Q3 2023 Alliant Energy Corp Earnings Call
[music].
Thank you for holding and walk us how Alliant Energy's third quarter 2023 earnings conference call. At this time all lines are in listen only mode. Today's conference call is being recorded I would now like to turn the call over to.
Your host Susan Gil Investor Relations manager at Alliant energy.
Good morning, I would like to thank all of you on the call and the webcast for joining US today. We appreciate your participation.
With me here today are John Larsen, Chairman and CEO, Lisa Barton, President and C O O and Robert Durian Executive Vice President and CFO following prepared remarks by John Lisa and Robert We will have time to take questions from the investment community.
We issued a news release last night announcing Alliant Energy's third quarter and year to date financial results narrowed our 'twenty twenty-three earnings guidance range provided 2024 earnings and dividend guidance and provided our annual capital expenditure plan through 'twenty 'twenty seven.
This release as well as earnings presentation will be referenced during today's call and is available on the investor page of our website at www dot align energy dotcom.
Before we begin I need to remind you the remarks, we make on this call and our answers to your questions include forward looking statements.
These forward looking statements are subject to risks that could cause actual results to be materially different. Those risks include among others matters discussed in Alliant Energy's news release issued last night and in our filings with the Securities and Exchange Commission, we disclaim any obligation to update these forward looking.
Statements.
In addition, this presentation contains references to non-GAAP financial measures. The reconciliation between non-GAAP and GAAP measures are provided in the earnings release and our quarterly report on Form 10-Q, which is available on our website.
At this point I'll turn the call over to John.
Thank you Susan good morning, everyone and thank you for joining us today I'm.
I'm pleased to report that we are firmly on track for delivering another year of solid financial and operating results.
Consequently, we are narrowing our 2023 earnings guidance range and I am affirming our long term earnings growth range of 5% to 7%.
We take great satisfaction and consistently achieving our earnings growth objectives.
Continuing that momentum turning to 'twenty 'twenty four I'm pleased to share our earnings guidance and dividend target.
'twenty 'twenty four earnings guidance midpoint represents a 6% increase to our forecasted 2023 adjusted earnings and our 2024 annual common stock dividend target is $1 92 per share.
Which is a 6% increase from this year's dividends.
We are focused on delivering steady and predictable results.
We have several key headlines and highlights this quarter, but before I get to them I'd like to touch on the news you likely saw last week.
I'm incredibly honored to have been with Alliant energy for the past 35 years and I'm excited to be continuing that journey and moving into the role of executive Chairman of our company as Lisa Barton assumes the role of CEO.
Lisa is an exceptional leader with a well established track record of success together with the board of directors I have complete confidence that she is well positioned to further align energy's ability to deliver consistent results as we continue to focus on our purpose of serving customers and building stronger communities.
Speaking of that purpose, let me take a few minutes to share a few headlines from quarter three that I'm, particularly proud of and I'll pass it over to Lisa and Robert to provide more details.
The first headline centers on our strong core investment thesis that is why you choose to invest in our company.
Simply put we consistently deliver strong results.
The well executed forward thinking actions our team took to mitigate rising financing costs positions, our company to deliver on investor expectations.
Coupled with our exceptional project execution and unwavering commitment to cost management and efficiency makes us well positioned to achieve our long term earnings guidance objective for the 14th consecutive year.
Our second headline highlights our updated customer centric capital investment forecast through 2027, which increases our capex by almost $600 million compared to the four year plan, we announced last year Lisa will cover the details of these exciting investments later in the call.
To build on my earlier comments I continue to take immense pride in the work of our dedicated teams who have diligently navigated through challenging financial procurement and economic conditions.
I'm, especially pleased with our team's efforts and taking advantage of the enhanced benefits from the inflation reduction Act. We are nearing completion of executing our contracts to monetize tax credits generated by our wind solar and energy storage investments. This helps us reduce our financing needs creates substantial cost savings for a COO.
Customers, all while taking advantage of zero fuel cost resources, and reducing our greenhouse gas emissions.
Now let me highlight two innovative projects. We are excited about first we celebrated our first Io a customer hosted solar project, which is nearing completion near Ames, Iowa and is expected to.
To be operational in the first half of 'twenty 'twenty four this solar farm at Iowa State University will serve as a one of a kind setting to advance the concept of agro volt tax.
