Iowa state regulators must consider environmental arguments for closing coal plants, Supreme Court says

Source: By Donnelle Eller, Des Moines Register • Posted: Monday, May 1, 2023

State regulators must consider environmental groups’ arguments for retiring some of MidAmerican Energy’s coal plants as a way to reduce greenhouse gas emissions, the Iowa Supreme Court ruled Friday.

The high court’s decision reversed a lower court ruling and sent the case back to the Iowa Utilities Board for consideration. At issue is MidAmerican Energy’s plan for cost-effectively meeting state and federal air quality standards while reliably providing power.

Both MidAmerican and the Iowa Utilities Board declined to comment Friday. MidAmerican, the Des Moines utility owned by Warren Buffett’s Berkshire Hathaway, said it’s still reviewing the ruling. The utilities board said it doesn’t comment on pending litigation.

The Iowa Environmental Council, the Environmental Law & Policy Center and Sierra Club, which successfully challenged the utilities board’s decision, lauded the ruling.

“Whenever MidAmerican is proposing to spend money on its coal plants, customers deserve to know whether it would instead save money to retire them and replace them with clean, emissions free electricity resources like wind, solar, and battery storage that also help fuel Iowa’s economy,” Laurie Williams, senior attorney for the Sierra Club’s Beyond Coal Campaign, said in a statement.

The ruling centers on an emissions management plan MidAmerican submitted to the utilities board in 2020, outlining the continued operation and maintenance of four coal-fired power plants: Walter Scott Jr. Energy Center Unit 3, George Neal Energy Center Unit 3 and Unit 4, and the Louisa Generating Station.

State law requires the regulators to evaluate utilities’ plans to manage emissions, and once approved, the utilities can then recover the plans’ costs from consumers. The Iowa Utilities Board approved MidAmerican’s plan, allowing the company to recoup costs through 2022.

The state’s high court, however, said in its ruling the state utilities board failed to consider expert testimony, on behalf of environmental groups and the Iowa attorney general’s consumer advocate, that it would be more cost-effective to retire two coal-fired power plants and replace them with renewable energy.

The groups argued the change could be made without reducing MidAmerican’s ability to provide electricity reliably and affordably.

The state utilities board, however, argued it considered the options presented by the consumer advocate and the environmental groups to be outside the scope of the proceedings. And a Polk County district court, asked to review the decision, sided with the utility board.

When the appeal moved to the high court, MidAmerican said state law neither allows the environmental groups or consumer advocate to “foist alternative budgets and plans on the utility, nor allows the board to consider or approve alternative budgets and plans,” the ruling said.

However, the high court said that MidAmerican has asked the utilities board to consider coal plant retirements when it submitted emissions plans in 2014, 2016 and 2018. “The board argues, and the district court agreed, that the board’s past practice of considering plant retirement is not relevant here because in those prior cases, plant retirement was advanced by the utility rather than an intervening party,” the court said.

“We think the distinction is immaterial and misses the point. If facility retirement was a relevant means of ‘managing regulated emissions from its facilities in a cost-effective manner’ when MidAmerican proposed it, it must also be relevant when offered into evidence” by environmental groups and the consumer advocate, the court said.

All but Justice David May participated in the decision, the court said.

Donnelle Eller covers agriculture, the environment and energy for the Register. Reach her at or 515-284-8457.