ALLIANT ENERGY CORP (LNT, NYSE)
Annual report, fiscal year 2019


# 2019
Annual Report






## Contents

CEO Letter 1
Selected Financial and Operating Statistics 2
Management's Discussion and Analysis of Financial Condition and Results of Operations 5
Management's Annual Report on Internal Control over Financial Reporting 20
Reports of Independent Registered Public Accounting Firm 21
Consolidated Financial Statements 24
Notes to Consolidated Financial Statements 28
Our Leaders 60
Shareowner Information Inside back cover

## Five-year return



Comparison of cumulative five-year total return when investing $100 on December 31, 2014.



## Dividends per share



* Annual common stock dividend target. Payment of the 2020 dividends is subject to the actual dividend declaration by the Board of Directors.

## 2020 Online Annual Meeting

Thursday, May 21, at 9 a.m.
Central Daylight Time



To participate online:

virtualshareholdermeeting.com/LNT2020



To listen by phone:

1-877-328-2502

Please connect 10 minutes in advance. You will need your 16-digit control number (found on your proxy card) for access through the website or to provide to the phone operator.

You can access proxyvote.com to vote your shares and post questions in advance. If we are not able to respond to all questions during the meeting, the questions and answers will be posted to virtualshareholdermeeting.com/LNT2020 after it.

The meeting will be virtual only. Please note that if you choose to listen by phone, you will not be able to vote or ask questions during the actual meeting.

## Who we are

Alliant Energy Corporation (NASDAQ: LNT) is a Midwest U.S. energy company with annual operating revenues of more than $3.6 billion. Our company is primarily engaged in electric generation and the distribution of electricity and natural gas. We serve approximately 970,000 electric and 420,000 natural gas customers through our two public utility subsidiaries, Interstate Power and Light (IPL) and Wisconsin Power and Light (WPL). IPL provides retail electric and gas service in Iowa, and sells electricity to wholesale customers in Minnesota, Illinois and Iowa. WPL provides retail and wholesale electric and retail gas service in Wisconsin.





Headquartered in Madison, Wisconsin, Alliant Energy has approximately 3,600 employees and more than 24,000 shareowners of record. Based on electric sales, the largest cities served in Iowa and Wisconsin are Cedar Rapids and Beloit, respectively.



# Dear Shareowners
of Alliant Energy,

In this uncertain environment caused by the global COVID-19 pandemic, our company continues to focus on providing the critical, reliable services our customers depend upon. As always, and especially now, we emphasize the health and welfare of our employees, customers and communities.
As an energy company, we are accustomed to preparing for storms and business disruptions. However, the COVID-19 situation is unlike
anything we have faced before. We have drawn on our collective talents, experience and teamwork to face this challenge and have adapted swiftly. We’ve implemented, and continue to revise, our plans to maintain safe and reliable operations. And following our Value to Care for Others, we have provided financial support and assistance to several charitable organizations, aiding those in our communities that need it most.



Our company’s nearly 3,600 employees across Iowa and Wisconsin share a common purpose – to serve customers and build stronger communities. Now more than ever, this purpose guides us to deliver solutions by:

■ Providing safe, reliable and affordable energy to our customers

■ Ensuring our investments are efficient and customer-focused

■ Accelerating clean energy development

Our renewables journey began a decade ago. By the end of 2020, we’ll have enough wind generation online to power 593,000 households, making Alliant Energy the third largest utility owner-operator of regulated wind in the United States.

And we’re not done. We plan to add solar energy to that story. Late last year, we announced plans to bring 1,000 MW of new solar generation to Wisconsin. All together, these renewable investments will be enough to power more than 850,000 homes with clean and affordable energy from the wind and sun.

We’re also investing in our energy grid by adding smart technologies that can help us better manage power disruptions and give consumers more insight into, and control over, their energy use.

Last fall, the industry-leading publication Site Selection magazine recognized our efforts to develop 16 shovel-ready business parks across Iowa and Wisconsin. This is a great example of how we partner with our communities to help drive sustainable economic growth.

Executing on our purpose also helps us achieve important Environmental, Social and Governance (ESG) goals. I will highlight some examples:

■ Our employees invest thousands of volunteer hours in our communities, bringing to life our Do the right thing and Make things better company Values.

■ Our philanthropic and Foundation giving support local programs to address food insecurity, strengthen families and extend STEM education programs.

■ Our Care for others Value is the cornerstone of our workplace diversity, equity and inclusion efforts. For the third year in a row, we earned a perfect score on the LGBTQ equity index issued by the Human Rights Campaign Foundation. And Milwaukee Women, Inc. recognized us for gender diversity on our Board of Directors.

By focusing on our purpose, we were able to deliver another year of strong financial performance for our shareowners in 2019. Your investment in Alliant Energy delivered a 33% return, which exceeded the returns of both the S&P 500 Index and the Edison Electric Institute Stock Index. Our Board of Directors also approved raising the dividend target in 2020 by 7% to $1.52 per share – the 17th year in a row we’ve increased shareowner dividends.

In closing, I want to express my gratitude for the talented and dedicated employees of this great company. Whatever the challenge, we come together to provide safe, reliable and affordable energy to our customers. Thank you for your continued confidence in Alliant Energy and for being a part of our story.



John O. Larsen
Chairman, President and CEO



## SELECTED FINANCIAL AND OPERATING STATISTICS

<table><tr><td>Financial Information - Alliant Energy</td><td>2019 (a)</td><td>2018 (a)</td><td>2017</td><td>2016</td><td>2015</td></tr><tr><td></td><td colspan="5">(dollars in millions, except per share data)</td></tr><tr><td>Income Statement Data:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Revenues</td><td>$3,647.7</td><td>$3,534.5</td><td>$3,382.2</td><td>$3,320.0</td><td>$3,253.6</td></tr><tr><td>Amounts attributable to Alliant Energy common shareowners:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Income from continuing operations, net of tax</td><td>557.2</td><td>512.1</td><td>455.9</td><td>373.8</td><td>380.7</td></tr><tr><td>Income (loss) from discontinued operations, net of tax</td><td>—</td><td>—</td><td>1.4</td><td>(2.3)</td><td>(2.5)</td></tr><tr><td>Net income</td><td>557.2</td><td>512.1</td><td>457.3</td><td>371.5</td><td>378.2</td></tr><tr><td>Common Stock Data:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Earnings per weighted average common share attributable to Alliant Energy common shareowners (basic):</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Income from continuing operations, net of tax</td><td>$2.34</td><td>$2.19</td><td>$1.99</td><td>$1.65</td><td>$1.69</td></tr><tr><td>Loss from discontinued operations, net of tax</td><td>$—</td><td>$—</td><td>$—</td><td>($0.01)</td><td>($0.01)</td></tr><tr><td>Net income</td><td>$2.34</td><td>$2.19</td><td>$1.99</td><td>$1.64</td><td>$1.68</td></tr><tr><td>Earnings per weighted average common share attributable to Alliant Energy common shareowners (diluted):</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Income from continuing operations, net of tax</td><td>$2.33</td><td>$2.19</td><td>$1.99</td><td>$1.65</td><td>$1.69</td></tr><tr><td>Loss from discontinued operations, net of tax</td><td>$—</td><td>$—</td><td>$—</td><td>($0.01)</td><td>($0.01)</td></tr><tr><td>Net income</td><td>$2.33</td><td>$2.19</td><td>$1.99</td><td>$1.64</td><td>$1.68</td></tr><tr><td>Common shares outstanding at year-end (000s)</td><td>245,023</td><td>236,063</td><td>231,349</td><td>227,674</td><td>226,918</td></tr><tr><td>Dividends declared per common share</td><td>$1.42</td><td>$1.34</td><td>$1.26</td><td>$1.175</td><td>$1.10</td></tr><tr><td>Market value per share at year-end</td><td>$54.72</td><td>$42.25</td><td>$42.61</td><td>$37.89</td><td>$31.225</td></tr><tr><td>Book value per share at year-end</td><td>$21.24</td><td>$19.43</td><td>$18.08</td><td>$16.96</td><td>$16.41</td></tr><tr><td>Market capitalization at year-end</td><td>$13,407.7</td><td>$9,973.7</td><td>$9,857.8</td><td>$8,626.6</td><td>$7,085.5</td></tr><tr><td>Other Selected Financial Data:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash flows from operating activities (b)</td><td>$660.4</td><td>$527.7</td><td>$521.6</td><td>$392.8</td><td>$871.2</td></tr><tr><td>Construction and acquisition expenditures</td><td>$1,640.1</td><td>$1,633.9</td><td>$1,466.9</td><td>$1,196.8</td><td>$1,034.3</td></tr><tr><td>Total assets at year-end</td><td>$16,700.7</td><td>$15,426.0</td><td>$14,187.8</td><td>$13,373.8</td><td>$12,495.2</td></tr><tr><td>Long-term obligations, net</td><td>$6,190.8</td><td>$5,506.1</td><td>$4,870.6</td><td>$4,325.1</td><td>$3,837.0</td></tr></table>