We are partnering with both I would state and the University of Wisconsin, and this innovative area of research.
Anchor bolt takes research is intended to uncover how solar agricultural land and farming can harmoniously coexist for mutual benefit.
The second project is our long duration storage project at the Columbia Energy Center near Portage, Wisconsin or.
Our first of a kind energy project in the United States. The 200 megawatt hour energy storage system will be built to deliver 10 hours of energy storage capacity by compressing carbon dioxide gas into liquid.
We are particularly excited this project will be built in the same community that is hosted our Columbia Energy Center for the last 40 plus years.
Citing this project at an existing generating facility enables us to take advantage of the existing grid interconnection.
Our company was selected for a $30 million grant from the U S Department of energy office of clean energy to support this project.
Importantly, both projects exemplify our purpose and showcases how our forward thinking efforts partnerships and innovation are helping us build stronger communities.
Our investments are made in our backyard and the communities, we serve where our customers live and where we partner with local suppliers contractors and vendors.
Now before I turn the call over to Lisa I'd like to recognize that the farmers in our service territory or in the later stages of harvest season, and I'd like to extend my appreciation to all farmers and farm families for your commitment and partnership.
Together, we are using the Earth's natural resources to provide vital services. Please be safe as you wrap up your harvest.
And I'd also like to take a moment to reflect on the achievements of our dedicated employees as we conclude another strong quarter.
They've done a tremendous job of serving our customers and positioning us for success. There are efforts to keep the lights on and the gas flowing irrespective of weather conditions underscores our unwavering commitment to our purpose.
I will now turn the call over to Lisa.
Thank you John It is an honor to be entrusted with the future growth and stewardship of this industry leading company since joining alliant energy. It has been abundantly clear that our organization lives and delivers on its purpose day in and day out in fact, the organization's commitment and alignment with its purpose as well.
Drew me to Alliant energy.
I recently had the opportunity to meet with our team in Janesville, Wisconsin and was struck by the level of engagement and ideas. Our frontline teams brought to the table to better serve our customers.
As you know we are actively underground our lines to provide greater reliability and system resiliency in this conversation our employees, we're offering suggestions to prioritize the underground ing of overhead facilities located in backyards.
They were sharing how these facilities can be difficult to get to require specialized equipment and due to the nature of the terrain restoration can be time consuming factors that can be avoided by under grounding I appreciated their ideas and focus on our customers with a goal to reduce outages and restoration times.
Notable example of the level of engagement and the connection with our purpose to serve our customers and build stronger communities.
Our team's passion for innovation and dedication to serving our customers and communities is consistent across the company in both Iowa, and Wisconsin, and it's precisely why it is a true privilege to take on the role of CEO and to serve as a member of our board of directors.
Before going into the Capex plan I would like to underscore our organization's ongoing role of being at the forefront of the clean energy transition by providing our customers with access to a cleaner and more diverse energy mix in 2022, approximately 40% of the energy we supply to retail customer.
<unk> was generated by zero fuel cost renewable resources. This number will quickly grow with the addition of 1.2 gigawatts of solar set to be in service by the end of 'twenty 'twenty four.
Across our portfolio of new generation, we're successfully bringing projects online investing in energy security, creating local jobs and providing valuable tax revenues for the communities we serve.
In Wisconsin, we expect to bring approximately 600 megawatts of solar online by yearend in Iowa with an advanced ratemaking ruling in hand for our planned 400 megawatts of solar we will continue to expand our investments in resilient clean energy resources for our customers and communities.
Entities by bringing this new generation online.
In addition to solar we made great strides in our energy storage plans during the third quarter.
We commissioned our first micro grid project in Richland County, we secured regulatory approval in Wisconsin for 175 megawatts of battery storage projects in wood and grant counties, which will be paired with our solar investments. In addition, we secured approval for 99 megawatts of battery storage.
Our edgewater generating facility site to take advantage of our existing interconnection and additional tax credits associated with Repurposing a brownfield site.
These storage projects strengthen the performance of our generation portfolio increased grid resiliency and improve reliability.
These investments tied to the capital expenditures, John mentioned, which are essential to deliver a diverse mix of energy with the enhanced reliability our customers depend on.
Looking forward, we have refreshed our capital expenditures plan over the next four years by 600 million. These investments expand our dispatch will generation resources include wind Repowering for approximately 500 megawatts of our legacy wind fleet, bringing efficiency savings to our customers and <unk>.
