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Iowa Utilities Board demands Alliant Energy refund $7.5 million to customers while approving rate increase

This news story was published on January 9, 2020.
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DES MOINES – The Iowa Utilities Board (IUB) issued its final decision order in docket RPU-2019-0001 regarding a request from Alliant Energy/Interstate Power and Light Company (Alliant) to increase Iowa retail customer electric rates.

On March 1, 2019, Alliant filed with the IUB an application seeking an increase in electric rates and requesting a permanent annual revenue increase of approximately $203.6 million. On October 3, 2019, a non-unanimous partial settlement among many of the parties was filed and reduced the annual revenue increase to $127 million and a return on equity to 9.5 percent.

The IUB’s final decision order approves the non-unanimous partial settlement agreement and resolves other contested issues in the case. The order:

Approves a refund of $7.5 million for customers who paid interim rates;
Increases the monthly customer charge from $11.50 to $13 for residential customers and from $19 to $20 for general service customers;
Sets a monthly fee of $4.06 for customers who opt out of having an advanced metering infrastructure (AMI) meter but does not allow Alliant to charge a fee to customers who choose a reduced-pulse meter;
Approves a renewable energy rider (RER) as a line item on customers’ bills to recover costs of wind projects known as New Wind I and II, which will go into service in 2020. Alliant indicated that the RER will delay the need to file a rate increase request in 2021; and
Establishes a regulatory principle that the return on equity on interim rates cannot be higher than the return on equity for proposed final rates.
Board Member Richard Lozier dissented from the majority decision regarding interim rates and management efficiency.

The Board cites to evidence in the rate case demonstrating that Alliant has not efficiently managed its relationships with its customers. The Board requires Alliant to file a comprehensive improvement plan within 90 days and review its own internal processes, identify opportunities for improvement, and correct deficiencies as they become apparent.

As part of the proceedings in the electric rate case, the IUB received more than 5,600 written public comments and in the spring of 2019 held 10 public customer comment meetings throughout Alliant’s Iowa service territory.

The IUB stated that many customer comments revealed concerns with Alliant’s management practices. Those comments, the IUB’s disapproval of Alliant’s process to introduce and implement AMI meter technology, and a “lack of transparency and misrepresentation” during a 2018 municipalization vote in the city of Decorah led the IUB to find Alliant “did not meet the expected standard of conduct for a regulated monopoly.” Therefore, the IUB told Alliant in the order it will continue to monitor and review the company’s management efficiency practices and may take necessary action as allowed by Iowa Code chapter 476.

The electric rate case and natural gas rate case in docket RPU-2019-0002 were the first filings to base increased rates on a future test year rather than a historic year. The IUB will conduct a subsequent proceeding to determine whether the actual costs and revenues are reasonably consistent with those approved by the IUB.

The order approved the settlement’s proposed return on equity of 9.5 percent and found if Alliant implements interim rates as part of its next electric rate review, the company will use a return on equity for interim rates of no greater than 9.5 percent.

The IUB ordered Alliant to file compliance tariffs within 20 days, based on the decision and documents showing the approved revenue increase, by customer class, as a percentage of total revenues and base rate revenues. Rate changes will take effect upon the IUB’s review and approval of the compliance tariffs.

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9 Responses to Iowa Utilities Board demands Alliant Energy refund $7.5 million to customers while approving rate increase

  1. Avatar

    Anonymous Reply Report comment

    January 15, 2020 at 4:57 am

    If Demanded to refund 7+ million back to customers, obviously some discrepancies were found. The Board and Alliant are in cahoots . 7+ million doesn’t even out to $1.00 per customer. I’m sure Alliant will screw the customers $1.00 on their bills “some how” and get more then their 7+ million back in a month or 2, plus get their rate increase started. Demand of refund there is some not right… I would love to see a class action lawsuit against the board and Alliant for discrepancies, billing practices and rate increases. I’m sure if both investigated there would be LOTS turned up and maybe a stop to these ridiculous rate increases that should be illegal or at least unethical!!!! Any brave lawyers out there willing to stand up for the Alliant customers and stop this monopoly? I’m sure every Alliant customer would sign on to stop them!!!

  2. Avatar

    Sheeple are silent Reply Report comment

    January 13, 2020 at 6:14 pm

    The fact that there are only 6 comments on this subject tells me the citizens must like this rate increase.

    Actually, I believe the citizens feel they are powerless and have deep-seated anger at the government, The people just don’t know how to rise up and take to the streets in protest. It’s called complacentcy!

    • Avatar

      Anonymous Reply Report comment

      January 14, 2020 at 9:28 am

      And I see that YOU are leading by example.

  3. Avatar

    Anonymous Reply Report comment

    January 11, 2020 at 9:59 am

    Former Iowan how much do you pay after the first 1000 KWh?

    • Avatar

      Former Iowan Reply Report comment

      January 12, 2020 at 7:40 am

      The same. 6.5 cents per KWH and that includes all the taxes and line charge. Deregulation IMO works to lower prices to the consumer.

  4. Avatar

    Anonymous Reply Report comment

    January 11, 2020 at 7:50 am

    Alliant Energy is nothing but a Monopoly! Horrible company that overpays their managers that know nothing about how electricity and natural gas works. They are screwing us and they know it! Next time they ask for a rate increase, WE THE PEOPLE need to stand up and fight against this bully, terrible company! They keep downsizing all the time. The millions they save from getting rid of people should be enough to get what they want. NO MORE RATE INCREASES!

    • Avatar

      Anonymous Reply Report comment

      January 11, 2020 at 5:09 pm

      We the people tried that last time. The utilities board just politely went through the motions of listening to us peasants and approved the rate increase anyway.

      If Alliant wants to build a bunch of rusty hulk wind turbines that will be obsolete and out of service in 20 years, let them do it on their own dime. Not ours.

  5. Avatar

    Former Iowan Reply Report comment

    January 11, 2020 at 7:34 am

    First, make no mistake the IUB (Iowa Utilities Board) is in cahoots with Alliant Energy. They both knew when they put in the request for a rate increase it was more than would be approved. A monopoly regulated by an appointed state agency is a total scam!

    Second, utility users are forced to pay for the windmills and then pay for the electricity they windmills produce. Tax Credits and now a new line item on monthly bills, what a con job!

    Third, the carbon energy that is necessary to build a windmill exceeds what it saves in carbon. Another hoax!

    Finally, 15 states have deregulated electricity where users can choose from whom they buy their electricity. In Texas I currently pay 6.5 cents/KWH. Deregulation is what Iowa’s citizens should demand!

  6. Avatar

    Just what I have to say Reply Report comment

    January 10, 2020 at 12:18 pm

    In other words, bend over, they will keep this up.
    Alliant already raises rates as fast as allowed, as high as allowed.
    If they weren’t a monopoly, I am quite sure people would drop them faster than hardline phones.