Susan Gille:

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, Executive Chairman; Lisa Barton, President and CEO, 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 second quarter financial results. This release as well as the earnings presentation, which will be referenced during today’s call are available on the Investor page of our website at www.alliantenergy.com. 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 ongoing earnings per share, which is a non-GAAP financial measure. The reconciliation between non-GAAP and GAAP measures is provided in the earnings release, which is available on our website. References to ongoing earnings exclude material charges or income that are not normally associated with ongoing operations. At this point, I’ll turn the call over to John.

Lisa Barton:

Thank you, John. I’d like to take a moment to recognize John’s outstanding leadership. John’s vision, dedication and passion for our customers and the communities that we serve has laid a strong foundation for our continued success, a focus, which will continue to guide us into the future. John’s foresight and commitment to advancing clean energy solutions, coupled with an acute focus on our customers has left an indelible mark on our organization and communities. Congratulations, John, on your upcoming retirement. I look forward to working with you in your continued role as board share. Building on John’s remarks and before we get into additional updates, we are committed to our long-term 5% to 7% earnings growth target and we are reaffirming our 2024 ongoing EPS guidance range of $2.99 to $3.13. Our confidence in reaffirming the range assumes the following normal weather for the remainder of the year, execution of cost controls and receipt to the timely order from the Iowa Utilities Commission with rates effective October 1. I want to highlight the extraordinary focus the organization has on maintaining the financial discipline needed to deliver on investor and customer expectations. We continue to focus on making capital investments to serve the needs of our customers and communities while also focusing on operational excellence to drive efficiencies within the business. Our team is focused on prioritizing reliability, supporting economic growth in our communities and driving affordability, which gives me confidence in our ability to execute on our plan. Pivoting now to our strategic priorities of driving consistent growth and building stronger communities, our Iowa rate review settlement provides continued regulatory progress. It strikes the right balance between shareholders and customers and uniquely positions ITL to attract economic development growth to our service territory, benefiting customers, shareowners and the state of Iowa. Our settlement in Iowa is a testament to the benefits of parties rolling up their sleeves and coming together to engage in constructive settlement discussions and outcomes. With this settlement, customers will see base rate stability through the end of the decade. Through the individual customer rate construct, ITL will have the ability to move quicker and more nimbly to attract new commercial and industrial customers to the region. Shareowners will retain tax and energy benefits from new generation with the ability to earn a consistent and fair return. Most importantly, Iowa will benefit from economic growth, rate stability and be recognized as the state that is open for business with utilities well positioned to support the evolving needs of its customers and communities. As noted in our news release, the settlement also provides greater flexibility to attract economic development, which is expected to have a positive and meaningful impact on promoting load growth. We have been proactively working to attract new customers in both Iowa and Wisconsin, and we are pleased to announce that we have executed multiple agreements with data centers in both states. Approval by the IUC of the settlement, which includes the individual customer rate construct is necessary for these projects to move forward in Iowa. In our third quarter call, we’ll provide details on the expected customer load commitments and the timing of the energy demands associated with this growth. Locking in both is necessary to drive our resource and CapEx forecast. The interest we have seen is a testament to the value of our incentive rate design structures in Iowa and Wisconsin and the commitment and the hard work of our economic development teams. These rate design structures will fuel our ability to deliver on earnings growth and affordability. To support our economic development aspirations, we have built a strong partnership with both ATC and ITC Midwest to ensure timely interconnection of new loads in our service area. We have prioritized economic development, and we’ll continue to focus on partnering with existing customers looking to grow and attracting new industries to our service territory. The recently passed megasite legislation in Iowa is already yielding interest from large businesses. As a reminder, the legislation is designed to attract projects that span at least 250 acres with investments of at least $1 billion in capital. The incentives are geared towards advanced manufacturing, biosciences and research-based companies locating at a certified site. Moving on to our Clean Energy Blueprint, our resource planning process, we continuously plan ahead for new generation development, identifying sites and strategic transmission interconnections that enable us to be flexible as we respond to load growth and changes in MISO’s capacity accreditation. We understand the importance for our investors to have transparency in our future plans. As such, we will provide updated load forecast, resource needs and CapEx requirements in our third quarter capital expenditure update and in future regulatory filings. Before I turn the call over to Robert, I would like to express my appreciation to our employees, especially our field and operation team members. Thank you for your tireless efforts to ensure our customers have the reliability they expect, a special note of appreciation for those who answered the call for mutual assistance and stepped up to aid our neighboring utilities. This program serves as the cornerstone of the industry, offering a unique framework for rapid coordinated support during emergencies, ensuring reliable service is restored as quickly and safely as possible. I will now turn the call over to Robert.

John Larsen:

Thank you, Robert. As you heard today, Alliant Energy is well positioned for the future. Before I turn the call back to the operator, let me take a minute and summarize the key takeaways. We are reaffirming our 2024 ongoing earnings guidance range. We’ve made great progress with the regulatory and economic development, positioning us for long-term growth and we are looking forward to sharing progress updates on our Clean Energy Blueprint and economic development efforts as we lead up to the fall EEI conference. I want to thank my colleagues for their collaboration and customer focus, which have strengthened the communities we proudly serve. I also want to thank the investors and analysts for your support of Alliant Energy. I look forward to the next chapter and continuing to serve Alliant Energy in my role as Board Chairman. At this time, I will turn the call back over to the operator to facilitate the question-and-answer session.

Nathan Richardson:

Hey, good morning. It’s actually Nathan Richardson on for Nick. I was just wondering – sorry, I was wondering for Slide 8, you say modest equity needs to maintain 40% to 45% paired equity structure. I was wondering if you could quantify that a little bit more and maybe some more color on how we can think about that?

Nathan Richardson:

Got it. That’s super helpful. Thank you. And then one more in terms of weather headwinds year-to-date, I was wondering where – if you wouldn’t mind, where you’re tracking in the ‘24 range right now?

Nathan Richardson:

Awesome. Thank you again everyone.

Andrew Weisel:

Hi. Good morning and congratulations again for John.

Andrew Weisel:

First question, Lisa, if you could clarify, I just want to make sure I think you said you will be in a position to announce some data center customers or contracts by the third quarter call, or maybe you could just elaborate or were you just talking about updated load forecast perhaps. What was it that you were foreshadowing?

Andrew Weisel:

Okay. Great. So, typical cadence of the updates, but we will have a bit more juice or color or detail in terms of some of these economic development updates. Is that kind of what you are saying?

Andrew Weisel:

Sounds great, definitely looking forward to that. Then a couple of questions on the Iowa settlement if I may. First, when you think the years 3 to 5, 5 years certainly a long stay out. What are the upside and downside risks to the earned ROE relative to be allowed? In other words, you have this earnings sharing mechanisms, under what scenario might you see the earned ROE exceed be allowed, or what might you – under what scenario might you under-earn, and are there any off-prem, so to speak, where you might need some relief, for example, if we went into a hypothetical deep recession in 2 years?

Robert Durian:

Yes. So, when we structured the agreements with the intervening parties as part of the settlement agreements, we did take into consideration that situation that you described, Andrew, and there is a provision within the agreement, if you read into the details of it that allow us to come back in for a rate case if our ROEs fall below a certain level, either on an annual basis or over a 2-year period. And so we feel like that will protect us well in case of any significant decrease, but we remain pretty optimistic about the upside opportunities as Lisa described, with the ability to capture some of this new data center load growth and benefit from that as well as what I would say is more of an innovative model that allows us to keep the tax benefits and the energy margins and the capacity revenues related to new generation as well as the tax benefits from any repowering opportunities that we may have over that opportunity. So, that gives us some level of optimism for that period.

Robert Durian:

Yes. Andrew, we didn’t get into a lot of details on the events. We are making principles in the settlement. As you may recall, there is legislation that’s been recently passed in Iowa that expands the eligibility of ratemaking principles to include not only renewables, but now also energy storage facilities as well as nuclear. So, I would say it opens us up for some additional opportunities over the next few years, mainly related to what I would say, larger gas projects, renewable projects as well as now battery projects.

Andrew Weisel:

Good stuff. Thank you very much.

Paul Zimbardo:

Hi. Good morning team.

Paul Zimbardo:

The first that was hopefully a small clarification, with respect to the two steam customer contracts you talked about through 2025 that are ending, is there any ongoing earnings impact to think about from those?

Paul Zimbardo:

Okay. Great. And then not to fall on the bigger EEI update coming. But is there any way to kind of frame the scope of the capital needs, maybe like how much generation length you have under the current plan, before factoring in the data centers? Any kind of flavor of like what kind of the system needs could be on the generation side would be helpful.

Paul Zimbardo:

Okay. Great. Thank you. We at least had to try. Thanks.

Operator:

[Operator Instructions] We will move next with Alex Mortimer with Mizuho Securities. Please go ahead.

Lisa Barton:

Good morning Alex.

Lisa Barton:

Really all is a matter of timing. And so yes, again, as soon as we have that information, we will be putting it out.

Operator:

And we show no further questions at this time. I will turn the call back to management for closing remarks.

Operator:

This does conclude today’s program. Thank you for your participation. You may disconnect at any time.

Susan Gille:

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, Executive Chairman; Lisa Barton, President and CEO 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.

Lisa Barton:

Thank you, John, and good morning, everyone. As John stated, we had a solid start to the year, and we are well positioned to achieve our 2024 earnings and growth objectives. Warmer-than-normal temperatures impacted our first quarter earnings, reflecting similar temperatures experienced in the broader region.

Operator:

[Operator Instructions]. We will take our first question from Andrew Weisel with Scotiabank.

Andrew Weisel:

Okay. Great. And timing?

Andrew Weisel:

Okay. Great. Next, I want to ask about the agreement you've entered to sell the tax credit. Can you quantify that? You mentioned you'll generate around $400 million this year. Are you fully committed for about $400 million this year and next?

Andrew Weisel:

Very good. One more, if I can squeeze it in. Any update on the timing for approvals for your proposed energy dome? I think you're waiting to hear about a DOE grant, but with Columbia slated to retire in mid-2026, how does that timing look?

Andrew Weisel:

Great. A lot of good things to look forward to in the coming months. Thank you very much.

Paul Fremont:

Thank you very much. In the -- in the advanced ratemaking proceeding, I think you reached a partial settlement in Iowa. If you were to settle, would you expect a settlement to be a partial settlement or unanimous settlement?

Lisa Barton:

Good memory, Paul. Yes, it was actually part of some legislation that was circulated and that did not go forward. Iowa recognizes the need for the utilities in Iowa to be flexible with respect to the generation. And in fact, we saw the advanced ratemaking and expansion to batteries and to nuclear investments on a going-forward basis.

Susan Gille:

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.

Susan Gille:

Good morning. I would like to thank all of you on the call and webcast for joining us today. We appreciate your participation. With me here today are John Larsen, Executive Chairman; Lisa Barton, President and CEO; 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 fourth quarter and year-end financial results. This release as well as an earnings presentation will be referenced during today's call and are available on the Investor page of our website at alliantenergy.com. Before we begin, I need to remind you that 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. References to adjusted earnings exclude non-GAAP adjustments as well as net temperature impacts. The reconciliation between non-GAAP and GAAP measures are provided in the earnings release which is available on our website. At this point, I'll turn the call over to John.

Lisa Barton:

Thank you, John. I'm honored for the opportunity to build on your legacy of growth and exceptional service to the communities we are so privileged to serve. As I reflect on 2023, I am appreciative of our employees for their ongoing determination and commitment to serving our customers and strengthening our communities. I'll begin by building on John's comments about our notable progress on our generation transformation in Wisconsin, where we recently brought eight solar projects online, a huge milestone. We are currently leveraging the sun in Wisconsin to fuel nearly 900 megawatts for customers. This will increase to nearly 1.1 gigawatts this spring when our final Wisconsin solar project becomes operational. Coupled with our plans to bring 400 megawatts of solar online in Iowa this year, by year-end, nearly 1,500 of additional megawatts of the energy our customers use will be from clean, zero fuel cost energy resource. In addition to our utility scale solar investments, we continue to partner with local businesses and communities interested in hosting solar projects. our customer-hosted projects help local businesses achieve their clean energy goals while community solar projects provide all customers with affordable options to participate in the solar revolution. In Cedar Rapids, our Community solar garden is fully operational and will soon be generating bill credits for all solar block purchasers. Our Janesville Solar Garden in Wisconsin now has an anchor tenant JP Cullen and construction is set to begin this spring. We have additional customer hosted projects underway and expect they'll be operational before summer. We made great progress in our clean energy transformation in 2023. We retired the last coal unit at Lansing which had dutifully served our customers and communities for nearly 50 years. The retirement reduces O&M costs and advances us towards a cleaner, more efficient and cost-effective energy mix. At the same time, we continue to see the frequency and duration of outages in our service footprint steadily declined, a 20-year trend that we expect will continue as we continue focusing on improving reliability and system resilience to meet the expectations of the customers we serve. We began the process to repower the Franklin County Wind project in Iowa to increase the efficiency of our fleet. This investment will provide our customers with many more years of production tax credits. On the environmental front, we completed closure work at 29 surface impoundments across 10 sites, eliminating all Alliant Energy ash funds [ph] in Iowa and Wisconsin. With these 2023 accomplishments, coupled with our planned investments in dispatchable gas generation, battery storage and wind repowering, we are well on our way of enabling a successful and responsible clean energy transition while assuring we are addressing our system resiliency needs. Looking forward, we continue to plan for the future by evolving and refining our clean energy blueprint, taking into account dynamic economic developments, evolving energy technologies and the emerging needs of the communities we serve. It is a necessary step as we look to balance our energy mix create greater grid reliability, ensure customer affordability and address MISO's resource adequacy needs. 2023 was a record year for us for economic development activities with more than 130 megawatts of announced new load across our footprint, primarily in the manufacturing sector. With a capital investment of approximately $3.8 billion, these projects are expected to create more than 4,000 new local jobs. Going forward, we will continue to pursue opportunities for new customer growth at our industrial parks as we strive to build and support stronger communities. Our strong customer and community focus were contributing factors in recently being named a top utility by Business Facilities Magazine for the fourth year in a row. Alliance Energy received a number of recognitions this past year, a few of them, including ones that focus on our employees' dedication to creating a welcoming and inclusive workplace are highlighted on Slide 5. Earlier this week, we announced the retirement of Terry Kouba, President of IPL. In early March, Terry will be celebrating his 43rd year with the company and has been a thoughtful, respected and customer-focused leader of our Iowa operations. We are grateful for his service and dedication to Alliant Energy, our customers, communities and employees. As we celebrate Terry's well-deserved retirement, we are advancing our succession plan by appointing May Farlinger to the position of President of IPL effective May 1. May have spent her career at Alliant Energy serving in several leadership roles. We are confident in her ability to lead our dedicated team of professionals in Iowa. As we move forward in 2024, I have every confidence we will continue to take the required actions to meet our customer needs and deliver on investor expectations. We are well positioned to quickly adapt to a dynamic environment as we execute our strategy for generating clean, reliable and affordable energy. At this time, I'll turn the call over to Robert.

Operator:

[Operator Instructions] Your first question would be from Shahriar Pourreza at Guggenheim Partners.

Lisa Barton:

Sure. So I mean, we're feeling very good about where we are with respect to IPL. Everything is going as expected, the schedule on track. If you're looking at a settlement window, it's really any time after the intervenor testimony is submitted through that June 18 deadline.

Lisa Barton:

So those recommendations actually have been out for the legislature to consider. As we look at our legislative priorities this year, the mega site development to support economic development is top of mind for us, advancing the advanced ratemaking for alternative technologies. One of the elements that has been brought up in the legislature is asking for a contested IRP and that is something that we are not supportive of. We have been very transparent in our resource plans. We're pro planning, we're pro transparency. But in terms of a contested proceeding, that's just something that is not really consistent with the evolving generation landscape that we're finding ourselves in.

Nicholas Campanella:

I guess just on -- you previewed some kind of tax credit monetization already. You have $200 million in the plan for '24. Just -- Is it still the case that you kind of expect $300 million a year plus in '25 and beyond? Or can you just help us kind of think about what the tax credit transferability benefit is in the out years?

Nicholas Campanella:

And then just on your comments on Wisconsin filing cadence. I think you kind of mentioned that you have new renewables coming into the picture that you had to file for. But is that just like a follow-on limited reopener type filing from the prior rate case? Or this is not like a full rate case here to contemplate right now. Can you just kind of maybe update us on your overall strategy there?