Additional tax benefits through the inflation reduction Act.
This plan reflects increased investments in American transmission company to support expansion of transmission within the state of Wisconsin, and underscores our commitment to enhancing grid resiliency and underground thing.
Our updated customer centric capital investment forecast through 2027 contributes to a solid 8% rate base growth through 2027.
Approximately 55% of our investments over the next four years will be in generation, a strong demonstration of our commitment to a diverse clean reliable and resilient energy future for our customers.
We take considerable pride in the balance of resources in our generation portfolio. We will continue to invest in renewables over the five year planning period. We also recognize our resource plans need to address my Soc resource adequacy needs. This is why you see greater additional capital expenditure.
Yours for gas projects when compared to prior plans.
In 2024, we will continue our transparent process to engage with regulators and stakeholders as we update and revise our resource plans to adapt to changing reliability needs are.
Our plans include new dispatch level natural gas resources capacity and efficiency improvements and investments to ensure resiliency and availability of fuels during extreme weather and other disruptions.
Specifically, our focus will be on improving the capacity and efficiency of our existing units in both Iowa, and Wisconsin as well as Repurposing sites, where coal units will be retiring in the next five years.
We will be investing in new flexible natural gas resources to complement our investments in battery storage and renewables.
We will also invest in reliability of natural gas supply in both Iowa, and Wisconsin to address concerns about reliability and resiliency during extreme weather. This includes exploring opportunities to enhance resiliency through gas LNG and electric storage technologies.
Now switching to regulatory matters first we appreciate the certainty. They are you B's advance ratemaking decision provides last month, the IU be approved a minimum or a way of 10.25% over the 30 year life of 400 megawatts of solar we remain confident in the advance.
Ratemaking process and look forward to submitting additional filings following our stakeholder and regulatory engagement process next year.
Staying in Iowa, We recently filed our forward test year rate review.
Our forward looking electric and gas rate review focuses on our plans to strategically invest in a cost effective and diverse energy mix, coupled with grid modernization to deliver a more reliable sustainable resilient and secure energy future for Iowa customers and communities.
With our steadfast focus on keeping customer value top of mind, we continuously strategize to take proactive measures to manage costs and to meet customers' ever changing energy needs. This is the reason why we have asked for a two step increase the investments we are making in the state are expected to reduce the number and duration of outages.
Improved safety lower operating maintenance and fuel expenses, while reducing the impact of fuel price volatility.
Shifting gears to our rate review in Wisconsin. The procedural schedule is now complete and we await a decision from the PSC W to place new rates into effect on January 1st.
We believe the P. S E. W. Staff testimony was constructive and gave the commission a good starting point for their decision.
I will now turn the call over to Robert to provide insights regarding our financial results guidance and a few additional regulatory matters.
Thanks, Lisa good morning, everyone.
Yesterday, we announced third quarter non-GAAP earnings of $1 five per share compared to 93 cents per share in the second or third quarter of 2022.
Our quarterly earnings change year over year was primarily due to higher revenue requirements and a few D. C from WP, all capital investments and lower operating and maintenance expenses.
These positive drivers were partially offset by higher interest expense.
The non-GAAP adjustment recorded in the third quarter of three cents per share related to Iowa State tax reform.
In September the Iowa Department of revenue announced corporate state tax rate of seven 1% for 2024, which is down from the current rate of eight 4%.
This change resulted in a current year charge at our non utility and parent operations related to lower deferred tax asset values.
This change will also enable us to past millions of dollars of annual savings from lower state taxes onto our customers in Iowa for decades into the future.
A similar non-GAAP adjustment was recognized in the third quarter last year related to I was corporate tax rate change effective for 2023.
Through September of this year, our net temperature impacts decreased Alliant Energy's earnings by approximately <unk> <unk> per share and.
In comparison net temperatures increased Alliant energy earnings for the first three quarters of 2022 by seven cents per share.
Our temperature normalized electric sales for the first three quarters are tracking in line with sales for the same period in 2022, including no material changes across the customer classes or are two states.
Looking forward to the fourth quarter and our full year 2023 results. We expect strong earnings growth from investments in Wisconsin, and Iowa solar projects and lower O&M, partially offset by higher interest expense.
