In Unanimous Decision, Iowa Supreme Court Excoriates “Crony Capitalism” in Victory for Consumers

WASHINGTON – The Iowa Supreme Court struck a blow against anticompetitive monopoly interests in its decision to issue an injunction against the state’s Right of First Refusal (ROFR). The judges issued a unanimous decision in which they described the ROFR legislation as “quintessentially crony capitalism,” returning the bill to lower courts.

In a statement, Paul Cicio Chair of the Electricity Transmission Competition Coalition said, “Iowa’s Supreme Court Justices recognized the transparent efforts of utilities to block competition and hike rates on consumers and that’s why they struck down this ROFR bill. These bills are unconstitutional and anticompetitive.”

He added, “Misguided lawmakers in several states have introduced ROFR bills, which would harm consumers and make efforts to upgrade our electrical grid prohibitively expensive. The Iowa Court decision is a victory for consumers and an important reminder that free market competition is the best way to tackle the challenge of lowering electricity costs.”

In its judgment the Iowa Justices said:

“We are not surprised the ROFR lacked enough votes to pass without logrolling. The provision is quintessentially crony capitalism. This rent-seeking, protectionist legislation is anticompetitive. Common sense tells us that competitive bidding will lower the cost of upgrading Iowa’s electric grid and that eliminating competition will enable the incumbent to command higher prices for both construction and maintenance. Ultimately, the ROFR will impose higher costs on Iowans.”

Electricity transmission competition has been shown to lower costs by as much as 40% for consumers.[1] ROFR bills cement monopoly power leading to higher monthly rates on utility bills for families and businesses. The Iowa Supreme Court put consumers first with its decision and they will be the beneficiaries.

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About the Electricity Transmission Competition Coalition

The Electricity Transmission Competition Coalition (ETCC) is a broad-based, nation-wide coalition committed to increasing competition in America’s electricity transmission infrastructure. We advocate for common-sense policies and solutions that result in competitively priced transmission projects, which reduce energy costs for all ratepayers – from large manufacturers to residential consumers. The ETCC represents a diverse group of more than 86 companies and organizations from all 50 states, including manufacturing groups, retail electric consumers, state consumer advocates, public power representatives, think tanks, and non-incumbent transmission developers.

For more information, visit: www.electricitytransmissioncompetitioncoalition.org.

Press Contact:
Julian Graham
jgraham@signaldc.com

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[1] Brattle Group: Cost Savings Offered by Competition in Electric Transmission, https://www.brattle.com/wp-content/uploads/2021/05/16726_cost_savings_offered_by_competition_in_electric_transmission.pdf