Nicholas Campanella:

Got it. Yes. That's -- and that CapEx is not in the plan now and is more of a fall update to your point. Okay.

Operator:

Next question will be from Julien Dumoulin-Smith at Bank of America.

Lisa Barton:

Yes, that's a great question, Julien. We are certainly focused on economic development. That's something we're doubling down on. In terms of putting that into our forecast and into our resource plans. We need to have a level of confidence that they'll be there. So just stay tuned with respect to that space. And as I mentioned earlier, later in '24, we will be updating our resource planning needs over the future, where we have factored in load growth and factored in the implications of the MISO rules that are constantly evolving.

Lisa Barton:

Well, we constantly watch MISO's work with respect to tranche 1 and tranche 2. Tranche 2 is expected later this year. It'll probably be about the same timeframe.

Lisa Barton:

So we are actively and aggressively marketing our mega sites that are located in both Iowa and Wisconsin and that would really be the locations to be looking at?

Andrew Weisel:

Just wanted to clarify a little bit of -- I think, Robert, you talked about this in the prepared remarks but I want to ask about O&M and the weather impact. The $0.06 of negative weather, that is not included in the adjusted earnings, I think. So first question is, is that a change? Have you historically done that?

Andrew Weisel:

Okay. I guess I don't mean to be critical but you've got a great track record of meeting or exceeding the midpoint in, I think going back to 2015 or so. And obviously, this one was a little bit light. Anything to look into there? Obviously, it was a tough year with the interest rates and all that. But anything philosophically changing around either O&Ms or the midpoint as a target?

Andrew Weisel:

And then lastly, apologies if I missed it but what's your outlook for O&Ms in 2024?

Operator:

Ms. Gille, at this time, there are no further questions.

Operator:

Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. At this time, we ask that you please disconnect your lines. Have a good weekend.

Susan Gille:

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, Chair and CEO; Lisa Barton, President and COO, 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 2023 earnings guidance range, provided 2024 earnings and dividend guidance, and provided our annual capital expenditure plan through 2027. 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.alliantenergy.com. 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.

Lisa Barton:

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 commitments and alignment with its purpose is what 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 undergrounding our lines to provide greater reliability and system resiliency. In this conversation, our employees were offering suggestions to prioritize the undergrounding 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 undergrounding. I appreciated their ideas and focus on our customers with the goal to reduce outages and restoration times, a 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 supplied to retail customers 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 2024. Across our portfolio of new generation, we are 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 year-end. 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 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 microgrid 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 at 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, increase grid resiliency, and improve reliability. These investments tie 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 dispatchable generation resources, include wind repowering for approximately 500 megawatts of our legacy wind fleet, bringing efficiency savings to our customers, and 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 undergrounding. Our updated customer-centric capital investment forecast through 2027 contributes to a solid 8% rate-based 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 MISO's resource adequacy needs. This is why you see greater additional capital expenditures 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. Our plans include new dispatchable 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 the IUB's advanced ratemaking decision provides. Last month, the IUB approved a minimum ROE of 10.25% over the 30-year life of 400 megawatts of solar. We remain confident in the advanced 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 our 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, improve 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 PSCW to place new rates into effect on January 1st. We believe the PSCW 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.

Operator:

Thank you, Mr. Durian. 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. [Operator Instructions] Your first question comes from Nicholas Campanella with Barclays. Please go ahead.

Lisa Barton:

Hey, Nathan.

Nathan Richardson:

Hello. Happy Friday. I just have a couple of questions here. You touched on the tax credit opportunity a little bit, and I appreciate the '23 and '24 guidance, but I was wondering if you could give any more Color into '25 and '26 and then maybe the full contribution over the five-year plan?

Nathan Richardson:

Got it. That's super helpful. Thank you. And then my last question is some of your Midwest peers have been showing some decline in load in fiscal year '23. And I just wanted to see how we could think about what you've embedded in the fiscal year '24 outlook from a sales perspective and then maybe any longer term sales growth assumptions.

Nathan Richardson:

Got it. Thank you so much.

Operator:

Your next question comes from Julien Dumoulin Smith with Bank of America. Please go ahead.

Robert Durian:

Yes, Dariusz, this is Robert. Yes, I would characterize that we're tracking towards the midpoint. We have seen what I'd characterize, some milder weather temperatures in the first quarter this year. That really put our earnings down about $0.4 per share. But we actually picked up $0.2 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 land pretty close to the midpoint and so that's we've been guiding people, too.

John Larsen:

Yes. Dariusz, John here. You know, I'd say there's really four factors for our guidance with, you know, 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've put out there. And as we get into '24, we would certainly update that if we're tracking a different part of that range. But think of it as pretty solid for our range in '24.

Lisa Barton:

Yes, Dariusz, it's Lisa here, and I'll handle that question. So, you know, as you know, we always have a very transparent process with respect to our rate reviews. Our Clean Energy blueprint provides a high level of transparency. We had a balanced ask with a two-step 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.

John Larsen:

That was great. Thanks, Dariusz.

Ross Fowler:

Good morning, John. Good morning, Lisa. Hey, congratulations on the appointments.

John Larsen:

Thanks, Ross.

Lisa Barton:

Yes, Ross. Ross, you're correct. I mean, we're constantly reviewing our resource plans, taking into account changing conditions such as the MYSO capacity construct. Again, it's always that very transparent process that we use. And, you know, we'll be talking with regulators and stakeholders here in the earlier parts of '24.

Robert Durian:

Yes, that's correct. Ross, it's a reminder, so we've got 2019 and 2020 vintage wind projects that will be continuing to provide PTCs for us. We'll be building out the full 1,500 megawatts of new solar projects. We've added to our recent CapEx plans, 500 megawatts of repowering of wind projects that will produce new PTCs for us to be able to monetize. And we also have battery projects that we've put into the plant, 275 megawatts, which have already been approved by the PSCW 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.

John Larsen:

You know, Ross, John here. I think what I'd say, we've got a lot of future CapEx opportunities, so we'll be sharing more of the details of how we're thinking about the latter part of not only this four 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 and Lisa noted, right now it just makes sense for us to add some capacity resources while we continue to look for future renewable developments.

John Larsen:

Thanks, Ross.

Operator:

Your next question comes from Andrew Weisel with Scotiabank. Please go ahead.

Lisa Barton:

Thank you.

John Larsen:

Yes. 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 want to -- I appreciate you listening and picking up on Agrivoltaics. We can talk more about that when I see you at EEI. So Robert, over to you.

Robert Durian:

Yes, Andrew. I would say, as we've kind of evaluated 2023 and 2024, we are looking for opportunities to continue to kind of time to spend to be able to achieve all of our financial objectives over the two years. You're correct in thinking that when we announced 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 we had in 2022, including focuses on resource planning, economic development, and advancing some of our technology projects. But we continue to find opportunities to be able to reduce costs through the efficiencies of a lot of the folks out in our field organizations. I think Lisa had a nice story that she started out with her script talking about efforts underway 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, I would say it's a mix, maybe half sustainable half what I would characterize as strategic spend in 2022 that we see for reductions, but we're continuing to anticipate we'll see some further O&M reductions in the fourth quarter and probably end up lower than we expected from 2022.

Lisa Barton:

Yes Andrew, so basically what the IUB 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 our rate review process to be pushing for that 10.25%. As you know, the settlement that we had in place in Iowa 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 RPU is indicative of anything with for -- respect to the rate review filing. So we continue to think that there are opportunities to settle in Iowa similar to the history and the strong history we've had for settlements in the past.

Robert Durian:

Yes, I think of that, Andrew, as just the WPL decision that we'll hopefully be seeing here in the next few weeks. And so, yes, as we've stated in some of our previous remarks, what we've 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 $40 million for every 50 basis points.

Robert Durian:

Yes, we would plan to continue to utilize our share 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 keep that going into the future.

Operator:

Your next question comes from Alex Mortimer with Mizuho Securities. Please go ahead.

Lisa Barton:

Good morning.

John Larsen:

Yes, I think -- thanks for your question, Alan. You know, we continue to push for what I'd say, you know, a general rate increase that, you know, kind of keep the increases very similar to, you know, 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.

Alex Mortimer:

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 the settlement process in Wisconsin?

Lisa Barton:

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 IOUs were before the Commission at one time. So that made it a little bit challenging this year.

John Larsen:

Thank you.

Susan Gille:

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.

Susan Gille:

Good morning. I would like to thank all of you on the call and on the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Board Chair and CEO; Lisa Barton, President and COO; 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 second quarter 2023 financial results. This release as well as an earnings presentation that will be referenced during today's call are available on the Investor page of our website at www.alliantenergy.com. 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. Those 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 press release issued last night and in our filings with the Securities and Exchange Commission. We disclaim any obligation to update these forward-looking statements. At this point, I'll turn the call over to John.

Lisa Barton:

Thank you, John. One of the areas that drew me to Alliant Energy revolves around our unwavering commitment to delivering value in a holistic and sustainable manner and our dedication to ESG principles. We are resolute in our long-term commitment to consistent growth in ensuring a successful clean energy transition for our customers and communities, making a positive difference in the lives of our customers and communities is a core value and guides us as we navigate the evolving energy landscape. We recently released our 2023 corporate responsibility report, showcasing our commitment to environmental stewardship, meeting the social needs of our communities and corporate governance. With a diverse portfolio of generating facilities, we consistently provide reliable energy to our valued customers while continuing to broaden their access to zero fuel cost and carbon-free energy resources. As we advance our clean energy initiatives, we prioritize competitive rates, reliability, system resiliency, sustainability and innovation. We partner and invest in organizations which proactively advance our industry's knowledge and collaborate on best practices. Now let's review our great environmental progress from 2022. First off, 40% of the energy we supply to our retail customers in 2022 was from renewable sources. Second, we reduced our annual carbon dioxide emissions from fossil fuel generation by 39% from our 2005 levels, evidence that we are well on our way to achieving our goal of a 50% CO2 reduction by 2030. We reduced our water usage by 50% from our 2005 levels, demonstrating our progress towards our 75% reduction goal by 2030. Looking forward, we have updated our clean energy goals to reflect our company's progress and strategic plans to support the transition to a low-carbon economy. On Slide 3, we highlighted examples of our sustainability efforts. Over the years, we have made significant strides in reducing our carbon footprint by transitioning from older, less efficient coal units to cost-effective and efficient generation resources, such as wind, natural gas, battery storage and solar. These resources not only demonstrate our commitment to environmental sustainability, but also served as lower cost options for our service territory, providing value for our customers well into the future. Building upon our successful wind energy expansion, our strong project management execution capabilities, we are focusing on expanding our solar energy portfolio. With our substantial investments totaling 1.1 gigawatts of solar projects, we are set to become the largest owner-operator of solar energy in Wisconsin. In 2022, we successfully placed 250 megawatts of solar capacity into service, and we are on schedule to add an additional 840 megawatts by mid-2024. Our investments are helping customers focus on their sustainability objectives in the communities we serve. With our customer-hosted renewables projects, we partner with businesses or communities to host an Alliant Energy solar farm on site. Two examples are with the Iowa State University and the University of Wisconsin-Madison. In partnership with Iowa State, we are also investing in agrivoltaics, the study of crop or livestock production underneath or adjacent to solar panels. Through our community solar program, we created community funded solar sites bringing the cost synergies of large-scale solar and offering customers an alternative to rooftop installations. Our Clean Energy Blueprint serves as our road map towards a cleaner energy future. This blueprint encompasses not only generation, but emphasizes the importance of an efficient, reliable and resilient energy grid. John mentioned our focus on resiliency by undergrounding our distribution system. Undergrounding distribution lines allows us to reduce the resources needed to trim trees, improves reliability and reduces the cost of customer inconvenience associated with storm response. Through our innovative solutions and strategic investments, we continuously strive to deliver sustainable energy options without compromising customer satisfaction. An example of this is our investment in the Neenah and Sheboygan Falls gas plants, where our advanced gas path upgrades will increase the efficiency, capacity and reliability of these units. Finally, in Iowa, I am pleased to report we reached a settlement with the Office of Consumer Advocate regarding our Iowa ratemaking principles docket. Settlement details are provided on Slide 5. The hearing on the advanced ratemaking principles for these projects was completed earlier this week. We requested an expedited decision from the Iowa Utilities Board so that we can start construction on these cost-effective investments for our Iowa customers. These investments will create jobs in Iowa during construction, support reliability of electric service in our Iowa service territory, bring shared revenues to our local communities and lease payments to rural landowners, all of which aligns with our purpose to serve customers and build stronger communities. I will now pass the mic to Robert, who will share our financial results and provide additional detail on our regulatory progress. Robert?

Operator:

[Operator Instructions] Your first question will come from Julien Dumoulin-Smith at Bank of America.

John Larsen:

Great. Dariusz, this is John. So we're very pleased with the progress on this docket and the hearing went as expected. I think as you're aware, we also reached settlement with the Office of Consumer Advocate. So we are going to be awaiting the IUB's decision. But maybe I'll ask Robert to share a few of those items a little more color on the puts and takes as you noted, Dariusz.

Dariusz Lozny :

Great. If I could ask one more and this is more on the quarter/trends that you're seeing year-to-date. Certainly noted that it was maybe a bit of a softer quarter from a weather temperature standpoint. Can you just comment on the growth that you're seeing on a normalized basis across the 3 main customer classes?

Robert Durian :

Yes. Maybe the only thing I’d add is, as John indicated, it was slightly better than expected as far as the temperature normalized growth. It was really on our residential side where we saw most of that really good meter growth for both electric and gas this quarter. So that was the primary driver.

Alex Mortimer:

As you've examined your cost management throughout this year and planned out your own cuts for the later half of the year, have you discovered any savings you may be able to continue into the future? Maybe phrase another way, what portion should we think of as more onetime in nature versus ongoing run rate?

Lisa Barton:

Alex, the one thing that I would add to what Robert talked about is the fact that we are focused on affordability. We understand that that's going to be a driver of growth in the future. So from a cultural standpoint, the entire organization is really focused on evaluating our processes, our cost structure to make sure that we're delivering as best we can for our customers and communities.

John Larsen:

Yes. Alex, I think we're still at a point where it's going to be very important, particularly in the region and climate that we have for gas to play a major role, certainly understand there's going to be lot of discussion about the role of natural gas, where it plays on either producing for generation or for home heating. But for at least the immediate future and for a while past that, we see natural gas playing a very important role.

Operator:

[Operator Instructions] Your next question will come from James Kennedy at Guggenheim.

Robert Durian:

Yes, James, this is Robert. So if you think forward to the third quarter conference call in early November in the EEI Finance Conference that will be shortly after that. We will be providing updated capital expenditure and rate base projections for 2023 through 2027. And expect to have additional insights on expectations of our rate reviews in Iowa and Wisconsin to provide us more specifics on what we'll see for earnings guidance and financing plans in 2024.

Robert Durian:

To be determined. Like I said, we're expecting to make good progress with both of those proceedings in Wisconsin and Iowa and hopefully have more details or specifics regarding exactly what we'll show for earnings guidance in '24 and financing plans for '24. We're still very confident with the 5% to 7% long-term growth plan for EPS. So you shouldn't expect anything. But we'll just provide some more specifics hopefully, once we get further through these rate reviews.

John Larsen:

Yes. Maybe, James, I’ll just note that battery storage is very cost-effective solution and quite frankly, important part of our resource plan for our customers. So we fully expect to advance energy storage, but there are some options on kind of the regulatory, recovery and proceeding going forward. So a little more to be played out as the RPU proceeding advances. So I think we’ll have more updates as we get to the Q3 call or EEI on the energy storage.

Susan Gille:

This concludes Alliant Energy’s second quarter earnings call. Thank you for your continued support of Alliant Energy, and feel free to contact me with any follow-up questions.

Susan Gille:

Good morning. I would like to thank all of you on the call and on the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Board Chair and CEO; and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night announcing Alliant Energy's first quarter 2023 financial results. This release as well as an earnings presentation that will be referenced during today's call are available on the Investor page of our website at www.alliantenergy.com. 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 press release issued last night and in our filings with the Securities and Exchange Commission. We disclaim any obligation to update these forward-looking statements. At this point, I'll turn the call over to John.

