Alliant Energy Corporation Supplemental Information February 23, 2018 Earnings Call

Transcription

1 Alliant Energy Corporation Supplemental Information February 23, 2018 Earnings Call Forward Looking Statements The information regarding forecasted earnings per share, forecasted effective income tax rates, and regulatory plans contain forward-looking statements. Actual results could differ materially because the realization of those results is subject to many uncertainties, including: the state of the economy in the service territories of IPL and WPL; state and federal legislation and regulatory actions; weather; and other factors discussed in more detail in Alliant Energy Corporation s earnings release dated February 22, 2018 and in Alliant Energy s SEC filings. Alliant Energy cannot provide any assurance that the assumptions used in the forward-looking statements or otherwise are accurate or will prove to be correct. All forward-looking statements included in this presentation are based upon information presently available, and Alliant Energy assumes no obligation to update any forward-looking statements. 1

2 2015, 2016, and 2017 Non-GAAP Temperature Normalized EPS versus Midpoint of 2018 EPS Guidance $2.20 $2.11 $2.00 $1.99 6% increase $1.88 6% increase $1.80 $1.79 5% increase $1.60 $ (a) 2016(b) 2017(c) 2018(d) (a) 2015 GAAP EPS from continuing operations was $1.69. Non-GAAP EPS adjustments were ($0.04) for temperature impacts and ($0.04) for losses from sales of Minnesota distribution assets and ($0.02) for voluntary employee separation charges. (b) 2016 GAAP EPS from continuing operations was $1.65. Non-GAAP EPS adjustment was ($0.23) for a valuation charge related to the Franklin County wind farm. (c) 2017 GAAP EPS from continuing operations was $1.99. Non-GAAP EPS adjustments were ($0.06) for temperature impacts, $0.08 related to Tax Reform and ($0.02) for net write-down of regulatory assets due to IPL electric rate review settlement. (d) 2018 midpoint of EPS guidance range 2

3 2016 to 2017 GAAP Earnings Walk 2016 GAAP earnings per share from continuing operations $1.65 Utilities and Corporate Services: Higher margins from IPL interim retail electric base rate increase $0.20 Higher margins from WPL retail electric and gas base rate increases 0.19 Higher depreciation expense (0.13) Higher energy efficiency cost recovery amortization at WPL (0.07) Estimated temperature impact on retail electric and gas sales in 2017 (0.06) Effects of Tax Reform in Higher interest expense (0.03) Changes in AFUDC (primarily Marshalltown Generating Station) (0.03) Higher WPL electric fuel-related costs, net of recoveries (0.03) Net write-down of regulatory assets due to IPL retail electric rate review settlement in 2017 (0.02) Equity dilution (0.02) Other 0.03 Total Utilities and Corporate Services 0.07 Total ATC Investment 0.01 Non-utility and Parent: Asset valuation charges for Franklin County wind farm in 2016 $0.23 Effects of Tax Reform in Other (0.01) Non-utility and Parent variances GAAP earnings per share from continuing operations $1.99 3

4 2016 to 2017 GAAP to Non-GAAP Earnings Walk 2016 GAAP earnings per share from continuing operations $1.65 Asset valuation charges for Franklin County wind farm in Non-GAAP earnings per share from continuing operations 1.88 Higher margins from IPL interim retail electric base rate increase 0.20 Higher margins from WPL retail electric and gas base rate increases 0.19 Higher depreciation expense (0.12) Higher energy efficiency cost recovery amortization at WPL (0.07) Estimated temperature impact on retail electric and gas sales in 2017 (0.06) Higher interest expense (0.05) Changes in AFUDC (primarily Marshalltown Generating Station) (0.03) Higher WPL electric fuel-related costs, net of recoveries (0.03) Equity dilution (0.02) Other Non-GAAP earnings per share from continuing operations 1.93 Effects of Tax Reform in Net write-down of regulatory assets due to IPL retail electric rate review settlement in 2017 (0.02) 2017 GAAP earnings per share from continuing operations $1.99 4

5 2016 to 2017 Utilities and Corporate Services GAAP Earnings Variances IPL WPL Corporate Services Total Utilities and Corporate Services: Higher margins from IPL interim retail electric base rate increase $0.20 $ $ $0.20 Higher margins from WPL retail electric and gas base rate increases Higher depreciation expense (0.08) (0.05) (0.13) Higher energy efficiency cost recovery amortization at WPL (0.07) (0.07) Estimated temperature impact on retail electric and gas sales in 2017 (0.03) (0.03) (0.06) Effects of Tax Reform in 2017 (0.02) Higher interest expense (0.02) (0.01) (0.03) Changes in AFUDC (primarily Marshalltown Generating Station) (0.05) 0.02 (0.03) Higher WPL electric fuel-related costs, net of recoveries (0.03) (0.03) Equity dilution (0.01) (0.01) (0.02) Net write-down of regulatory assets due to IPL retail electric rate review settlement in 2017 (0.02) (0.02) Other 0.02 (0.01) Total Utilities and Corporate Services ($0.01) $0.06 $0.02 $0.07 5

