Iowa utilities to save millions from tax reform - KWWL - Eastern Iowa Breaking News, Weather, Closings

Iowa utilities to save millions from tax reform

Posted: Updated:
CEDAR RAPIDS (KWWL) -

A federal tax cut put in place by President Trump could mean money saved on electric bills for Iowans.

On January 1, 2018, the Tax Cuts and Job Acts law, signed by President Trump, went into effect. In it, a corporate tax cut from 35% down to 21%, which will mean a savings up to $147 million in utility bills.

It's money saved that utility companies plan to put back into the pockets of Iowans.

On January 18, the Iowa Utilities Board ordered an investigation into the effect of the tax cut and how it will impact Iowa's rate-regulated utilities and their customers. On January 25, a workshop was held with the Iowa companies about the savings they expect to see.

In that workshop, Alliant Energy estimated customer savings to be from $18.6 million to $19.6 million for electric, and between $500,000 to $3.7 million for gas.

"Our customers really stand to gain from this.  Because we're going to be paying less in corporate taxes, we're going to be able to give more of that back to our customers," Alliant Energy Spokesperson, Justin Foss, said.

MidAmerican Energy estimated between $90.8 million and $112.3 million in customer savings.

How much money customers can expect to see back, and when, is still being determined, according to Foss.

"Anytime you're able to get that money back to customers, it makes a difference for them. Just how big of a difference it will be? We're still working through that right now," he said.

Foss said Alliant has been giving its customers tax benefits since 2011.  Those were provided through a "tax rider," which worked as a monthly credit on bills. However, the federal corporate tax cut is different. Foss said, ultimately, it will depend on last year's taxes and an approved proposal from the Iowa Utilities Board before an exact savings can be determined.

"We've already given $500 million back to customers. For the average electric bill, that's been about a 3% savings they've seen. We're hoping with the new lower corporate taxes we'll be able to give that benefit back to customers, as well, and that will benefit both electric and gas customers across the state," Foss said.

Powered by Frankly