Iowa communities that are home to coal-fueled power plants should be proactive about planning for the facilities to close. That’s one of the recommendations from a new study commissioned by the Iowa Environmental Council, which surveyed area stakeholders on the role of the plants and estimated their economic impacts to the local economy.
Iowa’s energy landscape has changed drastically in recent decades, with more wind turbines and solar panels cropping up amid the rolling acres of corn and soybeans. With the cost of renewables going down and demand going up, these clean energy resources are rapidly overtaking coal-generated energy, with significant implications for the communities that are home to the coal-burning facilities.
Iowa is currently has nine utility-owned coal plants, which employ some 613 people. The study argues that while the economic impact of eventual closing the facilities may be significant, local communities can manage the loss.
“These can be scary conversations but it’s important not to shy away from them. Communities that are proactive and plan ahead are going to be better positioned to face whatever the future brings,” said Eric Christianson, the study’s main author. “The goal of this study is to reduce some of that uncertainty, not in what the future of the plants will be but understanding the economic landscape where they’re located.”
Coal has a long history in Iowa, with 19th century settlers mining the hills of south central Iowa. Even as the mines declined and closed down, the state’s dependence on imported coal continued.
According to the report, coal-fueled power plants generated some 72 percent of the state’s electricity as recently as 2010. But by 2020, that share had dropped to just 22 percent.
At least one coal-powered plan will close next year. Alliant Energy plans to close its Lansing coal generating plant by 2022, and it has announced plans to convert its Burlington coal plant to natural gas in 2021.
Kerri Johannsen, director of the IEC’s Energy Program says it’s understandable that residents may overestimate the economic impact of the state’s remaining coal plants, because of the role they played historically.
“We understand these coal plants, many of them, have been located in the communities for a long time. There are many employees who are residents of the communities. They’re very visible,” Johannsen said. “And at one point they would’ve employed many more people than they do currently. And so it’s understandable that there’s some maybe inflation of how…much a coal plant closure would impact the community.”
Collectively the nine utility-owned plants in Allamakee, Des Moines, Linn, Louisa, Muscatine, Pottawattamie, Wapello and Woodbury Counties indirectly support the jobs of more than 1,376 people throughout the communities. According to the IEC’s analysis, that amounts to just 0.54 percent of the total jobs in the counties where the facilities are located.
The plants also contribute to local government coffers through the Utility Replacement Tax, which on average accounts for 1.47 percent of the counties’ budgeted revenues, though the amounts vary. According to the report, Allamakee County’s Lansing Generating Station, which is slated to close next year, contributes 8.61 percent to the Eastern Allamakee School District’s budget.
Today IEC released the new IA State University study reviewing the transition away from #coal-fueled electric generation & how it presents significant but manageable challenges to the 7 communities where coal-fueled #power plants are located in #Iowa. https://t.co/6372cy5zgf
— Iowa Environmental Council (@Iowa_Env) October 7, 2021
The challenges associated with a plant closure will likely be even greater in rural communities and the impacts will be felt most acutely by the workers themselves. Still, the study authors found that substitute jobs using similar skills are widely available in Iowa, though the replacement jobs may pay less than 65 percent of the power plant jobs.
“Iowa Environmental Council wanted to commission this study to really give communities the facts about how many employees there are, how those employees’ salaries and the spending and the plants in the communities impact other jobs in the area and the region, so that we can all level-set and start from a place where we’re working from the same set of information,” Johannsen said. “And so that people can plan without having to fear a future where they don’t know what the facts on the ground are.”
With a better understanding of the potential economic impacts of the plants, the study authors reason that local leaders, economic development officials and workers themselves can proactively prepare for a potential closure, with an eye on what could come next.
“By clarifying…the impact these plants are having, community leaders can begin today to build stronger and more resilient local economies,” Christianson said. “They don’t need to wonder anymore about the impact these plants are having. Potential impacts are real to local economies, local government budgets but they’re manageable with proper planning.”
