take risks, and invest. Creating an electric utility will hold plenty of challenges, but the jobs and stewardship rewards could be felt for generations. We owe it to ourselves and our kids to learn more, to not throw away our shot.”
Tim Wagner, also with Decorah Power, noted how the energy markets have been making a significant transition in recent years, due to cheaper renewable technologies, much more energy efficiency that reduces demand, and also world-wide calls for reducing our reliance on traditional fossil fuel-based sources of energy. This has resulted in more opportunities for local energy ownership and production. He said that because of Decorah’s size and the fact that the community already has a vibrant renewable energy sector, the city could be in a very unique position to capitalize on an MEU opportunity.
Council members Kirk Johnson, Gary Rustad, Steve Luse, Andy Carlson, and Dan Bellrichard were present for the discussion. All spoke in support of Decorah Power pursuing a feasibility study for the creation of an MEU, and agreed that holding off on signing a new agreement with Alliant shouldn’t be a problem. Official action on the issue will likely be brought to the full Council at its next meeting, Monday, March 20, and Decorah Power invites the public to attend.
More information on Decorah Power can be found at decorahpower.org.