Exhibit 10.18


                            ALLIANT SERVICES COMPANY

                     KEY EMPLOYEE DEFERRED COMPENSATION PLAN

   <PAGE>

                                Table of Contents

                                                                         Page
   ARTICLE 1      BACKGROUND . . . . . . . . . . . . . . . . . . . . . . .  1

   ARTICLE 2      DEFINITIONS  . . . . . . . . . . . . . . . . . . . . . .  1

        2.1       Account  . . . . . . . . . . . . . . . . . . . . . . . .  1
        2.2       Affiliate  . . . . . . . . . . . . . . . . . . . . . . .  1
        2.3       Beneficiary  . . . . . . . . . . . . . . . . . . . . . .  1
        2.4       Code . . . . . . . . . . . . . . . . . . . . . . . . . .  1
        2.5       Company  . . . . . . . . . . . . . . . . . . . . . . . .  1
        2.6       Compensation . . . . . . . . . . . . . . . . . . . . . .  1
        2.7       Deferred Compensation  . . . . . . . . . . . . . . . . .  1
        2.8       Disability . . . . . . . . . . . . . . . . . . . . . . .  1
        2.9       Effective Date . . . . . . . . . . . . . . . . . . . . .  1
        2.10      Eligible Employee  . . . . . . . . . . . . . . . . . . .  1
        2.11      Employer . . . . . . . . . . . . . . . . . . . . . . . .  2
        2.12      ERISA  . . . . . . . . . . . . . . . . . . . . . . . . .  2
        2.13      Participant  . . . . . . . . . . . . . . . . . . . . . .  2
        2.14      Plan . . . . . . . . . . . . . . . . . . . . . . . . . .  2
        2.15      Plan Year  . . . . . . . . . . . . . . . . . . . . . . .  2
        2.16      Plan Administrator . . . . . . . . . . . . . . . . . . .  2
        2.17      Retirement . . . . . . . . . . . . . . . . . . . . . . .  2
        2.18      Savings Plan . . . . . . . . . . . . . . . . . . . . . .  2
        2.19      Termination of Employment  . . . . . . . . . . . . . . .  2
        2.20      Unforeseeable Emergency  . . . . . . . . . . . . . . . .  2

   ARTICLE 3      ADMINISTRATION . . . . . . . . . . . . . . . . . . . . .  2

        3.1       Powers and Duties  . . . . . . . . . . . . . . . . . . .  2
        3.2       Delegation . . . . . . . . . . . . . . . . . . . . . . .  3

   ARTICLE 4      DEFERRED COMPENSATION  . . . . . . . . . . . . . . . . .  3

        4.1       Participant Deferrals  . . . . . . . . . . . . . . . . .  3
        4.2       Employer Contributions . . . . . . . . . . . . . . . . .  3
        4.3       Deferred Compensation Accounts . . . . . . . . . . . . .  4

   ARTICLE 5      PAYMENT OF DEFERRED COMPENSATION . . . . . . . . . . . .  5

        5.1       Payment of Deferred Compensation . . . . . . . . . . . .  5
        5.2       Time of Payment  . . . . . . . . . . . . . . . . . . . .  5
        5.3       Form of Payment  . . . . . . . . . . . . . . . . . . . .  5
        5.4       Amount of Payments . . . . . . . . . . . . . . . . . . .  5
        5.5       Participant Elections  . . . . . . . . . . . . . . . . .  5
        5.6       Emergency Payments . . . . . . . . . . . . . . . . . . .  6
        5.7       Tax Payments . . . . . . . . . . . . . . . . . . . . . .  6
        5.8       Facility of Payment  . . . . . . . . . . . . . . . . . .  7

   ARTICLE 6      CLAIMS PROCEDURE . . . . . . . . . . . . . . . . . . . .  7

        6.1       Decisions on Claims  . . . . . . . . . . . . . . . . . .  7
        6.2       Review of Denied Claims  . . . . . . . . . . . . . . . .  7

