State board grants natural gas utility a 4.8 percent rate increase

DES MOINES ? Interstate Power and Light Company (IPL), a subsidiary of Alliant Energy, has been granted a portion of the rate increase it filed May 25, 2012.

IPL, which serves the Mt. Pleasant area with natural gas, requested a $14.8 million (5.6 percent) annual revenue increase last spring. The utility already has collected a temporary revenue increase of $8.6 million (3.3 percent) since June 4, 2012.

The Iowa Utility Board (IUB) ruled Monday to grant IPL a permanent annual revenue from natural gas rates to increase by $10.5 million (4.8 percent) and includes tax credits that will reduce customer rate impacts over the next three years.

The settlement calls for three years of bill credits to customers resulting from IPL?s tax benefits for, among other things, its mixed service costs, repair expenditures and 2008 flood proceeds.

Tax credits will be applied to all IPL customer classes with varying rate impacts. With tax credits in place, a typical IPL residential natural gas customer should pay about 39 cents (0.6 percent) less per month than before this rate increase was filed. When the tax credits expire in three years, residential customers? bills will increase by approximately $3 per month.

The IUB?s order, based on its review of the evidence submitted in the proceeding, finds that the settlement agreement is reasonable, consistent with the law and in the public interest.

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.

Filings in the case are available on the IUB?s electronic filing system. Additional information is available on the IUB?s website, docket number RPU-2012-0002.