Alliant Energy Expects Lower Electric Bills in Iowa

CEDAR RAPIDS, Iowa, Jan. 12, 2011 /PRNewswire/ -- Interstate Power and Light Company (IPL), a subsidiary of Alliant Energy Corporation (NYSE: LNT), expects Iowa customers to see lower electric bills in 2011 as a result of the company's 2010 electric rate case. The expectation is based on details from the Iowa Utilities Board's (IUB) written decision order in IPL's 2010 Iowa electric rate case. Potential savings come from approval of the company's cost management plan and a small refund to certain customers.

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Customers are expected to significantly benefit from a cost management plan to reduce customer bills which was proposed by IPL and approved by the IUB. The plan will utilize approximately $200 million in expected tax benefits to provide customers a credit on their monthly electric bill over the next three years. The total amount provided under this plan could be adjusted depending on the outcome of ongoing audits with the Internal Revenue Service.  

In 2011, the plan is expected to credit customers approximately $64 million. The credit will appear as a reduction in the "Energy Cost" line item on customer bills. Residential customers will receive an average savings of approximately $3.79 each month from this plan. IPL will file annual updates to adjust the credits being returned to customers over the life of the plan.

IPL announced today its plans to not file its next electric base rate case before 2014. This commitment is part of the IUB's approval of IPL's request to adjust customer bills as transmission costs adjust. The transmission rates that IPL pays to ITC Midwest are approved by federal regulators and will change annually. These charges will appear on customer bills as a new line item labeled "Regional Transmission Service." This practice is similar to the line item IPL uses on customer bills to capture monthly adjustments in fuel costs.

The IUB's order provides details on small refunds for some IPL electric customers. Many factors, including former rate zone and rate class will determine what, if any, refund customers receive. Any refund payments will include interest. Refunds will be provided to current customers through a bill credit. Former customers who are due a refund will receive a check at the address most recently provided to IPL. The company can start identifying refund amounts for customers after final rates are put in place in mid-February. Refunds are expected to be paid to eligible customers by late spring.

New rates, as well as credits from the cost management plan will appear on customer bills beginning in approximately mid-February, pending IUB approval. The new rates will also include the final step of rate equalization, meaning each of IPL's Iowa customers in a rate class will pay the same rate for electric service.

"The IUB has struck a balance between the financial impact on our customers in today's economy and our company's need to recover critical investments to our electric system," says Tom Aller, President of IPL. "We believe the order is consistent with our company's strategic plan to provide reliable service to customers while aggressively managing the costs of providing utility service."

The IUB's order also includes additional details on an audit to review some aspects of IPL's business operations.  "We welcome this opportunity and look forward to working with the IUB on this effort," added Aller.

The following chart provides a comparison of customer bills before the 2010 rate case, during the time interim rates were in effect, and estimates of customer bills based on the IUB's final written order. This chart is based on the average monthly usage of our Iowa electric customers.  Specific customer's bills will change due to different usage patterns. The new monthly bill estimates below include updated transmission costs as well as the benefit of approximately $64 million in credits expected to be returned to customers through the company's cost management plan in 2011.

The company continues to review the written decision order from the IUB. All available detail, including expected rates and refunds, are based on the IUB's order. In rate case proceedings, the utility and all interveners have 20 days to file applications for rehearing. Until the rehearing process, if any, is completed, details of the case are not final and the information provided in this news release is subject to change.

A copy of the IUB's final written order is available on the Iowa Utilities Board web site at efs.iowa.gov/efiling/groups/external/documents/docket/056900.pdf and a summary fact sheet is available in the 'Events" section at alliantenergy.com/investors.

IPL filed its electric rate case in March 2010 to recover nearly $1 billion in investments that expanded home-grown renewable energy, reduced emissions and enhanced the safety, efficiency and reliability of the company's electric system in Iowa.

Alliant Energy is an energy-services provider with subsidiaries serving approximately 1 million electric and over 412,000 natural gas customers. Providing its customers in the Midwest with regulated electric and natural gas service is the company's primary focus.  Interstate Power and Light, the company's Iowa utility subsidiary, serves 530,000 electric and 235,000 natural gas customers and is headquartered in Cedar Rapids, Iowa.  Alliant Energy is a Fortune 1000 company traded on the New York Stock Exchange under the symbol LNT. For more information, visit the company's Web site at www.alliantenergy.com.

This press release includes forward-looking statements. These forward-looking statements can be identified as such because the statements include words such as "expected," "plan," "believes," "estimates," "approximately," or other words of similar import. Similarly, statements that describe expected outcomes in the rate case filed with the IUB are forward-looking. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those currently anticipated. Actual results could be affected by the following factors, among others:

• state regulatory or governmental actions, and future regulatory proceedings, including any reconsideration of the IUB's written order regarding electric rates in Iowa;
• economic and political conditions in IPL's service territory;
• the impact fuel and fuel-related prices and the effectiveness of continued cost control efforts and operating efficiencies; and
• our ability to successfully resolve tax audits.

These factors should be considered when evaluating the forward-looking statements and undue reliance should not be placed on such statements. The forward-looking statements included herein are made as of the date hereof and Alliant Energy and IPL undertake no obligation to update publicly such statements to reflect subsequent events or circumstances.

SOURCE Alliant Energy Corporation