REGULATORY MATTERS

Regulatory Assets - Alliant Energy, IPL and WPL assess whether IPL’s and WPL’s regulatory assets are probable of future recovery by considering factors such as applicable regulations, recent orders by the applicable regulatory agencies, historical treatment of similar costs by the applicable regulatory agencies and regulatory environment changes. Based on these assessments, Alliant Energy, IPL and WPL believe the regulatory assets recognized as of December 31, 2023 are probable of future recovery. However, no assurance can be made that IPL and WPL will recover all of these regulatory assets in future rates. If future recovery of a regulatory asset ceases to be probable, the regulatory asset will be charged to expense. At December 31, regulatory assets were comprised of the following items (in millions):


	Alliant Energy		IPL		WPL
	2023	2022	2023	2022	2023	2022
Tax-related	$934	$929	$831	$848	$103	$81
Pension and OPEB costs	347	392	171	197	176	195
Assets retired early	273	70	259	53	14	17
AROs	194	151	160	110	34	41
Commodity cost recovery	120	160	12	1	108	159
Derivatives	102	84	34	48	68	36
WPL’s Western Wisconsin gas distribution expansion investments	44	48	—	—	44	48
IPL’s DAEC PPA amendment	42	66	42	66	—	—

Other	205	146	68	63	137	83
	$2,261	$2,046	$1,577	$1,386	$684	$660

At December 31, 2023, IPL and WPL had $74 million and $32 million, respectively, of regulatory assets that were not earning a return on investment. IPL’s regulatory assets that were not earning a return consisted primarily of retired analog electric meters, emission allowances and costs for certain construction projects. WPL’s regulatory assets that were not earning a return consisted primarily of costs for certain construction projects. The other regulatory assets reported in the above table either earn a return or the cash has not yet been expended, in which case the assets are offset by liabilities that also do not incur a carrying cost.

Tax-related - IPL and WPL record regulatory assets for certain temporary differences (primarily related to utility property, plant and equipment at IPL) that result in a decrease in current rates charged to customers and an increase in future rates charged to customers based on the timing of income tax expense that is used to determine such rates. These temporary differences for IPL include the impacts of qualifying deductions for repairs expenditures, allocation of mixed service costs, and Iowa accelerated tax depreciation, which all contribute to lower current income tax expense during the first part of an asset’s useful life and higher current income tax expense during the latter part of an asset’s useful life. These regulatory assets will be recovered from customers in the future when these temporary differences reverse resulting in additional current income tax expense used to determine customers’ rates. Refer to Note 12 for discussion of Iowa Tax Reform, which resulted in a decrease in Alliant Energy’s and IPL’s tax-related regulatory assets in 2023.

Pension and other postretirement benefits costs - The IUB, PSCW and FERC have authorized IPL and WPL to record the previously unrecognized net actuarial gains and losses, and prior service costs and credits, as regulatory assets in lieu of accumulated other comprehensive loss on the balance sheets, as these amounts are expected to be recovered in future rates. These regulatory assets will be increased or decreased as the net actuarial gains or losses, and prior service costs or credits, are subsequently amortized and recognized as a component of net periodic benefit costs. Regulatory assets are also increased or decreased as a result of the annual defined benefit plan measurement process. Pension and OPEB costs are included within the recoverable cost of service component of rates charged to IPL’s and WPL’s retail and wholesale customers, which are based upon pension and OPEB costs determined in accordance with GAAP and are calculated in accordance with IPL’s and WPL’s respective regulatory jurisdictions.