   ARTICLE 7      FUNDING  . . . . . . . . . . . . . . . . . . . . . . . .  8

   ARTICLE 8      AMENDMENT AND TERMINATION  . . . . . . . . . . . . . . .  8

   ARTICLE 9      GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . .  8

        9.1       Status of Participants . . . . . . . . . . . . . . . . .  8
        9.2       No Guaranty of Employment  . . . . . . . . . . . . . . .  8
        9.3       Delegation of Authority  . . . . . . . . . . . . . . . .  8
        9.4       Legal Actions  . . . . . . . . . . . . . . . . . . . . .  8
        9.5       Applicable Law . . . . . . . . . . . . . . . . . . . . .  9
        9.6       Rules of Construction  . . . . . . . . . . . . . . . . .  9
        9.7       Expenses of Administration . . . . . . . . . . . . . . .  9
        9.8       Indemnification  . . . . . . . . . . . . . . . . . . . .  9

   <PAGE>
                                    ARTICLE 1

                                   BACKGROUND

   Alliant Services Company wishes to adopt a plan to allow certain of its
   key employees to defer payment of part or all of their current
   compensation.  To accomplish this purpose, it has adopted the Alliant
   Services Company Key Employee Deferred Compensation Plan as hereinafter
   set forth.

                                    ARTICLE 2

                                   DEFINITIONS

        When the following words or phrases are used in this Agreement, they
   shall have the meanings set forth below unless otherwise specifically
   provided:

        2.1  Account.  An account which has been established for a
   Participant pursuant to Section 4.3.

        2.2  Affiliate.  A business organization that is under common control
   with the Company, as determined under Section 414(c) of the Code.

        2.3  Beneficiary.  The person or persons (including a trustee or
   trustees) designated as a Participant's Beneficiary in the last written
   instrument signed by the Participant for the purposes of this Plan and
   received by the Plan Administrator prior to the Participant's death.  If
   no such person has been designated, the Participant's Beneficiary shall be
   the person or persons who constitute the Participant's beneficiary for the
   purposes of the Savings Plan.

        2.4  Code.  The Internal Revenue Code of 1986, as from time to time
   amended.

        2.5  Company.  Alliant Services Company, and any successor or
   successors thereto.

        2.6  Compensation.  A Participant's base salary and any incentive
   compensation earned by a Participant under a plan adopted by the
   Participant's Employer on or after the Effective Date.

        2.7  Deferred Compensation.  The balance from time to time credited
   to a Participant's Account.

        2.8  Disability.  A Participant's eligibility for immediate benefits
   under his or her Employer's long-term disability plan.

        2.9  Effective Date.  The later of January 1, 1998 or the effective
   date of the Company's incorporation.

        2.10 Eligible Employee.  An employee of an Employer who is a member
   of a select group of management or highly compensated employees within the
   meaning of Section 201(2) of ERISA, and who has been designated by the
   Chief Executive Officer of the Company as being eligible to participate in
   the Plan.

        2.11 Employer.  The Company, and each Affiliate of the Company whose
   employees have been designated as being eligible to participate in the
   Plan.

        2.12 ERISA.  The Employee Retirement Income Security Act of 1974, as
   from time to time amended.

        2.13 Participant.  An Eligible Employee for whom an Account has been
   established pursuant to Section 4.3.

        2.14 Plan.  The Alliant Services Company Key Employee Deferred
   Compensation Plan, as set forth herein, and as from time to time amended.

        2.15 Plan Year.  The 12 consecutive month period ending on each
   December 31.

        2.16 Plan Administrator.  The Compensation and Personnel Committee of
   the Board of Directors of Interstate Energy Corporation.

        2.17 Retirement.  Termination of Employment at or after age 55 or by
   reason of Disability.

        2.18 Savings Plan.  The Alliant Services Company Retirement Savings
   401(k) Plan.

        2.19 Termination of Employment.  Severance of a Participant's
   employment relationship with all of the Employers and their Affiliates.  A
   transfer of employment among Employers or their Affiliates will not
   constitute a Termination of Employment.

        2.20 Unforeseeable Emergency.  A severe financial hardship to a
   Participant resulting from a sudden and unexpected illness or accident of
   the Participant or a dependent (as defined in Section 152(a) of the Code)
   of the Participant, loss of the Participant's property due to casualty, or
   a similar extraordinary and unforeseeable circumstance arising as a result
   of events beyond the control of the Participant.