As a result of solid earnings through September and our projected fourth quarter results. We have narrowed our 2023 earnings guidance to a range of $2 85 per share.
To $2 93 per share.
During 2023, our team has continued to advance our purpose driven strategy to ensure that we not only accomplished our current year goals, but also enable the achievement of our financial and operational objectives over the long term.
We strategically invest in the best interest of our customers aiming to enhance customer value, while controlling costs for our costs.
As we continue our transition to renewables, while preparing to retire our fossil fuel generating resources, we will continue to reduce our operating costs.
Additionally, with the implementation of our planned solar projects and the Repowering of our wind facilities, we anticipate the production tax credits and reduce fuel expenses will help offset the impact of increased renewable rate base rendering these new investments highly cost effective for our customers.
This commitment will result in long term benefits for our customers and long term value for our shareholders.
With our success, thus far in advancing and executing on our renewable capital projects, we continue to be well positioned to capture additional benefits of the inflation reduction Act.
Expected benefits include applying for federal funding.
Maximizing tax benefits by meeting tax credit added requirements.
And leveraging new and enhanced opportunities to monetize tax credits, which materially improve our cash flows and credit metrics as well as reduce future financing needs.
Moving to our financing plans in.
In September we successfully completed a $300 million debt issuance at IPO to finance, our solar generation projects.
So far this year, we have issued approximately $200 million of new common equity. Thus, we are well on our way to raising our planned $250 million in equity for 2023.
As we look to future financings.
Robust capital investment plan is expected to be financed through a combination of cash from operations, including significant proceeds from tax credit Modernizations and new long term debt.
We also have modest levels of common equity anticipated in our financing plans through 2027.
Including approximately $25 million of new common equity plan each year from our shareowner direct plan.
And up to $350 million of new common equity in aggregate through future ATM programs.
The new common equity through future ATM programs is largely dependent upon whether the PSC W and you'd be granted authority of our request to increase the equity layers in W pills, and ipl's capital structures and their respective pending rate reviews.
More near term our plans over the next 14 months include up to $1 $9 billion of financings.
Leading up to $1 billion of long term debt at Alliant energy finance.
Up to $700 million of debt at IPL.
Approximately $25 million of new common equity through our shareowner direct plan.
And up to $200 million of new common equity only to support any increase authorized by the PSC W. For WPZ equity later.
We also have two debt maturities in 2024, including $450 million at Alliant energy finance and $500 million at IPO.
Finally, I'll highlight our regulatory initiatives and progress as well as those regulatory filings we plan to initiate in 2024.
Currently in progress, we have electric and gas rate reviews in each state.
In Wisconsin, we anticipate an oral decision before Thanksgiving and a written order by the end of December.
And in Iowa, We expect a decision by the third quarter of next year.
We also have two additional pending proceedings in Wisconsin.
We are anticipating a decision on our request for improvements aimed to increase the efficiency capacity and reliability of our neenah and Sheboygan falls gas generating units by the end of Q2 2024.
And this quarter, we filed a joint application to sell an additional 125 megawatts of the west Riverside facility to work energy and Madison gas and electric.
We are also anticipating a decision on this application by Q2 of 2024.
Turning to our planned regulatory filings in 2024.
In conjunction with our updated capital expenditure plan.
We expect to make regulatory filings in both Iowa, and Wisconsin for additional renewables and dispatch will resources to enhance reliability further diversify our energy resources and meet customer energy needs.
Filings will also include construction authority request for the innovative new long duration energy storage in Wisconsin mentioned by John.
We very much appreciate the continued support of our company and look forward to meeting with many of you at the <unk> Finance conference.
Next week, we plan to post on our website the updated materials in advance of the AR.
At this time I'll turn the call back over to the operator to facilitate the question and answer session.
Yeah.
Thank you Mr. Jerry and at this time the company will open up the call to questions from members of the investment community.
Ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press star followed by the one on your Touchtone phone.
Here are three Tom acknowledging your request and your questions will be folded in the order. They are received should you wish to take time from the polling process. Please press star followed by the <unk>.
If you are using a speaker phone please lift the handset before pressing any keys. Your first question comes from Nicholas Campanella with Barclays. Please go ahead.
Hi, everybody its actually Nathan Richardson on for Nick.
Hey, Nathan.
Good morning, Hello, Happy Friday.
A couple of questions here.
