Interstate Power and Light Rate Case in Iowa
Synapse provided expert witness testimony on behalf of a group of Environmental Intervenors, which includes the Sierra Club, Environmental Law and Policy Center, and Iowa Environmental Council, in the state of Iowa regarding Interstate Power and Light’s (IPL or Alliant) 2024 Rate Case in Docket No. RPU-2023-0002. The testimony focused on whether IPL’s analysis justifying its spending during the test year was adequate, especially concerning its coal-fired power plants at Ottumwa, Neal 3, Neal 4, and Louisa, as well as its management of coal plants co-owned with MidAmerican Energy Company.
Synapse found that IPL has not provided any recent analysis assessing the economics of continuing to operate and co-own its coal-fired power plants compared to alternatives. Therefore, IPL has not justified its request in the Rate Case to keep including the associated costs in rates. We noted that IPL has not adequately overseen the plants it co-owns with MidAmerican. In examining the economics of the coal units, we found that all of IPL’s coal units faced net revenue losses in at least three of the last five years. Specifically, at Ottumwa, the unit had unusually high forced outage rates and poor practices for committing to run the unit. We also found that IPL did not properly explore using funding from the Inflation Reduction Act (IRA) Energy Infrastructure Reinvestment (EIR) Act to address the undepreciated balance at the Lansing or Ottumwa power plant and to finance clean energy alternatives.
Synapse recommended that the Commission disallow the inclusion in rates of all avoidable future costs at the coal plants until IPL provides an analysis showing it makes economic sense to continue relying on its aging coal assets. We recommended that the Commission require IPL to commit to operating the Ottumwa power plant economically or to explain its daily unit commitment practices. We also suggested that the Commission require IPL to show more active oversight of its co-owned plants operated by MidAmerican. Finally, we recommended that the company seek clarification from the US Department of Energy on how to use EIR funding to refinance and replace fossil resources.