                                    ARTICLE 3

                                 ADMINISTRATION

        3.1  Powers and Duties.  Full power and authority to construe,
   interpret, and administer this Plan is vested in the Plan Administrator. 
   In particular, the Plan Administrator shall make each determination
   provided for in this Plan and may adopt such rules, regulations, and
   procedures, as it deems necessary or desirable to the efficient
   administration of the Plan.  The Plan Administrator's determinations need
   not be uniform, and may be made by it selectively among persons who may be
   eligible to participate in the Plan.  The Plan Administrator shall have
   sole and exclusive discretion in the exercise of its powers and duties
   hereunder, and all determinations made by the Plan Administrator shall be
   final, conclusive, and binding unless they are found by a court of
   competent jurisdiction to have been arbitrary and capricious.

        3.2  Delegation.  The Plan Administrator may delegate part or all of
   is duties to any person or persons, and may from time to time revoke such
   authority and delegate it to another person or persons.  Each such
   delegation to a person who is not an employee of the Company or an
   Affiliate will be in writing, and a copy will be furnished to the person
   to whom the duty is delegated, who will file a written acceptance with the
   Plan Administrator.  Any delegate's duty will terminate upon revocation of
   such authority by the Plan Administrator, upon withdrawal of such person's
   acceptance or, in the case of a delegate who is an employee of the Company
   or an Affiliate, upon the termination of such employment.  Any person to
   whom administrative duties are delegated may, unless the delegation
   provides otherwise, similarly delegate part or all of such duties to
   another person.

                                    ARTICLE 4

                              DEFERRED COMPENSATION

        4.1  Participant Deferrals.  An Eligible Employee may elect to defer
   up to 100% of his or her Compensation for any Plan Year.  An election to
   defer Compensation shall be made in writing prior to the first day of the
   Plan Year to which it will apply or, if later, within 30 days after the
   Eligible Employee is first notified by the Plan Administrator of his or
   her eligibility to participate in the Plan, and it shall be subject to the
   following requirements:

             (a)  The election may defer a percentage of the Participant's
        base salary, and/or a percentage of the Participant's incentive
        compensation.  Amounts deferred from a Participant's base salary
        shall reduce the Participant's base salary in equal installments for
        each pay period during the Plan Year (or portion thereof) to which
        the election applies.  Amounts deferred from a Participant's
        incentive compensation shall reduce the Participant's incentive
        compensation for the Plan Year on the date such incentive
        compensation would otherwise be paid to the Participant.

             (b)  The election shall be irrevocable with respect to all
        Compensation payable for services performed by the Participant during
        the Plan Year following the date on which the election is received by
        the Plan Administrator, except that a Participant may terminate an
        election to defer Compensation if the Plan Administrator determines
        that the termination is necessary as a result of an Unforeseeable
        Emergency.

        4.2  Employer Contributions.  Each Employer shall credit to the
   Account of each Participant who is employed by that Employer an "Employer
   Contribution" in an amount equal to 50% of (a) minus (b), where:

             (a)  is the lesser of:

                  (i)  the sum of the amounts (if any) contributed by the
             Participant to the Savings Plan during a Plan Year which were
             eligible for matching contributions under the Savings Plan, plus
             the amounts deferred by the Participant during the Plan Year
             pursuant to Section 4.1; or

                  (ii) 6% of the Participant's base salary for the Plan Year;
             and

             (b)  is the amount of any matching contributions that were made
        to the Savings Plan on behalf of the Participant for the Plan Year.

   Notwithstanding the foregoing, a Participant shall not receive an Employer
   Contribution for any Plan Year unless:  (A) the Participant is employed by
   an Employer or an Affiliate on the last day of the Plan Year; or (B) the
   Participant's employment terminated during the Plan Year by reason of the
   Participant's Retirement or death.

