LETTER TO MEMBERS CONCERNING NEW PURPA STANDARDS
AS SET FORTH IN THE INFRASTRUCTURE INVESTMENT AND JOBS ACT OF 2021
On November 15, 2021, the Infrastructure Investment and Jobs Act of 2021 ("IIJA") was signed into law. Certain provisions in the IIJA amend the Public Utility Regulatory Policies Act ("PURPA") of 1978. The IIJA adds two (2) new federal rate-making standards to PURPA. The two standards regard Demand Response Practices and Electric Vehicle Charging Programs. Under the IIJA, your cooperative must consider each of these new standards and determine whether to adopt them. Your cooperative has a specific timeline within which to consider each of these standards.
At its October 27, 2022 meeting, the Board of Directors of your Cooperative adopted a resolution providing for the consideration of the new PURPA standards. The management and staff of Iowa Lakes Electric Cooperative were directed to determine the best procedure to complete the consideration, including the procedure for soliciting comments from interested persons or entities. The Cooperative has decided to solicit written comments from its members regarding each of the standards. Cooperative staff also intends to gather various publicly available industry information concerning the standards and will be monitoring the progress of other utilities and state regulatory bodies as they undertake a similar consideration process. Once all of the information has been gathered, the Cooperative Board of Directors will either make a written determination concerning each standard or, if it deems necessary, prescribe what additional procedures should be followed in order to develop sufficient information from which to make a determination concerning each standard.
Set forth below is a description of each of the two new PURPA standards, as well as an identification of the deadline within which the cooperative must make a decision concerning each standard. The Cooperative has set forth specific questions within the discussion of each standard and is soliciting written comments or responses from its interested member-owners concerning these questions. However, any member-owner wishing to submit written comments should feel free to provide whatever additional information they deem relevant to the Cooperative's decision-making process. Any interested member-owners wishing to submit written comments responding to the questions outlined herein shall submit those comments in writing on or before June 30, 2023. Responses may be mailed to the cooperative office Attn: Jen Sievert, 702 South 1st Street, Estherville, Iowa 51334, e-mailed to the cooperative at JenniferS@ilec.coop or submitted through the Cooperative website at www.ilec.coop/purpa-notice.
As you review this information, please keep in mind that the cooperative must make its own independent determination concerning each of the PURPA standards. The standards are to be considered in light of the purposes and goals of PURPA, namely: (1) conservation of energy supplied by electric utilities; (2) optimal efficiency of electric utility facilities and resources; and (3) equitable rates for electric member-owners. The Cooperative may implement any of the standards or decline to implement any standard.
Two New Standards
In general, the standard provides that:
Each electric utility shall promote the use of demand-response and demand flexibility practices by commercial, residential, and industrial member-owners to reduce electricity consumption during periods of unusually high demand.
A nonregulated electric utility may establish rate mechanisms for the timely recovery of the costs of promoting demand-response and demand flexibility practices in accordance with this standard.
2. Electric vehicle charging programs
In general, the standard provides that each State shall consider measures to promote greater electrification of the transportation sector, including the establishment of rates that-
promote affordable and equitable electric vehicle charging options for residential, commercial, and public electric vehicle charging infrastructure;
improve the member-owner experience associated with electric vehicle charging, including by reducing charging times for light-, medium-, and heavy-duty vehicles;
accelerate third-party investment in electric vehicle charging for light-, medium-, and heavy duty vehicles; and
appropriately recover the marginal costs of delivering electricity to electric vehicles and electric vehicle charging infrastructure.
With respect to the new PURPA standard concerning demand response, the Cooperative is soliciting input and answers from its member-owners to the following questions:
Do you actively participate in the Cooperative's current load management program?
Do you monitor peak alert notices on your Cooperative’s website?
If so, what action do you take to try and reduce your energy consumption at the peak times?
Do you have back-up generation or energy supply options?
What recommendations would you have, if any, concerning the Cooperative's rate structure regarding demand response practices?
As part of the Cooperative's consideration of the standard on electric vehicle charging, the Cooperative is soliciting input from its member-owners concerning the following questions:
Do you own an electric vehicle?
If you do, where do you do most of your charging of the vehicle?
If you do not, would additional rebates or other incentives on charging equipment influence your decision to invest in an electric vehicle or not? If so, what level of rebate would be impactful?
If you own or were to own an electric vehicle, would you modify your charging habits to only charge your vehicle during periods of time when the energy rate was lower?
Do you believe the Cooperative should spend additional resources to promote electric vehicles or promote electric vehicle infrastructure?
Conclusions and Procedure
The Cooperative Board of Directors has until November 15, 2023 to make a determination regarding each of the new PURPA rate-making standards. The Cooperative staff understands that many of the issues that will need to be considered relative to the standards are complicated and can be both legally and technologically complex. Many of the Cooperative's member-owners may not be interested in responding to the inquiries contained in this letter or participating in the decision-making process. Rest assured that the Cooperative staff will investigate all of these issues thoroughly and will be providing significant information to the Board of Directors in order to assist the Board of Directors in its decision-making process. However, the Cooperative also wants to make sure that its member-owners, who will be affected by the decisions of the Board of Directors, have full and ample opportunity to participate and submit comments.
Any member-owners wishing to respond to the questions set forth in this letter should do so in writing, with the comments or responses being submitted to the Cooperative on or before June 30, 2023. As noted at the beginning of this letter, these comments can be submitted by mailing them to the Cooperative's office Attn: Jennifer Sievert, 702 1st Ave South, Estherville, Iowa 51334, e-mailing them to the cooperative at Jennifers@ilec.coop, or by submitting on our website at https://www.ilec.coop/purpa-notice. All of the comments and responses submitted will be considered by the Board of Directors, together with the other material generated by Cooperative staff. The Cooperative Board of Directors will then make a determination concerning each standard prior to the applicable deadline. The member-owners will be notified of the Cooperative's decision concerning each standard through the Cooperative newsletter. Copies of the decision will also be mailed directly to each individual member-owner who submits written comments or responses to the questions set forth herein. Any member-owner who has questions concerning this process or the PURPA requirements generally, is encouraged to contact the Cooperative office at 800-225-4532 and speak with Jennifer Sievert.
Board of Directors and Management
Iowa Lakes Electric Cooperative