Assets retired early - IPL and WPL have retired various natural gas- and coal-fired EGUs, and IPL has retired certain analog electric meters. As a result, the remaining net book value of these assets was reclassified from property, plant and equipment to a regulatory asset on their respective balance sheets. Details regarding the recovery of the remaining net book value of these assets from IPL’s and WPL’s customers are as follows (dollars in millions):

Entity

Asset

Retirement Date

Regulatory Asset Balance as of Dec. 31, 2023

Recovery

Regulatory Approval

IPL

Lansing

2023

$216

Return of and return on remaining net book value through 2037

FERC and pending with the IUB (a)

IPL

Analog electric meters

2019

20

Return of remaining net book value through 2028

IUB and FERC

IPL

Sutherland Units 1 and 3

2017

12

Return of and return on remaining net book value through 2027

IUB and FERC

IPL

M.L. Kapp Unit 2

2018

11

Return of and return on remaining net book value through 2029

IUB and FERC

WPL

Edgewater Unit 4

2018

14

Return of and return on remaining net book value through 2028

PSCW and FERC

(a)IPL’s retail electric rate review for the October 2024 through September 2025 forward-looking Test Period includes a request with the IUB for continued recovery of the remaining net book value of Lansing through 2037.

AROs - Alliant Energy, IPL and WPL believe it is probable that certain differences between expenses accrued for AROs related to their utility operations and expenses recovered currently in rates will be recoverable in future rates, and are deferring the differences as regulatory assets. In 2023, in conjunction with IPL's retirement of the Lansing Generating Station, IPL reclassified the remaining net book value of the associated AROs from property, plant and equipment to a regulatory asset on Alliant Energy’s and IPL’s balance sheets.

Commodity cost recovery - Refer to Note 1(g) for details of IPL’s and WPL’s commodity cost recovery mechanisms. The cost recovery mechanism for WPL’s retail electric customers is based on forecasts of certain fuel-related costs expected to be incurred during forward-looking test periods and fuel monitoring ranges determined by the PSCW during each retail electric rate proceeding or in a separate fuel cost plan approval proceeding. In 2021, WPL’s actual fuel-related costs fell outside these fuel monitoring ranges, resulting in a $37 million deferral as of December 31, 2022, which was collected in 2023 from its retail electric customers, plus interest. In 2022, WPL’s actual fuel-related costs fell outside these fuel monitoring ranges, resulting in a $117 million deferral as of December 31, 2022, which WPL is collecting from October 2023 through December 2025 from its retail electric customers, plus interest ($12 million was collected in 2023). In 2023, actual fuel-related costs fell outside these fuel monitoring ranges, resulting in a $34 million regulatory liability as of December 31, 2023, which is expected to be addressed in a future regulatory proceeding.

Derivatives - In accordance with IPL’s and WPL’s fuel and natural gas recovery mechanisms, prudently incurred costs from derivative instruments are recoverable from customers in the future after any losses are realized, and gains from derivative instruments are refundable to customers in the future after any gains are realized. Based on these recovery mechanisms, the changes in the fair value of derivative liabilities/assets resulted in comparable changes to regulatory assets/liabilities on the balance sheets. Refer to Note 15 for discussion of changes in Alliant Energy’s, IPL’s and WPL’s derivative liabilities/assets during 2023, which resulted in comparable changes to regulatory assets/liabilities on the balance sheets.

WPL’s Western Wisconsin gas distribution expansion investments - WPL made contributions in aid of construction to a third party for investments as part of its Western Wisconsin gas distribution expansion project. Pursuant to authorization by the PSCW, Alliant Energy and WPL have recorded a regulatory asset for these costs, and are authorized by the PSCW to recover these amounts from WPL’s retail gas customers in base rates from 2021 through the end of 2040.

IPL’s DAEC PPA Amendment - In 2020, IPL made a buyout payment of $110 million in exchange for shortening the term of its DAEC PPA by 5 years. The buyout payment, including a return on, is being recovered from IPL’s retail and wholesale customers from 2021 through the end of 2025, and is currently being amortized to “Electric production fuel and purchased power” in Alliant Energy’s and IPL’s income statements.

