# Flexible rates.

**Citation:** 199 IAC 19.11  
**Type / status:** regulation / current  
**Agency:** Iowa Utilities Commission  
**Effective:** 2025-07-16  
**Published:** 2026-08-19

19.11(1) Purpose. This rule is intended to allow gas utility companies to offer, at their option, incentive or discount rates to their sales and transportation customers. 19.11(2) General criteria. a. Natural gas utility companies may offer discounts to individual customers, to selected groups of cu

## Document text

19.11(1) Purpose. This rule is intended to allow gas utility companies to offer, at their option, incentive or discount rates to their sales and transportation customers.

19.11(2) General criteria.

a. Natural gas utility companies may offer discounts to individual customers, to selected groups of customers, or to an entire class of customers. However, discounted rates must be offered to all directly competing customers in the same service territory. Customers are direct competitors if they make the same end product (or offer the same service) for the same general group of customers. Customers that only produce component parts of the same end product are not directly competing customers.

b. In deciding whether to offer a specific discount, the utility shall evaluate the individual customer's, group's, or class's situation and perform a cost-benefit analysis before offering the discount.

c. Any discount offered should be such as to significantly affect the customer's or customers' decision to stay on the system or to increase consumption.

d. The consequences of offering the discount should be beneficial to all customers and to the utility. Other customers should not be at risk of loss as a result of these discounts; in addition, the offering of discounts shall in no way lead to subsidization of the discounted rates by other customers in the same or different classes.

19.11(3) Tariffs. If a company elects to offer flexible rates, the utility shall file for review and approval of tariff sheets specifying the general conditions for offering discounted rates. The tariff sheets shall include, at a minimum, the following criteria:

a. A cost-benefit analysis demonstrating that offering the discount will be more beneficial than not offering the discount.

b. The ceiling for all discounted rates shall be the approved rate on file for the customer's rate class.

c. The floor for the discount sales rates shall be equal to the cost of gas. Therefore, the maximum discount allowed under the sales or transportation tariffs is equal to the nongas costs of serving the customer.

d. No discount shall be offered for a period longer than five years unless the commission determines upon good cause shown that a longer period is warranted.

e. Discounts should not be offered if they will encourage deterioration in the load characteristics of the customer receiving the discount.

f. Customer charges may be discounted.

19.11(4) Reporting. Each natural gas utility electing to offer flexible rates shall file annual reports with the commission within 30 days of the end of each 12 months. Reports shall include the following information:

a. Section 1 of the report concerns discounts initiated in the last 12 months, which shall include:

(1) The identity of the new customers (by account number, if necessary);

(2) The value of the discount offered;

(3) The cost-benefit analysis results;

(4) The cost of alternate fuels available to the customer, if relevant;

(5) The volume of gas sold to or transported for the customer in the preceding 12 months; and

(6) A copy of all new or revised flexible-rate contracts executed between the utility and its customers.

b. Section 2 of the report relates to overall program evaluation. For all discounts currently being offered, the report shall include:

(1) The identity of each customer (by account number, if necessary);

(2) The total volume of gas sold or transported in the last 12 months to each customer at discounted rates, by month;

(3) The volume of gas sold or transported to each customer in the same 12 months of the preceding year, by month;

(4) The dollar value of the discount in the last 12 months to each customer, by month;

(5) The dollar value of volumes sold or transported to each customer for each of the previous 12 months; and

(6) If customer charges are discounted, the dollar value of the discount shall be reported separately.

c. Section 3 of the report concerns discounts denied or discounts terminated. For all customers specifically evaluated and denied or having a discount terminated in the last 12 months, the report shall include:

(1) Customer identification (by account number, if necessary);

(2) The volume of gas sold or transported in the last 12 months to each customer, by month;

(3) The volume of gas sold or transported to each customer in the same 12 months of the preceding year, by month; and

(4) The dollar value of volumes sold or transported to each customer for each of the past 12 months.

d. No report is required if the utility had no customers receiving a discount during the relevant period and had no customers that were evaluated for the discount and rejected during the relevant period.

