Alliant Energy’s Iowa energy company reaches partial settlement on pending rate review
Proposed settlement balances customer costs with recovery of investments in Iowa’s power grid
CEDAR RAPIDS, Iowa – September 21, 2017 – Today, Alliant Energy’s Iowa energy company filed a proposed partial settlement agreement in its 2017 electric rate review. This agreement creates cost certainty for customers and allows Alliant Energy to continue to advance cleaner energy, to strengthen the reliability of Iowa’s power grid and provide innovative customer solutions.
“This collaborative process with our customer groups and our company created a fair agreement that supports our objective to provide exceptional service to our customers,” said Doug Kopp, President of Alliant Energy’s Iowa utility. “I want to thank the Iowa Office of Consumer Advocate, the Iowa Business Energy Coalition and the Large Energy Group for coming together on this agreement.”
On April 3, 2017, Alliant Energy filed its first rate review in six years. An interim base rate increase went into effect ten days later. This agreement increases base rates less than 2 percent above interim rates.
Under this agreement, the total increase from this base rate review would be 8.6 percent. Spread over the last six years, this increase would have equated to less than 1.5 percent annually. The final bill impact for each customer class will be decided as part of the rest of the rate review process.
Through the rest of 2017, customers will also continue to receive bill credits related to tax benefits and refunds on transmission expenses to offset the base rate increases and maintain competitive customer costs. In addition, under this agreement Alliant Energy will give more tax-related bill credits to customers in 2018.
Key details of the proposed settlement:
- Final annual retail electric revenue requirement of $130 million
- Electric rate base of $4.2 billion, including deferred tax assets for production tax credits and post-test year additions through the third quarter of 2017. Retail electric rate base of $4.0 billion.
- Blended return on equity (ROE) of approximately 10%. ROE for all non-ratemaking principle assets of 9.6%
- No application of double leverage
- Common equity component of regulatory capital structure of 49%
- Agreement on fixed monthly customer charges ($11.50 residential, $19.00 general service)
This settlement will result in a modest, one-time charge associated with certain regulatory assets. Not all interested parties in the rate review have agreed to the proposed settlement.
The settlement does not include items such as the transmission rider, rate design and class cost of service, which will be addressed as part of the rest of the rate review process. The next step of the process is the hearing in front of the Iowa Utilities Board starting on October 4, 2017. The IUB has 10 months from the date of filing (April 3, 2017) to issue a final decision. The proposed settlement agreement filing is available on the Board’s electronic filing system. The filing is under docket number RPU-2017-0001.
Media contact: Justin Foss, (319) 786-4040
Investor contact: Susan Trapp Gille, (608) 458-3956
Alliant Energy Forward-Looking Statement
This press release includes forward-looking statements. These forward-looking statements describe the details of the proposed rate review settlement. These details are subject to final approval by the IUB and could change, possibly materially, prior to final approval. The forward-looking statements included herein are made as of the date hereof and Alliant Energy and Interstate Power and Light Company undertake no obligation to update publicly such statements to reflect subsequent events or circumstances.