Regulatory Liabilities - At December 31, regulatory liabilities were comprised of the following items (in millions):


	Alliant Energy		IPL		WPL
	2023	2022	2023	2022	2023	2022
Tax-related	$566	$579	$299	$303	$267	$276
Cost of removal obligations	366	398	242	259	124	139
Derivatives	65	210	34	115	31	95
Commodity cost recovery	48	40	13	38	35	2
WPL’s West Riverside liquidated damages	1	32	—	—	1	32




Other	84	65	56	39	28	26
	$1,130	$1,324	$644	$754	$486	$570

Tax-related regulatory liabilities reduce revenue requirement calculations utilized in IPL’s and WPL’s respective rate proceedings. Cost of removal obligations, to the extent expensed through depreciation rates, reduce rate base. A significant portion of the remaining regulatory liabilities is not used to adjust revenue requirement calculations.

Tax-related - Alliant Energy’s, IPL’s and WPL’s tax-related regulatory liabilities are primarily related to excess deferred tax benefits resulting from the remeasurement of accumulated deferred income taxes caused by the Tax Cuts and Jobs Act. The majority of these benefits related to accelerated depreciation are subject to tax normalization rules. These rules limit the rate at which these tax benefits are allowed to be passed on to customers.

Cost of removal obligations - Alliant Energy, IPL and WPL collect in rates future removal costs for many assets that do not have associated AROs or that have removal costs in addition to AROs. Alliant Energy, IPL and WPL record a regulatory liability for the amounts collected in rates for these future removal costs and reduce the regulatory liability for amounts spent on removal activities. Cash payments related to cost of removal obligations are included in “Other” in cash flows used for investing activities.

WPL’s West Riverside liquidated damages - Pursuant to terms included in the related West Riverside construction procurement contracts, WPL reached agreement with the contractor on liquidated damages in 2020. A significant portion of the liquidated damages was settled by WPL offsetting amounts owed to the contractor that were previously withheld for

payment, which were non-cash investing activities. Pursuant to PSCW authorization, WPL’s amortization of liquidated damages related to West Riverside construction procurement contracts was used to offset increases in WPL’s retail electric 2022/2023 Test Period revenue requirement, resulting in decreases in regulatory liabilities on Alliant Energy’s and WPL’s balance sheets and decreases in depreciation and amortization expenses in Alliant Energy’s and WPL’s income statements in 2023.

Rate Reviews -

WPL’s Retail Electric and Gas Rate Reviews (2022/2023 Forward-looking Test Period) - In December 2021, the PSCW issued an order authorizing annual base rate increases of $114 million and $15 million for WPL’s retail electric and gas customers, respectively, covering the 2022/2023 forward-looking Test Period, which was based on a stipulated agreement between WPL and certain stakeholders. The key drivers for the annual base rate increases include higher retail fuel-related costs in 2022, lower excess deferred income tax benefits in 2022 and 2023 and revenue requirement impacts of increasing electric and gas rate base, including investments in solar generation. In addition, the PSCW authorized WPL to receive a recovery of and a return on the remaining net book value of Edgewater Unit 5 through 2023. WPL's settlement extended, with certain modifications, an earnings sharing mechanism through 2023. Retail electric rate changes were effective on January 1, 2022 and extended through the end of 2023. Retail gas rate changes were effective on January 1, 2022 and extended through the end of 2022.

In December 2022, the PSCW issued an order authorizing an additional annual base rate increase of $9 million for WPL’s retail gas customers, covering the 2023 forward-looking Test Period, which reflects changes in weighted average cost of capital, updated depreciation rates and modifications to certain regulatory asset and regulatory liability amortizations. These retail gas rate changes were effective on January 1, 2023 and extended through the end of 2023.

WPL’s Retail Electric and Gas Rate Reviews (2024/2025 Forward-looking Test Period) - In December 2023, the PSCW issued an order authorizing annual base rate increases of $49 million and $13 million for WPL’s retail electric and gas customers, respectively, effective January 1, 2024, for the 2024 forward-looking Test Period. The PSCW’s order also authorized WPL to implement an additional $60 million increase in annual rates for its retail electric customers, effective January 1, 2025, for the 2025 forward-looking Test Period.

