Senate approves renewable energy development fund

BYLINE: Roos Jonathan

The $100 million initiative aims to spur research and development.

By JONATHAN ROOS

REGISTER STAFF WRITER

An effort to spur development of Iowa's renewable energy industry and help wean the state from its dependence on imported oil is gathering a head of steam in the Legislature.

The Senate on Thursday approved the creation of a $100 million Iowa Power Fund.

Senate File 599, passed on a 36-13 vote, also contains the framework for spending the money under the direction of a proposed state Office of Energy Independence and a new, 18-member board.

Gov. Chet Culver has been traveling around Iowa trying to pump up support for the fund along the lines he has recommended - with relatively few strings attached for spending the money on renewable energy projects.

The proposed research, development and commercialization fund is a centerpiece of the new Democratic governor's agenda for the 2007 legislative session, which is expected to end next week.

The $100 million fund would be created in $25 million installments over four years. The legislation would earmark at least 10 percent for energy efficiency and conservation initiatives. Also, $2.5 million would be reserved annually for worker training focused on the renewable energy industry.

Critics questioned whether the proposed economic development program was a "grab bag" that lacks direction.

"It is very unclear what the resulting goals of the plan will be," said Sen. Jeff Angelo, a Creston Republican.

Supporters of the plan disagreed. "The Iowa Power Fund is a big step that will encourage the production of alternative, Iowa-grown energy," said Sen. Bill Dotzler, a Waterloo Democrat who guided the bill through Senate debate.

Dotzler said the plan contains a number of safeguards for spending the money.

The Office of Energy Independence would take applications and examine proposals. A seven-member "due diligence" committee would review the feasibility of the projects, and the 18-member Iowa Power Fund Board would decide whether to provide financial incentives.

The board would include seven people appointed by the governor who have experience or expertise in such areas as renewable fuels, agribusiness and finance.

State officials say they want to build on the leadership that Iowa has already established in some areas: first in the nation in ethanol production capacity, second in biodiesel production, third in wind power.

The bill now goes to the House for more debate.

Reporter Jonathan Roos can be reached at (515) 284-8443 or jroos@dmreg.com