Another threat to energy conservation programs has emerged in the Iowa Legislature.

One week after a bill to repeal utilities’ energy efficiency requirements surfaced in the state Senate, a broad public utility reform bill is set to reach a subcommittee Thursday.

The study bill (SSB3093) would let large industrial customers opt out of efficiency programs, allow utilities to apply a different cost-effectiveness formula, and also require each initiative be cost-effective on its own instead of evaluating the portfolio as a whole. It would also cap efficiency spending at 2 percent of a utilities’ revenue.

“It’s a significant scaling back of energy efficiency, and a step away from our leadership on energy efficiency,” Environmental Law & Policy Center attorney Josh Mandelbaum said.

The bill, set to be discussed in a Commerce subcommittee meeting Thursday, was introduced by State Sen. Jake Chapman with support from Interstate Power & Light, one of the state’s largest investor-owned utilities.

Chapman did not respond to an interview request.

Interstate Power spokesman Justin Foss responded to questions about the bill with a brief statement:

“Iowa has been a pioneer in renewable energy and energy policy, providing economic growth for the state. To maintain this leadership position, Iowa needs updated policies to continue to promote the integration of new energy technologies, reduce regulatory inefficiencies, help customers save money, and provide even more opportunities for business growth and job creation.”

Other supporters include Black Hills Energy, a smaller investor-owned utility, the Iowa Association of Municipal Utilities, and the Iowa Association of Electric Cooperatives. MidAmerican Energy is seeking similar changes in its next five-year energy efficiency plan, now under consideration by the Iowa Utilities Board.

The bill goes beyond efficiency and includes proposed changes to how utilities interact with customers who generate their own electricity. It likely would make it easier for utilities to impose fees on solar or other renewable-generating customers based on differences in the cost of serving them, or differences in the amount of energy they use.

Kerri Johannsen, who lobbies on behalf of the Iowa Environmental Council, said the language “would allow utilities to create rates that are discriminatory towards customers with distributed generation.”

The bill would also give the Iowa Utility Board only 30 days to rule on rate changes that are revenue-neutral or voluntary for customer.

“In 30 days, you can’t even collect [necessary] information, let alone analyze and challenge it,” Mandelbaum said. “There’s a reason why rate-design cases go on for almost a year.”