(a) Refer to “Results of Operations” in MDA for discussion of the 2019 and 2018 results of operations.

(b) In 2018, Alliant Energy’s cash flows from operating activities were restated for 2017 and 2016 as a result of the adoption of a new cash flows presentation accounting standard. Alliant Energy’s cash flows from operating activities for 2015 were not retrospectively amended for this new presentation standard as the information was not available due to the implementation of a new customer billing and information system in 2016.

<table><tr><td>Electric Operating Information - Alliant Energy</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Revenues (in millions)</td><td>$3,063.6</td><td>$3,000.3</td><td>$2,894.7</td></tr><tr><td>Sales (000s MWh)</td><td>31,794</td><td>31,584</td><td>30,192</td></tr><tr><td>Customers (End of Period)</td><td>971,301</td><td>965,514</td><td>962,121</td></tr><tr><td>Sources of electric energy (000s MWh):</td><td></td><td></td><td></td></tr><tr><td>Gas</td><td>11,060</td><td>9,731</td><td>5,315</td></tr><tr><td>Purchased power:</td><td></td><td></td><td></td></tr><tr><td>Nuclear</td><td>3,748</td><td>3,538</td><td>3,727</td></tr><tr><td>Wind (a)</td><td>2,383</td><td>1,086</td><td>1,268</td></tr><tr><td>Other (a)</td><td>3,264</td><td>4,076</td><td>6,242</td></tr><tr><td>Wind (a)</td><td>2,896</td><td>1,603</td><td>1,591</td></tr><tr><td>Coal</td><td>8,643</td><td>12,113</td><td>12,380</td></tr><tr><td>Other (a)</td><td>239</td><td>240</td><td>239</td></tr><tr><td>Total</td><td>32,233</td><td>32,387</td><td>30,762</td></tr></table>

(a) All or some of the renewable energy attributes associated with generation from these sources may be used in future years to comply with renewable energy standards or other regulatory requirements.



<table><tr><td>Gas Operating Information - Alliant Energy</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Revenues (in millions)</td><td>$445.2</td><td>$446.6</td><td>$400.9</td></tr><tr><td>Sales (000s Dths)</td><td>152,985</td><td>143,746</td><td>126,166</td></tr><tr><td>Retail Customers (End of Period)</td><td>417,322</td><td>415,174</td><td>413,054</td></tr></table>

## DEFINITIONS

The following abbreviations or acronyms used in this report are defined below:

<table><tr><td>Abbreviation or Acronym</td><td>Definition</td><td>Abbreviation or Acronym</td><td>Definition</td></tr><tr><td>AEF</td><td>Alliant Energy Finance, LLC</td><td>GAAP</td><td>U.S. generally accepted accounting principles</td></tr><tr><td>AFUDC</td><td>Allowance for funds used during construction</td><td>GHG</td><td>Greenhouse gases</td></tr><tr><td>Alliant Energy</td><td>Alliant Energy Corporation</td><td>IPL</td><td>Interstate Power and Light Company</td></tr><tr><td>ARO</td><td>Asset retirement obligation</td><td>IRS</td><td>Internal Revenue Service</td></tr><tr><td>ATC</td><td>American Transmission Company LLC</td><td>ITC</td><td>ITC Midwest LLC</td></tr><tr><td>ATC Holdings</td><td>Interest in American Transmission Company LLC and ATC Holdco LLC</td><td>IUB</td><td>Iowa Utilities Board</td></tr><tr><td>ATI</td><td>AE Transco Investments, LLC</td><td>KWh</td><td>Kilowatt-hour</td></tr><tr><td>CA</td><td>Certificate of authority</td><td>Marshalltown</td><td>Marshalltown Generating Station</td></tr><tr><td>CAA</td><td>Clean Air Act</td><td>MDA</td><td>Management&#x27;s Discussion and Analysis of Financial Condition and Results of Operations</td></tr><tr><td>CCR</td><td>Coal combustion residuals</td><td>MGP</td><td>Manufactured gas plant</td></tr><tr><td>CO2</td><td>Carbon dioxide</td><td>MISO</td><td>Midcontinent Independent System Operator, Inc.</td></tr><tr><td>Corporate Services</td><td>Alliant Energy Corporate Services, Inc.</td><td>MW</td><td>Megawatt</td></tr><tr><td>CPCN</td><td>Certificate of Public Convenience and Necessity</td><td>MWh</td><td>Megawatt-hour</td></tr><tr><td>CWIP</td><td>Construction work in progress</td><td>N/A</td><td>Not applicable</td></tr><tr><td>DAEC</td><td>Duane Arnold Energy Center</td><td>Note(s)</td><td>Notes to Consolidated Financial Statements</td></tr><tr><td>DCP</td><td>Alliant Energy Deferred Compensation Plan</td><td>OIP</td><td>Alliant Energy 2010 Omnibus Incentive Plan</td></tr><tr><td>DLIP</td><td>Alliant Energy Director Long Term Incentive Plan</td><td>OPEB</td><td>Other postretirement benefits</td></tr><tr><td>Dth</td><td>Dekatherm</td><td>PPA</td><td>Purchased power agreement</td></tr><tr><td>EGU</td><td>Electric generating unit</td><td>PSCW</td><td>Public Service Commission of Wisconsin</td></tr><tr><td>EPA</td><td>U.S. Environmental Protection Agency</td><td>Receivables Agreement</td><td>Receivables Purchase and Sale Agreement</td></tr><tr><td>EPS</td><td>Earnings per weighted average common share</td><td>Riverside</td><td>Riverside Energy Center</td></tr><tr><td>FASB</td><td>Financial Accounting Standards Board</td><td>SEC</td><td>Securities and Exchange Commission</td></tr><tr><td>Federal Tax Reform</td><td>Tax Cuts and Jobs Act</td><td>U.S.</td><td>United States of America</td></tr><tr><td>FERC</td><td>Federal Energy Regulatory Commission</td><td>VEBA</td><td>Voluntary Employees&#x27; Beneficiary Association</td></tr><tr><td>Financial Statements</td><td>Consolidated Financial Statements</td><td>VIE</td><td>Variable interest entity</td></tr><tr><td>FTR</td><td>Financial transmission right</td><td>Whiting Petroleum</td><td>Whiting Petroleum Corporation</td></tr><tr><td>Fuel-related</td><td>Electric production fuel and purchased power</td><td>WPL</td><td>Wisconsin Power and Light Company</td></tr><tr><td>FWEC</td><td>Forward Wind Energy Center</td><td></td><td></td></tr></table>