6 Tax Reform Key Takeaways Lower customer costs Modestly accretive to forecasted future earnings (No change to 2018 EPS guidance nor any changes to 5-7% long-term growth rate target) ~$550 million increase to projected combined rate base in 2020 Expect to issue additional debt and equity to maintain authorized capital structures at utilities Alliant s Tax Reform Regulatory Proposals Interstate Power and Light (IPL) Deliver 2018 income tax benefits to electric customers through billing credits via the tax benefit rider. Defer excess deferred tax benefits until next Iowa electric rate review planned in 2019 Deliver lower electric transmission costs to electric customers via the transmission rider Deliver tax benefits to gas customers by adjusting interim rates in the next Iowa gas rate review planned to be filed in Q Wisconsin Power and Light (WPL) Deliver 2018 income tax benefits to electric and gas customers through billing credits and acceleration of regulatory asset amortizations Defer excess deferred tax benefits until next retail rate review planned to be filed by May 1, 2018 Defer lower electric transmission costs to transmission escrow account to be addressed in future rate review 6

7 2017 Non-GAAP Temperature Normalized Earnings to Mid-point of 2018 Consolidated Earnings Guidance Walk Utilities and Corp. Services ATC Investment Non-Utility and Parent 2017 Non-GAAP temperature normalized EPS from continuing operations $1.86 $0.11 $0.02 $1.99 Higher margins from IPL retail electric and gas base rate increases Lower transmission cost recovery amortizations at WPL Lower energy efficiency cost recovery amortizations at WPL Higher depreciation expense (0.16) (0.16) Higher AFUDC Higher interest expense (0.05) (0.04) (0.09) Equity dilution (0.03) (0.03) Other (a) (0.05) Forecasted EPS Midpoint $1.97 $0.13 $0.01 $2.11 Total (a) Other includes the remaining impact of the lower tax rate not captured in the individual earnings drivers listed above. Other also includes the anticipated refund/deferral of revenues collected subject to regulatory approval, since the majority of the lower tax rate will ultimately accrue to the benefit of customers. 7

8 2017 and Forecasted 2018 Statutory versus Overall Annual Effective Tax Rates AEC IPL WPL 2018 (a) (a) (a) 2017 Statutory federal income tax rate (c) 21% 35% 21% 35% 21% 35% IPL s tax benefit riders (b) (3) (8) (5) (19) Effect of rate-making on property-related differences (8) (9) (14) (19) (3) (2) Production tax credits (6) (6) (6) (7) (7) (7) Effect of Tax Reform (c) (3) 2 (6) Other items, net Overall income tax rate 12% 13% 1% (5%) 17% 25% (a) Forecasted (b) The tax impacts of IPL's tax benefit riders were $41 million in 2017 and are forecasted to be $14 million in (c) Impact of the Tax Cuts and Jobs Act (Tax Reform), which was effective in December Tax Reform impacts for 2018 are represented in each individual line item, where applicable. 8

9 Key Regulatory Initiatives Interstate Power and Light Iowa Utilities Board Decision regarding Retail Electric Base Rate Review - Test Year 2016 (RPU ) File Energy Efficiency Plan (EEP ) Estimated Key Dates Decision regarding Wind Expansion Advance Ratemaking Principles (RPU ) Q File Retail Gas Base Rate Review - Test Year 2017 Q Decision regarding treatment of the effect of Tax Cut and Jobs Act of 2017 (INU ) Q Federal Energy Regulatory Commission (FERC) Decision regarding authorized ROE amounts for MISO transmission owners' second complaint H Wisconsin Power and Light Public Service Commission of Wisconsin Decision on Retail Electric Fuel Rate Review - Test Year 2018 (6680-FR-109) File for Wind Expansion Construction Authority H Decision regarding the purchase of an interest in Forward Wind Energy Center (5-BS-226) Q File Retail Electric and Gas Rate Review - Test Periods 2019 and 2020 Q Decision regarding treatment of the effect of Tax Cut and Jobs Act of 2017 (05-AF-101) Q FERC Decision regarding the purchase of an interest in Forward Wind Energy Center (FERC 203 filing) Decision regarding authorized ROE amounts for MISO transmission owners' second complaint H ü ü ü 9