Luther’s energy provider Alliant to increase rates

As+Luther%27s+consumption+has+decreased%2C+the+price+per+kilowatt+hour+has+increased+an+average+f+4.72+percent+annually+from+2003+to+2018.

Graph courtesy of Jay Uthoff

As Luther's consumption has decreased, the price per kilowatt hour has increased an average f 4.72 percent annually from 2003 to 2018.

Luther’s energy provider Alliant Energy announced a potential rate increase of 33%, or around $260,000 more per year for Luther. Luther partnered with the city of Decorah, the Winneshiek Energy District, Winneshiek Medical Center, and the Aase Haugen Nursing Home to form the Decorah Area Group, which brought a case against the rate increase with the assistance of a lawyer and other consultants.

In a customer notice, Alliant Energy stated that the increase for 2020 was due to their expansion in renewable energy and advancements in metering, among other improvements to their services. The Decorah Area Group was able to reduce the 33% increase down to about 11% for Luther, or about a $100,000 increase for 2020-2021. Luther paid approximately $980,000 for the 2018-2019 academic year.

Professor of Religion and Director of the Center for Sustainable Communities Jim Martin-Schramm was involved with the Decorah Area Group that brought the case against Alliant Energy.

“The consumer advocate can only do so much,” Martin-Schramm said. “They are only one voice, so we thought we needed to defend our interests. We had a lawyer, we had utility analysts, and we had to hire experts to represent us.”

After a process that took nearly 10 months, they reached a settlement agreement to reduce the rate increase. Luther had to negotiate with Alliant Energy because it is their only option as an energy supplier.

“In Iowa, there isn’t market competition,” Martin-Schramm said. “We can only buy electricity from Alliant Energy. We are in their service territory, and everybody in Decorah must buy energy from Alliant.”

This situation has led to a monopoly of energy for Alliant Energy. Because there is no competition, they can raise their prices without the risk that their customers might choose another option. However, any rate increase has to be

approved by the Iowa Utilities Board. According to Iowa’s Legislative Service Agency, Alliant Energy’s rates increased by about 45% between 2008 and 2018. Mid American, the other investor owned utility serving Iowa, increased rates by about 25% in that same period.
Luther has offset some of the rising costs over the years through improvements in energy efficiency and increased use of renewable energy sources like wind and solar power. Energy usage on campus has decreased from nearly 18 million kilowatt hours of electricity in 2002-2003 to approximately 12 to 13 million kilowatt hours in 2018-2019.

According to Director of Facilities Services Jay Uthoff, Luther’s electricity use has been on a downward trend since 2003, even with the addition of the Sampson- Hoffland Laboratories and air conditioning in multiple buildings.

“We continue to work on energy efficiency projects, such as replacement of lamps with LEDs, motor controls, scheduling of HVAC equipment, and preventive maintenance of our existing equipment,” Uthoff said.

Uthoff hopes new technology will bring a 5% reduction in energy use and more cognizant behaviors will reduce consumption an additional 2 to 3%.

In 2018-2019, students paid around $500 each for electricity on campus, which is included in the comprehensive fee. The rate increase could potentially add costs to tuition.

“I would imagine that that means tuition will increase, and that obviously is not thrilling to me, but I do like the idea of providing more sustainable options,” August Halverson (‘23) said. “If we could use this to incentivize the investment in better forms of energy, that would be a good silver lining. I know that [the Environmental Concerns Organization] can promote awareness on this topic, and I also think that Luther Sustainability does similar things.”

Alliant Energy is likely to continue to increase its prices for the coming years. Uthoff stressed that students have a role in keeping costs down and that the rate increase affects them.

“Students can do their part by being aware of energy consumption and turning off lights and appliances,” Uthoff said. “We all have a hand in conservation practices.”

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