19.11(5) Rate case treatment. In a rate case, 50 percent of any identifiable increase in net revenues will be used to reduce rates for all customers; the remaining 50 percent of the identifiable increase in net revenues may be kept by the utility. If there is a decrease in revenues due to the discount, the utility's test year revenues will be adjusted to remove the effects of the discount by assuming that all sales or transportation services or customer charges were made at full tariffed rates for the customer class. Determining the actual amount will be a factual determination to be made in the rate case.

## Provenance

- Official: Yes
- Source: <https://www.legis.iowa.gov/DOCS/ACO/IAC/LINC/Chapter.199.19.pdf>
- Source ID: `ia-legislature-pipeline-safety`
- SHA-256: `3083cb9fb40745bea2f8f3411c03cb320149497c9a85f83196239ac0837bbc9a`
- Retrieved: 2026-08-20T08:17:15.771Z
- Exported: 2026-08-24T11:29:31.545Z
- Document slug: `ia-iac-199-19-11`

### Source metadata

```json
{
  "jurisdiction": "US-IA",
  "chapter": "199 IAC chapter 19",
  "exactScope": "This bounded corpus contains every current rule in 199 IAC chapters 10 and 19, the two chapters identified by the Iowa Utilities Commission pipeline-safety page, plus 15 selected Iowa Code sections that directly establish gas-utility applicability, inspection and rulemaking authority, enforcement, penalties, and acceptance of federal pipeline-safety aid. It does not claim all Iowa pipeline law or all of Iowa Code chapters 476 and 479.",
  "excludedScope": "Excluded are hazardous-liquid safety (which the IUC says remains exclusively with PHMSA), hazardous-liquid permitting in 199 IAC chapter 13 and Iowa Code chapter 479B, damage prevention and one-call law, agricultural restoration chapter 9, railroad-crossing chapter 42, general procedure and filing chapters, permits/orders/forms, privately owned propane service, and federal or private incorporated text. Former 199 IAC chapter 12 is inventoried as repealed and is not searchable.",
  "applicabilityCaveat": "Applicability depends on IUC jurisdiction, public-utility or pipeline-company status, intrastate versus interstate status, the gas and facility involved, customer count, rate regulation, exemptions, federal preemption, waivers, permits, tariffs, and Commission orders. Iowa inspects interstate gas operators only as PHMSA's agent; federal authorities retain enforcement. Chapter 19 is limited to rate-regulated gas utilities except where another law or order extends a duty.",
  "incorporationCaveat": "The rules incorporate or reference 49 CFR Parts 191, 192, 193, and 199; ASME B31.8-2022; NFPA 59-2024, NFPA 54-2024, and NFPA 501A-2021; other Iowa rules and statutes; federal forms and interpretations; and utility tariffs. The connector records citations but does not reproduce incorporated federal or private material, decide which edition controls beyond the state text, or grant rights in private standards.",
  "publicationCaveat": "The current IAC chapter listings dated August 5, 2026 are used to prove chapter and rule inventory; their official PDF and DOCX-formatted 'RTF' artifacts are archived independently. The official 2026 Iowa Code was published December 22, 2025. The live 2026 Code & Acts Sections Amended report is provisional; signed HF 2799 sections 23 and 24, effective July 1, 2026, are preserved as overlays to selected sections 476.1B and 476.2. Any unexpected selected-section amendment causes refresh failure.",
  "rights": "Iowa legal text and other government edicts are preserved with official attribution and cryptographic provenance. Public access does not grant rights in agency seals, website presentation, forms, utility filings, incorporated federal compilations, or privately authored standards; redistribution of those materials requires a separate rights review.",
  "references": [],
  "sourceHistory": "[ARC 9351C, IAB 6/11/25, effective 7/16/25]",
  "region": "IA"
}
```