Robert Durian:

Thanks, John. Good morning, everyone. Yesterday, we announced first quarter 2023 GAAP earnings of $0.65 per share. The primary drivers of the quarter-over-quarter EPS variances were the impacts of warmer temperatures than last year, resulting in lower retail electric and gas sales for this quarter. Higher interest expense due to additional financings and increasing interest rates and the timing of income tax expense that will reverse later this year. These items were partially offset by higher earnings resulting from increasing revenue requirements and allowance for funds used during construction from Wisconsin Power & Light's capital investments. For the full year, we are reaffirming our earnings guidance of $2.82 to $2.96 per share. The midpoint of that range is a 6% increase over 2022 adjusted earnings per share. Details on our quarter earnings drivers and 2023 full year earnings guidance can be found on Slide 3. To assist you in modeling our quarterly earnings this year, I wanted to provide some additional context to a few of the quarterly 2023 drivers. First, in anticipation of continuing inflationary pressures, we accelerated our cost transformation efforts in the second half of 2022. We do not anticipate the same heightened spend in the second half of 2023 for such efforts. Thus, we are anticipating that most of our year-over-year O&M savings will occur in the second half of 2023. Second, we anticipate quarter-over-quarter variances related to interest expense were at their highest level in the first quarter with the quarter-over-quarter variances expected to taper as we proceed through the year. This quarterly interest expense impact is based on the cadence of our financings in 2022 versus 2023. And third, income tax expenses recorded each quarter based on an estimated annual effective tax rate and the proportion of full year earnings generated each quarter. This causes fluctuations in the amounts of tax expenses quarter-over-quarter, but it will not have an impact on our full year earnings. We've already executed a large portion of our 2023 financing plan to fund our investments in renewable projects and to support refinancing of $400 million debt maturity in 2023. In March, Alliant Energy issued $575 million of 3.875% convertible senior notes maturing in 2026. These convertible notes offered us an attractive financing opportunity given the current interest rate environment. In March, WPL also issued $300 million of 4.950% Green Bonds maturing in 2033. The proceeds from this offering will be used for the development and acquisition of solar generating units, which are a key component of our clean energy blueprint. We have taken proactive steps to significantly reduce exposure to higher interest rates with these two debt issuances and an interest rate swap all executed in the first quarter of 2023. These actions will help insulate us from interest rate increases and produce better-than-expected interest expense relative to our annual plan. Earlier this year, we also closed on the sale of 25 megawatts of our West Riverside natural gas facility to MG&E. And we are working towards a closing on the sale of 100 megawatts of West Riverside to WEC Energy later this quarter. The sales of these partial interests in West Riverside were included in our plans and are expected to provide combined proceeds of approximately $125 million. We're also making progress with plans to start transferring 2023 renewable tax credits later this year after we received guidance from the treasury on the requirements for such transfers under the inflation Reduction Act. We have seen strong interest in transferring these tax credits, and the proceeds from these asset transfers will help fund our future utility investments and reduce some of our future financing needs. The remaining financings for 2023 include plans to issue up to $300 million of long-term debt IPO and plans to raise up to $225 million of new common equity through our at-the-market program. The ATM is in addition to the $25 million of common equity that we expect to raise under our DRIP plan. The 2023 financing plan is driven by robust capital expenditure plans, and supports our objective to maintain the capital structures at our two utilities, consistent with their most recent regulatory decisions. We've included our key regulatory initiatives for 2023 on Slide 5. Starting in Wisconsin. Last week, WPL filed an electric and gas rate review for test years 2024 and 2025. The filing includes recovery of several investments that support sustainability and resiliency while keeping customer value and competitive rates top of mind. These investments include nearly 1.1 gigawatts of solar generation in the state by mid-2024 and 274 megawatts of energy storage by 2025. WPL is also exploring opportunities to enhance the value of its existing natural gas assets with new projects to increase output and efficiency. Finally, we plan to continue investing in underground distribution and standardizing system voltage to enhance resiliency while reducing O&M expenses. Next steps in the rate review process included a discovery phase and audit by the PSCW staff and interveners, with a hearing anticipated in early fall and a final decision expected from the PSCW later this year. More details on the rate review, including key terms requested in this filing can be found on Slides 6 and 7. Additionally in Wisconsin, WPL recently submitted its 2022 fuel reconciliation filing. This field reconciliation filing is requesting future recovery of $117 million of additional field costs incurred by WPL in 2022 due to higher energy cost to serve its customers. WPL currently anticipates a decision from the PSCW on this filing in the third quarter of this year. While our utilities experienced higher fuel costs in 2022 driven by elevated commodity prices, during the first 3 months of 2023, we have experienced significant reductions in natural gas prices which will help lower fuel costs for our Wisconsin customers in the future. And in Iowa, we have already started passing these lower fuel cost benefits on to our customers through the monthly fuel cost tariff. Looking forward in Wisconsin, we are preparing applications to request approval for capacity and efficiency improvements for some of our natural gas-fired peaking units. Also, we are awaiting the PSCW decision on the proposed 274 megawatts of battery storage projects. These projects were part of the capital expenditure plan announced in the third quarter of 2022 and are part of the proposed revenue requirement WPL's recently filed rate review for test periods 2024 and 2025. Moving on to our Iowa jurisdiction. In late 2021, we filed for advanced rate making principles for approximately 400 megawatts of solar generation and 75 megawatts of battery storage. In January of this year, we provided additional testimony and evidence to the Iowa Utilities Board as requested in this proceeding. This testimony and evidence further demonstrated that IPL is taking prudent action to meet its customers' need for capacity, and our projects represent cost-effective solutions compared to alternative options available in the market. Last week, the IUB approved advance ratemaking principles for 200 megawatts of build-transfer solar projects at the Duane Arnold location. And we are proceeding with the judicial review requesting a District Court decision to enable the IUB to issue advanced frame-making principles for the 200 megawatts of Creston and Weaver self-build solar projects and 75 megawatts of battery storage projects. We are confident these projects will provide customer benefits including reliability and resiliency and remain committed to executing these projects. With an active regulatory calendar, we look forward to getting to know and engage with the new commissioner in Wisconsin, Summer Strand and the two new Board members in Iowa, Sarah Martz and Eric Helen. We congratulate them on their appointments. We appreciate your continued support of our company and look forward to meeting with many of you in the coming months. As always, we will make our Investor Relations materials available on our website. At this time, I'll turn the call back over to the operator to facilitate the question-and-answer session.

Dariusz Lozny:

Just wanted to maybe pick up on that last comment that Robert was making about the advanced ratemaking process in Iowa. I noticed that the Duane Arnold order included no ROE incentive, which had been included in projects in the past. Just wondering with just kind of given where you guys are in the energy transition in Iowa, obviously, you've got the blueprint out there. Can you maybe comment on expectations for future ROE incentives on future projects that you'll be proposing?

Dariusz Lozny:

One more, if I could. And again, this is probably more a little bit high level. Can you comment at all on the opportunity set that you see for repowering any of your existing wind assets in the portfolio?

Dariusz Lozny:

And just to confirm, John, nothing in the existing plan as far as capital for repowering?

Operator:

[Operator Instructions] There are no further questions at this time. Ms. Gille, back over to you.

Operator:

Ladies and gentlemen, this concludes your conference call for today. We thank your participating and ask that you please disconnect your lines. Have a great day.

Susan Gille:

Good morning. I'd like to thank all of you on the call and the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chair, President, and CEO and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night announcing Alliant Energy's fourth quarter and year-end 2022 financial results and affirmed our 2023 earnings guidance. This release as well as an earnings presentation will -- which will be referenced during today's call are available on the Investor page of our website at www.alliantenergy.com. 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 press 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 which is available on our website. At this point, I'll turn the call over to John.

Robert Durian:

Thanks, John. Good morning, everyone. Yesterday, we announced 2022 GAAP earnings of $2.73 per share compared to $2.63 per share in 2021. On an adjusted basis, which excluded the impacts of temperatures and non-recurring adjustments, our earnings per share increased 6% from 2021. Looking year-over-year, the increase in 2022 was driven by higher earnings from capital investments at our Wisconsin utility and higher electric and gas margins. These favorable drivers were partially offset by higher financing and depreciation expenses. Our diverse retail customer base supported the higher electric and gas margins in 2022. Residential temperature-normalized electric sales increased by almost 1%, largely due to strong customer growth. We also saw higher-than-expected sales from commercial customers with continued recovery from COVID for several business sectors in our service territory. These were offset by lower industrial sales, primarily due to temporary plant shutdowns at some of our larger customers. In 2022, we also saw a better than expected temperature-normalized natural gas sales enabled by solid customer growth. The 2022 results we are sharing today are result of our consistent efforts to manage through and mitigate ongoing inflationary pressures. We're extremely proud that we kept 2022 utility operating expenses in line with 2021 and we were able to manage through and offset the negative impacts on earnings from rising interest and fuel costs. Our work in 2022 accelerated strategic initiatives that will set us up for many years to come. We invested in economic development and electrification that will enable future sales growth. We updated our resource planning to maximize Inflation Reduction Act benefits, and meet the new MISO seasonal reliability requirements. And we accelerated technology and automation investments to improve efficiency. As we look to 2023, we anticipate operating and maintenance expenses will be lower than 2022, continuing our trend of flat to declining O&M to enable cost savings for our customers. We recorded a few nonrecurring adjustments in 2022. These included $0.03 per share related to the Iowa state income tax rate change, $0.02 per share related to retirement plan settlement losses, at the end of 2022 and $0.02 per share related to a reserve adjustment for American Transmission Companies base ROE changes. Turning to 2023. We are positioned for another year of consistent 5% to 7% earnings per share growth. We are affirming our 2023 earnings guidance range with a midpoint of $2.89 per share, representing a 6% increase over 2022 adjusted earnings. Our 2023 earnings drivers include earnings on customer investments in our core utility business, and our continued efforts to reduce cost to increase customer value. Higher depreciation and financing expenses associated with these investments will partially offset these positive drivers. Our efforts to support customer value through making smart investments in our future support our ability to consistently deliver strong financial results. Other key assumptions for 2023 include growing sales by approximately 0.5% of 1%, led by higher sales to our commercial and industrial customers. And we estimate a consolidated effective tax rate of 1%, with substantial production tax credits generated by our large wind portfolio and growing solar portfolio, helping us maintain low effective tax rates for the upcoming year and several more years to come. The benefits from these production tax credits are passed on to our electric customers to help them manage their bills and therefore, are largely earnings neutral. Our financing plans for 2023 include a mix of new debt supplemented with modest new common equity to finance our investments in renewable projects and to support refinancing a $400 million debt maturity in 2023. In December, we launched an At The Market or ATM program as our intended approach for raising up to $225 million of new common equity throughout 2023, which is in addition to the $25 million of common equity that we expect to raise under our DRIP finance. And in January, we entered into an interest rate swap to help reduce the risk of rising interest rates related to a portion of our variable-rate debt. The 2023 financing plan is driven by robust capital expenditure plans and supports our objective to maintain the capital structures at our two utilities consistent with our most recent regulatory decisions. Next, I'll highlight this year's key regulatory initiatives. Last month, we provided additional testimony and evidence to the Iowa Utilities Board and IPL's advanced remaking proceeding. This testimony and evidence further demonstrates that IPL is taking prudent actions to meet its customers' need for capacity by advancing Iowa-based solar and storage projects that represent cost-effective solutions compared to alternative options available in the market. We also informed the IUB that we have identified our self-developed Creston and Wever projects as the second 200 megawatts of solar products, in addition to the 200 megawatts build transfer solar projects at the Duane Arnold site. To date, we've provided all the information requested by the IUB demonstrating that these projects are in the best interest of our customers. The IUB's decision this week to pause the advanced rate making process is procedural. We are working through both the regulatory and judicial processes in parallel, and following the well-defined process to move these projects forward. Next, we expect the IUB to file a response with the District Court in early March. We are confident these projects will provide considerable customer benefits, including reliability and resiliency and remain committed to executing these projects while we await the IUB's final rule. In Wisconsin, we are awaiting a decision from the PSCW on WEC Energy's purchase of a portion of our West Riverside natural gas generating facility. We are also anticipating decisions from the PSCW in 2023 on WPL's request for 274 megawatts of battery storage. 175 megawatts of these battery projects would complement 2 of WPL solar projects and 99 megawatts of the battery projects will be located by our Edgewater Generating Station to take advantage of the existing infrastructure and transmission rights at that location. Finally, we plan on filing a normal biennial electric and gas rate review in Wisconsin for test years 2024 and 2025 in the second quarter. In both states, we are also anticipating making filings to support additional resources for growing dispatchable generation capacity, needed to improve seasonal reliability and meet customer energy needs. As always, we continue to move forward proposing energy investments that support both sustainability and resiliency, keeping our customers' needs top of mind. I will conclude with a recap of the prominent legislation enacted this past year that has set us up for a solid future financial success, while providing significant customer cost benefits. Alliant Energy is a strong beneficiary of the Inflation Reduction Act. As it directly supports our strategic plans to advance cleaner energy for our customers, while providing significant customer and investor benefits. The IRA enables additional rate base opportunities while also lowering customer costs with a shift from tax equity to full ownership for our planned solar and battery projects. In our November 2022 refreshed capital expenditure plan, we incorporated the benefits of the IRA along with the changes from the MISO seasonal construct, which provides visibility to our planned 8% rate base growth through 2026. Another key element of the IRA improves our cash flows, through the ability to transfer renewable tax credits starting with those generated in 2023. With a large portion of wind and solar projects, we anticipate that we'll be able to transfer up to approximately $150 million of 2023 tax credits. As we continue to add more solar and battery projects over the next few years, the amount of annual transferable credits will continue to grow. We expect this to positively impact our credit metrics through acceleration of cash and reduction in future external financing needs and to lower our customer costs by reducing sharing costs on tax credit carryforwards. The IRA will provide significant benefits for our customers and investors with no notable downsides as we expect to remain exempt from the alternative minimum tax for the foreseeable future. And finally, we also expect to benefit from new state tax legislation enacted in Iowa in 2022, which is lowering state corporate tax rates, enabling us to pass millions of dollars of annual savings onto our customers in Iowa for decades into the future. We appreciate your continued support of our company and look forward to meeting with many of you in the coming months. At this time, I'll turn the call back over to the operator to facilitate the question-and-answer session.

Shahriar Pourreza:

Hey. Good morning, guys.

Shahriar Pourreza:

Good morning. So, just two quick ones here. I guess the first one is, as we kind of look at -- look ahead to the rate case filing in Wisconsin, you guys built up a substantial fuel deferral last year at WPL. How should we be thinking about, I guess, your regulatory pathways to spreading this out, and more broadly, I guess how should we be thinking about the total rate increases you're targeting, i.e., is there a double-digit guardrail here? Thanks.

Shahriar Pourreza:

Okay, perfect. The last point was what I was trying to get at. And then just I guess, maybe a familiar question at this point, but any sort of incremental clarity or thoughts on how we should be thinking about the equity needs post 2023, as you work through the cash flow impacts of the IRA? And are you still targeting roughly $100 million to $200 million of cash flow benefits from the ITC PTCs?

Shahriar Pourreza:

Okay, perfect. That was nice and simple. Appreciate it, guys.

Operator:

Thank you. Your next question comes from the line of Julien Dumoulin-Smith from Bank of America. Please go ahead.

John Larsen:

Yeah. Maybe I'll take the coal supply part. We've done a lot of work on a number of fronts in 2022, Shar, and even a bit ahead of that on the coal supply. So, we feel in very good shape as we go forward on the coal supply and maybe I'll let Robert if you want to talk a little bit about -- more on the fuel part.

Julien Dumoulin-Smith:

Got it. Okay. Fair enough. I appreciate. Just talk to us a little bit about the core challenge, the decision to create kind of a parallel pathway here in pursuing some degree of certainty on that construct, if you will, just the strategy, right? Typically, we see these kinds of more nuanced issues continue to remain within the confines of regulatory processes. Maybe that's the way I'd frame it.

Julien Dumoulin-Smith:

Awesome. Alright, thank you, guys, very much. And then just quickly next rate case in Iowa, just how does it fit in here, if you will, if there's any consideration around that?

Julien Dumoulin-Smith:

Excellent guys. Thank you. Good luck, alright. Thank you for the time.