## FORWARD-LOOKING STATEMENTS

Statements contained in this report that are not of historical fact are forward-looking statements intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified as such because the statements include words such as "may," "believe," "expect," "anticipate," "plan," "project," "will," "projections," "estimate," or other words of similar import. Similarly, statements that describe future financial performance or plans or strategies are forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, such statements. Some, but not all, of the risks and uncertainties of Alliant Energy, IPL and WPL that could materially affect actual results include:

- IPL’s and WPL’s ability to obtain adequate and timely rate relief to allow for, among other things, the recovery of and/or the return on costs, including fuel costs, operating costs, transmission costs, deferred expenditures, deferred tax assets, tax expense, capital expenditures, and remaining costs related to EGUs that may be permanently closed and certain other retired assets, earning their authorized rates of return, and the payments to their parent of expected levels of dividends;



• federal and state regulatory or governmental actions, including the impact of legislation, and regulatory agency orders;

- the impact of customer- and third party-owned generation, including alternative electric suppliers, in IPL's and WPL's service territories on system reliability, operating expenses and customers' demand for electricity;

• the impact of energy efficiency, franchise retention and customer disconnects on sales volumes and margins;

- the impact that price changes may have on IPL’s and WPL’s customers’ demand for electric, gas and steam services and their ability to pay their bills;

- the ability to utilize tax credits and net operating losses generated to date, and those that may be generated in the future, before they expire;

- the direct or indirect effects resulting from terrorist incidents, including physical attacks and cyber attacks, or responses to such incidents;

- the impact of penalties or third-party claims related to, or in connection with, a failure to maintain the security of personally identifiable information, including associated costs to notify affected persons and to mitigate their information security concerns;

- any material post-closing payments related to any past asset divestitures, including the sale of Whiting Petroleum, which could result from, among other things, indemnification agreements, warranties, parental guarantees or litigation;

- employee workforce factors, including changes in key executives, ability to hire and retain employees with specialized skills, ability to create desired corporate culture, collective bargaining agreements and negotiations, work stoppages or restructurings;

• weather effects on results of utility operations;

- issues associated with environmental remediation and environmental compliance, including compliance with all environmental and emissions permits, the CCR rule, future changes in environmental laws and regulations, including federal, state or local regulations for CO2 emissions reductions from new and existing fossil-fueled EGUs, and litigation associated with environmental requirements;

• increased pressure from customers, investors and other stakeholders to more rapidly reduce CO2 emissions;

- the ability to defend against environmental claims brought by state and federal agencies, such as the EPA, state natural resources agencies or third parties, such as the Sierra Club, and the impact on operating expenses of defending and resolving such claims;

• continued access to the capital markets on competitive terms and rates, and the actions of credit rating agencies;

• inflation and interest rates;

- the impact of the economy in IPL’s and WPL’s service territories and the resulting impacts on sales volumes, margins and the ability to collect unpaid bills;

- the ability to complete construction of wind and solar projects within the cost caps set by regulators and to meet all requirements to qualify for the full level of production tax credits and investment tax credits, respectively;

- changes in the price of delivered natural gas, purchased electricity and coal due to shifts in supply and demand caused by market conditions and regulations;

• disruptions in the supply and delivery of natural gas, purchased electricity and coal;

- the direct or indirect effects resulting from breakdown or failure of equipment in the operation of electric and gas distribution systems, such as mechanical problems and explosions or fires, and compliance with electric and gas transmission and distribution safety regulations, including regulations promulgated by the Pipeline and Hazardous Materials Safety Administration;

- issues related to the availability and operations of EGUs, including start-up risks, breakdown or failure of equipment, performance below expected or contracted levels of output or efficiency, operator error, employee safety, transmission constraints, compliance with mandatory reliability standards and risks related to recovery of resulting incremental costs through rates;

- impacts that excessive heat, storms or natural disasters may have on Alliant Energy’s, IPL’s and WPL’s operations and recovery of costs associated with restoration activities, or on the operations of Alliant Energy’s investments;

• Alliant Energy’s ability to sustain its dividend payout ratio goal;

- changes to costs of providing benefits and related funding requirements of pension and OPEB plans due to the market value of the assets that fund the plans, economic conditions, financial market performance, interest rates, life expectancies and demographics;

• material changes in employee-related benefit and compensation costs;

• risks associated with operation and ownership of non-utility holdings;

- changes in technology that alter the channels through which customers buy or utilize Alliant Energy’s, IPL’s or WPL’s products and services;

- impacts on equity income from unconsolidated investments due to further potential changes to ATC’s authorized return on equity;

- impacts of IPL’s future tax benefits from Iowa rate-making practices, including deductions for repairs expenditures, allocation of mixed service costs and state depreciation, and recoverability of the associated regulatory assets from customers, when the differences reverse in future periods;

• the impacts of adjustments made to deferred tax assets and liabilities from changes in the tax laws;

- changes to the creditworthiness of counterparties with which Alliant Energy, IPL and WPL have contractual arrangements, including participants in the energy markets and fuel suppliers and transporters;

• current or future litigation, regulatory investigations, proceedings or inquiries;

- reputational damage from negative publicity, protests, fines, penalties and other negative consequences resulting in regulatory and/or legal actions;



• the effect of accounting standards issued periodically by standard-setting bodies;

- the ability to successfully complete tax audits and changes in tax accounting methods with no material impact on earnings and cash flows; and

• other factors listed in MDA.

Alliant Energy, IPL and WPL each assume no obligation, and disclaim any duty, to update the forward-looking statements in this report, except as required by law.

## MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This MDA includes information relating to Alliant Energy, IPL and WPL, as well as AEF and Corporate Services. Where appropriate, information relating to a specific entity has been segregated and labeled as such. The following discussion and analysis should be read in conjunction with the Financial Statements and Notes included in this report. Unless otherwise noted, all “per share” references in MDA refer to earnings per diluted share.

## OVERVIEW

Alliant Energy’s mission is to deliver energy solutions and exceptional service that its customers and communities count on -safely, efficiently and responsibly. The mission is supported by a strategy focused on meeting the evolving expectations of customers while providing an attractive return for investors. This strategy includes the following key elements:

Providing affordable energy solutions to customers - Alliant Energy’s strategy focuses on affordable energy solutions that support retention and growth of its existing customers and attract new customers to its service territories.

Key Highlights in 2019 and 2020 -

• WPL maintaining flat base rates in 2019 and 2020 by utilizing Federal Tax Reform benefits and lower fuel costs.

• IPL’s rate settlement, which will provide $35 million of billing credits to Iowa electric customers starting in 2020.

- Significant fuel cost reductions achieved in 2019 and further reductions in fuel cost expected in 2020 as a result of expansion of renewable generation and operating highly efficient, low cost natural gas facilities.

- IPL’s energy efficiency plan for 2019 through 2023 approved by the IUB in March 2019, which provides direct financial savings to customers and provides cost-effective options to help electric and gas customers reduce their energy usage.

Making customer-focused investments - Alliant Energy’s strategy drives a capital allocation process focused on: 1) transitioning its generation portfolio to meet the growing interest of customers for cleaner sources of energy, 2) upgrading its electric and gas distribution systems to strengthen safety and resiliency, as well as enable distributed energy solutions in its service territories, and 3) enhancing its customers’ experience with evolving technology and greater flexibility.

