The state Judicial Building.
The Iowa Supreme Court has overturned lower court rulings that blocked two Missouri-based utility companies from building new electric transmission lines in the state.
LS Power Midcontinent and Southwest Transmission challenged a law passed in 2020 that gave those who already owned electric lines in the state the right of first refusal on new projects. The Missouri companies brought the case against the Iowa Utilities Board and MidAmerican Energy Company and ITC Midwest, which already build transmission lines in the state.
The lower courts ruled the two companies had no case because there was not a current project they were bidding on. The Iowa Supreme Court ruled the companies are qualified to supply transmission lines and they would be harmed by not being able to bid on new projects. The ruling says “the provision is quintessentially crony capitalism. This rent-seeking, protectionist legislation is anti-competitive. 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.”
The Supreme Court also ruled in favor of their argument that the Right of First Refusal issue was improperly thrown into an omnibus bill that passed late in the legislative session. The court says the issue did not have the votes to pass on its own and attaching it to a bill that is sure to pass is a hallmark of what’s known as logrolling.
The Supreme Court vacated the judgment of the court of appeals and reverse the judgment of the district court. They sent the case back to the district court to decide the merits of LSP’s claims the Right of First Refusal is unconstitutional.
Here’s the full ruling: Transmission line ruling PDF