Alliant rates higher than average in Midwest

Electrical rates are on the march.

Alliant Energy's 7 percent interim rate increase became permanent this month, and the utility will be asking for another increase in about a month.

MidAmerican Energy customers might feel better about things. They've been experiencing a rate freeze since 1997 under a regulatory deal between the Des Moines-based utility and state regulators.

Opponents of Alliant's proposed 16 percent rate increase pointed out that MidAmerican customers pay about 22 percent less in energy charges, on average, than Alliant's Iowa customers.

That rate freeze will expire in 2013, however, setting the stage for MidAmerican to get a rate increase as early as 2014.

Few customers take time to understand and read their bills. Those who do notice that they had been going up until recently, even without state-approved rate increases. That's because of rising costs for coal, natural gas and purchased power, which were being passed along through an automatic bill adjustment mechanism - the energy adjustment clause.

Alliant, which sold its transmission system two years ago, is expected to seek a similar pass-along for transmission charges in its next rate case after failing in its last bid.

Are the rates of Iowa's regulated electrical utilities high? Compared to other utilities in Iowa, only a little.

Alliant's average residential rate of 10.8 cents per kilowatt hour for 2008 is only slightly higher than the 10.46 cents per kilowatt hour statewide average in just October 2008, as recorded by the Energy Information Administration. It remained well below the national average of 11.76 cents per kilowatt hour.