Key Highlights in 2019 and 2020 (refer to “Customer Investments” for details) -

• Completion of construction of IPL’s new wind projects: Upland Prairie (303 MW in March 2019), English Farms (172 MW in March 2019) and Whispering Willow North (201 MW in January 2020).

- Progress made with the construction of IPL’s and WPL’s remaining wind projects (approximately 480 MW) that are expected to be placed in service in 2020.

- Expansion of natural gas-fired generation with the construction of WPL’s 730 MW West Riverside facility, which is expected to be completed in the first half of 2020.

• WPL’s announcement of plans for development and acquisition of up to 1,000 MW of solar generation by 2023.

• WPL’s planned expansion of its gas distribution system in Western Wisconsin in 2020.

• Installation of a selective catalytic reduction system at IPL’s Ottumwa Unit 1 in 2019.

• Completed implementation of advanced metering infrastructure for IPL customers in 2019.

Growing customer demand - Alliant Energy’s strategy supports expanding electric and gas usage in its service territories by promoting electrification initiatives and economic development in the communities it serves.
Key Highlights in 2019 -

- Progress with certifying development-ready sites throughout Iowa and Wisconsin, including finalizing certification of the Prairie View Industrial Center Super Park, a 730-acre rail-served ready-to-build manufacturing and industrial site in Ames, Iowa, which is in close proximity to the regional airport and interstate freeways and accesses IPL’s electric services. In addition, the Beaver Dam Commerce Park was certified, which is a 520-acre ready-to-build manufacturing and industrial site in Beaver Dam, Wisconsin, with access to commercial and freight airports, interstate freeways and WPL’s electric services.



## RESULTS OF OPERATIONS

Results of operations include financial information prepared in accordance with GAAP as well as utility electric margins and utility gas margins, which are not measures of financial performance under GAAP. Utility electric margins are defined as electric revenues less electric production fuel, purchased power and electric transmission service expenses. Utility gas margins are defined as gas revenues less cost of gas sold. Utility electric margins and utility gas margins are non-GAAP financial measures because they exclude other utility and non-utility revenues, other operation and maintenance expenses, depreciation and amortization expenses, and taxes other than income tax expense.

Management believes that utility electric and gas margins provide a meaningful basis for evaluating and managing utility operations since electric production fuel, purchased power and electric transmission service expenses and cost of gas sold are generally passed through to customers, and therefore, result in changes to electric and gas revenues that are comparable to changes in such expenses. The presentation of utility electric and gas margins herein is intended to provide supplemental information for investors regarding operating performance. These utility electric and gas margins may not be comparable to how other entities define utility electric and gas margin. Furthermore, these measures are not intended to replace operating income as determined in accordance with GAAP as an indicator of operating performance.

Additionally, the table below includes EPS for Utilities and Corporate Services, ATC Holdings, and Non-utility and Parent, which are non-GAAP financial measures. Alliant Energy believes these non-GAAP financial measures are useful to investors because they facilitate an understanding of segment performance and trends, and provide additional information about Alliant Energy’s operations on a basis consistent with the measures that management uses to manage its operations and evaluate its performance.

Financial Results Overview - Alliant Energy’s net income and EPS attributable to Alliant Energy common shareowners were as follows (dollars in millions, except per share amounts):

<table><tr><td rowspan="2"></td><td colspan="2">2019</td><td colspan="2">2018</td></tr><tr><td>Income (Loss)</td><td>EPS</td><td>Income (Loss)</td><td>EPS</td></tr><tr><td>Utilities and Corporate Services</td><td>$529.5</td><td>$2.22</td><td>$485.7</td><td>$2.08</td></tr><tr><td>ATC Holdings</td><td>33.6</td><td>0.14</td><td>28.4</td><td>0.12</td></tr><tr><td>Non-utility and Parent</td><td>(5.9)</td><td>(0.03)</td><td>(2.0)</td><td>(0.01)</td></tr><tr><td>Alliant Energy Consolidated</td><td>$557.2</td><td>$2.33</td><td>$512.1</td><td>$2.19</td></tr></table>

Alliant Energy’s Utilities and Corporate Services income increased $44 million in 2019 compared to 2018. The increase was primarily due to higher earnings resulting from IPL’s and WPL’s increasing rate base. This item was partially offset by higher depreciation expense and higher interest expense.

Operating income and a reconciliation of utility electric and gas margins to the most directly comparable GAAP measure, operating income, was as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Operating income</td><td>$777.7</td><td>$694.4</td><td>$402.8</td><td>$350.8</td><td>$347.2</td><td>$312.9</td></tr><tr><td>Electric utility revenues</td><td>$3,063.6</td><td>$3,000.3</td><td>$1,781.2</td><td>$1,731.1</td><td>$1,282.4</td><td>$1,269.2</td></tr><tr><td>Electric production fuel and purchased power expenses</td><td>(776.7)</td><td>(855.0)</td><td>(434.5)</td><td>(469.0)</td><td>(342.2)</td><td>(386.0)</td></tr><tr><td>Electric transmission service expense</td><td>(481.4)</td><td>(495.7)</td><td>(340.2)</td><td>(352.9)</td><td>(141.2)</td><td>(142.8)</td></tr><tr><td>Utility Electric Margin (non-GAAP)</td><td>1,805.5</td><td>1,649.6</td><td>1,006.5</td><td>909.2</td><td>799.0</td><td>740.4</td></tr><tr><td>Gas utility revenues</td><td>455.2</td><td>446.6</td><td>264.2</td><td>266.2</td><td>191.0</td><td>180.4</td></tr><tr><td>Cost of gas sold</td><td>(221.7)</td><td>(232.3)</td><td>(119.9)</td><td>(129.6)</td><td>(101.8)</td><td>(102.7)</td></tr><tr><td>Utility Gas Margin (non-GAAP)</td><td>233.5</td><td>214.3</td><td>144.3</td><td>136.6</td><td>89.2</td><td>77.7</td></tr><tr><td>Other utility revenues</td><td>46.5</td><td>48.0</td><td>44.2</td><td>45.0</td><td>2.3</td><td>3.0</td></tr><tr><td>Non-utility revenues</td><td>82.4</td><td>39.6</td><td>—</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Other operation and maintenance expenses</td><td>(712.2)</td><td>(645.8)</td><td>(404.6)</td><td>(402.6)</td><td>(260.9)</td><td>(241.6)</td></tr><tr><td>Depreciation and amortization expenses</td><td>(567.2)</td><td>(506.9)</td><td>(326.7)</td><td>(283.5)</td><td>(235.6)</td><td>(219.4)</td></tr><tr><td>Taxes other than income tax expense</td><td>(110.8)</td><td>(104.4)</td><td>(60.9)</td><td>(53.9)</td><td>(46.8)</td><td>(47.2)</td></tr><tr><td>Operating income</td><td>$777.7</td><td>$694.4</td><td>$402.8</td><td>$350.8</td><td>$347.2</td><td>$312.9</td></tr></table>



Operating Income Variances - Variances between periods in operating income for 2019 compared to 2018 were as follows (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Total higher utility electric margin variance (Refer to details below)</td><td>$156</td><td>$97</td><td>$59</td></tr><tr><td>Total higher utility gas margin variance (Refer to details below)</td><td>19</td><td>8</td><td>12</td></tr><tr><td>Higher non-utility revenues due to AEF&#x27;s new acquisitions</td><td>42</td><td>—</td><td>—</td></tr><tr><td>Total higher other operation and maintenance expenses variance (Refer to details below)</td><td>(66)</td><td>(2)</td><td>(19)</td></tr><tr><td>Higher depreciation and amortization expense, primarily due to additional plant in service in 2018 and 2019, and new IPL depreciation rates effective May 2018</td><td>(60)</td><td>(43)</td><td>(16)</td></tr><tr><td>Other</td><td>(8)</td><td>(8)</td><td>(2)</td></tr><tr><td></td><td>$83</td><td>$52</td><td>$34</td></tr></table>