Regulatory Matters [Line Items]

Regulatory Matters

REGULATORY MATTERS

Regulatory Assets - Alliant Energy, IPL and WPL assess whether IPL’s and WPL’s regulatory assets are probable of future recovery by considering factors such as applicable regulations, recent orders by the applicable regulatory agencies, historical treatment of similar costs by the applicable regulatory agencies and regulatory environment changes. Based on these assessments, Alliant Energy, IPL and WPL believe the regulatory assets recognized as of December 31, 2023 are probable of future recovery. However, no assurance can be made that IPL and WPL will recover all of these regulatory assets in future rates. If future recovery of a regulatory asset ceases to be probable, the regulatory asset will be charged to expense. At December 31, regulatory assets were comprised of the following items (in millions):


	Alliant Energy		IPL		WPL
	2023	2022	2023	2022	2023	2022
Tax-related	$934	$929	$831	$848	$103	$81
Pension and OPEB costs	347	392	171	197	176	195
Assets retired early	273	70	259	53	14	17
AROs	194	151	160	110	34	41
Commodity cost recovery	120	160	12	1	108	159
Derivatives	102	84	34	48	68	36
WPL’s Western Wisconsin gas distribution expansion investments	44	48	—	—	44	48
IPL’s DAEC PPA amendment	42	66	42	66	—	—

Other	205	146	68	63	137	83
	$2,261	$2,046	$1,577	$1,386	$684	$660

At December 31, 2023, IPL and WPL had $74 million and $32 million, respectively, of regulatory assets that were not earning a return on investment. IPL’s regulatory assets that were not earning a return consisted primarily of retired analog electric meters, emission allowances and costs for certain construction projects. WPL’s regulatory assets that were not earning a return consisted primarily of costs for certain construction projects. The other regulatory assets reported in the above table either earn a return or the cash has not yet been expended, in which case the assets are offset by liabilities that also do not incur a carrying cost.

Tax-related - IPL and WPL record regulatory assets for certain temporary differences (primarily related to utility property, plant and equipment at IPL) that result in a decrease in current rates charged to customers and an increase in future rates charged to customers based on the timing of income tax expense that is used to determine such rates. These temporary differences for IPL include the impacts of qualifying deductions for repairs expenditures, allocation of mixed service costs, and Iowa accelerated tax depreciation, which all contribute to lower current income tax expense during the first part of an asset’s useful life and higher current income tax expense during the latter part of an asset’s useful life. These regulatory assets will be recovered from customers in the future when these temporary differences reverse resulting in additional current income tax expense used to determine customers’ rates. Refer to Note 12 for discussion of Iowa Tax Reform, which resulted in a decrease in Alliant Energy’s and IPL’s tax-related regulatory assets in 2023.

Pension and other postretirement benefits costs - The IUB, PSCW and FERC have authorized IPL and WPL to record the previously unrecognized net actuarial gains and losses, and prior service costs and credits, as regulatory assets in lieu of accumulated other comprehensive loss on the balance sheets, as these amounts are expected to be recovered in future rates. These regulatory assets will be increased or decreased as the net actuarial gains or losses, and prior service costs or credits, are subsequently amortized and recognized as a component of net periodic benefit costs. Regulatory assets are also increased or decreased as a result of the annual defined benefit plan measurement process. Pension and OPEB costs are included within the recoverable cost of service component of rates charged to IPL’s and WPL’s retail and wholesale customers, which are based upon pension and OPEB costs determined in accordance with GAAP and are calculated in accordance with IPL’s and WPL’s respective regulatory jurisdictions.

