Alliant CEO: Data center growth will help the company ‘keep costs down for all customers’

CEDAR RAPIDS — The development of data centers in Iowa — including two that are planned for southwest Cedar Rapids — will “keep costs down for all customers,” Lisa Barton, president and CEO of Alliant Energy told a Cedar Rapids audience Tuesday.

Barton, who became Alliant’s CEO on Jan. 1, 2024, was the keynote speaker at the annual Cedar Rapids Metro Economic Alliance meeting, held at the downtown DoubleTree by Hilton hotel.

“We really see economic development as the linchpin for building stronger communities,” Barton told The Gazette after the meeting. “One of the things this does is that the electric and gas industry has a lot of fixed costs, so when you're able to spread those fixed costs over a larger base, then you can keep costs down for all customers.”

The two massive data center projects planned for Cedar Rapids are being built on land in the Big Cedar Industrial Center — hundreds of acres of development-ready land along 76th Avenue and Edgewood Road SW. All 1,391 acres of Big Cedar were controlled by Alliant Energy. Last year, 1,029 acres of the site were sold to developers of the two projects.

Barton spoke Tuesday of Alliant’s settlement with the Iowa Utilities Commission, which will keep the utility company’s rates flat for the next five years. But, she said, with development like the two data centers — and other economic activity in the region — it’s likely rates could stay flat for even longer.

“I don't think that there's another state in this country where you can say for the next five years electric rates are not going up,” Barton said.

Alliant initially sought to increase its electric rate revenue by $284 million. The settlement with the IUC cut that to $185 million. Similarly, the settlement reduced the growth in Alliant’s natural gas revenue from the $14 million it requested, to $10 million.

The settlement also eliminated the two-phase increase Alliant had proposed, allowing just one increase.

Barton said Iowa’s five-year flat rate is unique.

“We have the ability to have a five-year flat rate construct here. That has been one of the things that we have targeted as a company to figure out how do we make sure that we're maintaining affordability while growing,” Barton said. “I think that when you look at all of the different areas in this country, there are very few states that you can say ‘Where can you have your rates flat for at least the next five years?’ We've been able to solve that regulatory construct here to make sure that we can grow with our communities and keep rates flat.”

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Economic development

Barton said Alliant is “encouraged and excited” about the future of economic development in Cedar Rapids.

Asked about potential future development projects, she said Alliant “always has an interest in economic development.”

“I've seen this other places, where once some of these data centers come into place, then there's so many other businesses that come along to support them,” she said.

In her speech, Barton said the company is working to simultaneously solve the “Rubik’s Cube” that is electric reliability, resiliency, growth, sustainability and affordability.

“You can't do these things with just one side of the Rubik's Cube being solved for,” she said. “It's part of, I think, what makes Alliant Energy different and so focused on the Cedar Rapids community and all the communities that we serve. We want to make sure that we are working in partnership with our communities to make sure that we're solving for all of those complexities.”

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A changing landscape

With the two data center projects anticipated to come online by the end of 2028, Alliant is preparing for a “rapidly changing energy landscape,” said Melissa McCarville, senior communications partner for Alliant Energy.

“By investing in a diverse energy mix and continuing to modernize the energy grid, we are building a more reliable, sustainable, resilient and secure energy future in Iowa,” McCarville said. “This means fewer outages and faster restoration of power during outages.”

McCarville said the company is “continually focused” on meeting its customers’ energy needs.

“With the growth of data center development as well as onshoring of manufacturing, access to electrical capacity is important in site location decisions,” she said.

A key component of Alliant’s long-term plan to manage rates and electric reliability is development of zero-fuel generation resources, McCarville said.

“Our plan to replace older generation facilities with a more diversified energy portfolio will help avoid future costs that we would have incurred had we continued business as usual,” she said. “We are implementing our strategic plan to create a more sustainable future for our customers and communities.”

Alliant has been working to transition its energy toward renewable energy sources, away from coal. Between 2005 and 2023, Alliant decreased its electricity generation from coal by 25 percent. The company also has reduced carbon dioxide by 38 percent over the last 20 years.

Olivia Cohen covers energy and environment for The Gazette and is a corps member with Report for America, a national service program that places journalists in local newsrooms to report on under-covered issues.

Comments: olivia.cohen@thegazette.com