Electric and Gas Revenues and Sales Summary - Electric and gas revenues (in millions), and MWh and Dth sales (in thousands), were as follows:

<table><tr><td rowspan="2"></td><td colspan="4">Electric</td><td colspan="4">Gas</td></tr><tr><td colspan="2">Revenues</td><td colspan="2">MWhs Sold</td><td colspan="2">Revenues</td><td colspan="2">Dths Sold</td></tr><tr><td></td><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2018</td><td>2018</td></tr><tr><td>Alliant Energy</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Retail</td><td>$2,751.2</td><td>$2,687.8</td><td>25,121</td><td>25,684</td><td>$408.4</td><td>$402.3</td><td>55,850</td><td>53,389</td></tr><tr><td>Sales for resale</td><td>250.2</td><td>259.2</td><td>6,594</td><td>5,804</td><td>N/A</td><td>N/A</td><td>N/A</td><td>N/A</td></tr><tr><td>Transportation/Other</td><td>62.2</td><td>53.3</td><td>79</td><td>96</td><td>46.8</td><td>44.3</td><td>97,135</td><td>90,357</td></tr><tr><td></td><td>$3,063.6</td><td>$3,000.3</td><td>31,794</td><td>31,584</td><td>$455.2</td><td>$446.6</td><td>152,985</td><td>143,746</td></tr></table>

Sales Trends and Temperatures - Alliant Energy’s retail electric sales volumes decreased 2% in 2019 primarily due to the impact of lower residential and commercial sales due to cooler summer temperatures during 2019 compared to 2018 and lower demand from IPL’s industrial customers due to customer operations and general economic conditions.

Estimated increases to electric and gas margins from the impacts of temperatures were as follows (in millions):

<table><tr><td></td><td colspan="2">Electric Margins</td><td colspan="2">Gas Margins</td></tr><tr><td></td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>IPL</td><td>$10</td><td>$20</td><td>$5</td><td>$1</td></tr><tr><td>WPL</td><td>4</td><td>12</td><td>3</td><td>2</td></tr><tr><td>Total Alliant Energy</td><td>$14</td><td>$32</td><td>$8</td><td>$3</td></tr></table>

Utility Electric Margin Variances - The following items contributed to increased (decreased) utility electric margins for 2019 compared to 2018 (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Impact of IPL&#x27;s retail electric interim and final base rate increases effective April 2019 and May 2018, respectively (a)</td><td>$102</td><td>$102</td><td>$—</td></tr><tr><td>Higher margins at WPL from earning on increasing rate base for rates effective January 2019</td><td>58</td><td>—</td><td>58</td></tr><tr><td>Higher revenues at WPL due to changes in the amounts recorded in 2019 and 2018 for WPL&#x27;s earnings sharing mechanism (2018 reflected higher sharing of WPL&#x27;s earnings than in 2019)</td><td>15</td><td>—</td><td>15</td></tr><tr><td>Higher revenues at IPL related to changes in recovery amounts for energy efficiency costs through the energy efficiency rider (offset by changes in energy efficiency expense)</td><td>10</td><td>10</td><td>—</td></tr><tr><td>Higher revenues at IPL due to changes in electric tax benefit rider credits on customers&#x27; bills (offset by changes in income tax expense)</td><td>9</td><td>9</td><td>—</td></tr><tr><td>Estimated changes in sales volumes caused by temperatures</td><td>(18)</td><td>(10)</td><td>(8)</td></tr><tr><td>Other (partially due to lower industrial sales at IPL)</td><td>(20)</td><td>(14)</td><td>(6)</td></tr><tr><td></td><td>$156</td><td>$97</td><td>$59</td></tr></table>



(a) IPL’s interim retail electric base rate increase effective April 1, 2019 was reduced by anticipated production tax credits for IPL’s new wind generation placed in service in March 2019. This reduction in revenue requirement is expected to be offset by a reduction in income tax expense resulting from production tax credits recognized from the new wind generation. Additionally, the interim retail electric base rate increase was reduced by $8 million as a result of the partial refund agreed to as part of the rate review settlement. Refer to Note 2 for further discussion.

Utility Gas Margin Variances - The following items contributed to increased (decreased) utility gas margins for 2019 compared to 2018 (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Impact of IPL&#x27;s retail gas final base rate increase effective January 2019</td><td>$9</td><td>$9</td><td>$—</td></tr><tr><td>Higher margins at WPL from earning on increasing rate base for rates effective January 2019</td><td>9</td><td>—</td><td>9</td></tr><tr><td>Estimated changes in sales volumes caused by temperatures</td><td>5</td><td>4</td><td>1</td></tr><tr><td>Lower revenues at IPL related to changes in recovery amounts for energy efficiency costs through the energy efficiency rider (offset by changes in energy efficiency expense)</td><td>(7)</td><td>(7)</td><td>—</td></tr><tr><td>Other</td><td>3</td><td>2</td><td>2</td></tr><tr><td></td><td>$19</td><td>$8</td><td>$12</td></tr></table>

Other Operation and Maintenance Expenses Variances - The following items contributed to (increased) decreased other operation and maintenance expenses for 2019 compared to 2018 (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Higher operation expense at AEF due to new acquisitions</td><td>($39)</td><td>$—</td><td>$—</td></tr><tr><td>Higher energy efficiency cost recovery amortizations at WPL pursuant to authorization from PSCW rate order effective January 2019</td><td>(15)</td><td>—</td><td>(15)</td></tr><tr><td>Higher performance compensation expense</td><td>(9)</td><td>(5)</td><td>(4)</td></tr><tr><td>Higher energy efficiency expense at IPL (offset by higher electric revenues and lower gas revenues)</td><td>(2)</td><td>(2)</td><td>—</td></tr><tr><td>Other</td><td>(1)</td><td>5</td><td>—</td></tr><tr><td></td><td>($66)</td><td>($2)</td><td>($19)</td></tr></table>

Other Income and Deductions Variances - The following items contributed to (increased) decreased other income and deductions for 2019 compared to 2018 (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Higher interest expense primarily due to higher average outstanding long-term debt balances</td><td>($26)</td><td>($8)</td><td>($4)</td></tr><tr><td>Lower equity income due to decreased earnings from non-utility wind farm resulting from an acceleration of earnings in 2018 due to Federal Tax Reform (Refer to Note 6 for more details)</td><td>(10)</td><td>—</td><td>—</td></tr><tr><td>Higher equity income due to increased earnings from ATC resulting from return on equity reserve adjustments recorded in 2019 related to the FERC decision regarding MISO transmission owners&#x27; authorized return on equity (Refer to Note 17(h) for more details)</td><td>6</td><td>—</td><td>—</td></tr><tr><td>Higher AFUDC primarily due to changes in CWIP balances related to IPL&#x27;s new wind generation and WPL&#x27;s West Riverside Energy Center</td><td>17</td><td>7</td><td>10</td></tr><tr><td>Other</td><td>(4)</td><td>(4)</td><td>(2)</td></tr><tr><td></td><td>($17)</td><td>($5)</td><td>$4</td></tr></table>

Income Taxes - Refer to Note 12 for details of effective income tax rates.



