Business Overview
Alliant Energy Corporation (LNT) is a Midwest-based utility holding company that provides regulated electric and natural gas services to approximately 1 million electric and 425,000 natural gas customers across Iowa and Wisconsin. The company has a long history of delivering reliable energy solutions and exceptional service to its customers, while also maintaining a strong focus on environmental sustainability and community engagement.
Alliant Energy Corporation was formed in 1998 through the merger of IES Industries and WPL Holdings. The company operates through two primary wholly-owned subsidiaries: Interstate Power and Light Company (IPL) and Wisconsin Power and Light Company (WPL). IPL, founded in 1917, serves customers in Iowa, while WPL, established in 1916, serves customers in Wisconsin.
IPL's history includes significant growth through acquisitions, notably the purchase of Iowa Southern Utilities Company in 1982. Similarly, WPL expanded its footprint in the 1980s and 1990s by acquiring Madison Gas and Electric Company's electric service territory and Wisconsin Power and Light Company.
In the early 2000s, Alliant Energy faced challenges including an economic recession, high natural gas prices, and regulatory uncertainties. The company responded by improving operational efficiency, managing costs, and strengthening its balance sheet. During this period, Alliant Energy also divested some of its non-utility businesses to focus on its core regulated utility operations.
Despite these challenges, Alliant Energy has maintained a strong commitment to its shareholders, marking 2024 as the 21st consecutive year of dividend increases. The company has also consistently invested in its electric and natural gas infrastructure to enhance reliability and support customer growth in its service territories.
Today, Alliant Energy's regulated utility business, comprising IPL and WPL, forms the core of its operations and accounts for the majority of the company's revenues and earnings. The company also maintains a non-utility segment, which includes investments in transmission assets, a non-utility wind farm, corporate venture investments, and other non-regulated businesses.
Financial Strength and Operational Efficiency
Financials
Alliant Energy has demonstrated financial discipline and operational efficiency in recent years. As of the end of 2024, the company reported total revenues of $3.98 billion, with net income of $690 million, or $2.69 per diluted share on a GAAP basis. On a non-GAAP or "ongoing" basis, the company reported earnings per share of $3.04, a 7.8% increase from the prior year.
For the fourth quarter of 2024, Alliant Energy reported quarterly revenue of $976 million and quarterly net income of $150 million. The company experienced a year-over-year revenue growth of 1.6% in the quarter, primarily due to higher electric and gas sales rates, partially offset by lower sales volumes due to milder temperatures.
The IPL segment, serving customers in Iowa, generated electric utility revenues of $1.75 billion in 2024, with retail electric revenues accounting for $1.66 billion. IPL's gas utility revenues totaled $250 million for the same period. The WPL segment, serving Wisconsin customers, reported electric utility revenues of $1.62 billion, with retail electric revenues of $1.35 billion, and gas utility revenues of $215 million in 2024.
Alliant Energy's non-utility operations, grouped under the "Other" segment, contributed $90 million in revenues for 2024. These operations include Travero (a supply chain solutions company), ATI (the company's interest in American Transmission Company), and various corporate venture investments.
Liquidity
The company's balance sheet remains strong, with a debt-to-total capitalization ratio of 54.5% as of December 31, 2024. Alliant Energy's cash flow from operations totaled $1.17 billion in 2024, a 35% increase compared to 2023, driven by improved recoveries of infrastructure investments, successful tax credit monetization, and working capital optimization.
As of December 31, 2024, Alliant Energy reported cash and cash equivalents of $81 million. The company also had $742 million available capacity under a single revolving credit facility and $40 million available capacity under IPL's sales of accounts receivable program. The debt-to-equity ratio stood at 1.49, while the current ratio and quick ratio were 0.44 and 0.33, respectively.
Alliant Energy's focus on operational efficiency is also reflected in its management of operating expenses. In 2024, the company's other operation and maintenance expenses, excluding non-GAAP adjustments, were approximately $30 million lower than the prior year, showcasing the team's ability to manage costs while delivering reliable service to customers.
Strategic Investments in Renewable Energy and Infrastructure
One of the key pillars of Alliant Energy's strategy is its ongoing investment in renewable energy and grid modernization. Over the past few years, the company has made significant strides in transitioning its generation mix towards cleaner sources, while also strengthening its electric and gas distribution systems.
In 2024, Alliant Energy commissioned 1.5 gigawatts (GW) of new solar generation, adding to its existing 1.8 GW wind generation fleet. The company's current resource plan calls for the development and acquisition of an additional 1.2 GW of new wind and solar generation, as well as 1 GW of energy storage and 750 MW of new natural gas resources over the next five years.
