Utility bill break: Iowa's biggest utility companies are asked to return tax savings to consumers

This may be a first: Iowans are getting good news about their utility bill in January.

State regulators said Thursday they want the state's investor-owned utilities to consider returning tax savings they received from the federal government to consumers.

The Iowa Utilities Board issued an order asking MidAmerican Energy, Alliant Energy and others to provide information on the tax savings they'll see from the federal tax cut and jobs act that became effective Jan. 1.

The order said the board is assessing whether rates are "just and reasonable," given that federal income taxes are a "significant factor" in determining electric and gas rates.

The board is holding a workshop on the issue Jan. 25.

It's unclear how much of the extra money will be passed to consumers, said Jennifer Easler, an attorney in the Iowa Attorney General's consumer advocate office.

But the savings should be substantial. "It should be a great thing for consumers," Easler said.

The federal income tax rate for corporations is dropping from 35 percent to 21 percent under the new tax laws.

MidAmerican and Alliant Energy, the parent of Interstate Power and Light Co., said Thursday they're calculating the savings and what it will mean for consumers.

The tax change comes as Alliant proposes increasing its utility rates between 10 and 12 percent.

The utility seeks the hike to pay for its new $645 million electric generating station in Marshalltown and other investments.

Justin Foss, an Alliant spokesman, said the utility company is recalculating its rate increase with the the tax savings in mind.

Foss said the utility has proposed returning its tax savings to consumers by March.

MidAmerican said it's committed to making sure customers benefit from the federal tax cuts.

Easler said the utilities board will look at how the savings should be passed along to consumers. For example, the savings could manifest in a rebate or lower rates.

Iowans could have a better idea of how much might be returned to consumers next week, she said.

In addition to MidAmerican and Alliant, tax savings also will be sought from Black Hills Energy, Liberty Utilities and Iowa American Water Co.