Iowa State University announced that it has begun to evaluate a potential public/private partnership. The university presented plans to the state Board of Regents to upgrade its utility system Thursday. After the University of Iowa’s historic public/private partnership reached financial close in March, Iowa State University is now researching and evaluating its own opportunities for a public/private partnership.
ISU Interim Senior Vice President for Operations and Finance Pam Cain spoke about the university’s plans at a virtual state Board of Regents meeting Thursday. She said ISU’s overall goal in exploring a potential public/private partnership is to benefit the university and enhance the value of its utility system.
“Iowa State [University] is researching and evaluating P3 opportunities that might exist… to leverage innovation and capture efficiency for the benefit of the university,” she said. The UI began exploring public/private partnerships in 2018 when Gov. Kim Reynolds wrote a letter to Regent President Mike Richards on the topic, asking the institutions’ leaders to consider such agreements.
As The Daily Iowan previously reported, UI President Bruce Harreld and the board signed a $1.1 billion upfront deal with ENGIE/Meridiam, a French energy conglomerate in January. The deal is expected to grow to $3 billion over the 50-year partnership. Regardless of financial losses due to the COVID-19 outbreak, Harreld told the DI in an interview on May 6 that the university still has just under $1 billion in cash and remains in an economically sound position.
As it begins the process of evaluating a public/private partnership, ISU is already changing the way its utility system is structured. The university received approval from the board to proceed with project planning for improvements to the university’s utility system on Thursday. Cain presented the plan to reconfigure two 32-year-old coal-fired boilers to natural gas boilers.
Cain said the estimated cost of the project is $12 to $14 million and it will run parallel with the university’s public/private partnership efforts. She said the project will also increase the value of the utility system. “This capital improvement project is aligned with Iowa State’s campus sustainability goals,” Cain said. “It will allow the university to become coal-free and reduce greenhouse gas emissions by 35 percent by the year 2023.”