Operator:

Thank you. Your next question comes from the line of Nicholas Campanella from Credit Suisse. Please go ahead.

Robert Durian:

Yes. Nick, this is Robert. So there's no definitive time frame regarding the judicial process, but we have asked for expedited review is how I'd characterize it. Largely because as we continue to move forward with these projects, like a lot of the other utilities, we are seeing costs continue to increase. So we have a desire to try and get these in, as soon as possible to make them as cost effective as possible for our customers. But there is no definitive time frame, but we'll be continuing to work closely with both the IUB as well as the judicial process to try and get these done as quickly as possible.

John Larsen:

Yeah Nick, John here. And we're still very confident in our 5% to 7% in midpoint.

Robert Durian:

Yes. Nick, when we look at, I'll say, AEC as an entire company, specifically at the FFO to debt metric, we are slightly below the targeted level for AEC, largely because of the timing of those fuel cost recoveries, as well as some additional solar construction costs. We incurred financing on, in 2022 as a result of pivoting away from a tax equity partnership to full ownership. . We expect those credit metrics to improve materially when you look out about 12 months. As we begin to recover those fuel costs as well as we get to the next rate case in Wisconsin where we'll start recovering those additional solar costs as well. So we feel very confident about the ability, like I said, within the next 12 month window to be able to improve those metrics. We're also cautiously optimistic that as early as 2023, we might be able to start realizing the benefits of our tax credits that have available to be sold now into the market as a result of the IRA. So a lot of positive developments we see over the next 12 months when it comes to those credit metrics.

Operator:

Thank you. Your next question comes from the line of Andrew Weisel from Scotiabank. Please go ahead.

John Larsen:

Hey, Andrew.

Robert Durian:

Yes, Andrew, I would think of it, as we'll continue to work the process with the advanced rate making principles over the next few months. We still have a little bit of time, I would characterize to be able to get through that process, and not need to start those construction projects. But once we get to the second half of this year, I would expect that we'll be starting the construction. And hopefully, we'll have all of the RPU process that's completed, and get an answer from the IUB to support them.

Robert Durian:

No, we would expect that we'll be locking in the ROE before construction starts. We need to, like I said, follow those procedural steps to make that happen. But I don't think that we'll be starting that construction until we have better clarity on that.

John Larsen:

Yes. Andrew, I'd say we're -- we feel well positioned for the filing that we have. So it really isn't a change for us. We've used what we call our Clean Energy Blueprint process to be very transparent on the projects that we'll have. And in fact, many of them have already been in front of the commission or vetted and very strong cost management. So we understand the balance with affordability. As far as settlement, it's certainly always a possibility as we think about filing. We're certainly well positioned, if we'll go through the entire process, but also see the opportunity for potential settlement along the way.

Operator:

Thank you. Your next question comes from the line of Alex Mortimer from Mizuho. Please go ahead.

Robert Durian:

Yeah Alex, this is Robert. So think of that $100 million to $200 million was identified as the 2023 number, which we picked the midpoint there of $150 million. As we complete the construction of the 1,100 megawatts of solar in Wisconsin, we continue to add up to 350 megawatts of new battery projects. Those tax credits actually get probably closer to $300 million to $400 million on an annual basis. And think of that over probably once you get to the 2025 time frame, you'll see those types of levels. So -- so that's what gives us a lot of optimism about future cash flow opportunities, when it comes to the transferability of these tax credits.

Robert Durian:

Yeah, right now for AEC, our consolidated group, think of that in that 14% to 15% range, and we expect to be at that point, like I said, in the next 12 months in that 2024 time frame.

Operator:

Thank you. Your next question comes from the line of Ashar Khan from Verition. Please go ahead.

Robert Durian:

I think that's a reasonable estimation of the time line. When we think about the second half of 2023 and the start of construction, we're looking for the opportunity to get through all of the IUB and introduce a reuse by that point in time. We don't have complete control over that. But again, we're going to petition the fact that our expeditious review of this will really help support our customers and bring it in those cost-effective solutions for them quicker. So, I think your time frame is, generally speaking, a good one.

Robert Durian:

Yeah. I would say there is a strong need for capacity when you think about as we project out and as part of our resource planning with the retirement of our Lansing coal plants here in the first half of 2023. We know we need additional resources. We think these are the best resource options for us. But if they're not supported by the process that we're going through, we do have other potential avenues for capacity resources that we'll need to put into place.

John Larsen:

Yeah. What I had shared was, we'll communicate it by the first half of 2024. And again, as we noted, that's going to be tied to the final timing of our solar projects within IPL.

Operator:

Thank you. There are no further questions at this time. I would now turn the call back over to Ms. Susan Gille for closing remarks.

Operator:

Thank you. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask, that you please disconnect your lines. Have a lovely day.

Susan Gille:

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, Chair, President and CEO; Robert Durian, Executive Vice President and CFO. Following prepared remarks by John 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 and raised the midpoint of our 2022 earnings guidance range and announced the 2023 earnings guidance and common stock dividend target. It also provided our annual capital expenditure plan through 2026. This release as well as an earnings presentation, which will be referenced during today's call are available on the Investor page of our website at www.alliantenergy.com. Before we begin, I need to remind you that 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 press 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.

Robert Durian:

Thanks, John. Good morning, everyone. Yesterday, we announced third quarter non-GAAP earnings of $0.93 per share, compared to $1.02 per share in the third quarter of 2021. Our quarterly earnings change year-over-year was primarily due to higher interest expenses and the timing of income taxes. The non-GAAP adjustment recorded in the third quarter of $0.03 per share related to Iowa tax Reform enacted earlier this year. In September, the Iowa Department of Revenue announced a corporate state tax rate of 8.4% for 2023, which is down from the current rate of 9.8%. This change resulted in a current year charge at our nonutility and parent operations related to lower deferred tax asset value. However, this change will also enable us to pass millions of dollars of annual savings from lower state taxes onto our customers in Iowa for decades into the future. Through September of this year, our net temperature impacts increased Alliant Energy earnings by approximately $0.07 per share. And our temperature-normalized sales are tracking above our sales growth expectations from the beginning of the year. Looking forward to the fourth quarter and our full year 2022 results, we expect strong earnings growth from investments in Wisconsin solar projects and the reversal of tax timing issues that have impacted the first nine months of this year. As a result of stronger sales through September and our projected fourth quarter results, we have narrowed and raised our 2022 earnings guidance to a range of $2.76 per share to $2.83 per share. During 2022, our team has been advancing and transforming our Clean Energy Blueprint to ensure that we not only accomplish our current year goals, but also enable the achievement of our financial and operational objectives over the long-term. Our sourcing team, has been ensuring materials and equipment are on-site or are on order to achieve the targeted completion dates of our announced solar project. And our development team has been advancing a robust portfolio of future generation resources that supports the future of clean, affordable and reliable energy for our customers. As John mentioned, we issued our consolidated 2023 earnings guidance range of $2.82 to $2.96 per share. The key drivers of the 6% growth in EPS are related to earnings on investments in our core utility business and our continued efforts to reduce cost to support customer affordability. We are forecasting these key earnings growth drivers will be offset by higher depreciation and higher financing costs associated with new construction projects. We invest strategically and in the best interest of our customers. These investments include implementing technology in many areas of our business, from our enterprise work and asset management solution to our advanced distribution management system. We are working to improve the customer and employee experience while controlling customer costs. Through our ongoing transition and retirement of our fossil fuel generation resources, we will continue reducing our operating costs. And as we bring our planned solar projects into service, we expect production tax credits and lower fuel expenses to largely offset the impact of increases in renewables rate base, which makes these new investments very cost-effective for customers. This will translate into long-term benefits for our customers and as John mentioned long-term value for our shareowners. Moving to our financing plans, in August, we successfully completed a $600 million green bond issuance at WPL to finance solar generation project. And in September, we filed information with our two state commissions, announcing plans to move away from tax equity financing to full ownership of WPL and IPL's solar and battery projects to capture even more benefits for our customers. We expect to replace the previously planned tax equity financing with additional long-term debt issuances, supplemented with some modest levels of new common equity to fund our announced solar and battery project. Our 2023 plans include $1.3 billion of financing, largely related to funding customer focused investment. This includes issuing up to $300 million of long-term debt at both our Iowa and Wisconsin Utilities, up to $450 million of debt at Alliant Energy Finance and up to $250 million of new common equity. We have won $400 million maturity in mid-2023, which will be refinanced with the planned new debt issuance in Alliant Energy Finance. This 2023 financing plan is driven by robust capital expenditure plan, and supports our objective of maintaining capital structures at our two utilities, consistent with their most recent regulatory decisions. And our future financing plans anticipate utilizing the new transferability provisions within the Inflation Reduction Act to accelerate cash flows from future tax credits generated by wind, solar and battery projects, thereby reducing our future financing needs. Finally, I'll highlight our regulatory initiatives in progress as well as those regulatory filings we plan to make in 2023. First, there are two key regulatory initiatives currently in progress. In Wisconsin, we recently requested construction authority for 175 megawatts of battery storage, which supports capacity needs resulting from the proposed sale by WPL of a portion of the West Riverside generating facility to our neighboring utilities. And in Iowa, we are expecting a decision from regulators on our advanced ratemaking filing for 400 megawatts of solar and 75 megawatts of battery storage. This proceeding is progressing, and we anticipate a decision in the next few weeks. As a reminder, this decision should include an improved ROE and depreciation rates for the life of the solar and battery storage assets. Turning to our 2023 regulatory plans, in conjunction with our updated capital expenditure plan, we expect to make regulatory filings in both Iowa and Wisconsin in 2023 for additional renewables and dispatchable resources to improve seasonal reliability and meet customer energy needs. From a rate review calendar, we expect to file a WPL rate review covering future test years 2024 and 2025 in the first half of next year. And for IPL, we expect to file our next rate review by the first half of 2024. Before I wrap my remarks, I want to acknowledge our Alliant Energy employees. You've executed our plan and kept our strategic projects on track, allowing us to share the financial and operational plans today from clearing supply chain hurdles to regulatory planning and communication, from preparing our tax equity financing to pivoting to full ownership to capture even greater customer benefits from the Inflation Reduction Act. Your actions have been and continue to be focused on the best interest of our customers and the communities we are privileged to serve. We very much appreciate the continued support of our company by our investors and look forward to meeting with many of you at the EEI Finance Conference next week. Later this week, we plan to post on our website the updated materials in advance of EEI. At this time, I'll turn the call back over to the operator to facilitate the question-and-answer session.

Dariusz Lozny:

Hi guys, good morning, this is Dariusz on for Julien. Thank you for taking the question. My first one is just about the substantial step-up in the capital funding plan. Just curious, how should we be thinking about equity funding needs beyond 2023? Is it as straightforward as just taking approximately half of that incremental capital versus the previous plan or just curious how we should be thinking about that?

John Larsen:

Dariusz, this is John here. I just might add that primary drivers here are really growth, renewables and dispatchable as Robert had outlined. And the IRA alone adds about $1 billion of investment that will have really minimal or no impact - will impact the customers so really a great CapEx update and refreshment.

John Larsen:

Yes, I think thinking of it as continued on the 5% to 7%, Dariusz. But as you noted, the capital plan we have - sets us up quite well for a very long-term, 5% to 7%. So we feel very well positioned and a lot of strength in that 5% to 7% long-term outlook.

Operator:

[Operator Instructions] We'll take our next question from Michael Sullivan with Wolfe Research. Please go ahead.

John Larsen:

Good morning.

Robert Durian:

Yes, Michael, maybe I'll give you some sense of the magnitude of the production tax credits that we're forecasting. So right now, we're generating a little over $100 million a year from those wind projects that we've put into service in 2019 and 2020, when you layer on the 1,500 megawatts of solar that we're planning on putting this service by the 2025 time period, that's also roughly another $100 million of production tax credit. So roughly in, the neighborhood of about $200 million to $250 million of production tax credits from wind and solar projects. We also expect, with our battery projects, investment tax credits that will be generated, those will be, I would say, less consistent. They'll be just timed within - we put those into service. But we're talking upwards of probably $200 million to $300 million of annual tax credits and depending upon the ability to monetize those timely. Then we do see some pretty significant inflows of cash flows that will reduce our future financing needs. So, we're still working with the credit rating agencies to know exactly how they'll treat those future inflows of cash. But we know we will be able to reduce our financing needs on the debt side. We're just not sure if that will be reflected as part of our FFO to know exactly how that's going to be treated for the debt credit metrics.

Robert Durian:

I think that's a fair statement. We don't expect any years in the future to be even at that level, we're expecting it to be lower than level when you think about '24 through '26.

John Larsen:

I just might add, Michael, a lot of moving parts there, but a lot of positives as well. So as you can imagine, I think we're following that as a modest in the future, but working towards making that on the low end, if at all needed.

John Larsen:

Yes, maybe I'll start. We're anticipating that seasonal construct. It's a matter of probably when, not if, as we see that go forward. So we've been doing a lot of planning for that in advance. We've got capacity and resource needs just from our load growth and maintaining reliability. And then when you add, what we'd expect on the seasonal construct, if you think of that long-term with resources and resource plan, it's just going to drive some additional resources for us. Timing-wise, I might ask Robert to opine on where we're at on the schedule for that, but it's likely to happen. It's just timing is the question, Michael.

Michael Sullivan:

Okay thanks so much. See you guys down in Florida.

Operator:

We'll take our next question from Nick Campanella with Credit Suisse. Please go ahead.

Robert Durian:

Yes, sure Nick. So we're continuing down the path. We kicked off several years ago to create some sustainable O&M savings in the business and are working to advance those efforts. We go back to 2019 and bring it forward. We've reduced O&M about 5% or about $40 million in total. So in 2022 here, we've done quite a bit of work with different strategic initiatives to set us up for a solid financial future, including expenses incurred this year to enable sales growth through economic development and electrification. We've updated our resource planning to maximize the IRA benefits and meet our new seasonal requirements and then accelerated technology and automation investments to gain cost efficiencies. So quite a bit of work in 2022 to really help us offset and reduce inflationary pressures that we're going to see in 2023. We're also expecting our coal plant costs to go down in 2023, partly because of the Lansing Generation facility retirement as well as the fact that we're able to defer costs associated with the Edgewater 5 Unit as a result of the last rate case. So when you kind of factor all that together, we actually expect 2023 O&M expenses to be lower than 2022. And so, we'll use that to offset some of the impacts we're seeing as far as interest rate increases. And so as we think about the key drivers for next year, those are probably two of the factors that will offset each other, and then we'll see the growth largely from all the investments that we're making in solar and battery projects in both our Iowa and Wisconsin jurisdiction. From a longer-term perspective, it will continue to be a focus for us for O&M. We'd say probably flat to declining over the longer term, and we're really focused on that right now from a customer affordability perspective.

John Larsen:

Nick, John here, maybe I'll - you've got the Wisconsin spot on with our typical two-year cadence. In Iowa, think of it as one of those major drivers is the consideration would be our 475 megawatts of solar and storage. So thinking about the timing of the rate case with that, we obviously like to stay out of that a little bit longer, but that's going to be one of the considerations. And obviously, there's some cost impacts that will factor into that decision-making as well. As Robert noted, sometime between middle of '23 and first half of '24 would be likely the timeframe that we would file. Anything you'd add to that, Robert?

Nick Campanella:

Got it, that's really helpful. And one last from me and I recognize it's small, but you do have a small proportion of unregulated earnings, mostly at parent, and I'm just curious in this new forecast, are you just holding that flat? Is there any kind of considerations there around the unregulated business either way? Thanks.

Nick Campanella:

All right, we'll see in a few - see you next week actually. Thank you.

Operator:

And we'll take our next question from Ashar Khan with Verition. Please go ahead.

Robert Durian:

Yes, I think you've got the right thinking as far as when we think about the rate base CAGR at roughly 8%. So really, the offset to that right now is financing costs, both the new equity that we proposed in 2023 as well as we are expecting some higher interest expense at the parent and non-regulated businesses. So that's the key offset as we think about the next few years. I would say that - we do have some opportunities to be kind of in the upper half of that earnings range when we get out to the full impact of the rate base opportunities, but we tend to kind of signal our longer-term guidance range of 5% to 7% and target that midpoint and very comfortable with that over the next four or five years.

Operator:

And Ms. Gille, there are no further questions at this time.

Operator:

And this concludes today's call. Thank you for your participation. You may now disconnect.

