Des Moines, Ia- Alliant Energy customers could be in store for refunds after a decision on a rate increase.
The Iowa Utilities Board issued its final decision Thursday on a request from Alliant Energy/Interstate Power and Light Company to increase Iowa customer electric rates.
Back in March, Alliant filed an application seeking an increase and requesting a permanent annual revenue increase of approximately $203.6 million. In October, the amount was reduced to an annual revenue increase of $127 million and a return on equity to 9.5 percent.
The board approved a refund of $7.5 million to customers who paid an interim rate increase. It also allows for a customer charge to go up from $11.50 to $13 for residential customers and from $19 to $20 for general service customers.
The board also approved a settlement agreement that resolves other contested issues with the utility company. It 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;
Board Member Richard Lozier dissented from the majority decision regarding interim rates and management efficiency.
The Board cites 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 the necessary action as allowed by Iowa Code chapter 476.
The electric rate case and a 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.