        4.3  Deferred Compensation Accounts.  The Plan Administrator shall
   establish an Account in the name of each Participant to record the
   Deferred Compensation payable to the Participant.  Such Account shall be
   for bookkeeping purposes only, and shall not be deemed to create a fund or
   trust for the benefit of the Participant.  Each Participant's Account
   shall periodically be adjusted as follows:

             (a)  The Plan Administrator shall credit the following amounts
        to a Participant's Account:

                  (i)  Amounts deferred by a Participant pursuant to Section
             4.1 shall be credited to the Participant's Account as of the
             dates on which they are applied to reduce the Participant's
             current Compensation.

                  (ii) Amounts contributed on behalf of a Participant by the
             Participant's Employer pursuant to Section 4.2 shall be credited
             to the Participant's Account as of July 1 of the Plan Year for
             which such amounts are contributed.

                  (iii)     All deferred amounts credited to a Participant's
             Account shall be credited interest on December 31 at a rate
             equivalent to the A-Utility Bond yield (as reported in the
             Federal Reserve statistical release H.15), or the Wall Street
             Journal prime interest rate, (whichever is greater), using the
             average of the rates reported for the last Friday of each month
             for the preceding year.  Interest shall continue to be credited
             and compounded in this manner until the final payment shall have
             been made from the Participant's Account.

             Partial year interest accruals for Participants who because of
        financial hardship, retirement, termination or death during the Plan
        Year will also be computed (in the manner prescribed above) using the
        average rates from the January 1 preceding the Participant's
        retirement/termination date through the fourth Friday of the month
        preceding the Participant's retirement or termination date.  Interest
        payments will apply to amounts deferred up to the date the plan
        distribution is made.

             (b)  The Plan Administrator shall charge to the Participant's
        Account the amount of any payments made to or on behalf of the
        Participant, and the amount of any penalty imposed on the Participant
        pursuant to Section 5.5(c), as of the dates on which such payments
        are made or such penalty is imposed.

                                    ARTICLE 5

                        PAYMENT OF DEFERRED COMPENSATION

        5.1  Payment of Deferred Compensation.  In the event of a
   Participant's Termination of Employment for reasons other than the
   Participant's death, the balance credited to the Participant's Account
   shall be paid to the Participant.  In the event of a Participant's death,
   the balance credited to the Participant's Account shall be paid to the
   Participant's Beneficiary.

        5.2  Time of Payment.  Payment of a Participant's Deferred 
   Compensation shall commence as follows:

             (a)  Retirement.  In the case of a Participant's Retirement,
        payment shall commence within 60 days after the date of the
        Participant's Termination of Employment or within 60 days after the
        last day of the Plan Year in which the Participant retires, as
        elected by the Participant pursuant to Section 5.5.  If payment is
        made in annual installments, each installment after the first shall
        be paid within 31 days after the last day of the Plan Year in which
        the first installment was paid.

             (b)  Death.  In the case of a Participant' death, payment shall
        commence within 60 days after the date the Participant's Beneficiary
        has been identified.

             (c)  Other Termination of Employment.  In the case of a
        Participant's Termination of Employment for reasons other than the
        Participant's death or Retirement, payment shall commence within 60
        days after the date of the Participant's Termination of Employment.

        5.3  Form of Payment.  Payments due by reason of a Participant's
   death or Retirement shall be made in a lump sum or in up to ten annual
   installments, as elected by the Participant pursuant to Section 5.5. 
   Payments due by reason of a Participant's Termination of Employment for
   reasons other than a Participant's death or Retirement shall be made in a
   lump sum.

        5.4  Amount of Payments.  The amount of a lump sum payment shall be
   equal to the balance credited to the Participant's Account as of a date
   selected by the Plan Administrator, which date shall not be more than 30
   days prior to the date the lump sum is paid.  The amount of an installment
   payment shall be equal to the balance credited to the Participant's
   Account as of a date selected by the Plan Administrator (which shall not
   be more than 30 days prior to the date the installment is paid), divided
   by the number of installments (including the current installment)
   remaining to be paid.