Zach Fields:

Good morning. I would like to thank all of you on the call and on the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chair, President and CEO; and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night announcing Alliant Energy’s second quarter 2022 financial results. This release as well as an earnings presentation will be referenced during today’s call, and are available on our Investors page of our website at www.alliantenergy.com. Before we begin, I need to remind you that 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 press release issued last night, and in our filings with the Securities and Exchange Commission. We disclaim any obligation to update these forward-looking statements. At this point, I’ll turn the call over to John.

Robert Durian:

Thanks, John. Good morning, everyone. Yesterday we announced second quarter 2022 GAAP earnings of $0.63 per share, compared to $0.57 per share in the second quarter of 2021. Our utility earnings increased year-over-year driven by higher AFUDC earnings attributable to increasing solar construction activities, higher electric and gas sales and the timing of income taxes. These increases in earnings were partially offset by higher interest expense. For the year, we are reaffirming our 2022 earnings guidance range of $2.67 to $2.81 per share. And as a result of strong sales year to date, combined with our employees continued focus on managing costs, we are currently trending towards the upper half of our 2022 guidance range. In the second quarter, we experienced strong electric sales driven by warmer than normal temperatures throughout our service territories and our continued trend of better than expected temperature normalized sales. This continued strength in electric sales has resulted in first half 2022 temperature normalized sales more than 2% above the first half of 2021 with our second quarter temperature normalized sales 3% higher than last year. This strength was reflected in all electric customer classes in both states and most pronounced in sales to residential and commercial classes. We continue to see strong customer growth at our Wisconsin utility and a continued pandemic recovery, particularly in customer facing businesses, such as entertainment, education and recreation. These sales results are indicative of the strength of the economies in Wisconsin and Iowa and are helping offset the impact of current cost trends. Turning to our solar investments. As John mentioned, we are moving forward on our planned solar projects without major delays. We have maintained strong momentum on these projects through proactive, procurement and panel deliveries and solid progress with our construction activities this summer. We are also encouraged by the Biden administration’s executive order in June to establish a two year moratorium on tariffs related to the investigation by the Department of Commerce. That order is expected to help ensure lower project costs for our customers, as we complete the 1.5 gigawatts of solar projects planned through 2024. In June, WPL announced plans to adjust the timing of the retirement of its two remaining Wisconsin coal plans. While this decision will change the trajectory of our projected O&M, it also limits our customer’s exposure to potentially higher capacity charges. This short-term shift of the retirement dates allows us the ability to manage regional capacity and supply chain challenges, while continuing to move forward with adding new solar generation and providing safe and reliable service to our customers, which is our number one priority. We do not expect any material earnings impacts from this short-term shift. Given the most recent Wisconsin rate order provides WPL the ability to defer cost incurred to operate the Edgewater Generating facility beyond its previously planned retirement date. We continue to make progress on our key regulatory initiatives included on Slide 6 of the supplemental slides. Looking first at our Wisconsin jurisdiction, in June, we received written approval for our second certificate of authority filing for 414 megawatts of solar, enabling us to move forward with the construction of six additional solar projects throughout our Wisconsin service territory. In July, WPL filed an updated request for the recovery of its forecasted 2023 fuel cost to reflect the impact of adjusting the retirement date of its Edgewater Generating facility. If approved, the request would result in flat year-over-year fuel cost recoveries in 2023, to help stabilize electric rates for our Wisconsin customers, despite increasing energy prices. We anticipated a decision on this request from the PSCW later this year. And as announced earlier this year, WPL expects to make additional filings in the coming months for up to 300 megawatts of firm capacity to replace capacity related to its West Riverside Energy Center that may be purchased by other Wisconsin utilities under outstanding purchase options. Turning to Iowa. We filed rebuttal testimony in our advanced ratemaking filing for 400 megawatts of solar and 75 megawatts of batteries to meet future capacity requirements for our Iowa utility. We use the rebuttal testimony to update our requested cost cap to reflect increases in costs since our initial filing in the fourth quarter of last year. The hearing for this filing is scheduled to take place next week. And we requested a decision from the Iowa regulators by the end of the third quarter. While I’m on Iowa and renewables, it’s worth noting that our wind portfolio in Iowa has performed well this year. In fact, the energy produced by our wind facilities through the first six months was approximately 30% higher than the same time period last year. These higher levels of wind output have helped reduce fuel costs for our Iowa customers in 2022. And there’s another example of the customer benefits from a strong and diverse generation portfolio. On the legislative front, while the Inflation Reduction Act is still a proposal, we are encouraged by the opportunities presented within the current text to enhance the value of our current Clean Energy Blueprint for both customers and shareowners. Certain key provisions, including tax credit transferability, production tax credit eligibility for solar projects and standalone tax credits for energy storage could provide us even more pathways to bring clean and affordable energy to our customers. We will continue to monitor this proposed legislation and evaluate its potential impacts. Finally, our financing plans for 2022 remain unchanged. In June, we started receiving contributions from our first tax equity partnership related to WPL’s 2022 solar projects. And we anticipate receiving the balance of the contributions after the solar projects are placed into service later this year. Our remaining financing activities in 2022 include plans to issue up to $600 million of long-term debt at our Wisconsin utility to provide additional funding for solar construction projects. We are also on track to issue approximately $25 million of common equity through our Shareowner Direct Plan. In closing, I’d like to echo John’s remarks related to our talented employees. I am so proud to work alongside such dedicated people who work hard each and every day deliver on our purpose of serving customers and building stronger communities. Thank you for joining us today and for your interest in Alliant Energy. We look forward to meeting with many of you in the coming months. Now, I’ll turn the call back over the operator to facilitate the question-and-answer session.

Unidentified Analyst:

Hey, good morning, everyone. This is Darius on for Julien. Thank you for taking my question. First one, if I may just around the potential IRA legislation, I realize it’s fairly preliminary and you noted in the comments you’re continuing to evaluate. Just curious if you have any preliminary thoughts as to impact on items such as credit metrics, FFO to debt, anything along those lines that you could potentially speak to.

Robert Durian:

Well, thanks, John. Yes. For the most part, we haven’t been prepared to disclose any specific details. But I think directionally, you can think of this, giving us an opportunity to actually increase our rate base, an opportunity to lower customer costs and an opportunity really to improve our cash flow metrics. When you think about the transferability of tax credits, not only the ones that we may generating from our new solar projects, but from our existing wind projects we see a pretty good opportunity to increase our cash flow over the next several years as a result of those provisions. When you kind of combine that with the fact that we do not think we’ll be subject to the 15% minimum tax based on our current income levels, we actually think it’s going to be pretty positive all around when it comes to customers, shareowners and debt holders, so pretty encouraged by the legislation.

John Larsen:

Yes. I think you spot on Darius. As Robert noted, it’s likely that this could move us more towards ownership so increased rate base. So we’d certainly take a look at that, but also with the cash aspect of this, it can tend to balance out a bit. But anything you want to add with that, Robert. I think you’re spot on Darius.

Unidentified Analyst:

Okay, great. That’s super helpful. One more, if I can just on the pension. Any impact from higher pension plan expense, I think it’s something that you alluded to in the previous update, just given the moves both in interest rates and also in asset values. Just curious if there’s any update there. I think in the past you’ve said that WPL there’s a deferral mechanism, so the impact would be mostly at IPL. I’m just curious if there’s any update you can provide on that front.

Unidentified Analyst:

Got it. That’s very helpful. Thank you. And I’ll pass it on here.

Michael Sullivan:

Hey everyone. Good morning.

Michael Sullivan:

Hey, John, just wanted to circle back to kind of what got discussed in the Q&A on the last call. Can you just clarify, so on the solar plans, is everything back to fully on track, including those 500 megawatts in late 2023 that seem to be facing some uncertainty? And then I think during Q&A you had indicated that that uncertainty may put you towards the lower end of the growth rate temporarily. Is that still the case, or should we think of all that as kind of resolved now?

Michael Sullivan:

Okay. And on the growth rate, should we still think of some pressure potentially in the near-term or you think you’re kind of firmly back at the midpoint?

Michael Sullivan:

Okay, great. Thanks. And then can you just review rate case timing plans in both states and whether or not the coal retirement delays has any impact on that?

Robert Durian:

Yes, sure. Michael, maybe starting in Wisconsin here, the rate case scheduled for Wisconsin would indicate another rate case for 2024, 2025 to keep on our two year cycle. And the change in the retirement dates for the Columbian Edgewater facility would not impact the timing of those rate cases. So think of 2024 and 2025, the next one in Wisconsin. For Iowa, we’re continuing to watch these cost trends. Historically, we were trying to stay out a little bit longer in Iowa, but we may be inclined to come in a little bit sooner now, maybe as early as 2023. So that’s still to be determined. And what that might look like in the future as far as whether it’s a future historical test year. But all indications are from a cost since we probably would be coming in a little bit earlier and maybe as early as the 2023 time period.

John Larsen:

Thanks, Michael.

Andrew Weisel:

Hey, good morning guys.

Andrew Weisel:

First question is at WPL, I think you mentioned the 300 megawatts of capacity, I guess you’ll file for that kind of any day now. Any updated thoughts on what that’s going to look like?

Andrew Weisel:

Okay, great. Next, a couple questions on the coal plants. Can you talk about the O&M impact? I think you alluded a little bit to higher O&M kind of offset by the avoided capacity costs. Robert, can you maybe just talk a little bit about some of the numbers behind that and how that would impact rates between now and the next rate case that you just alluded to?

Andrew Weisel:

Okay, great. That’s helpful. And then how do you expect the units to run as they transition to becoming capacity resources? I understand that MISO determines the dispatch, but are you expecting a gradual declining capacity factors or more like an abrupt change at some point?

Andrew Weisel:

Sounds good. One last one, if I may. Given the strength of the year to date results, have you started to pull some expenses forward from 2023 or beyond to help customers and better position yourselves financially? Or are you waiting to get through this summer before you reinvest?

Andrew Weisel:

Just to clarify, I wasn’t asking about guidance. I was asking about your O&Ms and how potentially like accelerating, feed trimming or programs like that.

Andrew Weisel:

Very good. Thank you for the details.

Operator:

And it appears there are no further telephone questions. I’d like to turn the conference back to Mr. Fields for any additional or closing remarks.

Operator:

And once again, that does conclude today’s conference. We thank you all for your participation. You may now disconnect.

Zach Fields:

Good morning. I would like to thank all of you on the call and on the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chair, President and CEO; and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night announcing Alliant Energy's first quarter 2022 financial results. This release as well as an earnings presentation will be referenced during today's call, and are available on our Investors page of our website at www.alliantenergy.com. Before we begin, I need to remind you that 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 press release issued last night, and in our filings with the Securities and Exchange Commission. We disclaim any obligation to update these forward-looking statements. At this point, I will turn the call over to John.

Robert Durian:

Thanks John. Good morning, everyone. Yesterday we announced first quarter 2022 GAAP earnings of $0.77 per share, compared to $0.68 per share in 2021. First quarter earnings were 13% higher on a year-over-year basis led by increasing rate base at our Wisconsin utility, higher AFDC earnings, largely attributable to our 2022 solar portfolio construction and higher electric and gas sales. For the full year, we are reaffirming our earnings guidance of $2.67 to $2.81 per share. The midpoint of that range is a 6% increase over 2021 adjusted earnings per share of $2.58. Details on our quarter earnings drivers and 2022 full year guidance can be found on Slide 3. Our temperature normalized sales for the first quarter of 2022 were better than expected, growing more than 1% compared to the first quarter of 2021, driven by stronger residential and commercial sales. Residential sales were higher primarily due to new customer growth in both Wisconsin and Iowa. And the commercial sales growth was supported by continued pandemic recovery in the education, office and entertainment sectors of our customer base. Owned and other utilities was flat versus the first quarter of 2021 after excluding changes in energy efficiency expenditures. In the current environment of widespread inflationary pressures across the various areas of our business, I'm proud of our team's efforts to control costs on behalf of our customers and maintain utility O&M expenses consistent with 2021 levels. Moving to our new solar developments, we have made good progress on the construction of the initial 325 megawats of utility scale solar in Wisconsin that is planned to go in service this year. Slide 4 showcases some of these 2022 solar development activity. The department of commerce investigation that was initiated in the first quarter has the potential impact of timing and costs of our 2023 planned solar projects. However, we feel confident that our 2022 planned solar projects will progress as anticipated and be placed in service later this year. We are advocating both directly and indirectly through multiple trade organizations for an expedited and fair outcome of this investigation. While we acknowledge investigation could impact our 2023 plan projects, we are focused on mitigating such impacts and continuing our long track record of delivering on our 5% to 7% growth targets throughout the planning period. We have included our key regulatory initiatives on Slide 5. We were pleased to reach another key milestone with our clean energy blueprints yesterday, with the receipt of the Public Service Commission of Wisconsin's verbal approval of our second certificate authority filing for 414 megawats of additional solar projects in Wisconsin. Looking forward in Wisconsin, we are preparing a third certificate of authority filing to request approval, to construct an estimated 300 megawats of additional firm capacity to meet our customers growing demand. We're planning to make that filing in the upcoming month. And in our Iowa jurisdiction, we recently requested to provide the procedural schedule for our advanced remaking filing for 400 megawats of solar and 75 megawats of battery storage in the state. This request was made to allow time for our team to ensure we are providing the most current cost estimates for the projects we are pursuing. The updated procedural schedule can be seen on Slide 6. We have requested a decision from Iowa regulators by the end of the third quarter. We do not anticipate this modified procedural schedule to have a material impact on the timing of the in-service dates of our projects or the timing of our overall CapEx plan. Turning to our financing plans, we have made great progress so far in 2022. In the first quarter at our Align Energy Finance subsidiary, we refinanced our $300 million term loan and issued $350 million of new long-term debt. Our remaining 2022 financing plan includes issuing up to $600 million of long-term debt at our Wisconsin utility and retiring $325 million of remaining long-term debt maturities in the second half of 2022. Lastly, Iowa corporate tax reform was signed into law last month. The new tax rules are expected to phase down the corporate income tax rate from its current rate of 9.8% to as low as 5.5% over time. The amount the tax rate will decline each year is dependent on annual state income tax collections from corporations and will be announced by the fourth quarter of each year. We view this tax law change as positive for customers as it is expected to provide long-term benefits to lower customer costs and serves as another driver for economic development activities in Iowa. As a result of this tax change, we also expect to recognize a modest earnings charge later this year, related to revalue and deferred tax assets at our non-regulated businesses, which we plan to recognize as an adjustment to our earnings from normal operations. Refer to Slide 7 in our presentation for more information on this tax change to assist you with your modelling. We appreciate your continued support of our company, and look forward to meeting with many of you virtually and in person in the coming months. As always we'll make our Investor Relation materials available on our website. At this time, I'll turn the call back over to the operator to facilitate the question-and-answer session.

Unidentified Analyst:

Hey, good morning guys. I just wanted to touch a little bit on sort of the circumvention tariffs, because obviously it's topical with investors and we could be in a situation, we get a proposed decision from the commerce department in August. Just curious on, sort of the language around potentially seeing a shifting out of projects. The 23 projects, certain peer and a couple peers actually talked about potentially having pricing uncertainty through '25. So I guess, the question is, is why only would the 23 projects could we see further slippage? And then curious also what levers, you have to sort of mitigate the shifting out of that sort of solar capital to reiterate the 5% to 7%, or could we maybe see a situation where the profile of the 5% to 7% is slightly tweaked in the near term as we're thinking about capital being potentially pushed out.

Robert Durian:

Yeah, good morning, Shar. As John noted, we took, yeah, we took actions after the first petition in 2021 to mitigate the impacts of the potential tariffs. And we've made really good progress in securing panels through the first quarter of this year. So as we pivoted also to source panels from some of our projects that would not be subject to the tariffs. As a result, we do not expect significant impacts to the 325 megawats of WPL solar projects that we expect to put into service later this year, as well as we don't expect any significant impacts to approximately 250 megawats of the earlier projects in 2023. So we're going to continue to monitor the department of commerce investigation over the next couple quarters here and continue to work with our developers and our solar panels to mitigate the impacts on the timing for what I would characterize as the remaining 500 megawats that John indicated was in the kind of the latter half of 2023.

