netrashetty
Netra Shetty
Alliant Energy Corporation (NYSE: LNT) is a public utility holding company that incorporated in Madison, Wisconsin in 1981. It consists of two subsidiaries:[3]
Interstate Power and Light Company (IPL) is a public utility that generates and distributes electricity, and purchases and distributes natural gas in Iowa and Minnesota.
Wisconsin Power and Light Company (WPL) provides similar services as IPL in Wisconsin.
Alliant Energy (NYSE:LNT) is a mid-western public utility holding company that supplies energy to about 1 million customers and natural gas to 412,000 customers in the states of Iowa, Wisconsin, and Minnesota.[1] It provides these services through its main subsidiaries: IPL, WPL, and Resources. Most of Alliant's business is regulated by state governments. This, combined with LNT's stable regional customer base allows LNT the luxury of having a stable income and financial situation.
Over the last few years, Alliant has focused on returning to its origins as a domestic regulated utility. As a result of this decision, it has dropped its unprofitable international ventures. These ventures in the non-regulated international arena hurt earnings.
The downside to not have international exposure is that Alliant's growth prospects have diminished. In order to increase earnings, capacity must be increased in its current territories. It plans to generate this expansion through new wind and coal-burning generators which are schedule to be completed by 2013. Annually, the company is planning to spend about $500 million towards this expansion. These additions should provide another 690 MW of electricity generation or about 12% increase over current production.
Company Overview
Alliant Energy is a public utility holding company that was incorporated in Wisconsin in 1981. Nearly all of Alliant's revenues come from regulated utilities, utilities that have rates and customer regions that are regulated by local and state governments.
Business Financials
In 2009, LNT earned a total of $3.4 billion in total revenues. This was a decline from its previous year's total revenues of $3.7 billion in 2008. Unsurprisingly, as a result of the decreased total revenues, LNT's net income situation was adversely affected. Between 2008 and 2009, LNT's net income declined from $288 million in 2008 to $130 million in 2009.[2]
Business Segments
All of Alliant's business is conducted through four subsidiaries:
IPL (Interstate Power and Light Company)
IPL is a public utility that generates and distributes electricity and transports natural gas to parts of Iowa and southern Minnesota.
WPL (Wisconsin Power and Light Company)
WPL is a company that primarily generates and distributes electricity and natural gas in southern and central Wisconsin.
Resources
This segment is used to organize the companies non-regulated investments (includes international investments).
Corporate Services
Corporate Services is used to provide administrative services to the subsidiaries.
Trends and Forces
95% of Alliant's business is regulated by government agencies
Government agencies regulate many aspects of Alliant's business, including:
Rates charged to customers
Portion of the cost of fuel, purchased power, and natural gas that can be recovered from customers
Construction of new electricity generation facilities
Installation of environmentally friendly equipment; transactions with other utility companies
These government regulations could impact Alliant's strategic plan of increasing electric generating capacity by building hybrid coal/biomass generation facilities and wind generating facilities. The Wisconsin government also regulates utility companies investments into other types of businesses which could be seen as a hindrance to companies looking to take over Alliant Energy. Changes in laws including environmental laws could impact Alliant's profit potential. At the same time, these regulations offer Alliant a degree of security since government regulators dictate the region of customers that Alliant supplies.[3]
Environmental Actions
Most of Alliant's operations emit Carbon dioxide (CO2) from the burning of fossil fuels and Alliant's business plan includes the construction of more coal-fueled plants. Current legislation and regulations on the federal level calling for reductions in CO2 emissions can affect whether these expansions are allowed. State regulators also have control on whether or not current expansion plans can be implemented and policies regarding CO2 emissions will have a negative impact on these plans. The lack of technologies designed to reduce CO2 emissions as well as a lack of specific CO2 levels that will need to be met in the future mean that Alliant cannot guarantee that it will be able to comply with future regulations or avoid any related penalities. As a result, environmental regulations can impact Alliant's growth plans and financial state, however to what extent remains unknown. [4]
Competition
Electric custumers in Iowa and Wisconsin do not have the ability to choose their electric provider due to government regulation of the utility industry. As a result Alliant has a relative monopoly over the regions it supplies to. However, electric suppliers compete to keep rates low to attract new customers into their service areas. [5]
The gas utility business is still regulated at the present time. Currently, federal and state policies are being enacted that will work towards deregulating the industry. This is in hope of bringing more competition and innovation to the industry. This will result in more competition in the sale of Natural gas and similar services. However, the distribution of natural gas will still be a regulated industry. It remains unknown whether the deregulation of the sale of natural gas will actual provide incentive for small retail customers to switch providers or whether there will only be economic incentive for large ones.