Other Future Considerations - In addition to items discussed in this report, the following key items could impact Alliant Energy's, IPL's and WPL's future financial condition or results of operations:

- Financing Plans - Alliant Energy currently expects to issue up to $250 million of common stock in 2020 through the equity forward agreements that were executed in November 2019 and its Shareowner Direct Plan. IPL, WPL and AEF currently expect to issue up to $300 million, $350 million and $300 million of long-term debt in 2020, respectively. IPL, WPL and AEF have $200 million, $150 million and $300 million of long-term debt maturing in 2020, respectively.

- Common Stock Dividends - Alliant Energy announced a 7% increase in its targeted 2020 annual common stock dividend to $1.52 per share, which is equivalent to a quarterly rate of $0.38 per share, beginning with the February 2020 dividend payment. The timing and amount of future dividends is subject to an approved dividend declaration from Alliant Energy's Board of Directors, and is dependent upon earnings expectations, capital requirements, and general financial business conditions, among other factors.

- Higher Earnings on Increasing Rate Base - Alliant Energy and IPL currently expect an increase in earnings in 2020 compared to 2019 due to impacts from increasing revenue requirements from IPL's retail electric and gas rate reviews (2020 Forward-looking Test Period). IPL's and WPL's 2020 increased revenue requirements are expected to be offset by returning to customers a portion of the excess deferred income tax credits from Federal Tax Reform.

- Depreciation and Amortization Expenses - Alliant Energy, IPL and WPL currently expect an increase in depreciation and amortization expenses in 2020 compared to 2019 due to property additions, including IPL's expansion of wind generation and WPL's West Riverside natural gas-fired EGU.

- Interest Expense - Alliant Energy currently expects interest expense to increase in 2020 compared to 2019 primarily due to financings completed in 2019 and planned in 2020 as discussed above.

- Allowance for Funds Used During Construction - Alliant Energy currently expects AFUDC to decrease in 2020 compared to 2019 primarily due to decreased CWIP balances related to IPL's wind generation that was placed in service in 2019 and is expected to be placed in service in 2020, and WPL's West Riverside Energy Center, which is currently expected to be placed in service in the first half of 2020.

- Pending Refunds Related to Transmission Expense - Alliant Energy currently expects to receive refunds related to the MISO transmission owner return on equity complaints later in 2020. These refunds are expected to be provided to IPL and WPL customers without an expected impact to earnings.

## CUSTOMER INVESTMENTS

Alliant Energy’s, IPL’s and WPL’s strategic priorities include making significant customer-focused investments toward cleaner energy and sustainable customer solutions. These priorities include:

## Environmental Stewardship

Alliant Energy’s environmental stewardship is focused on meeting its customers’ energy needs in an economical, efficient and sustainable manner. Alliant Energy proactively considers future environmental compliance requirements and proposed regulations in its planning, decision-making, construction and ongoing operations activities. Alliant Energy is focused on executing a long-term strategy to deliver reliable and affordable energy with lower emissions independent of changing policies and political landscape. To achieve these long-term goals, Alliant Energy will transition away from coal-fired EGUs and incorporate more renewable energy, energy efficiency, demand response, highly-efficient natural gas-fired EGUs and other emerging technologies such as energy storage. Alliant Energy’s voluntary environmental-related goals and achievements include the following:

- Reduce air emissions for sulfur dioxide by 90%, nitrogen oxide by 80% and mercury by 90% from 2005 levels, which it achieved in 2019.

• Reduce CO \( _{2} \)  emissions from its fossil-fueled generation 40% by 2030 and 80% by 2050 from 2005 levels.

• Reduce water supply needs from its fossil-fueled generation 75% by 2030 from 2005 levels.

• Renewables of at least 30% of Alliant Energy’s overall energy mix by 2030.

• Eliminate existing coal-fired EGUs from Alliant Energy’s overall energy mix by 2050.

## Renewable Generation

Alliant Energy’s cleaner energy strategy includes the planned development and acquisition of renewable energy, including wind and solar generation. Current wind generation plans include adding up to approximately 1,200 MW in aggregate (approximately 1,000 MW at IPL and approximately 200 MW at WPL) from 2018 through 2020. Current solar generation plans include adding up to approximately 1,000 MW at WPL by the end of 2023. Alliant Energy, IPL and WPL continue to evaluate additional opportunities to add more renewable generation. Estimated capital expenditures for the planned renewable projects for 2020 through 2023 are included in the “Renewable projects” line in the construction and acquisition expenditures table in “Liquidity and Capital Resources.”



IPL’s Expansion of Wind Generation - In 2016 and 2018, IPL received approvals from the IUB for advance rate-making principles for up to 1,000 MW of new wind generation. IPL currently has on-going, new wind generation development utilizing the following sites:

<table><tr><td>Wind Site</td><td>Nameplate Capacity</td><td>Actual/Expected In-service Date</td><td>Location</td></tr><tr><td>Upland Prairie</td><td>303 MW</td><td>March 2019</td><td>Clay and Dickinson Counties, Iowa</td></tr><tr><td>English Farms</td><td>172 MW</td><td>March 2019</td><td>Poweshiek County, Iowa</td></tr><tr><td>Whispering Willow Expansion</td><td>201 MW</td><td>January 2020</td><td>Franklin County, Iowa</td></tr><tr><td>Golden Plains</td><td>Up to 200 MW</td><td>2020</td><td>Winnebago and Kossuth Counties, Iowa</td></tr><tr><td>Richland</td><td>Up to 130 MW</td><td>2020</td><td>Sac County, Iowa</td></tr></table>

WPL’s Expansion of Wind Generation - In January 2019, WPL received final approval from the PSCW to own a 150 MW wind project being developed in Kossuth County, Iowa. In October 2019, WPL purchased the development assets related to this project, including land rights and permits. Construction began in 2019 and the wind farm is currently expected to be placed in service in 2020. In addition, WPL acquired a partial ownership interest in the assets of the FWEC wind farm located in Wisconsin (59 MW) in 2018, pursuant to approvals from the PSCW and FERC.

WPL’s Solar Generation - WPL currently expects to file the first CA with the PSCW for a portion of the planned development of up to 1,000 MW of new solar generation in the first half of 2020. WPL expects that the new solar generation will qualify for 30% investment tax credits.

## Complementary Generation Investments

WPL’s Construction of West Riverside Natural Gas-fired Generating Station - In 2016, WPL received an order from the PSCW authorizing WPL to construct an approximate 730 MW natural gas-fired combined-cycle EGU in Beloit, Wisconsin, referred to as West Riverside. WPL’s construction of West Riverside began in 2016 and the EGU is currently expected to be completed in the first half of 2020. WPL’s estimated portion of capital expenditures is currently expected to be approximately $600 million. The capital expenditures include costs to construct the EGU and a pipeline to supply natural gas to the EGU, and exclude transmission network upgrades and AFUDC. West Riverside replaces energy and capacity being eliminated with the retirements of various EGUs.