John Larsen:

Yeah, I think, Shar, we certainly remain committed to that. There's clearly some I think it's a tail of some headwinds and tailwinds here. We've seen some load growth that's there. WE'VE had some great O&M, but as you note the impact to that and adjustments we'd have to make we would've to certainly factor that in as well, but off to a good start. Certainly a big part of our business planning is around contingencies for that back half of '23 projects as you noted.

John Larsen:

Yeah, certainly there are impacts of inflation and cost of goods. As you know, there's no question about it, but as you know, we put in place our cost reduction efforts in mitigation. Now we've been on this for a few years and we've had a lot of good momentum going into this year. So that's certainly helpful. It's a lot harder to be on that negative trajectory when you have some of those pressures. We still have some of these cost reductions, labor and others that are yet in front of us. They will be perhaps dampened a bit by some of these inflationary costs. I don't know if you want to add anything to that, Robert, but it's certainly an area we're going to have to just keep very, very sharp focused Shar.

John Larsen:

Yeah. Thank you.

Julien Dumoulin-Smith:

Thank you. Good morning, team Roberts, John, it's pleasure. So I suppose just following up on Shar's question on a multifold just to be more explicit about the ability to backfill, just, can you talk through, what exactly you're doing on that front? Sounds like you already were moving this, but should we expect more distribution CapEx amongst other things here move around on -- and just related to that, if I can, just also on '23, what percent of your panels have you guys procured and where do you guys stand with counterparties to address it otherwise?

Julien Dumoulin-Smith:

Excellent. Thank you. In fact, you kind of answered the next question in some respects here if you can. Retail loan growth up 2% in the first quarter is robust. How does that track against your internal forecast? You said specifically a second ago, load forecasts are pretty conservative and then separately on the O&M side, I think you guys talk about 3% to 5% reduction. You said a second ago that, there's some more room to go on that. Again, I know that you're guiding flat this year, but more structurally 3% to 5%. There's more room to go on a 3% to 5% vis-a-vie offsetting this, if I hear you right?

Julien Dumoulin-Smith:

Excellent. Well done. And on the low trend, even the Ag you mentioned here, is that something we should expect to accelerate given the global here as best you see it?

Julien Dumoulin-Smith:

Clearly. Well, best of luck. Thank you guys for the time.

Operator:

We will take our next question from Michael Sullivan from Wolfe Research.

John Larsen:

Good morning, Michael.

John Larsen:

Yeah, Michael, maybe I'll say it. I can assure you, we've done a lot of scenario planning on that and maybe it's not to get into too specific here, because there's a range of outcomes. We took some early action to have some very quality panel pricing and contracts. So it's just a matter of maybe if that clarity is there, that's certainly a good outcome. Pricing may have to be factored in, but when you look at the range of alternatives, these projects are going to make sense. There's a strong need. We've been talking about demand growth, a need for renewable. So that path and what we do is likely not really in question. It's just a matter of probably getting the certainty of what that pricing, if any change and maybe a little bit more on just the scheduling. What we'll do on our end is be well prepared for the sites. So when they arrive, obviously we can be very, very expeditious at getting them installed, which is what we did back last fall when we thought about our 22 projects. So hard to certainly handicap all of those outcomes, but maybe give you a little caller on how we're thinking about it.

Robert Durian:

Yeah. Maybe the best data point I can give you is compare it back to the regulatory approvals and the updated information we've shared as part of the CA1 projects. Those are the ones that we're going to be putting into service here in 2022. So we did update back in July of last year, the commission and let them know that we did see some cost increases roughly in that call it 10% increase range, and that puts it likely in the call it 1400 per KW for those projects. Since then we've continued to see escalations in price, but we still think we're probably around that in the 1400 for those first CA projects. And then with these second CA projects that we just received verbal approval for yesterday, that's in the call it 1600 per KW range. So with that said, those prices are still attractive for us when we think about alternatives for us to provide resources for our customers demand growth. So we still feel very committed to doing these and moving forward with them and what I would characterize as good projects with great pricing. Right now, what we're just trying to figure out is the exact timing of when we may be able to get those in service based on this department of commerce ongress investigation.

John Larsen:

Yeah, there's interesting developments when it comes to the pension plan information. So we benefit from the fact that interest rates are rising, because that lowers our obligation. But the plan performance, obviously with the stock market being relatively flat this year doesn't meet our expectations as far as earnings on the plant assets. So when you combine those two together, we could see some, I would say modest increases in pension plan expenses for 2023. As you indicated in our WPL rate case, we have a deferral mechanism such that if our pension costs succeed, what was set in the 2023 rate case levels, we were able to defer those costs. So we won't see any know impact Iowa side because we haven't been in for a rate case for a while. That would be something that we would have to offset as far as any impacts on 2023.

Operator:

We will take our next question from Andrew Weisel from Scotiabank. Please go ahead.

John Larsen:

Yeah. Hey, Andrew, John here. I'd say this is first of all, large part of efforts we've been doing as we've been transitioning from specific large projects, as we've talked about having a little more kind of bite sized in-service capital. So it's part of our planning to really have earnings more stable throughout the quarters instead of having primarily it was Q3 with just weather. So rather than translate that into a, Q1 times four in a different outcome. We've really tried to manage that. So still feel very comfortable with the guidance range that we've had and this is a little bit more about how we planned our investments and our in our rate case planning.

John Larsen:

It's certainly a bit stronger and I think I'd point to the sales was the primary positive upside on that Andrew, Okay.

Andrew Weisel:

Sure. Okay. That's helpful. Thank you both. Then second on the new Iowa tax change, I assume over time, a 100% of that savings would be passed on to customers, but what would be the mechanism? It might be too early, but would this be chewed up only after the next rate case whenever that is, or would it be more of like a fuel clause, annual adjustment?

Andrew Weisel:

Okay. Would it sort of accrue on the balance sheet in the meantime while that's being decided?

Operator:

We will take our next question from Andrew Levi from HITE Hedge.

John Larsen:

We can, Andy. Good morning. Good morning, Andy.

John Larsen:

Yeah, roughly that's the correct number,

John Larsen:

That's different from the $800 million or related to the 500 megawats in latter half.

John Larsen:

Yeah, you're usually seeing probably somewhere in the neighborhood of 30% to 40% that's funded through tax equity partnership structures.

John Larsen:

Yeah. The rate based impact, you're correct.

John Larsen:

Yeah. That would be CapEx in '22 and '23 with rate based editions going in '23.

John Larsen:

You're correct.

John Larsen:

Yeah. So we would be looking at that as part of our call it 24, 25 rate case planning activities, Andy. So there would likely be some capital expenditures that if these things were delayed longer than expected that we would be replacing this solar CapEx with different CapEx. To your point, it could be electric distribution spend. It could be other resources that we think about to meet the growing demand of our customers. And so that would all factor into our rate case planning activities to ensure that we put together a plan that's in the best interest of our customers and ensure that we recovery of that is part of our next case process.

John Larsen:

Yeah. I don’t go into the math on the numbers exactly Andy, but I think you're thinking about it correctly.

John Larsen:

Well, I think that's fair Andy. There would be I'll characterize it as a short term or we may be on the lower end of that range is how I characterize it. But over the long term, we still feel good about the 5% to 7%.

Operator:

We will take our next question from Ross Fowler from UBS.

John Larsen:

Good morning, Ross.

John Larsen:

Yeah. So first off there is no tariffs assumed in the 1600 per KW CA2 cost target. And what we would do is if we did see some additional costs above and beyond, what's in the CA2 target, we'd be sharing that with the commission similar to what we did with CA1 and CA2. As we went through the process, we've been keeping them informed. We've been very transparent about the economic conditions and inflation impacts on these solar projects. So it'd be a communication they would see throughout the next several quarters as we see information change, we'll share that with them. And at the end of the day, what'll happen is this information will be factored to our next rate case if there are any cost increases and we'll be going through a review of that and getting approval of that with the next rate case

John Larsen:

Ross. John here, maybe I'd say, it's not certainly atypical to go back if the there's a prudent cost increase on projects, we'd go back and work that through the process with our regulators. I think the real question is do the projects still make sense for customers, which I think Robert had noted compared to alternatives and the need that we have, the capacity need that we have, these are very strong projects. It's not necessarily something where you want the cost to increase, but they still make sense for our customers and we feel that's still gonna be a pretty strong story. I think the point about which panels, we've got to kind of take a look if there's different panels and different price out there, but we feel very good about the contracts we have in place and that's kind of a to be determined. So I don't want to get too far ahead on that part of it.

John Larsen:

Okay. Thanks so much.

Zach Fields:

Thank you. This concludes Alliant Energy's first quarter earnings call. A replay will be available on our investor website. Thank you for your continued support of Alliant Energy and feel free to contact me with any follow up questions.

Zach Fields:

Good morning. I would like to thank all of you on the call and on the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chair, President, and Chief Executive Officer; and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night announcing Alliant Energy's fourth quarter and year-end 2021 financial results, and updated our 2022 earnings guidance. This release as well as an earnings presentation will be referenced during today's call, and are available on our Investors page of our Web site at www.alliantenergy.com. Before we begin, I need to remind you that 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 press 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 earnings release, which is available on our Web site. At this point, I will turn the call over to John.

Robert Durian:

Thanks, John. Good morning, everyone. Yesterday, we announced 2021 GAAP earnings of $2.63 per share, compared to $2.47 per share in 2020. On an adjusted basis, which excludes its impacts of temperatures and non-reoccurring adjustments, our earnings per share increased 7% from 2020. Looking year-over-year, the increases in 2021 were driven by higher revenue requirements, primarily due to increasing rate base at our Wisconsin and Iowa utilities, and higher electric sales due to strong demand from commercial industrial customers and impacts of warmer summer temperatures. These favorable drivers were partially offset by higher depreciation and lower allowance for funds used during construction. Our temperature normalized retail electric sales grew 3% in 2021, when compared to 2020, primarily driven by a resurgence of our commercial and industrial customers, as our state economies have strengthened from the worst impacts of the pandemic in 2020. This recovery was more robust in 2021 than initially forecasted, led by stronger industrial sales resulting in total commercial and industrial sales levels for the year, roughly 1% higher than 2019 levels. As customers across our service territories have gradually been returning to their workplaces, we have seen some decline in residential sales. However, residential sales remain modestly higher than 2019 levels. The strong sales we experienced in 2021 were bolstered by a great year from our economic development efforts, as our team was able to assist with several key industrial customer additions and expansions, ultimately adding about 75 megawatts of load to our system. Additionally, we saw one of the strongest years of incremental customer growth in the past decade. We're announcing an update to our capital expenditure plans for 2022 through 2025. Our new plan is summarized on Slide 6 of our earnings presentation. There are two primary drivers for the updated plans. The first relates to recent progress made with our solar equipment suppliers that will allow us to receive equipment and materials earlier than previously anticipated. These efforts have allowed us to pull forward approximately $300 million of renewable expenditures into 2022. This enables us to complete these clean energy investments earlier than planned, with 325 megawatts now scheduled to go into service in 2022 for our Wisconsin customers. The balance of our previously announced solar and battery projects are expected to go in service in 2023 and 2024. The second driver of the updated capital expenditure plans involves accelerating clean energy investments into 2023 through 2025. To address capacity needs resulting from MISO's proposed seasonal resource adequacy construct. For those who may not be familiar, MISO is proposed to accredit generation capacity on a seasonal basis under this new construct, versus the current state where capacity is accredited on an annual basis. The additive investments included in our updated capital expenditure plans will help satisfy our anticipated seasonal capacity requirements, and support reliability for our customers. Our capital expenditure plans also continue to include investments to replace the capacity from the anticipated exercise of options by WEC Energy and MG&E to purchase a portion of our West Riverside natural gas facility. We anticipate making a Certificate of Authority filing with the PSCW in the first half of this year, for additional capacity resources to replace the capacity expected to be lost with the exercise of these options. We plan to share more details about these resources as we get closer to making that filing. Turning to this year's earnings guidance, with the updates to our capital expenditures plans, we're increasing our 2022 earnings guidance and remain well positioned for consistent 5% to 7% earnings growth going forward. The midpoint of our updated guidance range is $2.74 per share, which represents a 6% increase over 2021 adjusted earnings. The expected drivers of this increase in earnings include higher earnings on increasing capital investments, and higher APDC benefits from our solar projects under construction. More details on our 2022 earnings guidance are provided on Slide 7 of earnings presentation. In 2022, we estimate a consolidated effective tax rate of 4% with substantial production tax credits generated by our large wind portfolio, helping us maintain the low effective tax rate for the upcoming year and several more years to come. The benefits from these production tax credits are passed on to our electric customers to help manage customer bills. And therefore, are largely earnings neutral. Moving on to the financing plans for 2022, we plan to issue long-term debt of up to $1.4 billion in total for WTL and Alliant Energy Finance. The proceeds from the new debt will be used largely to finance investments in solar projects as well as to refinance $625 million of debt maturities in 2022. We also expect to receive approximately $25 million of new common equity under our DRIP plan in 2022. Lastly, we have included this year's key regulatory initiatives on Slide 8 related to our customer investments. In Wisconsin, we anticipate a decision on our approval request for 440 megawatts on solar in the first half of this year. In Iowa, our advanced remaking filing for 475 megawatts of solar and battery is progressing as expected. The Iowa Utilities Board issued procedural schedule last month which can be found on Slide 9. We anticipate a decision on this advanced remaking filing in the second half of this year. In Wisconsin, we also filed a joint application for the sale of a portion of our West Riverside natural gas generating facility to WEC Energy and MG&E at the end of January. We anticipate a decision on this application in either last 2022 or early 2023. These regulatory initiatives are an important part of executing our strategy. And we are thankful for the continued constructive relationships with our regulators in both of our state jurisdictions. As we conclude another successful year with solid financial results and constructive regulatory outcomes, I want express my optimism for the year ahead. We've demonstrated the flexibility of our CapEx plan to shift quickly future opportunities in solar project supply chain. We have regulatory certainty for the next couple of years with no major rate reviews planned. And we have dedicated and intelligent employees working hard every day to serve our customers and shareholders. We appreciate your continued support of our company and look forward to meeting with many of you virtually and in-person in the coming months. As always, we will make our investor relation material available on our Web site. At this time, I'll turn the call back over to operator to facilitate the question-and-answer session.

Dariusz Lozny:

Hi, good morning everyone. It's Dariusz on for Julien. Thank you for taking my question. I just wanted to, at the outset, ask more high-level as far as your long-term EPS CAGR. It seems like in the last few years, you had pretty good success achieving growth at the upper-end of that range. So, as we look ahead in the context of your increased CapEx plan, I guess what kind of -- what would you see happen that would potentially see growth at the lower end of that CAGR? I am just trying to think of the various scenarios, again, in the context of the increased investment plan.

Dariusz Lozny:

Okay, great. Appreciate that. And I guess more on the potential legislation side of things. I know the environment changed a little bit, and we were talking about potential direct pay getting passed a few months ago. I am just curious how are you thinking about that prospectively? How would your financing or FFO metrics change assuming that some kind of direct pay legislation or provision were passed in coming months?

Dariusz Lozny:

Okay, great, thank you. And if I could just sneak one more in here, just a point of clarification on the updated CapEx plan, obviously, you can appreciate that the renewable spend went up, as you alluded to. It looked like the other, the nonrenewable bucket on generation ticked down a little bit. Can you just speak to, I guess, what got either reduced or moved out in that bucket?

Dariusz Lozny:

Okay, great. I appreciate those responses. I'll pass it along here. Thank you.

Andrew Weisel:

Thank you. Good morning, everybody. I'd like to ask a question about the CAGR in a different way, similar idea though; you're reiterating 5% to 7%. In the past, you've talked about a bias towards the midpoint, and I believe the guidance midpoint for '22 is 6%. Just given your historical strength, I know you're sticking with the range, but is there a bias for the high-end in '22 and beyond, or do you really think that 6% is the more realistic number? I know you're conservative, but how to think about that?

Andrew Weisel:

Okay, got it. Then on equity, I see the $25 million in '22, that's a number you've talked about for kind of the foreseeable future, I believe. Is that still the case given the increase to the CapEx plan or might there be some upward pressure on equity needs, a lot of variables, of course, but given what you know today?

Andrew Weisel:

Okay. And remind us -- the DRIP was the $25 million you mean, right?

Andrew Weisel:

Okay, perfect. Thank you very much.

Operator:

We'll now take our next question from Peter Bourdon with Mizuho.