        5.5  Participant Elections.  A Participant's elections concerning the
   time and form of payment of Deferred Compensation shall be made in writing
   on forms provided by and filed with the Plan Administrator, and shall be
   subject to the following requirements:

             (a)  An election concerning the time at which payments of
        Deferred Compensation will begin must be received by the Plan
        Administrator with the Participant's first election to defer
        Compensation pursuant to this Plan.  Such an election shall apply to
        all of the Participant's Deferred Compensation, and it may not be
        changed or revoked after it has been received by the Plan
        Administrator except as provided in paragraph (c).  In the absence of
        a valid election, payment of a Participant's Deferred Compensation
        shall begin within 60 days after the Participant's Termination of
        Employment.

             (b)  A Participant's election concerning the form in which his
        or her Deferred Compensation will be paid must be received by the
        Plan Administrator with the Participant's first election to defer
        Compensation pursuant to this Plan.  Such an election shall apply to
        all of the Participant's Deferred Compensation, and it may not be
        changed or revoked after it has been received by the Plan
        Administrator except as provided in paragraph (c).  In the absence of
        a valid election, a Participant's Deferred Compensation shall be paid
        in a lump sum.

             (c)  A Participant may change an election as to the time and/or
        form of payment of his or her Deferred Compensation at any time by
        giving prior written notice to the Plan Administrator.  Any change in
        a Participant's elections shall result in a penalty in the amount of
        10% of the Participant's Deferred Compensation as of the date on
        which notice of the change is received by the Plan Administrator,
        which amount shall be forfeited to the Participant's Employer.

        5.6  Emergency Payments.  In the event of an Unforeseeable Emergency,
   the Plan Administrator may direct a Participant's Employer to pay any part
   or all of a Participant's Deferred Compensation to the Participant prior
   to the time provided in Section 5.2, to the extent necessary to prevent
   severe financial hardship.  Such action shall be taken only if the
   Participant submits a written application describing the circumstances
   which are deemed to justify the payment and the amount necessary to
   prevent severe financial hardship, together with such supporting evidence
   as the Plan Administrator may reasonably require.  Payments shall not be
   made under this section to the extent the Participant's hardship is or may
   be relieved:

             (a)  through reimbursement or compensation by insurance or
        otherwise;

             (b)  by liquidation of the Participant's assets, to the extent
        this would not in itself cause severe financial hardship; or

             (c)  by the termination of the Participant's election to defer
        Employer Compensation.

        5.7  Tax Payments.  If there is a final determination that a
   Participant or Beneficiary should be taxed on part or all of the
   Participant's Deferred Compensation before it is actually paid, the
   Participant's Employer shall pay to the Participant or Beneficiary the
   portion of the Participant's Deferred Compensation that has been
   determined to be currently taxable.  For the purposes of this section, a
   "final determination" means a determination by the Internal Revenue
   Service or a court of competent jurisdiction from which no further appeal
   may be taken, either because there is no further appeal available or
   because the time to take such appeal has expired.

        5.8  Facility of Payment.  An Employer may make payments due to a
   legally incompetent person in such of the following ways as the Plan
   Administrator shall determine:

             (a)  directly to such person;

             (b)  to the legal representative of such person; or

             (c)  to a near relative of such person to be used for the
        person's benefit.

   Any payment made in accordance with the provisions of this section shall
   be a complete discharge of the Employer's liability for the making of such
   payment.

                                    ARTICLE 6

                                CLAIMS PROCEDURE

        6.1  Decisions on Claims.  If a claim for benefits is denied, the
   Plan Administrator shall furnish to the claimant within 90 days after its
   receipt of the claim (or within 180 days after such receipt if special
   circumstances require an extension of time) a written notice which:

             (a)  specifies the reasons for the denial;

             (b)  refers to the pertinent provisions of the Plan on which the
        denial is based;

             (c)  describes any additional material or information necessary
        for the perfection of the claim and explains why such material or
        information is necessary; and

             (d)  explains the claim review procedures.

        6.2  Review of Denied Claims.  Upon the written request of the
   claimant submitted within 60 days after his or her receipt of such written
   notice, the Plan Administrator shall afford the claimant a full and fair
   review of the decision denying the claim and, if so requested, permit the
   claimant to review any documents which are pertinent to the claim, permit
   the claimant to submit issues and comments in writing, and afford the
   claimant an opportunity to meet with appropriate representatives of the
   Plan Administrator as a part of the review procedure.  Within 60 days
   after its receipt of a request for review (or within 120 days after such
   receipt if special circumstances, such as the need to hold a hearing,
   require an extension of time) the Plan Administrator shall notify the
   claimant in writing of its decision and the reasons for its decision and
   shall refer the claimant to the provisions of the Plan which form the
   basis for its decision.

