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At what cost?

Area residents question their ability to pay and speak against Alliant's proposed rate increases

During a public comment meeting, Terry Kouba, president of Interstate Power and Light Company, a wholly owned subsidiary of Alliant Energy, tells customers rate increases are based on several factors – affordability, customer expectations for clean energy, low natural gas prices and declining costs for renewables. The company has started interim rate increases to support a “clean energy” projects in Iowa.
During a public comment meeting, Terry Kouba, president of Interstate Power and Light Company, a wholly owned subsidiary of Alliant Energy, tells customers rate increases are based on several factors – affordability, customer expectations for clean energy, low natural gas prices and declining costs for renewables. The company has started interim rate increases to support a “clean energy” projects in Iowa.

After receiving notices in the mail from Alliant Energy regarding rate increases, area residents – many of whom were seniors – showed up to a public comment meeting Thursday at Southwestern Community College to dispute Alliant’s rate increases before a panel made up of representatives of Interstate Power and Light Company (IPL), a wholly owned subsidiary of Alliant Energy, members of the Iowa Utilities Board and an attorney and economist from the Office of the Consumer Advocate.

Customer comments

Belva White of Osceola shared her efforts to reduce personal energy costs with the panel and asked how she will be able to afford the rate increases.

“I live by myself. I’m an old woman and I have to watch how my money is spent,” said White. “I don’t keep my house really hot and I have other bills. I have gas for my car, I have food, I have clothes and I need all of that.”

White rhetorically asked the panel if she’ll have to use candles to afford the $1,205 more a year she said she’ll have to pay based on her calculations of the current rate structure.

“Do I keep my house at 50 degrees and wear a coat in my house? It seems like everything you have, there’s an increase in what we pay and it’s getting hard,” said White. “Do we all have to die before we get to be 80 years old because we can’t pay our bills anymore or live in the house that we’ve had?”

Bob Crawford of Creston, who is on a fixed income, said if energy prices keep increasing, he will eventually have to choose between eating and taking his medication and paying his energy bill.

Harold Jensen of Ames said he has changed all bulbs in his house to LEDs and installed energy efficient appliances. Despite his efforts to reduce his energy usage, Jensen said his bills continue to skyrocket.

Jensen, whose home is all electric, asked the panel to consider an all electric rate, after he noticed his typical bill of $200 to $250 increase to more than $500 in January.

“That’s pretty tough on myself and my neighbor who is retired,” said Jensen. “On a fixed income, it’s kind of important for us.”

Marion Nehring of Maxwell suggested to have a customer owned and operated utility.

“Most of that money is going to build wind turbines that company is going to own, but the customers are going to pay for ... I think the customers should have the opportunity to own these if they have to pay for them,” said Nehring.

James Kelley of Osceola encouraged attendees to raise “holy hell” with state legislators.

Juanita Jackson of Lenox said, as a single person, she doesn’t use much electricity, always turns her thermostat down and has kept it at 67 since January, yet her bill has increased 60% since January.

Lynn Kruse of Afton said he felt the utility company was misleading the public.

James Taylor, who grew up in Sioux City, but now works for The Heartland Institute, a nonprofit, public policy organization based out of Illinois, said the utility should not “fix something that isn’t broken.”

Taylor said Iowa’s electricity rates are 15% below the national average, which is due to coal power.

“There are 18 states where coal power provides the lion’s share of electricity production,” said Taylor. “Out of those 18 states, 15 of those states have energy prices below the national average. There’s only three that don’t.”

Taylor said one of those states is Kansas, which has the second highest wind power percentage in the country.

“There’s only so much coal can do when you have that much expensive wind power,” said Taylor.

The other two are Michigan and Wisconsin, which Taylor said are the fastest growing states for wind power.

Why wind?

Terry Kouba, president of IPL, said rate increases are based on several factors – affordability, customer expectations for clean energy, low natural gas prices and declining costs for renewables.

“Wind energy is a key aspect of Alliant Energy’s clean energy vision,” said Kouba. “Beyond the economic benefit of reduced fuel costs, there are clear environmental benefits to wind, which requires no fossil fuel and no water to operate.”

Kouba said adding 1,000 megawatts will helps IPL achieve its plan to eliminate all existing coal while being able to power more than 400,000 Iowa homes.

Rate increases

Anne Lenzen of IPL said the interim rate increase this year raises a typical residential customer’s monthly electric bill of $116 by about $8 per month, or 7%, and an additional $12 a month, or 10%, in 2020.

However, because of the structure of the bill, Lenzen said the increases are less than the 25% increase shown on the customer notices.

Lenzen said, in the IPL’s filing to the board, other savings programs to benefit its customers have been included, such as a fixed amount bill pilot, individual contract rates for large customers and new renewable rate options – including a community solar program.

Customer rates and utility revenue

Utility rates consist of base rate, and non-base rate, components.

According to IPL officials, the base rate account for approximately 66% of the electric bill, and 44% of the natural gas bill for a typical residential customer.

“IPL has requested an overall increase in annual revenue from its electric base rates of approximately $203.6 million and an overall increase in annual revenue from its natural gas base rates from approximately $21 million,” said Geri Huser, chairperson of the IUB.

Huser said IPL is collecting approximately $89.6 million of its total proposed revenue increase in electric rates through temporary rates that went into effect April 1.

Temporary rates, which are allowed by Iowa code section 476.69A, will be effective until the board issues a final decision on the permanent rate request.

Public hearings

The public comments meetings meeting are part of docket numbers RPU-2019-0001 and RPU-2019-0002, which are rate case proceedings in which IPL (Alliant Energy) has requested an increase in its electric and natural gas rates charged to its Iowa customers.

After the public comment meetings, the IUB will hold a hearing on the Alliant’s electric case Oct. 7-9 and a hearing on the utility’s natural gas rate increase is scheduled for Nov. 4-5.

Hearings are to be held at the Des Moines Iowa Utilities Board Building at 1375 E. Court Ave.

If the interim rate is later found unreasonable, the rate increase would be subject to refunds.

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