You touched on the tax credit opportunity, a little bit and I appreciate the 'twenty three and 'twenty four guidance, but I was wondering if you could give any more color.
225, and 26, and then maybe to full contribution over the five year plan.
Yes, there is a known.
Probably paid a little bit of a picture here for our financing plans when do you think about.
The capital expenditure refresh that we've done through 2027 and as we look at the kind of financing needs for that we actually think that we'll be able to fund all of that through cash flows from operations, including the monetization of tax credits as well as some new long term debt.
As we look at the opportunities to be able to monetize those tax credits are.
Given the volume of tax credits were generating currently with the wind projects in the solar projects as well as those will be <unk>.
Added into our portfolio over the next few years, along with battery storage.
Actually I think will be averaging probably close to $300 million a year in tax credit monetization proceeds.
So that provides us a lot of flexibility with our financing plans and therefore does not require any material common equity to be able to finance those those capital expenditure plans, where we do see potentially some need for new common equity is largely related to the regulatory constructs specifically the capital structures for our two utilities.
That is dependent upon the outcomes of the pending rate cases, so that's to be determined. So we should be seeing hopefully R. W. P. L rate case decision here in the next couple of weeks and as I indicated before the Iowa decision sometime probably by the second quarter to third quarter of next year, and so that'll give us more insights as to any potential equity needs, but it's really.
Tied into those additional equity layers at the two utilities.
Got it that's super helpful. Thank you and then my last question is.
Some of your Midwest peers have been showing some.
Klein and load in fiscal year 'twenty three.
Wanted to see.
How we could think about what you've embedded in the fiscal year 'twenty four outlook from a sales perspective, and then maybe any longer term sales growth assumptions.
Yeah. Nathan This is John here 23 has been largely in line with our expectations from a.
Temperature normalized load and we're planning for that similarly going forward, but I would say, we do have some pretty strong economic development interest we've kept our forecast pretty conservative pretty steady as we've seen but we've seen some great interest here and when we see that materialize.
A bit more we will provide updates if or as needed.
Got it thank you so much.
You bet. Thank you.
Your next question comes from Julien Dumoulin Smith with Bank of America. Please go ahead.
Hey, Good morning. This is darius on for Julien Thanks for taking the question.
Just wanted to start off on the narrowed 2023 guidance. Thank you for providing that update I'm. Just wondering if now that we're in November and there is probably a good line of sight to the end of the year. If you can.
Make any commentary as far as where you might be tracking within that range for the balance of the year.
Yes, Jerry this is Robert Yeah, I would characterize it we're tracking towards the midpoint, we have seen what I would characterize some milder weather temperatures are in.
In the first quarter of this year that really put our earnings down about four cents per share, but we actually picked up a <unk> back in the third quarter, given some warmer temperatures and so far here in the fourth quarter, we've actually started out with some favorable weather temperatures. So we actually think we'll we'll land pretty close to the midpoint and so that's we've been guiding people to.
Okay excellent. Thank you appreciate that and then just looking ahead to 2024 and the guidance and the drivers that you provided certainly appreciate the WTO process is still ongoing in the event that you did receive and improved equity layer. There could you see any upside to.
<unk>.
Or perhaps tracking to the upper end of the range that you provided for 2024.
Yeah Dara is John here.
I'd say, there's really four factors for our guidance with sales great execution of capital and.
You mentioned constructive decisions from regulatory filings and cost management I would say right now we feel very comfortable with the guidance range that we put out there and as we get into 'twenty four we would certainly update that if we're tracking.
A different part of that range, but think of it is pretty solid for a range in 'twenty four.
Okay excellent. Thank you and if I could sneak in one more obviously certainly appreciate the IPL rate case has recently filed but you've had some fairly constructive processes and outcomes, especially with the advanced ratemaking This year.
Curious if you could make any comments on <unk>.
For towards her prospects for settling that rate case.
Darius is Lisa here now.
Handle that question. So as you know we always have a very transparent process with respect to our rate reviews, our clean energy blueprint.
<unk> provides a high level of transparency and.
We had a balanced asked with this two step a request both in the single digits. Obviously, we've had a strong track record of settlements in Iowa.
And we continue to think that that's going to be possible in the future, but as always we're going to assess the pros and cons of settlement along the way.