Assets retired early - IPL and WPL have retired various natural gas- and coal-fired EGUs, and IPL has retired certain analog electric meters. As a result, the remaining net book value of these assets was reclassified from property, plant and equipment to a regulatory asset on their respective balance sheets. Details regarding the recovery of the remaining net book value of these assets from IPL’s and WPL’s customers are as follows (dollars in millions):

Entity

Asset

Retirement Date

Regulatory Asset Balance as of Dec. 31, 2023

Recovery

Regulatory Approval

IPL

Lansing

2023

$216

Return of and return on remaining net book value through 2037

FERC and pending with the IUB (a)

IPL

Analog electric meters

2019

20

Return of remaining net book value through 2028

IUB and FERC

IPL

Sutherland Units 1 and 3

2017

12

Return of and return on remaining net book value through 2027

IUB and FERC

IPL

M.L. Kapp Unit 2

2018

11

Return of and return on remaining net book value through 2029

IUB and FERC

WPL

Edgewater Unit 4

2018

14

Return of and return on remaining net book value through 2028

PSCW and FERC

(a)IPL’s retail electric rate review for the October 2024 through September 2025 forward-looking Test Period includes a request with the IUB for continued recovery of the remaining net book value of Lansing through 2037.

AROs - Alliant Energy, IPL and WPL believe it is probable that certain differences between expenses accrued for AROs related to their utility operations and expenses recovered currently in rates will be recoverable in future rates, and are deferring the differences as regulatory assets. In 2023, in conjunction with IPL's retirement of the Lansing Generating Station, IPL reclassified the remaining net book value of the associated AROs from property, plant and equipment to a regulatory asset on Alliant Energy’s and IPL’s balance sheets.

Commodity cost recovery - Refer to Note 1(g) for details of IPL’s and WPL’s commodity cost recovery mechanisms. The cost recovery mechanism for WPL’s retail electric customers is based on forecasts of certain fuel-related costs expected to be incurred during forward-looking test periods and fuel monitoring ranges determined by the PSCW during each retail electric rate proceeding or in a separate fuel cost plan approval proceeding. In 2021, WPL’s actual fuel-related costs fell outside these fuel monitoring ranges, resulting in a $37 million deferral as of December 31, 2022, which was collected in 2023 from its retail electric customers, plus interest. In 2022, WPL’s actual fuel-related costs fell outside these fuel monitoring ranges, resulting in a $117 million deferral as of December 31, 2022, which WPL is collecting from October 2023 through December 2025 from its retail electric customers, plus interest ($12 million was collected in 2023). In 2023, actual fuel-related costs fell outside these fuel monitoring ranges, resulting in a $34 million regulatory liability as of December 31, 2023, which is expected to be addressed in a future regulatory proceeding.

Derivatives - In accordance with IPL’s and WPL’s fuel and natural gas recovery mechanisms, prudently incurred costs from derivative instruments are recoverable from customers in the future after any losses are realized, and gains from derivative instruments are refundable to customers in the future after any gains are realized. Based on these recovery mechanisms, the changes in the fair value of derivative liabilities/assets resulted in comparable changes to regulatory assets/liabilities on the balance sheets. Refer to Note 15 for discussion of changes in Alliant Energy’s, IPL’s and WPL’s derivative liabilities/assets during 2023, which resulted in comparable changes to regulatory assets/liabilities on the balance sheets.

WPL’s Western Wisconsin gas distribution expansion investments - WPL made contributions in aid of construction to a third party for investments as part of its Western Wisconsin gas distribution expansion project. Pursuant to authorization by the PSCW, Alliant Energy and WPL have recorded a regulatory asset for these costs, and are authorized by the PSCW to recover these amounts from WPL’s retail gas customers in base rates from 2021 through the end of 2040.

IPL’s DAEC PPA Amendment - In 2020, IPL made a buyout payment of $110 million in exchange for shortening the term of its DAEC PPA by 5 years. The buyout payment, including a return on, is being recovered from IPL’s retail and wholesale customers from 2021 through the end of 2025, and is currently being amortized to “Electric production fuel and purchased power” in Alliant Energy’s and IPL’s income statements.

