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Alliant Energy weighs in with its own feasibility study of a municipal electric utility in Decorah, saying costs would be 30 percent higher

Posted: Mon, Jan 8, 2018 8:14 PM

Next Tuesday Decorah Power will present to the Decorah City Council the results of a feasibility study it commissioned on the concept of starting a municipal electric utility in Decorah.

On Monday night, Alliant Energy beat Decorah Power to the punch, unveiling its own feasibility study which concluded that switching to a municipal utility in Decorah would raise rates by 30 percent.

Consultant Ann Bulkley from Concentric Energy Advisors presented the conclusions of her study, then answered questions from some of the 125 people in attendance at Monday night's program.  Several Alliant Energy officials also were on hand to answer questions.

Bulkley stresses that any comparison needs to be "apples to apples."  She used three different financial projections, varying her assumptions.  Bulkley's study predicted $24 million in higher costs over the first 10 years of operation and $53 million in higher costs over the first 20 years of operation.  She also created a best-case and a worst-case scenario, but both showed higher costs than with Alliant's service.

Audience member Craig Cutting questioned why Alliant's rates are around 15 cents per kilowatt hour, while MidAmerican's are around 9 centers per kilowatt hour.  But Bulkley said the comparisons need to be made between Alliant and a possible municipal utility--not between two electric companies.  She also stressed her belief that a large customer base is better able than a small customer base to absorb some of the unexpected costs that may arise while running a utility.

Much of Monday night's discussion involved net metering for customers who have solar panel installations, with Bulkley saying 4.1 percent of Alliant customers in Decorah have net metering, versus 0.4 percent systemwide.  That explained several questions at Monday night's program which concentrated on solar energy issues.

Decorah Power will present its feasibility study results next Tuesday night.  Decorah Power vice president Tim Wagner released a statement after the meeting which said, "We're disappointed that the Alliant Energy-sponsored study presented on Monday night (regarding the option of Decorah establishing its own electrical municipality) offered numerous conclusions, but gave no underlying data to support their claims, and when Alliant personnel were asked to provide such data, they refused.  Decorah Power looks forward to presenting the findings of the city-approved feasibility study by NewGen Strategies and Solutions to the Decorah City Council on Tuesday, January 16 to at 5:45 pm. The public is welcome and encouraged to attend."