Consumer Information Energy Telecommunications
Elizabeth S. Jacobs
Chair
Nick Wagner
Board Member
Sheila K. Tipton
Board Member

Docket No. RPU-2012-0002: Alliant Energy/Interstate Power and Light Company's Natural Gas Service Rate Increase

On May 25, 2012, Interstate Power and Light Company (IPL), an Alliant Energy utility subsidiary, filed a request to increase its natural gas service rates in Iowa.  IPL’s proposed increase would generate about $14.8 million in additional annual revenue (5.6 percent increase).

Under Iowa law, a temporary revenue increase of $8.6 million (3.3 percent), which did not require pre-approval from the Iowa Utilities Board, went into effect on June 4, 2012. 

Four comment meetings were held to allow the public the opportunity to offer comments on this rate increase request:

  • July 10, 2012 - North Iowa Area Community College, Muse-Norris Conference Center, 500 College Drive, Mason City
  • July 12, 2012 - Mount Pleasant Civic Center (2nd Floor), 307 E. Monroe, Mount Pleasant
  • July 17, 2012 - Clinton Community College, Auditorium, 1000 Lincoln Boulevard, Clinton
  • July 19, 2012 - Fisher Community Center, 709 South Center Street, Marshalltown

On August 16, 2012, IPL, the Office of Consumer Advocate, and the Iowa Consumers Coalition filed a proposed settlement agreement for the Board to review and consider in this case.

On November 26, 2012, the Board issued an order approving the settlement agreement and canceling the December 3, 2012 evidentiary hearing. The approved settlement allows the utility’s permanent annual revenue from natural gas service rates to increase by $10.5 million (4.8 percent). It also establishes bill credits to customers resulting from IPL’s tax benefits for, among other things, its mixed service costs, repair expenditures, and 2008 flood proceeds, which will reduce customer rate impacts over the next three years. Tax credits will apply to all IPL customer classes, with varying rate impacts.

With the three-year tax credits, a typical IPL residential natural gas customer should pay about 39 cents (0.6 percent) less per month than before the utility’s rate increase request was filed. When the tax benefits expire in three years, residential customers’ bills will increase by approximately $3 per month.  Rate changes will only apply to the natural gas service portion of customer bills and not to the cost of the gas itself, which the utility passes to customers dollar for dollar.