John Larsen:

Good morning, Peter.

Peter Bourdon:

So, on the solar CapEx pull-forward, is that for Iowa or Wisconsin? And then secondly, how should we be thinking about the recovery of that spend?

Peter Bourdon:

Okay. And then the additional $300 million to that same period, does that have any regulatory approvals tied to it?

Peter Bourdon:

Okay, I appreciate that detail. And then, just one other separate one for me, can you just kind of give us an update on the West Riverside Energy Center with the ownership options? Is there still a cash inflow expected for 2022, or is that pushed into later year?

Robert Durian:

And just as a reminder period, there's two pieces to that. There's actually the first half of it, as John indicated, we'll see for the first time in 2023 and there's also a 2024 piece, so that's roughly $200 million to $250 million of cash will come in pretty evenly between those two years.

Operator:

[Operator Instructions] We'll now take our next question from Michael Sullivan with Wolfe Research.

Robert Durian:

Good morning.

John Larsen:

That's correct Michael.

Michael Sullivan:

Okay, great. And just from a total incremental megawatts perspective, so I think you pulled some forward and that that drove some of the CapEx increase, but in the back end of the plan and what's tied to this MISO capacity, construct change how should we think about that from a megawatt standpoint?

Michael Sullivan:

Okay, great. Thank you. And then my last one was just what are you embedding for sales growth in 2022 guidance, any color on that?

Michael Sullivan:

Very helpful. Thanks a lot.

Ross Fowler:

Good morning, John. Good morning, Robert. How are you?

Ross Fowler:

Just followed up on the 7% to 10% increase in CapEx, and I know you've pointed to that in a group before you know, that's a little bit of cross pressure on the solar side, but you were able to pull it forward into this year and I just, I stepped back and I juxtapose that against some others in the industry that have actually pushed out, so the projects because of cost and supply chain issues. So, maybe just delving into, you know, details of your agreements there with your suppliers that allowed you to pull that forward. And then second part of the question is, are you seeing further sort of cost pressures or supply chain issues beyond that 7% to 10% as I think about future years for solar, in particular?

Robert Durian:

Yes, maybe just relatively speaking in November, we pushed out some of those projects, knowing that there was some supply chain constraints, but the team has done an amazing job over the past few months to remedy that situation. So, we're pretty much close to the original planned in-service dates that we had towards the earlier part of 2021, so, just to keep that in mind to keep as a reference point.

Operator:

And it appears there are no further questions at this time.

Operator:

And once again that does conclude today's conference. We thank you all for your participation. You may now disconnect.

Zac Fields:

Good morning. I would like to thank all of you on the call and on the webcast for joining us today. We appreciate your participation.

John Larsen:

Thanks, Zac. Good morning, everyone. And thank you for joining us today as we highlight our solid results for the third quarter of 2021.

Robert Durian:

Thanks, John. Good morning, everyone.

Operator:

[Operator Instructions] And we'll take our first question from Julien Dumoulin-Smith with Bank of America.

John Larsen:

Yes. Julien, John here. Yes. I think you have that. Just a little bit of an adjustment for inflation. And then, of course, this time of year, we bring in our new refreshed CapEx. And as Robert noted, we've added a bit there with some repower and some additional resources. But I think you've got the headline on that one.

John Larsen:

Robert, do you want to take that one?

Julien Dumoulin-Smith:

Got it. But you're not ready to talk about what the, shall we say, nearer-term benefit to your cash flow metrics looks like thus far?

Julien Dumoulin-Smith:

Got it. And the last quick one there. Just on the shift in distribution CapEx, obviously, stepping up in the later years. Is there any undergrounding in there? I know we've talked about that at various points with respect to ratio follow-up.

Operator:

[Operator Instructions] We'll now take a follow-up from Julien Dumoulin-Smith with Bank of America.

John Larsen:

Yes. Affirmative on both, Julien. The solar in Iowa, we recently announced is in our CapEx, and we don't see the minimum tax as impacting Alliant Energy.

Operator:

[Operator Instructions] We'll now take a question from Andrew Levi with Hite Hedge.

Robert Durian:

Yes, Andrew. This is Robert. I guess when we look beyond '25, which we've announced to date, we have provided some guidance through some of our materials that show we're thinking about roughly $7 billion to $9 billion of CapEx over the following 5-year plan. And as you think about that, I think it's going to be a continuation of what we're focused on now. A lot of it is going to be focused on cleaner energy sources. So think of that as more solar, more wind, including repowering opportunities, more storage. So all of those line up well with what our intention is, to translate or transfer our generation fleet to cleaner sources.

John Larsen:

Yes. Maybe I'll just start off. Yes, it's certainly important, Andrew, from overall cost, and we know it's important for transmission that's needed to connect renewables. So we certainly have a forecast for that and certainly would like to see transmission commensurate with the renewable adds.

Zac Fields:

This concludes Alliant Energy's Third Quarter Earnings Call. A replay will be available through November 12, 2021 at (888) 203-1112 for U.S. and Canada or (719) 457-0820 for international. Callers should reference conference ID 4175543 and PIN 9578. In addition, an archive of the conference call and a script of the prepared remarks made on the call will be available on the Investors section of the company's website later today. Thank you for your continued support of Alliant Energy, and feel free to contact me with any follow-up questions.

Zach Fields:

Good morning. I would like to thank all of you on the call and the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chair, President and CEO; and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night announcing Alliant Energy’s second quarter 2021 financial results. This release, as well as supplemental slides that will be referenced during today’s call are available on the Investor page of our website at www.alliantenergy.com. Before we begin, I need to remind you the remarks we make on this call and our answers to 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 press 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 is provided in the earnings release and our 10-Q, which will be available on our website. At this point, I’ll turn the call over to John.

Robert Durian:

Thanks, John. Good morning, everyone. Yesterday we announced second quarter 2021 GAAP earnings of $0.57 per share, compared to $0.54 per share in 2020. Our utility earnings increased year-over-year, driven by higher margins from increasing rate base and warmer temperatures. These increases in earnings were partially offset by higher depreciation expense and lower allowance for funds used during construction for rate base additions in 2020. With a very solid first half of the year now in the book, we are reaffirming our 2021 earnings guidance range of $2.50 per share to $2.64 per share, and as a result of favorable margins from temperature impacts here today, as well as our continued success in managing costs, we are currently trending towards the upper half of our guidance range. Contributing to the higher margins was a higher rate base at our Iowa utility related to the successful completion of our 1000-megawatt wind expansion program in 2020, which has resulted in lower fuel costs and increased tax credits for Iowa customers. Additionally, our Iowa utility began recovering earlier this year, a return of and a return on $110 million payment made to NextEra to terminate the purchase power agreement with the Duane Arnold nuclear facility five years early. Customers in Iowa begin benefiting from lower energy costs related to this transaction last fall. In Wisconsin, higher margins are attributable to the rate stabilization plan that was approved last year. Based with the unexpected challenges associated with the COVID-19 pandemic, we work collaboratively with our stakeholders to keep rates flat for customers in 2021. This approach is benefiting both our customers, as well as our shareholders, as we began recovery of previously approved projects such as our Kossuth Wind Farm and the Western Wisconsin Pipeline, which we offset with excess deferred income tax benefits and fuel saving. The second quarter continued the trend of improving economic conditions as our service territories returned to pre pandemic levels of economic activity. Our temperature normalized retail electric sales in the second quarter were up 4% versus in the second quarter last year. This increase was largely from strength in commercial and industrial sale. These changes in sales are a positive sign of economic recovery and resulted in a positive impact to margin. As economic conditions have improved, we’ve also seen an uptick in economic development in our service territory. Two noteworthy successes so far this year are the announcements of new facilities for Simmons Pet Food in our Iowa jurisdiction and SprayCheck [ph] our Wisconsin jurisdiction. These two new customers are bringing new jobs into communities in our service territories, in addition to new load for Alliant Energy. Many of you joined us a few weeks ago at our ESG Investor Event. I hope you took away from our comments how passionate we are about our leadership position in the transition to cleaner energy and other important aspects of our ESG performance. One key area of ESG story is our commitment to focus on customer affordability. That begins with the efforts and innovations of our outstanding employees. Two such innovations include our plans, tax equity partnerships for solar generation and the levelized cost recovery mechanism for retiring Edgewater coal plant in Wisconsin. Both of these were brought to us through the research and hard work of our employees, who are consistently looking for new and unique ways to keep customer costs low. Let me spend a moment on our corporate tax rate, which are provided on slide four of our supplemental slide. We estimate our full year 2021 effective tax rate will be negative 17%, which is primarily the result of production tax credits we earned from our expansion of wind generation and the excess deferred tax benefits from the 2017 federal tax reform, which we continue to return to our customers. Both of these items support affordable rates for our customers. And please note that these items are largely earnings neutral, as they lower both revenues and income tax expense. Our financing plans for 2021 remain unchanged. We plan to issue up to $300 million of long-term debt for our Wisconsin utility later this year and we’re also on track to issue approximately $25 million of common equity through our shared DRIP plan in 2021. Moving to our key regulatory initiatives. We are pleased that our strong collaboration with stakeholders resulted in a settlement agreement in the second quarter for 2022 and 2023 revenue requirements in our Wisconsin rate review. The agreement includes maintaining 10% return on equity, achieving an effective regulatory equity layer of 54% and utilizing an innovative recovery mechanism for WPL’s retiring Edgewater coal plant. The settlement is now subject to review and approval by the PSCW and we anticipate a decision on this filing later this year. More details on the terms of the settlement agreement can be found on slide six. As John mentioned earlier, we received written approval from the PSCW in June for 675 megawatts of new solar generation at Wisconsin. This is a significant milestone in our clean energy transition and another example of our long track record of achieving constructive regulatory outcome. We also filed our second Certificate of Authority application on additional 414 megawatts of Wisconsin solar in March. We anticipate a decision from the PSCW on this filing in the first half of next year. Later this quarter, we plan to file a request for advanced ratemaking principles for up to 400 megawatts of new solar project in Iowa. The advanced remaking principles process in Iowa includes approval of the return on equity for the life of the asset, depreciation rates and cost caps for the project. We anticipate a decision from the Iowa Utility Board on this filing by the middle of next year. Thank you for joining us today and for your interest in Alliant Energy. We look forward to connecting with many of you over the coming month. Now, I will ask the operator to facilitate the question-and-answer session.

Unidentified Analyst:

Hi. Good morning. It’s a Gaylen [ph] on for Julien. Thank you for taking my question. I just wanted to ask about your comments about the upper half of the 2021 guidance range. Just want to maybe talk through some of the puts and takes as far as how you’re looking at Q3 and 4, relative to how you’re tracking for the first half of the year compared to 2020, if you can maybe just talk about some of the moving parts there? And additionally, is there any July weather effect built into that assumption as well? Thank you.

Robert Durian:

Yeah. Just maybe to quantify the impacts, so through the first half of the year, the weather impacts on our sales or temperature impacts on our sales are about $0.05 to $0.06 positive and so that’s what’s really pushing us to that upper half of the range.

John Larsen:

Yeah. Certainly, we would expect to roll forward CapEx as we get to EEI. So you’ll see more at that time along with some other items that we typically share dividend and others financing toward that time of the year. We’ve been working the overhead to underground now and getting more and more efficient at that. So we’ve got certainly a lot more opportunity. We’ll share more of the specifics a bit later in the year, as I noted. But we’re -- we really are moving towards that path quite aggressively and we’ll share more about how that plays into future CapEx when we get towards the EEI later in the year.

John Larsen:

Okay. Thank you.

Michael Sullivan:

Yeah. Hey. Good morning. First question, just wanted to ask on, just -- could you guys remind us where you stand on credit metrics and how much capacity there -- is there as potentially take up CapEx over time?

Michael Sullivan:

Okay. But any just like number specifics in terms of terms of like recorded debt?

Michael Sullivan:

Okay. Great. Thanks. And then also just any color on what you guys are seeing in terms of inflationary pressures, particularly with some of the solar development that you’re doing?

Michael Sullivan:

Great. Thanks. And just last one real quick, I could have missed it in the prepared remarks, but are you guys reaffirming the 5% to 7% long-term?

Michael Sullivan:

Awesome. Thanks so much.

Operator:

This concludes today’s question-and-answer session. Mr. Fields, I’d like to turn the conference back over to you for any additional or closing remark.

Susan Gille:

Good morning. I would like to thank all of you on the call and the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chair, President and CEO; and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night announcing Alliant Energy's first quarter 2021 financial results. This release as well as supplemental slides that will be referenced during today's call are available on the Investor page of our website at www.alliantenergy.com. Before we begin, I need to remind you the remarks we make on this call and our answers to 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 press 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 10-Q, which will be available on our website. At this point, I'll turn the call over to John.

Robert Durian:

Thanks, John. Good morning, everyone. Yesterday, we announced first quarter 2021 GAAP earnings of $0.68 per share compared to $0.70 per share in 2020. Similar to last year, the first quarter's earnings are more than 25% of our 2021 earnings target and represent a strong start to the year. Our earnings were slightly lower on a year-over-year basis, largely due to the timing of tax expense impacts, which will reverse later this year. For the full year, we are reaffirming our earnings guidance of $2.50 per share to $2.64 per share, an increase at the midpoint of more than 6% over 2020 temperature-normalized earnings per share of $2.42. To assist you in modeling our quarterly earnings this year, I wanted to provide some additional context to one of the larger variances shown in our earnings release. As some may recall, in the first quarter of 2020, we recognized $0.06 of favorability due to the timing of income taxes, which arose from the large amount of wind generation placed in service in 2020. We had additional tax favorability in the third quarter of 2020 before a full reversal in the fourth quarter of last year. You can expect to see the inverse of that in 2021, with unfavorable variances related to the timing of income tax expense for the sum of the first 3 quarters, followed by a favorable reversal in the fourth quarter of this year. We continue to see improving economic conditions in our service territories, with more businesses returning to normal operations following the lifting of many of the COVID-19 mitigation restrictions and increasing levels of economic development activities in both states. Of note, our temperature-normalized retail electric sales in the first quarter of 2021 were better than expected and represented an approximate 1% increase over the first quarter of 2020, which was largely pre-pandemic for our service territories. We are also very encouraged by the fact that the number of our customers in arrears or on payment plans today is lower than it was before the pandemic began. This is a testament to the great work of our employees, connecting customers having difficulty making payments with available federal and state resources. I'm also very proud of donations by our company and our customers to the Hometown Care Energy Fund, which provides confidential financial support for Alliant Energy customers faced with financial challenges. Due to the COVID-19 pandemic in 2020, it was necessary for us to accelerate our cost transformation efforts to reduce -- to offset reduced sales, while holding rates flat for our customers last year. Thanks to our employees' continued focus on cost reductions, we achieved another quarter of solid operating expense reductions in the first quarter of 2021. Over the longer term, we are targeting to reduce O&M by approximately 3% to 5% per year for the next several years off of 2019 levels. We will achieve these savings through efforts that fall under 3 pillars, all of which are enabled by our customer-focused capital investments. The first and most immediately impactful are investments in generation transformation. This includes our expansion of wind and solar energy, and the sunsetting of coal generation in our portfolio. The second pillar involves investments in electric distribution, particularly in the areas of undergrounding and converting larger portions of our system to 25 kv, which will enable lower maintenance expense. The third and final pillar include investments in technology across our company, which will enhance productivity and efficiency through automation, customer self-service and telework. Slide 4 of our supplemental slides has been provided to assist you in modeling the effective tax rates for our 2 utilities and our consolidated group. We estimate a consolidated effective tax rate of negative 19% for 2021. The primary drivers of the lower tax rate are the additional tax credits from new wind projects placed into service and the return of excess deferred taxes from federal tax reform to our customers. The production tax credits and excess deferred tax benefits will flow back to customers resulting in lower electric margins. Thus, the decrease in the effective tax rate is largely earnings neutral. Turning to our financing plans. We continue to maintain strong balance sheets at our 2 utilities and the parent company with minimal financing needs in 2021. As a reminder, our financing plans for 2021 include up to $300 million of long-term debt to be issued by our Wisconsin utility and no material debt maturities this year. In addition, the only new common equity forecast to be issued this year is approximately $25 million through the shareholder direct plan. We've included our regulatory initiatives of note on Slide 5. Starting in our Wisconsin jurisdiction, as John mentioned earlier this week, we filed a notice of intent to settle with key intervening parties in Wisconsin and WPL's next electric and gas rate review filing. The agreement in principle resulted from collaboration and alignment with the settling parties on total revenue requirements for 2022 and 2023. The agreement would enable key financial terms impacting such revenue requirements, including maintaining a 10% return on equity, achieving an effective regulatory equity layer of 54% and utilizing an innovative recovery mechanism for WPL's retiring Edgewater coal plant. WPL is working with the stakeholders to finalize the terms of the settlement, which will be subject to review and approval by the PSCW. We anticipate a decision from the PSCW on this filing later this year. More details on the terms of the agreement in principle can be found on Slide 6. Additionally in Wisconsin, we received verbal approval from the PSCW in April for our certificate of authority filing for 675 megawatts of new solar generation. This verbal approval is another example of our continued track record of constructive State Regulatory decisions, approving renewable projects that support our transition to cleaner sources of energy for our customers. In the discussion of this decision, all 3 commissioners were complementary of the resource planning process and stakeholder engagement that we conducted as part of our Wisconsin Clean Energy Blueprint. The commission commended our modeling efforts in this process and the consideration paid to affordability and stability of rates, reliability of service and our path to sustainability for our customers. We'd expect a written decision in the coming weeks. We also filed our second certificate authority application for an additional 414 megawatts of Wisconsin Solar in March. We anticipate a decision from the PSCW on this filing in the first half of next year. Moving to Iowa. We expect to file for advanced remaking principles in the third quarter for a proposed approximately 400 megawatts of solar, included in our Iowa Clean Energy Blueprint. The advance remaking principles process in Iowa includes approval of the return on equity for the life of the asset, depreciation rates and a cost cap for the project. We anticipate a decision from the Iowa Utilities Board on this filing by the middle of next year. We appreciate your continued interest in our company and look forward to connecting with many of you virtually over the coming months. At this time, I'll turn the call back over to the operator to facilitate the question-and-answer session.

