OTTUMWA — Alliant Energy’s initial proposal for an 18.9 percent utility rate increase had ratepayers covering losses from the company’s canceled power plant in Marshalltown.
Alliant spent about $45 million before canceling the Sutherland Unit 4 power plant project, which was going to be built in Marshalltown.
Now, Alliant officials say they have lowered that increase to 16.5 percent, hoping that the Iowa Utilities Board will approve taking approximately $26.5 million from another fund.
“We think this is something that would benefit customers, [but we] don’t know if the utilities board will approve it or not,” said Alliant spokesman Ryan Stensland. “We’re looking for every way possible to reduce our costs.”
Local officials don’t see it like that, though. An increase is an increase.
“I, along with others, was very disappointed in that concept,” said Ottumwa City Councilman Bob Meyers.
Wapello County Supervisor Chairman Steve Siegel said Alliant’s plan is “not acceptable,” and is an example of the company’s poor planning.
“Our rates have gone up 70 percent in the last seven years,” Siegel said. “They need to manage their company better or turn it over to someone who can.”
The burden of covering the losses of the power plant should go to the shareholders, Siegel said.
“I don’t know why the ratepayers should have to pay for that; we had no input into it,” he said. “So why should we have to pay for it?”
Stensland said if the company asks shareholders to pay for the canceled project, they may be less willing to support and help fund future projects.
Meyers remembers when the Southern Iowa Utilities company was the main utilities provider for residents about 20 years ago. He said that at that time, the Ottumwa area had some of the cheapest utility rates in the state.
“If the utilities board does not allow us to use these funds to offset the cost of the plant, it will actually be a 0.6 percent increase on customer bills over five years,” Stensland said. For example, a customer who has a bill of $100, would then have to pay $100.60, he said.
Stensland said the company’s decision to cancel plans for the proposed Marshalltown plant was a good one. One of the main reasons for the decision was climate change uncertainty and legislation.
“Especially at the federal level, that’s what really gave us cold feet,” he said.
Alliant hopes to use money from selling a previous plant that had been put aside to cover the majority of the cost. But that all depends on if the IUB approves it, Stensland said.
Alliant expects the Board to make a decision on the rate increases within the next month, he said.
Pat Shaver can be reached at (641) 683-5360 or by e-mail at p.shaver@ottumwacourier.com.
Local News
Officials hold dim view of Alliant plan
Alliant Energy wants rate increase to cover costs of canceled plant
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