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Iowa has made strides in adopting solar since 2020, when its commercial-scale market took off. Wind power continues to dominate the generation mix in the state. In Iowa, through the end of 2022, the Solar Energy Industries Association (SEIA) reports 658 MW of installed solar capacity to date. This is enough clean energy to supply more than 80,000 homes. The Hawkeye State was largely a commercial, industrial, and residential solar market until 2020, when commercial-scale development took off. Most of the states solar capacity was installed over three recent commercial-scale baseline years, from 2020 to 2022. Although only 1% of the states electricity comes from solar power, nearly 60% of Iowas power comes from wind power, according to the Iowa Environmental Council (IEC). The SEIA projects that Iowa will add another 1.5 GW of solar power over the next five years, which would rank it 33rd among US states in terms of capacity. For its part, the IEC projects that the total cumulative wind capacity in Iowa will reach 14 GW by 2024. Incentives Although Iowa does not have a state net metering law, some utilities do offer one. Net metering consists of paying the customers bill for the excess solar production that is sent to the electricity grid. MidAmerican Energy, a Berkshire Hathaway Energy utility, and Interstate Power & Light, an Alliant Energy utility, participate in the net metering for Iowa solar systems under 500 kW, which covers all projects residential and small commercial. Iowa also offers solar easement laws and access rights that help ensure that a consumers facility is not covered by shade. According to EnergySage, some Iowa municipalities also have provisions to prevent homeowner associations from blocking a solar installation. As in most US states, solar power in Iowa is exempt from property tax. According to Zillow, purchased solar installations can increase a homes value by 4%, but that additional value will not be passed on to property tax. Iowa also has an exemption from the sales tax on electrical generating equipment, so purchasers of solar panels will be exempt from the 6% state sales tax. As in all US states, Iowa solar installations are eligible for the Solar Investment Tax Credit, a direct-pay credit that covers 30% of installed system costs. Iowa used to have a state tax credit for solar energy, though it has been phased out. The credit was 15% from 2016 to 2019, gradually reducing to 0% for systems installed after June 2022. The credit was capped at $5,000 per installation. The states tax credit program has resulted in $15 million in credits paid in the last ten years, and an average private investment of $5 million a year in the state. Some 4,600 Iowa homeowners have received loans. In March 2022, Iowa Senator Dan Zumbach (R-Des Moines) introduced legislation that could prohibit landlords from leasing their land for commercial solar use, even if their soil meets a minimum “suitability for corn” rating. . Featured Facilities The Hawkeye Solar Project received electric generation certificate approval from the Iowa Public Utilities Board in October 2022. This 200 MW solar project is expected to produce enough power for 50,000 homes. Ranger Power is the developer of this 1,500 acre solar project. The construction of the project will generate about 200 jobs. Carbon offsetting is expected to reach the equivalent of taking nearly 100,000 cars off the road. Following approval, Hawkeyes developer has targeted construction to begin in Q4 2022 or Q1 2023, with an anticipated commercial development date of Q4 2024. Located near Grand Mound, Iowa, the project represents a $250 million capital investment in the local community and is expected to generate more than $12 million in new tax revenue for the county. Tax funds are expected to go 40% to Clinton County public infrastructure and services, 50% to school districts, and 10% to local municipalities and farm tracts. As part of the land lease agreement, the project owner-operator is obligated to return the land to its state prior to the decommissioning of the project. There will be a decommissioning bond, or money set aside, to ensure funds are available to take care of restoration obligations. |
