Commitments And Contingencies

12 Months Ended

Dec. 31, 2016

COMMITMENTS AND CONTINGENCIES

(a) Capital Purchase Obligations - Various contractual obligations contain minimum future commitments related to capital expenditures for certain construction projects. IPL’s projects include the installation of an SCR system at Ottumwa Unit 1 to reduce NOx emissions at the EGU. WPL’s projects include the Riverside expansion, generation maintenance and performance improvements at Columbia Units 1 and 2, and the installation of an SCR system at Columbia Unit 2 to reduce NOx emissions at the EGU. At December 31, 2016, Alliant Energy’s, IPL’s and WPL’s minimum future commitments related to certain contractual obligations for these projects were $58 million, $3 million and $55 million, respectively.

(b) Operating Expense Purchase Obligations - Various commodity supply, transportation and storage contracts help meet obligations to provide electricity and natural gas to utility customers. Other operating expense purchase obligations with various vendors provide other goods and services. At December 31, 2016, minimum future commitments related to these operating expense purchase obligations were as follows (in millions):



Alliant Energy	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$185		$189		$159		$137		$149		$599		$1,418
Natural gas	223		142		115		98		69		124		771
Coal (b)	105		54		18		—		—		—		177
Other (c)	16		4		5		2		2		5		34
		$529		$389		$297		$237		$220		$728		$2,400



IPL	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$138		$131		$144		$137		$149		$599		$1,298
Natural gas	120		74		55		39		23		71		382
Coal (b)	49		19		9		—		—		—		77
Other (c)	15		1		1		—		—		—		17
		$322		$225		$209		$176		$172		$670		$1,774



WPL	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$47		$58		$15		$—		$—		$—		$120
Natural gas	103		68		60		59		46		53		389
Coal (b)	56		35		9		—		—		—		100
Other (c)	—		1		1		—		—		—		2
		$206		$162		$85		$59		$46		$53		$611


(a)	Includes payments required by PPAs for capacity rights and minimum quantities of MWhs required to be purchased.


(b)	Corporate Services entered into system-wide coal contracts on behalf of IPL and WPL that include minimum future commitments. These commitments were assigned to IPL and WPL based on information available as of December 31, 2016 regarding expected future usage, which is subject to change.


(c)	Includes individual commitments incurred during the normal course of business that exceeded $1 million at December 31, 2016.

Certain contracts are considered leases and are therefore not included here, but are included in Note 10.

Flood Damage Claims - In 2013, several plaintiffs purporting to represent a class of residential and commercial property owners filed a complaint against CRANDIC, Alliant Energy and various other defendants in the Iowa District Court for Linn County. Plaintiffs assert claims of negligence and strict liability based on their allegations that CRANDIC (along with other defendants) caused or exacerbated flooding of the Cedar River in June 2008. In February 2016, the Iowa District Court for Linn County ruled in favor of Alliant Energy and CRANDIC and dismissed all claims against them, resulting in no loss. In August 2016, the Iowa District Court for Linn County dismissed all claims against the remaining defendants. In September 2016, plaintiffs filed a notice of appeal with the Supreme Court of Iowa. Alliant Energy does not currently believe any material losses for this complaint are both probable and reasonably estimated, and therefore has not recognized any material loss contingency amounts as of December 31, 2016.

Other - Alliant Energy, IPL and WPL are involved in other legal and administrative proceedings before various courts and agencies with respect to matters arising in the ordinary course of business. Although unable to predict the outcome of these matters, Alliant Energy, IPL and WPL believe that appropriate reserves have been established and final disposition of these actions will not have a material effect on their financial condition or results of operations.

(d) Guarantees and Indemnifications -

RMT - In 2013, Alliant Energy sold RMT. RMT provided renewable energy services, including construction and high voltage connection services for wind and solar projects. As part of the sale, Alliant Energy indemnified the buyer for any claims, including claims of warranty under the project obligations that were commenced or are based on actions that occurred prior to the sale, except for liabilities already accounted for through adjustments to the purchase price. In 2016, the indemnification obligations and contractual warranty periods expired; however, limited warranties may be extended in certain cases for warranty work performed.