WPL entered into agreements with neighboring utilities and electric cooperatives that provide each of them options to purchase a partial ownership interest in West Riverside. The purchase price for such options is based on the ownership interest acquired and the net book value of West Riverside on the date of the purchase. The exercise of the WPSC and MGE options is subject to PSCW approval, and the timing and ownership amounts of the options are as follows:

<table><tr><td>Counterparty</td><td>Option Amount</td><td>Option Timing</td></tr><tr><td>Wisconsin Public Service Corporation (WPSC)</td><td>Up to 200 MW (no more than 100 MW to be acquired in first two years) (a)</td><td>Up to four years following the in-service date</td></tr><tr><td>Madison Gas and Electric Company (MGE)</td><td>Up to 50 MW (no more than 25 MW to be acquired in first two years)</td><td>Up to five years following the in-service date</td></tr><tr><td>Electric cooperatives</td><td>Approximately 60 MW</td><td>Exercised January 2018</td></tr></table>

(a) If WPSC exercises its options, WPL may exercise reciprocal options, subject to approval by the PSCW, to purchase up to 200 MW of any natural-gas combined-cycle EGU that either WPSC or its affiliated utility, Wisconsin Electric Power Company, places in service within 10 years of the date West Riverside is placed in service.

Environmental Controls Projects - Alliant Energy’s strategy to transition its generation portfolio to cleaner sources of energy includes adding environmental controls at newer, larger and more efficient coal-fired EGUs to continue producing affordable energy for customers and to benefit the environment. In 2019, IPL completed the installation of a selective catalytic reduction system at Ottumwa Unit 1, which supports compliance obligations under the Cross-State Air Pollution Rule and IPL’s Consent Decree.

Plant Retirements and Fuel Switching - The current strategy includes the retirement, or fuel switch from coal to natural gas, of older, smaller and less efficient EGUs in the next several years. Alliant Energy, IPL and WPL are working with MISO, state regulatory commissions and other regulatory agencies, as required, to determine the timing of these actions, which are subject to change depending on operational, regulatory, market and other factors. Refer to Note 17(e) for discussion of IPL’s requirements to fuel switch or retire certain EGUs under a Consent Decree.



## Other Customer-focused Investments

Electric and Gas Distribution Systems - Customer-focused investments include replacing, modernizing and upgrading infrastructure in the electric and gas distribution systems. Electric system investments will focus on areas such as improving resiliency with more underground electric distribution and enabling distributed energy solutions with higher capacity lines. Gas system investments will focus on pipeline replacement to ensure safety and pipeline expansion to support reliability and economic development. Estimated capital expenditures for expected and current electric and gas distribution infrastructure projects for 2020 through 2023 are included in the “Electric and gas distribution systems” lines in the construction and acquisition expenditures table in “Liquidity and Capital Resources.”

Gas Pipeline Expansion - IPL and WPL currently expect to make investments to extend various gas distribution systems to provide natural gas to unserved or underserved areas in their service territories. In September 2019, WPL filed a CA application with the PSCW for approval to expand its gas distribution systems in Western Wisconsin in 2020. Estimated capital expenditures for this project for 2020 are included in the “Gas distribution systems” line in the construction and acquisition expenditures table in “Liquidity and Capital Resources.”

Gas Pipeline Safety - In October 2019, the Pipeline and Hazardous Materials Safety Administration published a final rule that updates safety requirements for gas transmission pipelines. Procedures must be developed by July 2021, and remediation efforts must be completed by July 2035. In anticipation of these rule changes, Alliant Energy, IPL and WPL have been proactively replacing certain of IPL's transmission pipelines and making modifications to certain of WPL's transmission pipelines, and are evaluating the impact of this final rule on their financial condition and results of operations.

Advanced Metering Infrastructure (AMI) - In 2019, IPL completed the installation of AMI in its electric and gas service territories in Iowa. AMI is a system of meters, communications networks and data management systems that enables two-way communication between utilities and its customers. AMI allows for remote meter reading, automatic outage notification, and remote disconnects and reconnects. AMI technology is expected to enhance the communication infrastructure in Alliant Energy's service territories, improve customer service, enhance energy management initiatives and provide operational savings through increased efficiencies.

Non-utility business - Alliant Energy continues to explore limited scope opportunities for growth outside of, but related to, Alliant Energy's utility business. This non-utility strategy continues to evolve through exploration of modest opportunities that are accretive to earnings and cash flows within and outside of Alliant Energy's service territories. In January and March 2019, AEF purchased two freight management companies. These non-utility acquisitions enhance Alliant Energy's Transportation value to customers by adding customized supply chain solution capabilities to their portfolio of service offerings. Refer to Note 3 for details.

## RATE MATTERS

## Rate Reviews

Retail Base Rate Filings - Base rate changes reflect both returns on additions to infrastructure and recovery of changes in costs incurred or expected to be incurred. Given that a portion of the rate changes will offset changes in costs, revenues from rate changes should not be expected to result in an equal change in net income for either IPL or WPL.

IPL's Retail Electric and Gas Rate Reviews (2020 Forward-looking Test Period) - In 2019, IPL filed retail electric and gas rate review requests with the IUB covering the 2020 forward-looking Test Period. In January 2020, IPL received an order from the IUB approving IPL's proposed settlement for its retail electric rate review. Final retail electric rates are expected to be effective by the end of the first quarter of 2020. In December 2019, IPL received an order from the IUB approving IPL's proposed settlement for its retail gas rate review. Final retail gas rates were effective January 10, 2020. Refer to Note 2 for details.

WPL's Retail Electric and Gas Rate Review (2019/2020 Forward-looking Test Period) - In 2017, WPL filed retail electric and gas rate review requests with the PSCW covering the 2019/2020 forward-looking Test Period. In December 2018, WPL received an order from the PSCW approving WPL's proposed settlement for its retail electric and gas rate reviews, effective January 1, 2019. Under the settlement, WPL's retail electric and gas base rates will not change from current levels through the end of 2020. Retail electric revenue requirements resulting from increasing investments in rate base (including West Riverside) are offset by lower fuel-related costs and Federal Tax Reform refunds. Retail gas revenue requirements resulting from increasing investments in rate base are offset by Federal Tax Reform refunds. WPL's settlement extends, with certain modifications, an earnings sharing mechanism through 2020. Under the earnings sharing mechanism, WPL will defer a portion of its earnings if its annual regulatory return on common equity exceeds 10.25% during the 2019/2020 Test Period. WPL must defer 50% of its excess earnings between 10.25% and 10.75%, and 100% of any excess earnings above 10.75%.

Planned Rate Review - WPL currently expects to make a retail electric and gas rate filing in the second quarter of 2020 for the 2021/2022 Test Period. The key drivers for the anticipated filing include recovery of capital projects, including investments in wind generation, and electric and gas distribution systems. Any rate changes granted from this request are expected to be effective on January 1, 2021. WPL currently expects a decision from the PSCW regarding this rate filing by the end of 2020.



Rate Review Details - Details related to IPL's and WPL's key jurisdictions were as follows:

<table><tr><td></td><td>Regulatory Body</td><td>Average Rate Base (in millions)</td><td>Authorized Return on Common Equity (a)</td><td>Common Equity Component of Regulatory Capital Structure</td><td>Effective Date</td></tr><tr><td>IPL Retail Electric (2020 Test Period)</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Marshalltown (b)</td><td>IUB</td><td>$559</td><td>11.00%</td><td>51.0%</td><td>(c)</td></tr><tr><td>Emery (b)</td><td>IUB</td><td>165</td><td>12.23%</td><td>51.0%</td><td>(c)</td></tr><tr><td>Whispering Willow - East (b)</td><td>IUB</td><td>163</td><td>11.70%</td><td>51.0%</td><td>(c)</td></tr><tr><td>Renewable energy rider (b)(d)</td><td>IUB</td><td>1,335</td><td>10.65%</td><td>51.0%</td><td>(c)</td></tr><tr><td>Other (b)</td><td>IUB</td><td>3,767</td><td>9.50%</td><td>51.0%</td><td>(c)</td></tr><tr><td>IPL Retail Gas (2020 Test Period) (b)</td><td>IUB</td><td>557</td><td>9.60%</td><td>51.0%</td><td>1/10/2020</td></tr><tr><td>IPL Wholesale Electric</td><td>FERC</td><td>119</td><td>10.97%</td><td>50.4%</td><td>1/1/2019</td></tr><tr><td>WPL Retail Electric and Gas</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Electric (2020 Test Period) (e)</td><td>PSCW</td><td>3,955</td><td>10.00%</td><td>52.5%</td><td>1/1/2020</td></tr><tr><td>Gas (2020 Test Period) (e)</td><td>PSCW</td><td>387</td><td>10.00%</td><td>52.5%</td><td>1/1/2020</td></tr><tr><td>WPL Wholesale Electric</td><td>FERC</td><td>239</td><td>10.90%</td><td>55.0%</td><td>1/1/2019</td></tr></table>

(a) Authorized returns on common equity may not be indicative of actual returns earned or projections of future returns.