                                    ARTICLE 7

                                     FUNDING

   This Plan is intended to be "unfunded" for the purposes of the Code and
   Title I of ERISA; however, nothing herein shall prevent an Employer, in
   its sole discretion, from establishing a trust of the type commonly known
   as a "rabbi trust" to assist it in meeting its obligations under the Plan.

                                    ARTICLE 8

                            AMENDMENT AND TERMINATION

   The Plan Administrator may amend or terminate this Plan at any time and
   for any reason; provided, that no amendment or termination of the Plan
   shall alter a Participant's right to receive payment of amounts previously
   credited to the Participant's Account.

                                    ARTICLE 9

                               GENERAL PROVISIONS

        9.1  Status of Participants.  Each Participant shall be a general
   unsecured creditors of his or her Employer with respect to amounts payable
   hereunder, this Plan constituting a mere promise by the Employers to make
   benefit payments in the future.  A Participant's right to receive payments
   under the Plan are not subject in any manner to anticipation, alienation,
   sale, assignment, pledge, encumbrance, attachment, or garnishment by the
   creditors of the Participant or the Participant's Beneficiaries.

        9.2  No Guaranty of Employment.  The establishment of this Plan shall
   not give a Participant any legal or equitable right to be continued in the
   employ of an Employer, nor shall it interfere with an Employer's right to
   terminate the employment of any of its employees, with or without cause.

        9.3  Delegation of Authority.  Whenever, under the terms of this
   Plan, an Employer is permitted or required to do or perform any act, it
   shall be done or performed by the Board of Directors of the Employer, by
   any duly authorized committee thereof, or by any officer of the Employer
   duly authorized by the articles of incorporation, bylaws, or Board of
   Directors of the Employer.

        9.4  Legal Actions.  No Participant, Beneficiary, or other person
   having or claiming to have an interest in this Plan shall be a necessary
   party to any action or proceeding involving the Plan, and no such person
   shall be entitled to any notice or process, except to the extent required
   by applicable law.  Any final judgment which is not appealed or appealable
   that may be entered in any such action or proceeding shall be binding and
   conclusive on all persons having or claiming to have any interest in this
   Plan.

        9.5  Applicable Law.  This Plan shall be construed and interpreted in
   accordance with the laws of the State of Iowa, except to the extent the
   same are preempted by ERISA or other federal law.

        9.6  Rules of Construction.  Wherever any words are used herein in
   the masculine gender, they shall be construed as though they were also
   used in the feminine gender in all cases where they would so apply, and
   wherever any words are used herein in the singular form they shall be
   construed as though they were also used in the plural form in all cases
   where they would so apply.  Headings of sections and subsections of this
   Plan are inserted for convenience of reference, are not a part of this
   Plan, and are not to be considered in the construction hereof.  The words
   "hereof," "herein," "hereunder," and other similar compounds of the word
   "here" shall mean and refer to the entire Plan, and not to any particular
   provision or section.

        9.7  Expenses of Administration.  All expenses and costs incurred in
   connection with the administration or operation of the Plan shall be paid
   by the Employers and/or any trust of the type described in Article 7.

        9.8  Indemnification.  Each Employer shall, to the extent permitted
   by its articles of incorporation and bylaws, and by the laws of the state
   in which it is incorporated, indemnify any employee or director of an
   Employer or an Affiliate providing services to the Plan against any and
   all liabilities arising by reason of any act or omission, made in good
   faith pursuant to the provisions of the Plan, including expenses
   reasonably incurred in the defense of any claim relating thereto.

   To record the adoption of the Plan as set forth above, the undersigned has
   executed this document this ___ day of ________________, 1997, for and on
   behalf of the Company.


                                      ALLIANT SERVICES COMPANY


                                      By_____________________________

                                      As its__________________________
   ATTEST:

   __________________________________
   As its____________________________