OTTUMWA, Iowa — Residents and business owners in Ottumwa met Monday night to better understand the recent rise in their Alliant Energy electric bills.
Bob Rafferty, executive director of Iowa Business for Clean Energy, shared his insights on potential causes behind the increase.
“The basic challenge is that our utility rate structure is based on a system that was put in place in the 1920s,” Rafferty said. “One hundred years ago and that hasn’t changed, and that structure focuses and incentivizes the utilities to build more capital assets. Their profits are based on how many capital assets they own, not on how efficient the energy system runs.”
During his presentation, Rafferty highlighted that Ottumwa residents face electric rates 50 to 60% higher than those served by MidAmerican Energy in other areas.
He also shared his thoughts on the steps needed to reform how utilities are assessed.
“First and foremost is the importance of having what’s called integrated resource planning,” Rafferty added. “It’s basically requiring a process of planning that ensures the stakeholders are involved in determining what are the future investments that utilities will make that ratepayers are going to be on the hook for. Because right now the stakeholders don’t have a seat at the table. So the decisions aren’t being made in the best interest of ratepayers but in the utilities and so that’s the first step to start this process of reform.”
We reached out to Alliant Energy to address concerns from customers in the area, specifically regarding potential rate increases.
In response, the company stated:
“New rates for Alliant Energy customers were implemented in October 2024 following approval by the Iowa Utilities Commission (IUC). Customers were informed of these changes when the new rates went into effect. Information about how the new rates impact customer bills is available here. Moving forward, electric base rates are not expected to increase for at least five years.”