Some of LNT's largest competitors include Wisconsin Energy (WEC) and Xcel Energy (XEL).
Interstate Power and Light Company (IPL) is a public utility that generates and distributes electricity, and purchases and distributes natural gas in Iowa and Minnesota.
Wisconsin Power and Light Company (WPL) provides similar services as IPL in Wisconsin.
Alliant Energy (NYSE:LNT) is a mid-western public utility holding company that supplies energy to about 1 million customers and natural gas to 412,000 customers in the states of Iowa, Wisconsin, and Minnesota.[1] It provides these services through its main subsidiaries: IPL, WPL, and Resources. Most of Alliant's business is regulated by state governments. This, combined with LNT's stable regional customer base allows LNT the luxury of having a stable income and financial situation.
Over the last few years, Alliant has focused on returning to its origins as a domestic regulated utility. As a result of this decision, it has dropped its unprofitable international ventures. These ventures in the non-regulated international arena hurt earnings.
The downside to not have international exposure is that Alliant's growth prospects have diminished. In order to increase earnings, capacity must be increased in its current territories. It plans to generate this expansion through new wind and coal-burning generators which are schedule to be completed by 2013. Annually, the company is planning to spend about $500 million towards this expansion. These additions should provide another 690 MW of electricity generation or about 12% increase over current production.
Company Overview
Alliant Energy is a public utility holding company that was incorporated in Wisconsin in 1981. Nearly all of Alliant's revenues come from regulated utilities, utilities that have rates and customer regions that are regulated by local and state governments.
Business Financials
In 2009, LNT earned a total of $3.4 billion in total revenues. This was a decline from its previous year's total revenues of $3.7 billion in 2008. Unsurprisingly, as a result of the decreased total revenues, LNT's net income situation was adversely affected. Between 2008 and 2009, LNT's net income declined from $288 million in 2008 to $130 million in 2009.[2]
Business Segments
All of Alliant's business is conducted through four subsidiaries:
IPL (Interstate Power and Light Company)
IPL is a public utility that generates and distributes electricity and transports natural gas to parts of Iowa and southern Minnesota.
WPL (Wisconsin Power and Light Company)
WPL is a company that primarily generates and distributes electricity and natural gas in southern and central Wisconsin.
Resources
This segment is used to organize the companies non-regulated investments (includes international investments).
Corporate Services
Corporate Services is used to provide administrative services to the subsidiaries.
Trends and Forces
95% of Alliant's business is regulated by government agencies
Government agencies regulate many aspects of Alliant's business, including:
Rates charged to customers
Portion of the cost of fuel, purchased power, and natural gas that can be recovered from customers
Construction of new electricity generation facilities
Installation of environmentally friendly equipment; transactions with other utility companies
These government regulations could impact Alliant's strategic plan of increasing electric generating capacity by building hybrid coal/biomass generation facilities and wind generating facilities. The Wisconsin government also regulates utility companies investments into other types of businesses which could be seen as a hindrance to companies looking to take over Alliant Energy. Changes in laws including environmental laws could impact Alliant's profit potential. At the same time, these regulations offer Alliant a degree of security since government regulators dictate the region of customers that Alliant supplies.[3]
Environmental Actions
Most of Alliant's operations emit Carbon dioxide (CO2) from the burning of fossil fuels and Alliant's business plan includes the construction of more coal-fueled plants. Current legislation and regulations on the federal level calling for reductions in CO2 emissions can affect whether these expansions are allowed. State regulators also have control on whether or not current expansion plans can be implemented and policies regarding CO2 emissions will have a negative impact on these plans. The lack of technologies designed to reduce CO2 emissions as well as a lack of specific CO2 levels that will need to be met in the future mean that Alliant cannot guarantee that it will be able to comply with future regulations or avoid any related penalities. As a result, environmental regulations can impact Alliant's growth plans and financial state, however to what extent remains unknown. [4]
Competition
Electric custumers in Iowa and Wisconsin do not have the ability to choose their electric provider due to government regulation of the utility industry. As a result Alliant has a relative monopoly over the regions it supplies to. However, electric suppliers compete to keep rates low to attract new customers into their service areas. [5]
The gas utility business is still regulated at the present time. Currently, federal and state policies are being enacted that will work towards deregulating the industry. This is in hope of bringing more competition and innovation to the industry. This will result in more competition in the sale of Natural gas and similar services. However, the distribution of natural gas will still be a regulated industry. It remains unknown whether the deregulation of the sale of natural gas will actual provide incentive for small retail customers to switch providers or whether there will only be economic incentive for large ones.
Some of LNT's largest competitors include Wisconsin Energy (WEC) and Xcel Energy (XEL).