Alliant Energy also continues to guarantee RMT’s performance obligations related to certain of RMT’s projects that were commenced prior to Alliant Energy’s sale of RMT. As of December 31, 2016, Alliant Energy had $75 million of performance guarantees outstanding, which are currently expected to expire in 2017. The expiration of these performance guarantees may be extended depending on when all valid warranty claims are resolved for the respective projects.

Although Alliant Energy has received warranty claims related to certain of these projects, it does not currently believe that material losses are both probable and reasonably estimated, and therefore, has not recognized any material liabilities related to these matters as of December 31, 2016. Alliant Energy does not currently believe that the range of future potential loss from any warranty claims will be material. Refer to Note 19 for further discussion of RMT, including amounts Alliant Energy recorded to “Operating expenses” in 2016, 2015 and 2014 related to certain warranty claims.

Whiting Petroleum - In 2004, Alliant Energy sold its remaining interest in Whiting Petroleum. Whiting Petroleum is an independent oil and gas company. Alliant Energy Resources, LLC, as the successor to a predecessor entity that owned Whiting Petroleum, and a wholly-owned subsidiary of AEF, continues to guarantee the partnership obligations of an affiliate of Whiting Petroleum under general partnership agreements in the oil and gas industry, including with respect to the future abandonment of certain platforms off the coast of California and related onshore plant and equipment owned by the partnerships. The guarantees do not include a maximum limit. As of December 31, 2016, the present value of the abandonment obligations is estimated at $31 million. Alliant Energy is not aware of any material liabilities related to these guarantees of which it is probable that Alliant Energy Resources, LLC will be obligated to pay and therefore has not recognized any material liabilities related to this guarantee as of December 31, 2016.

IPL’s Minnesota Electric Distribution Assets - IPL provided indemnifications associated with the July 2015 sale of its Minnesota electric distribution assets for losses resulting from potential breach of IPL’s representations, warranties and obligations under the sale agreement. Alliant Energy and IPL believe the likelihood of having to make any material cash payments under these indemnifications is remote. IPL has not recorded any material liabilities related to these indemnifications as of December 31, 2016. The general terms of the indemnifications provided by IPL included a maximum limit of $17 million and expire in October 2020. Refer to Note 3 for further discussion of the sale of IPL’s Minnesota electric distribution assets.

(e) Environmental Matters - Alliant Energy, IPL and WPL are subject to environmental regulations as a result of their current and past operations. These regulations are designed to protect public health and the environment and have resulted in compliance, remediation, containment and monitoring obligations, which are recorded as current and non-current environmental liabilities. Substantially all of the environmental liabilities recorded on the balance sheets relate to MGP sites.

MGP Sites - IPL and WPL have current or previous ownership interests in various sites that are previously associated with the production of gas for which IPL and WPL have, or may have in the future, liability for investigation, remediation and monitoring costs. IPL and WPL are working pursuant to the requirements of various federal and state agencies to investigate, mitigate, prevent and remediate, where necessary, the environmental impacts to property, including natural resources, at and around these former MGP sites in order to protect public health and the environment.

Environmental liabilities related to these MGP sites are recorded based upon periodic studies. Such amounts are based on the best current estimate of the remaining amount to be incurred for investigation, remediation and monitoring costs for those sites where the investigation process has been or is substantially completed, and the minimum of the estimated cost range for those sites where the investigation is in its earlier stages. There are inherent uncertainties associated with the estimated remaining costs for MGP projects primarily due to unknown site conditions and potential changes in regulatory agency requirements. It is possible that future cost estimates will be greater than current estimates as the investigation process proceeds and as additional facts become known. Costs of future expenditures for environmental remediation obligations are not discounted. At December 31, 2016, estimated future costs expected to be incurred for the investigation, remediation and monitoring of the MGP sites, as well as environmental liabilities recorded on the balance sheets for these sites, were as follows (in millions). At December 31, 2016, such amounts for WPL were not material.



	Alliant Energy				IPL
Range of estimated future costs		$14	-	$27		$12	-	$24
Current and non-current environmental liabilities	16				13

Refer to Note 2 for discussion of regulatory assets recorded by IPL and WPL, which reflect the probable future rate recovery of MGP expenditures. Considering the current rate treatment, and assuming no material change therein, Alliant Energy, IPL and WPL believe that the clean-up costs incurred for these MGP sites will not have a material effect on their financial condition or results of operations.