Regulatory Liabilities - At December 31, regulatory liabilities were comprised of the following items (in millions):


	Alliant Energy		IPL		WPL
	2023	2022	2023	2022	2023	2022
Tax-related	$566	$579	$299	$303	$267	$276
Cost of removal obligations	366	398	242	259	124	139
Derivatives	65	210	34	115	31	95
Commodity cost recovery	48	40	13	38	35	2
WPL’s West Riverside liquidated damages	1	32	—	—	1	32




Other	84	65	56	39	28	26
	$1,130	$1,324	$644	$754	$486	$570

Tax-related regulatory liabilities reduce revenue requirement calculations utilized in IPL’s and WPL’s respective rate proceedings. Cost of removal obligations, to the extent expensed through depreciation rates, reduce rate base. A significant portion of the remaining regulatory liabilities is not used to adjust revenue requirement calculations.

Tax-related - Alliant Energy’s, IPL’s and WPL’s tax-related regulatory liabilities are primarily related to excess deferred tax benefits resulting from the remeasurement of accumulated deferred income taxes caused by the Tax Cuts and Jobs Act. The majority of these benefits related to accelerated depreciation are subject to tax normalization rules. These rules limit the rate at which these tax benefits are allowed to be passed on to customers.

Cost of removal obligations - Alliant Energy, IPL and WPL collect in rates future removal costs for many assets that do not have associated AROs or that have removal costs in addition to AROs. Alliant Energy, IPL and WPL record a regulatory liability for the amounts collected in rates for these future removal costs and reduce the regulatory liability for amounts spent on removal activities. Cash payments related to cost of removal obligations are included in “Other” in cash flows used for investing activities.

WPL’s West Riverside liquidated damages - Pursuant to terms included in the related West Riverside construction procurement contracts, WPL reached agreement with the contractor on liquidated damages in 2020. A significant portion of the liquidated damages was settled by WPL offsetting amounts owed to the contractor that were previously withheld for

payment, which were non-cash investing activities. Pursuant to PSCW authorization, WPL’s amortization of liquidated damages related to West Riverside construction procurement contracts was used to offset increases in WPL’s retail electric 2022/2023 Test Period revenue requirement, resulting in decreases in regulatory liabilities on Alliant Energy’s and WPL’s balance sheets and decreases in depreciation and amortization expenses in Alliant Energy’s and WPL’s income statements in 2023.

Rate Reviews -

WPL’s Retail Electric and Gas Rate Reviews (2022/2023 Forward-looking Test Period) - In December 2021, the PSCW issued an order authorizing annual base rate increases of $114 million and $15 million for WPL’s retail electric and gas customers, respectively, covering the 2022/2023 forward-looking Test Period, which was based on a stipulated agreement between WPL and certain stakeholders. The key drivers for the annual base rate increases include higher retail fuel-related costs in 2022, lower excess deferred income tax benefits in 2022 and 2023 and revenue requirement impacts of increasing electric and gas rate base, including investments in solar generation. In addition, the PSCW authorized WPL to receive a recovery of and a return on the remaining net book value of Edgewater Unit 5 through 2023. WPL's settlement extended, with certain modifications, an earnings sharing mechanism through 2023. Retail electric rate changes were effective on January 1, 2022 and extended through the end of 2023. Retail gas rate changes were effective on January 1, 2022 and extended through the end of 2022.

In December 2022, the PSCW issued an order authorizing an additional annual base rate increase of $9 million for WPL’s retail gas customers, covering the 2023 forward-looking Test Period, which reflects changes in weighted average cost of capital, updated depreciation rates and modifications to certain regulatory asset and regulatory liability amortizations. These retail gas rate changes were effective on January 1, 2023 and extended through the end of 2023.

WPL’s Retail Electric and Gas Rate Reviews (2024/2025 Forward-looking Test Period) - In December 2023, the PSCW issued an order authorizing annual base rate increases of $49 million and $13 million for WPL’s retail electric and gas customers, respectively, effective January 1, 2024, for the 2024 forward-looking Test Period. The PSCW’s order also authorized WPL to implement an additional $60 million increase in annual rates for its retail electric customers, effective January 1, 2025, for the 2025 forward-looking Test Period.