Julien Dumoulin-Smith:

So perhaps just first, high-level question. As you think about the transmission opportunities reported here, how would you characterize the ATC opportunity looking at the MISO futures that were recently released, et cetera, in your words?

Julien Dumoulin-Smith:

Okay. All right. Fair enough. And then as you think about the backdrop of this Wisconsin settlement, I appreciate the comments in your prepared remarks. But how do you think about the rate base associated with that settlement? And where does that position you, if you can yet, against your larger 5% to 7% range, if you can comment?

Julien Dumoulin-Smith:

Got it. And I presume you're confident in getting the approval of the higher 54% equity layer as part of that settlement?

Julien Dumoulin-Smith:

Excellent. Sorry, if -- I know you guys are quick here. If I can just squeeze one more in here. On ATC, any initial thoughts or responses here? I mean folks are fixated on this RTO adder a little bit of late. Any context on how you think about on appeals process? Or otherwise, if should that materialize this summer? Maybe look pretty [indiscernible].

Operator:

[Operator Instructions] We'll take our next question from Andrew Weisel with Scotiabank.

John Larsen:

Yes. Great, Andrew. Great to hear from you. And maybe I'll let Robert get that dialed in. Robert, you want to share those numbers for us?

Andrew Weisel:

Okay, great. Certainly manageable there. Next, just a few questions on the WPL proposed settlement, please. So first, you mentioned the effective equity ratio of 54%, but I thought the press release showed 52.5%. Are there some accounting quirks there?

Andrew Weisel:

Okay. Great. Next, in terms of the 2022 increase, what would that mean for customer bills, like as a percentage change for customers either in rates or monthly bills?

Andrew Weisel:

Okay. Then does the settlement include usage of some of the regulatory liabilities that you have available? I think last time, we talked about a range of about $60 million to $80 million. What is this settlement due to that?

Andrew Weisel:

Would it utilize all of that, I guess, is what I'm asking? Or would there be still some remaining?

Andrew Weisel:

Okay, terrific. And then one last one on the settlement here. Can you explain a little more of the mechanics around the Edge 5 levelization mechanism? And how to bridge the 9.8% versus 9.2% effective return?

Andrew Weisel:

Okay. Great. That's a really helpful analogy. Congrats on filing the settlement.

Michael Sullivan:

Just following on the Wisconsin rate settlement. I had 2 questions there. I guess, just first, how much of the 1.1 gigawatts of solar that you're adding is covered in the rate ask? And then my second one was kind of back to Edgewater. Do you guys think that the way the recovery was treated here could be a pretty good blueprint for how Colombia ultimately is treated out in 2024?

Michael Sullivan:

Okay. Great. That's helpful. And then my other question was just more on the Biden tax plan. If maybe you could give some thoughts there, particularly as it relates to maybe the minimum book tax. I know you guys have a number of PTC carryforwards. And how you're thinking about how that could get treated. Yes, just some thoughts on the Biden tax plan.

Robert Durian:

Yes. For the Biden plan, too, the provisions we're watching closely right now is obviously the corporate tax rate going from 21% to something potentially higher, that we've modeled that out at, I think, with the top end of a reasonable range is at 28%. And we think that would equate to roughly about a 2% increase in our customer bills. Some modest impacts on our EPS and then actually some positive cash flows, given our NOL position and tax credit carryforwards. But we think we can manage through that and some of the latest thinking I've read about things that, that might be in maybe 24%, 25%. So that would even probably be less impact to our customers, which would be good from our perspective. The minimum tax, we actually have seen more recently where they may set a threshold related to that and not really apply that to any companies that have less than, I think, $2 billion of annual income, and that would exclude us or exempt us for that. So we would be comfortable with that and obviously, supportive of that. So we wouldn't be put into that position. As John indicated, we're actually more interested in the widened plan right now because we see some opportunities for us to utilize some of those benefits to support a lot of the future capital growth that we may be pursuing, things like Direct Pay and potentially refundability of tax credits, we think would give us a good set of cash flows that we can reinvest in future renewables going forward. The stand-alone credit for storage. We think that would really improve the economics of those opportunities for us in the future and could build out some further capital opportunities for us. And then we're also watching the potential to be able to use PTCs instead of ITCs for solar projects that could make, what we think are, very favorable economic turns for our current solar even better. So pretty excited about some of those opportunities on the widened plan and what they might do to our capital investment opportunities going forward here.

John Larsen:

Yes. We get -- we get very excited to tell our story each year and updates. I wouldn't think of anything too notably different, but you will see a bit more focus on water resources, which has been a focus for us for a number of years, but I think we'll be putting some more stories and metrics there about water stress and how our company is focused on water resources.

Andrew Levi:

Just a couple of questions. So just on the higher equity ratio in Wisconsin, have you guys quantified the earnings power on that? How that helps your earnings power? And then I guess, you have a slightly lower ROE, right? Or was it maintained at 10% in the settlement?

Andrew Levi:

Okay. Got it. And then -- it's very helpful. And then on -- because you guys had mentioned about -- you have been asked about the FERC ROE, and so I understand that the impact of -- for you guys is minimal. But maybe kind of asking your CEO just kind of like a bigger picture question. So as you think about ROEs in general and obviously, FERC has afforded a, whether it's adders or whatever it may be, incentives, the ROEs seem fairly high relative to the cost of capital. Just kind of on a big picture basis, whether it's 50 basis points or 100 basis point change in ROE from the level that is the base ROE, that would never change or not change, I should say, your the amount of investment that you would make, right? Am I correct about that?

Andrew Levi:

Okay. And then my last question is just around rates, in general. So I guess, is this the first rate increase because you talked about a 6% rate increase in Wisconsin in quite a while, is that correct?

Andrew Levi:

And your average rate in Wisconsin, if I'm not mistaken, is around $0.10, is that correct?

Andrew Levi :

Okay. Because here on the East Coast, it's about $0.18. So -- so you have done a good job. So I just want to point that out.

Susan Gille:

This concludes Alliant Energy’s first quarter earnings call. A replay will be available through May 14, 2021, at (888) 203-1112 for U.S. and Canada, or (719) 457-0820 for international. Callers should reference conference ID 4175543. In addition, an archive of the conference call and a script of the prepared remarks made on the call will be available on the Investors section of the company website later today. We thank you for your continued support of Alliant Energy, and feel free to contact me with any follow-up questions.

Susan Gille:

Good afternoon. I would like to thank all of you on the call and on the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chairman, President and Chief Executive Officer and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will take time to for questions from the investment community. We issued a news release last night announcing Alliant Energy's fourth quarter and year-end 2020 financial results and affirmed our 2021 earnings guidance. This release as well as supplemental slides that will be referenced during today's call are available on the Investor page of our website at alliantenergy.com. 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 press 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 10-Q, which are available on our website. At this point, I will turn the call over to John.

Robert Durian:

Thanks John. Good afternoon everyone. Yesterday, we announced 2020 GAAP earnings of $2.47 per share compared to $2.33 per share in 2019. Excluding non-GAAP adjustments and temperature impacts, earnings per share were up more than 7% year-over-year, driven by higher revenue requirements due to increasing rate base, partially offset by the higher depreciation and financing expenses from these rate base additions. As John noted earlier, our dedicated employees rose to the challenge in 2020 by reducing O&M expenses to offset the impact of lower sales caused the pandemic and derecho storm. These efforts allowed us to finish the year in the upper half of earnings guidance range. We provided additional details on the earnings variance drivers on slides four and five. Our temperature-normalized retail electric sales declined 2% in 2020 when compared to 2019, primarily driven by the impacts of the COVID-19 pandemic as well as the August derecho storm in our Iowa service territory. While the pandemic-related sales impacts were heaviest in the second quarter, sales recovered quickly and were roughly flat to 2019 levels in the second half of the year. The sales recovery we experienced was a direct result of the strength and resiliency of the economies in the states we serve. Wisconsin's unemployment rate is a full percent less than the U.S. unemployment rate and the state is experiencing population growth as neighboring states' residents are moving to Wisconsin. And in Iowa, the economy has been recovering even faster. With and unemployment rate that is second-lowest in the country as well as strengthening grain prices due to increasing demand from foreign countries. Tuning to our future year's earnings. We see a solid path to delivering our earnings guidance for 2021. And as we look further into the future, we believe our strong capital investment plan will allow us to continue deliver solid returns for our shareowners, including the expected 5% to 7% annual EPS growth rate through at least 2024. The key drivers of the 6% growth in our 2021 EPS guidance over 2020 are related to investments in our core utility business including our recently completed wind projects for Iowa and Wisconsin customers. These investments were reflected in WPL's approved electric rates for 2021 and IPL's renewable energy rider approved with its test year 2020 rate review. Currently, renewables make up approximately 20% our total rate base, which is one of the highest percentages of renewable rate base among all U.S. utilities. We expect renewables will make up an even larger portion of our rate base as we invest in solar projects for our Iowa and Wisconsin customers over the next three years. A walk from our 2020 non-GAAP temperature-normalized earnings to the midpoint of our 2021 earnings guidance range is provided on slide six. The 2021 earnings guidance assumes a 1% growth in retail electric sales over 2020 levels. This forecast assumes continued economic improvement and recovery from the COVID-19 pandemic. Additionally, our employees have been working to add new customers and load to our system. One recent example of success is our new wholesale customer in Wisconsin, Consolidated Water Power Company. This new customer came online at the beginning of this year and brings up to 60 megawatts of new load to our system. Alliant Energy's strategy focuses on providing affordable energy to our customers while continuing our decade-long track record of growing earnings 5% to 7%. As a reminder, we reached settlement in our Wisconsin jurisdiction to hold rates flat in 2021 by using excess deferred taxes and fuel savings to offset a higher revenue requirement due to growth in rate base. This settlement enables us to earn a return on our investments we have made on behalf of our Wisconsin customers without increasing their base rates in 2021. In our Iowa jurisdiction, we expect to manage our business to allow us to stay out of rate cases for the next couple of years. This has been made possible through a collaboration with our regulators and stakeholders in Iowa on key items such as deferring costs associated with the August derecho storm and the addition of the renewable energy rider. The renewable energy rider will allow IPL to recover costs of the incremental rate base from our recently completed one gigawatt of wind while also passing on significant incremental production tax credits and fuel cost savings to our customers. Additionally, our Iowa customers began seeing savings in the fall of 2020 as a result of our decision to terminate the purchase power agreement relating to the Duane Arnold Energy Center five years early. IPL is forecasting to get recovery of and a return on the buyout payments associated with this termination through a rider over the next five years while customers benefit from tens of millions of dollars in energy savings each year. Slide seven has been provided to assist you in modeling the effective tax rates for our two utilities and our consolidated group. We estimate a consolidated effective tax rate of negative 20% for 2021. The primary drivers of the lower tax rates are the additional production tax credits from the new wind projects that were placed in service throughout 2020 and the return of excess deferred taxes from Federal Tax Reform to our customers. The production tax credits and excess deferred tax benefits will fall back to customers resulting in lower electric margins. Thus, the decreases in the effective tax rate is largely earnings neutral. Turning to our financing plans. In November 2020, we accelerated $200 million debt offering at our Alliant Energy finance subsidiary, originally planned for 2021 to capture historically low interest rates. As a result, our 2021 financing plan is currently limited to one long-term debt issuance of up to $300 million at our Wisconsin utility. And the only common equity activity we are expecting in 2021 is approximately $25 million to be issued ratably during the year through our shareowner direct plan. And lastly, some key regulatory developments in our two states. In Iowa, current Chair Geri Huser was recently appointed for an additional six-year term and Josh Byrnes was recently appointed as a new members to the Iowa Utilities Board. We welcome Board member Byrnes and Chair Huser on her additional term. And in Wisconsin, the PSCW recently issued its final written order approving WPL's rate stabilization plan in December. The PSCW also issued a procedural schedule for our first solar Certificate of Authority filing in late 2020 as shown on slide eight. The docket for our solar CA filing is proceeding as expected, including the constructive public hearing held yesterday. We anticipate a decision on this first 675 megawatts of solar from the PSCW in April. Our 2021 key regulatory initiatives are listed on slide nine. In the first half of this year, we expect to make an advance rate making principles filing in Iowa for our planned 400 megawatts of solar generation for IPL. As a reminder, the key benefits of the advance rate making principles process in Iowa is the certainty it provides for the authorized returns we earn on these investment. In our three most recent advance rate making filings, we were authorized an 11% ROE for new generation assets. The ROE decided with these filings are fixed the life of the assets. In Wisconsin, we expect to file our second certificate of authority request in the first half of this year for the remainder of our announced solar generation at WPL. In addition, we expect to file a retail electric and gas rate review in Wisconsin in the second quarter for year one, two or three years beginning in 2022. We are thankful for the privilege to work in two states that are well-known for constructive regulatory outcomes and plan to continue our long-standing practice of working collaboratively with stakeholders towards constructive regulatory outcomes on these key regulatory initiatives in 201. As we conclude another successful year, I am excited about our flexible and thoughtful strategy at Alliant Energy. As John described earlier, we are a leading utility in renewable energy and environmental stewardship and we look forward to maintaining that leadership status into the future. We will continue to deliver on our clean energy vision that will best serve our customers and shareowners as well as our environment. We very much appreciate your continued support of our company and look forward to meeting with many of you virtually in the coming months. As always, we will make our Investor Relations materials available on our website. At this time, I will turn the call back over the operator to facilitate the question-and-answer session.

Andrew Weisel:

Thank you. Good afternoon everyone.

Andrew Weisel:

My first question is, can you repeat that stat? I think I heard you say that Iowa will be 50% of generation from renewables by 2030. I know you have the overall target of 53% from renewables. So does that include both Iowa and Wisconsin? And does that include owned and PPA'd?

Andrew Weisel:

Okay. Great. Are you able to breakout how much of that is owned? Or said differently, what percent of your own capacity will be renewables?

Andrew Weisel:

Okay. Great. Thank you. Next on O&Ms, impressive year after several other previously impressive years. What's your outlook for 2021 and beyond? And how much of the savings you identified in 2020 would you consider to be sustainable versus one-time?

Andrew Weisel:

Great color there. That's very helpful and a very impressive target. Last question is, you had a very good track record in Wisconsin of keeping rates stable and you mentioned you are planning to file again in the second quarter. is there any potential to further delay that or find creative ways to keep rates stable? And then you mentioned that the case could cover one, two or three years. What would determine that? What will that depend on?