WPL Consent Decree - In 2013, the U.S. District Court for the Western District of Wisconsin approved a Consent Decree that WPL, along with the other owners of Edgewater and Columbia, entered into with the EPA and the Sierra Club, thereby resolving claims against WPL. Such claims included allegations that the owners of Edgewater, Nelson Dewey and Columbia violated the Prevention of Significant Deterioration program requirements, Title V Operating Permit requirements of the CAA and the Wisconsin State Implementation Plan designed to implement the CAA.

WPL has completed various requirements under the Consent Decree. WPL’s remaining requirements include installing an SCR system at Columbia Unit 2 and fuel switching or retiring Edgewater Unit 4 by December 31, 2018. The Consent Decree also establishes SO2, NOx and particulate matter emission rate limits for Columbia Units 1 and 2, and Edgewater Units 4 and 5. In addition, the Consent Decree includes annual plant-wide SO2 and NOx emission caps for Columbia and Edgewater. WPL is in the process of completing approximately $7 million in environmental mitigation projects. Alliant Energy and WPL currently expect to recover material costs incurred by WPL related to compliance with the terms of the Consent Decree from WPL’s electric customers.

IPL Consent Decree - In 2015, the U.S. District Court for the Northern District of Iowa approved a Consent Decree that IPL entered into with the EPA, the Sierra Club, the State of Iowa and Linn County in Iowa, thereby resolving potential CAA issues associated with emissions from IPL’s coal-fired generating facilities in Iowa. IPL has completed various requirements under the Consent Decree. IPL’s remaining requirements include installing an SCR system or equivalent NOx reduction system at the Ottumwa Generating Station by December 31, 2019; fuel switching or retiring Prairie Creek Unit 4 by June 1, 2018, the Burlington Generating Station by December 31, 2021 and Prairie Creek Units 1 and 3 by December 31, 2025; and either installing combined cycle technology at, or retiring, the Dubuque and Sutherland Generating Stations by June 1, 2019.

The Consent Decree also establishes SO2, NOx and particulate matter emission rate limits with varying averaging times for the Burlington, Lansing, M.L. Kapp, Ottumwa and Prairie Creek Generating Stations. In addition, the Consent Decree includes calendar-year SO2 and NOx emission caps for the Prairie Creek Generating Station, and calendar-year SO2 and NOx emission caps in aggregate for the Burlington, Dubuque, Lansing, M.L. Kapp, Ottumwa, Prairie Creek and Sutherland Generating Stations. IPL is in the process of completing approximately $6 million in environmental mitigation projects. Alliant Energy and IPL currently expect to recover material costs incurred by IPL related to the environmental control systems and environmental mitigation projects from IPL’s electric customers.

Other Environmental Contingencies - In addition to the environmental liabilities discussed above, various environmental rules are monitored that may have a significant impact on future operations. Several of these environmental rules are subject to legal challenges, reconsideration and/or other uncertainties. Given uncertainties regarding the outcome, timing and compliance plans for these environmental matters, the complete financial impact of each of these rules is not able to be determined; however future capital investments and/or modifications to EGUs to comply with certain of these rules could be significant. Specific current, proposed or potential environmental matters include, among others: CSAPR, Effluent Limitation Guidelines, CCR Rule, and various legislation and EPA regulations to monitor and regulate the emission of GHG, including carbon emissions from new (CAA Section 111(b)) and existing (CAA Section 111(d)) fossil-fueled EGUs.

(f) Credit Risk - IPL and WPL provide regulated electricity and natural gas services to residential, commercial, industrial and wholesale customers in Iowa, Minnesota and Illinois for IPL and Wisconsin for WPL. The geographic concentration of these customers did not contribute significantly to overall credit risk exposure. In addition, as a result of a diverse customer base, IPL and WPL did not have any significant credit risk concentration for receivables arising from the sale of electricity or natural gas services.

Alliant Energy, IPL and WPL are subject to credit risk related to the ability of counterparties to meet their contractual payment obligations or the potential non-performance of counterparties to deliver contracted commodities and other goods or services at the contracted price. Credit policies are maintained to mitigate credit risk. These credit policies include evaluation of the financial condition of certain counterparties, use of credit risk-related contingent provisions in certain agreements that require credit support from counterparties not meeting specific criteria, diversification of counterparties to reduce concentrations of credit risk and the use of standardized agreements that facilitate the netting of cash flows associated with certain counterparties. Based on these credit policies and counterparty diversification, as well as utility cost recovery mechanisms, it is unlikely that counterparty non-performance would have a material effect on financial condition or results of operations. However, there is no assurance that these items will protect against all losses from counterparty non-performance.

