Special guest editorial by Leslie Kaufmanm executive vice president and general manager of the Iowa Association of Electric Cooperatives. 

At the Iowa Association of Electric Cooperatives, we are constantly monitoring issues that could impact the people and rural communities served by Iowa’s electric cooperatives. Our state’s 2025 Legislative Session will begin on January 13 and IAEC will prioritize efforts to ensure Iowa’s law regarding defined service areas is not undermined. I’d like to explain why this law has been so crucial to our mission to serve co-op member-consumers.
 

What are defined service areas?

In Iowa, your location determines which electric utility will serve you. This regulatory protection is called defined electric service territory and the State of Iowa wrote Senate File 1258 into law almost 50 years ago to efficiently ensure that every square foot of our state has an electric utility obligated to provide service upon request. 

Why do Iowa's electric cooperatives support defined service areas?

Electric co-ops are committed to safeguarding defined service areas because they protect rural Iowans by supporting affordable electric rates, fostering a resilient electric grid and encouraging economic development. 

Defined service areas provide a high degree of certainty to Iowa’s electric cooperatives which allows us to confidently make long-term investments in power generation to maintain affordable rates, finance major grid upgrades to ensure resiliency and utilize new technologies to enhance service. Electric co-ops can also be proactive in maintenance and vegetation management to improve reliability for the homes, farms and businesses we serve every day. Additionally, defined service areas allow electric co-ops to robustly support economic development efforts in the communities we serve, which retain and create local jobs and provide needed services and tax revenue.

Any efforts to remove or weaken Iowa’s defined service areas could result in higher electric bills and decreased reliability for Iowans. This issue is non-negotiable for Iowa’s not-for-profit electric cooperatives, which are mission driven to power lives and empower communities by providing electricity that is safe, reliable and affordable.

Since the 1990s, several states have deregulated their electric utilities, but the hopes that competition would result in lower rates and improved reliability have not materialized. In fact, according to a 2023 New York Times investigation, "Deregulation has resulted in increased rates/fees in every state where it has been introduced." The report goes on to conclude that "On average, residents living in a deregulated market pay $40 more per month for electricity…” This outcome is unacceptable for the Iowans we serve.

We invite you to learn more about this issue at www.ProtectRuralIowa.com where you will also find links to research and studies on deregulation. Your locally owned electric cooperatives are working hard to safeguard defined service area protections that have benefitted Iowans since 1976.