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Iowa technology companies that face the “valley of death” in bringing their energy innovations to market will have a new pathway to success beginning this year, as the Iowa Power Fund swings into action.

“I actually think there are 50 valleys of death,” said Roya Stanley, director of the Iowa Office of Energy Independence. “This (fund) is an opportunity for government to help ensure they get over the (gap in financing) and get the new technology into the marketplace in a way that supports the economy.”

Created by the Legislature less than a year ago, the Office of Energy Independence is responsible for administering the Iowa Power Fund as well as creating a broad array of educational programs promoting renewable energy sources, encouraging conservation and reducing greenhouse gas emissions.

The 18-member Iowa Power Fund board, chaired by retired insurance executive Fred Hubbell, has the authority to extend loans and grants to help boost renewable-energy research and development activity. The board expects to begin making awards this spring, Hubbell said. The Power Fund received a $25 million appropriation from the Legislature last year and anticipates receiving $25 million annually in each of the next three years.

“So far, it’s been very interesting,” said Hubbell, who moved back to Iowa a year ago from Amsterdam, where he oversaw U.S. and Dutch insurance operations for ING Groep N.V. “There are a lot of models to follow to get this started, but it is a new board, so we had to create all new roles and process, forms and applications. So that’s what we’ve spent a lot of time doing, and we’re pretty much done with all that.”

Another of the board’s accomplishments was delivering an initial state energy plan to the governor and Legislature by the designated deadline of Dec. 14, Hubbell said.

“Now, we’re ready to seriously begin looking at formal applications (for Power Fund money),” he said. “I would say I’m very impressed with the commitment and attention from the fellow board members. We’ve had nearly 100 percent participation in the meetings so far. We never lack for good discussion on the important topics, which is great.”

Stanley, who was appointed by the governor to her position last summer and began her duties on Aug. 30, said the new department has been able to get on its feet quickly through cooperation with other energy-related state agencies. The four-person office works collaboratively with the Iowa Utilities Board, the Iowa Department of Natural Resources and other agencies, she said.

“There’s a lot of support for (the agency), and I would even argue that there’s a pent-up demand for it,” said Stanley, who also returned to Iowa last year, after holding a top position with the U.S. Department of Energy’s National Renewable Energy Laboratory.

“Many times a day, I get calls or I see people in the Legislature and they want something and they want it yesterday,” she said. “Sometimes it’s a plan, or more support for a particular activity. That pent-up demand really does intersect with the support we’ve gotten from the Legislature and the governor and the other state agencies.”

Each request for Power Fund money will be reviewed by the Office of Energy Independence staff and then a due-diligence committee before proceeding to the full board. Awards will be made to four types of projects: commercialization, research and development, education and a catch-all “other” category.

“In every case, but it will be different by each case,” Hubbell said, “we would expect there would be some money at risk by the people that are asking us to put money in, and there should also be money from other sources, whether it be federal money, other state money or from lenders or investors. We hope to leverage the state’s money to get several sources of additional money coming in.”

Asked about the priority placed on creating jobs, Hubbell said that’s a consideration, but not the most important criterion.

“We’re not going to fund an ethanol plant that’s the current state-of-the-art,” he said. “But there may be a ‘valley of death’ between the current form of ethanol plant and one that truly can derive all its energy from things other than coal or natural gas. If we can help somebody develop that and build those in Iowa, that’s a heck of an opportunity for the state, and that’s something we’ll pay some attention to. And it may take some Power Fund money to encourage people to take those risks.”

Besides beginning to provide matching research dollars through the Power Fund, Stanley said another top agency priority this year will be to further develop the state’s energy plan.

“In addition to that, we’re likely to be working with other state agencies to support some initiatives,” she said. “For example, expanding the infrastructure for E85 fueling stations, and in that context, also working more closely with the Governor’s Ethanol Coalition. With regard to biofuels, we anticipate working more closely with the Iowa Biodiesel Board and helping them with infrastructure build-out and other barriers they’ve encountered in building their business.”

Two new state office buildings planned for the Capitol complex offer a prime opportunity for the state to lead by example by designing green buildings, Stanley said.

“I think of it as being energy-optimum – what are all the things we need to do to ensure that happens?” she said. “And ultimately, as the state leads by example, the capacity that’s built in the private sector gets transferred to the private sector. That is, when you are designing new buildings, it’s private architects and engineers you’re working with, and they’re gaining capacity in different approaches.”

“And by designing a building in a very environmentally friendly way to begin with,” Hubbell said, “you can get those upfront costs to be competitive. … It takes more willingness to plan upfront to design a building in an environmentally effective way.”

As for energy-related legislation that might be introduced this session, Stanley said she anticipates the governor’s office will propose an energy bill based on recommendations from the first energy report, “and we’ll be working very closely with the governor’s office on that.”

“Probably the most important thing,” Hubbell said, “is the governor and the leaders of the Legislature have all come out and said they do plan on continuing to fund the Power Fund for a second year. It’s not automatic; there is a commitment to do it for four years, but each year they have to agree to put the money there. It’s pretty good evidence that the direction’s not changed and the commitment’s still there.”