Okay excellent. Thank you very much for the responses I'll pass it along and we'll see you guys <unk> at about a week.
That was great. Thanks Darius.
Yeah.
Your next question comes from Ross <unk> with UBS. Please go ahead.
Good morning, John Good morning, Lisa.
Congratulations on the on.
On the appointments.
Thank you thanks Ross.
So and I apologize bouncing between sort of three calls. This morning. So this has already been asked and answered I do apologize, but I was just kind of looking through your capex refresh.
And we say I think I heard you say that.
Millwork sort of renewables Capex here is really being driven by the shift to gas projects to be responsive to MISO and not driven by sort of some of the consternation we've seen over the last 18 months around renewable investments right Youre still supply chain okay.
It's not about it's more being responsive and adding this gas projects in the plan.
Yes, Ross Ross, you're correct to me, we're constantly reviewing our resource plans taking into account changing conditions sites such as the MISO capacity construct a again, it's always a very transparent process that we use and we will be talking with regulators and stakeholders here in the early.
We're part of 'twenty four.
Yeah.
Okay, and then given that renewable spending is a little bit lower in the plan. Robert I think I think I heard you say that despite that you still expect pretty good.
Tax transferability tax credit transferability generation here that the only equity need is around if you get a higher equity ratio at the regulated utilities from your regulated.
Rate cases that are currently underway.
Yes, that's correct Rod so as a reminder, so we've got 2019 and 2020 vintage wind projects that'll be continuing to provide ptc's for us.
We will be building out the full 500 megawatts of new solar projects. We've added to our recent Capex plans of 500 megawatts of Repowering of wind projects that will produce new ptc's for us to be able to monetize and we also have battery projects that we've put into the planned 275 megawatts of which have already been <unk>.
By the PSC W that have all be generating tax credits and so still a very robust set of tax credits for us to monetize over the next four or five years.
And then one last one for me if if I heard correctly Theres still some go forward filings here.
That could that could raise your capex profile around some renewable projects and some clean energy initiatives in your states since I think about sort of.
Looking forward there.
There is still an opportunity to add more renewables to a plant.
Ross John here, I think what I would say we've got.
A lot of future capex opportunities. So we will be sharing more of the details of how we're thinking about the latter part of not only this for years, but you know kind of where we would see our future capex going but we're continuing to advance development for future renewables.
But as Robert Lisa noted right now where it just makes sense for us to add some capacity resources, while we continue to look for future renewable development.
That's perfect. Thank you.
That's it for me congratulations once again and we'll see you soon in Arizona.
Thanks, Ross Thanks Ross.
Your next question comes from Andrew Weisel with Scotiabank. Please go ahead.
Hi, everybody.
Agro volt, Hey, that's a new one for me.
First I just wanted to say congrats to John and Lisa is great to see for both of you.
Next thank you.
First question.
My first question is on O&M.
<unk> talked about a 3% to 4% reduction I know a lot of the year over year swing was supposed to come in the fourth quarter now that we're here can you, maybe refine and reaffirm that estimate and maybe some thoughts on how much might be sustainable versus one time.
Hey, Andrew This is John here I'm going to let Robert talk about that and it's really good news and the timing, but I wanted to I appreciate you.
Listening in picking up on <unk>, we can talk more about that when I see you at EI, So Robert over definitely.
Yeah, Andrew I would say.
Kind of evaluated 2023, and 2024, we are looking for opportunities to continue to kind of time the spend to be able to achieve all of our financial objectives over the two years.
You are correct in thinking that when we.
Our plans for O&M spend for 2023, there is a fair amount of reduction that we were expecting as a result of some of the strategic spend.
In 2022, including focuses on resource planning economic development and advancing some of our technology projects.
We continue to find opportunities to be able to reduce costs.
Through the efficiencies of a lot of the folks out into our field organizations I think Lisa had a nice story that she started out with our script talking about the efforts under.
Way with our underground program that are providing some benefits for us. We're also seeing some reductions on the generation side as a result of our Lansing retirement. So so I would say, it's a mix of maybe half a sustainable have what I would characterize as strategic spend in 2022 that we see for reductions, but we're continuing to anticipate we will see some further O&M rich.
<unk> in the fourth quarter, and probably end up lower than than we expected.
From 2022.
Very good.
Next on the 400 megawatts of solar in Iowa.