Alliant Energy's investments in renewable energy are complemented by its efforts to upgrade and modernize its electric and gas distribution infrastructure. The company is focused on improving reliability, resiliency, and enabling distributed energy solutions through initiatives such as expanding underground electric distribution, upgrading transmission capacity, and installing fiber optic communication networks.
These strategic investments not only support Alliant Energy's transition to a cleaner energy future but also help the company deliver exceptional service and meet the evolving needs of its growing customer base.
Economic Development and Customer Growth
Alliant Energy's service territories in Iowa and Wisconsin have experienced steady population and economic growth in recent years, driven by the availability of affordable and reliable energy, as well as favorable business climates. The company has been proactive in leveraging this growth to expand its customer base and support the development of new commercial and industrial projects.
In 2024, Alliant Energy reached a significant milestone in its economic development efforts, securing commitments for up to 1.9 GW of data center load at its Big Cedar Industrial Center in Cedar Rapids, Iowa. The company also recently announced an agreement in principle with a data center customer that has purchased land in Beaver Dam, Wisconsin.
To support this growing customer demand, Alliant Energy has implemented innovative regulatory constructs, such as the individual customer rate (ICR) in Iowa, which allows the company to customize contracts and rates for large energy users. These regulatory tools, coupled with the company's balanced resource portfolio and execution capabilities, position Alliant Energy as a trusted partner for economic development initiatives in its service territories.
Regulatory Landscape and Supportive Legislation
Alliant Energy operates in a highly regulated environment, with its utility subsidiaries subject to oversight by the Iowa Utilities Board and the Public Service Commission of Wisconsin. The company has demonstrated its ability to navigate the regulatory landscape effectively, securing constructive rate outcomes that support its investments and allow for the recovery of prudently incurred costs.
In 2024, the Iowa Utilities Board approved IPL's retail electric and gas rate review, which included a base rate increase of $185 million for electric customers and $10 million for gas customers. Notably, the order also implemented a retail electric base rate moratorium through 2029, providing rate stability for IPL's customers.
Alliant Energy's operations also benefit from supportive state-level legislation. In Iowa, recent enhancements to the state's economic development programs, including the Major Economic Growth Attraction program and expanded eligibility for advanced ratemaking, are designed to encourage investments and attract new commercial and industrial customers to the company's service territory. Similarly, Wisconsin enacted a sales and use tax exemption for data centers, further bolstering the state's appeal for large energy users.
These regulatory and legislative developments, coupled with Alliant Energy's strategic focus on customer growth and clean energy investments, position the company well for continued success in the years ahead.
Risks and Challenges
While Alliant Energy has demonstrated its ability to navigate the evolving energy landscape, the company is not without its risks and challenges. One key risk is its reliance on third-party transmission assets, as IPL and WPL do not own or operate their own transmission systems. Any disruptions or changes to the rates charged by the independent transmission companies could impact Alliant Energy's financial performance.
Additionally, the company's transition to a cleaner energy portfolio, while aligned with its long-term sustainability goals, carries execution risks. Alliant Energy's ability to successfully develop and integrate new renewable and storage projects, as well as manage the retirement or conversion of its existing fossil fuel-fired generation assets, will be critical to the company's continued success.
Regulatory risks, such as the potential for unfavorable rate decisions or changes in the regulatory environment, also remain a concern. Alliant Energy's financial results are heavily dependent on its ability to recover prudently incurred costs and earn its authorized returns through the ratemaking process.
Finally, the company is not immune to broader macroeconomic and industry-wide challenges, such as supply chain disruptions, inflationary pressures, and the potential for economic downturns that could impact customer demand and energy consumption patterns.
Outlook and Conclusion
Alliant Energy is well-positioned for continued growth and value creation. The company's strategic investments in renewable energy and grid modernization, coupled with its focus on economic development and customer growth, are expected to drive sustainable long-term performance.
For 2025, Alliant Energy has affirmed its ongoing earnings guidance range of $3.15 to $3.25 per share, reflecting the company's confidence in its ability to execute on its strategic priorities and deliver value to shareholders. This guidance is in line with Alliant Energy's long-term target of 5-7% earnings growth, based on its 2024 ongoing earnings of $3.04 per share.
The company's efforts to support customer value through smart investments and cost control, along with constructive regulatory outcomes, are expected to support its ability to consistently deliver solid financial results. The regulated utility industry has seen a compound annual growth rate (CAGR) in revenue and earnings in the low to mid-single digits in recent years, as utilities have invested heavily in infrastructure upgrades and renewable energy projects. Alliant Energy's performance aligns with this industry trend.
As Alliant Energy navigates the evolving energy landscape, the company's strong operational track record, financial discipline, and constructive regulatory relationships will be critical to its success. By continuing to invest in clean energy solutions, enhance its infrastructure, and support the economic development of its service territories, Alliant Energy is poised to power growth and deliver long-term value for its customers and shareholders.