Refer to Notes 5(a) and 15 for details of allowances for doubtful accounts and credit risk-related contingent features, respectively.

(g) Collective Bargaining Agreements - At December 31, 2016, employees covered by collective bargaining agreements represented 56%, 65% and 81% of total employees of Alliant Energy, IPL and WPL, respectively. In August 2017, IPL’s collective bargaining agreement with International Brotherhood of Electrical Workers Local 204 (Cedar Rapids) expires, representing 19% and 46% of total employees of Alliant Energy and IPL, respectively.

IPL [Member]

Commitments And Contingencies

COMMITMENTS AND CONTINGENCIES



Alliant Energy	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$185		$189		$159		$137		$149		$599		$1,418
Natural gas	223		142		115		98		69		124		771
Coal (b)	105		54		18		—		—		—		177
Other (c)	16		4		5		2		2		5		34
		$529		$389		$297		$237		$220		$728		$2,400



IPL	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$138		$131		$144		$137		$149		$599		$1,298
Natural gas	120		74		55		39		23		71		382
Coal (b)	49		19		9		—		—		—		77
Other (c)	15		1		1		—		—		—		17
		$322		$225		$209		$176		$172		$670		$1,774



WPL	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$47		$58		$15		$—		$—		$—		$120
Natural gas	103		68		60		59		46		53		389
Coal (b)	56		35		9		—		—		—		100
Other (c)	—		1		1		—		—		—		2
		$206		$162		$85		$59		$46		$53		$611


(a)	Includes payments required by PPAs for capacity rights and minimum quantities of MWhs required to be purchased.


(b)	Corporate Services entered into system-wide coal contracts on behalf of IPL and WPL that include minimum future commitments. These commitments were assigned to IPL and WPL based on information available as of December 31, 2016 regarding expected future usage, which is subject to change.


(c)	Includes individual commitments incurred during the normal course of business that exceeded $1 million at December 31, 2016.

Certain contracts are considered leases and are therefore not included here, but are included in Note 10.

(d) Guarantees and Indemnifications -



	Alliant Energy				IPL
Range of estimated future costs		$14	-	$27		$12	-	$24
Current and non-current environmental liabilities	16				13

Refer to Notes 5(a) and 15 for details of allowances for doubtful accounts and credit risk-related contingent features, respectively.

WPL [Member]

Commitments And Contingencies

COMMITMENTS AND CONTINGENCIES



Alliant Energy	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$185		$189		$159		$137		$149		$599		$1,418
Natural gas	223		142		115		98		69		124		771
Coal (b)	105		54		18		—		—		—		177
Other (c)	16		4		5		2		2		5		34
		$529		$389		$297		$237		$220		$728		$2,400



IPL	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$138		$131		$144		$137		$149		$599		$1,298
Natural gas	120		74		55		39		23		71		382
Coal (b)	49		19		9		—		—		—		77
Other (c)	15		1		1		—		—		—		17
		$322		$225		$209		$176		$172		$670		$1,774



WPL	2017		2018		2019		2020		2021		Thereafter		Total
Purchased power (a)		$47		$58		$15		$—		$—		$—		$120
Natural gas	103		68		60		59		46		53		389
Coal (b)	56		35		9		—		—		—		100
Other (c)	—		1		1		—		—		—		2
		$206		$162		$85		$59		$46		$53		$611


(a)	Includes payments required by PPAs for capacity rights and minimum quantities of MWhs required to be purchased.


(b)	Corporate Services entered into system-wide coal contracts on behalf of IPL and WPL that include minimum future commitments. These commitments were assigned to IPL and WPL based on information available as of December 31, 2016 regarding expected future usage, which is subject to change.


(c)	Includes individual commitments incurred during the normal course of business that exceeded $1 million at December 31, 2016.

Certain contracts are considered leases and are therefore not included here, but are included in Note 10.



	Alliant Energy				IPL
Range of estimated future costs		$14	-	$27		$12	-	$24
Current and non-current environmental liabilities	16				13

Refer to Notes 5(a) and 15 for details of allowances for doubtful accounts and credit risk-related contingent features, respectively.