Gentlemen, I believe called for 10, 75% ROE under the advanced ratemaking, but the IUD approved 10 in a quarter can you talk about why that was reduced in D. C. Any kind of read through to the rate case as a result of this.
Yeah, Andrew So basically what <unk> did is they said that 10.25 would be in essence, the base and we have the opportunity to go up from there. So we're going to use a R.
Our rate review process to be pushing for that 10.25 as you know the settlement that we had in place and Io was with one party and was not with all of the parties, we do not think that anything.
You know that was decided as part of this ARPA you is indicative of anything.
For with respect to the rate review filing. So we continue to think that there are opportunities to settle in Ireland are similar to the history and the strong history, we've had for settlements in the past.
Yeah.
Okay very good and then on equity two part question. So first of all the 200 million that you might need Robert did you see that was for IPL and WTO or is that just W. P. L and how much was like a sensitivity every 10 basis points of equity ratio would be some amount of equity can you provide that.
So think of that Andrew is just the WP all decision that will hopefully be seeing here in the next few weeks and so there is as we've stated in some of our previous remarks, what we requested is about a 250 basis point increase in our equity layer in Wisconsin, So that equates to about $200 million. So it's about a $40 million for every <unk>.
50 basis points.
Okay very helpful. And then just to clarify other than that quote unquote, one time step up.
You're suggesting about $25 million of equity per year in 'twenty, five and beyond or am I reading too far into that.
Yes, we would plan to continue to utilize our shareowner direct plan to be able to issue approximately $25 million a year in new common equity that's dependent upon the decisions of our shareowners as to how much they want to leverage that program, but that's just a continuation of what we've had historically and we plan to plan to keep that going into the future.
Perfect. Thank you so much to look forward to seeing you soon.
Your next question comes from Alex Morgan more chair with Mizuho Securities. Please go ahead.
Hi, good morning, Tim.
Good morning, good morning.
So all you highlight the transferability benefits, helping to keep financing cost manageable in the future given a higher for longer rate environment and your increased capital plan announced today, how should we think of the magnitude of rate requests.
Her cases going forward as compared to historical levels.
Yes, I think.
Thanks for your question Alan we continue to push for what I'd say.
Hum.
General.
Rate increases that.
Kind of keep the increase is very similar to that.
Kind of like cost of living increases if you will.
At or below so we've been very very consistent with that over the past few years, and we would see that continuing going forward.
And the one thing that I would add Alan is that we continue to add zero fuel cost resources as part of the plan and that very much plays into affordability affordability has been and will continue to be top of mind for for us going forward.
Understood. Thank you and then we've seen some other states where parties with maybe a larger priority on policy related goals as opposed to economic ones are playing a larger role in rate case proceedings and are making it slightly more challenging to settle cases.
How do you view the future of settling the settlement process in Wisconsin.
And I think we would view it as a.
<unk> to be a very constructive opportunity.
As both Lisa and Robert have noted.
We file these will continue to monitor we always look forward to being very very transparent and bringing parties to the table, but we don't see any material change in our ability to settle going forward.
And the one thing that I would add is again, our clean energy blueprint provides that high level of transparency and an opportunity for stakeholders to really engage ahead of time. This year was a little bit unique in the sense that five I O U's, where before the commission at one time, so that made it a little bit challenging this year.
Understood. Thanks, so much look forward to seeing you all soon.
Thank you.
Ladies and gentlemen, as a reminder, should you have a question. Please press star followed by the one.
MS. Gill there are no further questions at this time.
With no more questions. This concludes our call a replay will be available on our investor website.
We thank you for your continued support of Alliant energy and feel free to contact me with any follow up questions.
Yeah.
Ladies and gentlemen, this concludes your conference call for today, we thank you for participating and ask that you. Please disconnect your lines.
Okay.
Yes.
Okay.
Yeah.
Yes.
Yes.
Yes.
Okay.
Yes.
Okay.
[music].
Okay.
Okay.
[music].
Okay.
Sure.
Okay.
Thanks.
Okay.
Yes.
Yes.
Yeah.
Okay.
Okay.
Okay.
Yes.
Okay.
Okay.
Okay.
Yes.
Okay.
Okay.
Okay.
Yes.
Yeah.
Okay.
Okay.
[music].
Okay.
Yeah.
Sure.
Yes.
Yes.
Okay.
Yes.