(b) Average rate base amounts reflect IPL’s allocated retail share of rate base and do not include CWIP, and were calculated using a forecasted 13-month average for the test period.

(c) Final retail electric rates are expected to be effective by the end of the first quarter of 2020.

(d) Average rate base amounts recovered through IPL’s new renewable energy rider mechanism include construction costs incurred to fund IPL’s most recent 1,000 MW of new wind generation (11.00% return on common equity), production tax credit carryforwards for the most recent 1,000 MW of new wind generation (5.00% return on common equity) and certain transmission facilities classified as intangible assets (9.50% return on common equity).

(e) Average rate base amounts reflect WPL’s allocated retail share of rate base and do not include CWIP or a cash working capital allowance, and were calculated using a forecasted 13-month average for the test period. The PSCW provides a return on selected CWIP and a cash working capital allowance by adjusting the percentage return on rate base.

WPL’s Retail Fuel-related Rate Filing (2020 Forward-looking Test Period) - In December 2019, WPL received an order from the PSCW authorizing an annual retail electric rate decrease of $29 million, or approximately 2%, effective January 1, 2020. The decrease primarily reflects a change in expected fuel-related costs in 2020. Fuel-related costs are subject to deferral if they are outside an annual bandwidth of plus or minus 2% of the approved annual forecasted fuel-related costs.

## Other Rate Matters

Federal Tax Reform - Federal Tax Reform resulted in future benefits to customers as a result of remeasurement of accumulated deferred income taxes (approximately $350 million for IPL and $460 million for WPL of retail revenue requirement as of December 31, 2019). The majority of these benefits are subject to tax normalization rules (protected benefits), which limit the rate at which they can be passed on to their electric and gas customers.

For those benefits that were not limited by tax normalization rules (the non-protected benefits), IPL will begin providing $28 million of credits back to its retail electric and gas customers over a 12-month period beginning in 2020 when final rates go into effect. After returning these benefits to customers, IPL is not expected to have any significant remaining non-protected benefits as a result of the original Federal Tax Reform impacts.

WPL began providing non-protected benefits back to its retail electric and gas customers in 2019 and will continue into 2020. WPL expects to utilize approximately $72 million to help maintain base rates from current levels through 2020 and remaining non-protected benefits of approximately $118 million will be addressed in WPL's future retail electric and gas rate reviews.

## LIQUIDITY AND CAPITAL RESOURCES

Overview - Alliant Energy, IPL and WPL expect to maintain adequate liquidity to operate their businesses and implement their strategy as a result of operating cash flows generated by their utility business, and available capacity under a single revolving credit facility and IPL's sales of accounts receivable program, supplemented by periodic issuances of long-term debt and Alliant Energy equity securities.

Liquidity Position - At December 31, 2019, Alliant Energy had $16 million of cash and cash equivalents, $663 million ($281 million at the parent company, $250 million at IPL and $132 million at WPL) of available capacity under the single revolving credit facility and $83 million of available capacity at IPL under its sales of accounts receivable program.



Capital Structure - Alliant Energy, IPL and WPL plan to maintain debt-to-total capitalization ratios that are consistent with investment-grade credit ratings. IPL and WPL expect to maintain capital structures consistent with their authorized levels. Alliant Energy expects to maintain consolidated debt at approximately 55% of total capital and consolidated preferred stock at less than 5% of total capital. These targets may be adjusted depending on subsequent developments and the impact on their respective weighted-average cost of capital and investment-grade credit ratings. Capital structures as of December 31, 2019 were as follows (Common Equity (CE); IPL's Preferred Stock (PS); Long-term Debt (including current maturities) (LD); Short-term Debt (SD)):



Alliant Energy, IPL and WPL intend to manage their capital structures and liquidity positions in such a way that facilitates their ability to raise funds reliably and on reasonable terms and conditions, while maintaining capital structures consistent with those approved by regulators. In addition to capital structures, other important factors used to determine the characteristics of future financings include financial coverage ratios, capital spending plans, regulatory orders and rate-making considerations, levels of debt imputed by rating agencies, market conditions, the impact of tax initiatives and legislation, and any potential proceeds from asset sales. The PSCW factors certain imputed debt adjustments in establishing a regulatory capital structure as part of WPL's retail rate reviews. The IUB does not make any explicit adjustments for imputed debt in establishing capital ratios used in determining customer rates, although such adjustments are considered by IPL in recommending an appropriate capital structure. Debt imputations by rating agencies include pension and OPEB obligations and the sales of accounts receivable program.

Credit and Capital Markets - Alliant Energy, IPL and WPL maintain a single revolving credit facility to provide backstop liquidity to their commercial paper programs, and ensure a committed source of liquidity in the event the commercial paper market becomes disrupted. In addition, IPL maintains a sales of accounts receivable program as an alternative financing source.

Primary Sources and Uses of Cash - Alliant Energy’s most significant source of cash is from electric and gas sales to IPL’s and WPL’s customers. Cash from these sales reimburses IPL and WPL for prudently-incurred expenses to provide service to their utility customers and generally provides IPL and WPL a return of and a return on the assets used to provide such services. Capital needed to retire debt and fund capital expenditures related to large strategic projects is expected to be met primarily through external financings.

Cash Flows - Selected cash flows information was as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td></td><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td></td></tr><tr><td>Cash, cash equivalents and restricted cash, January 1</td><td>$25.5</td><td>$33.9</td><td></td><td>$12.4</td><td>$7.2</td><td>$9.2</td><td>$24.2</td><td></td></tr><tr><td>Cash flows from (used for):</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Operating activities</td><td>660.4</td><td>527.7</td><td></td><td>172.9</td><td>(5.0)</td><td>423.2</td><td>457.0</td><td></td></tr><tr><td>Investing activities</td><td>(1,287.3)</td><td>(1,066.8)</td><td></td><td>(667.0)</td><td>(429.4)</td><td>(557.2)</td><td>(607.5)</td><td></td></tr><tr><td>Financing activities</td><td>619.1</td><td>530.7</td><td></td><td>491.0</td><td>439.6</td><td>129.2</td><td>135.5</td><td></td></tr><tr><td>Net increase (decrease)</td><td>(7.8)</td><td>(8.4)</td><td></td><td>(3.1)</td><td>5.2</td><td>(4.8)</td><td>(15.0)</td><td></td></tr><tr><td>Cash, cash equivalents and restricted cash, December 31</td><td>$17.7</td><td>$25.5</td><td></td><td>$9.3</td><td>$12.4</td><td>$4.4</td><td>$9.2</td><td></td></tr></table>



Operating Activities - The following items contributed to increased (decreased) operating activity cash flows for 2019 compared to 2018 (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Higher collections from IPL&#x27;s retail electric and gas base rate increases</td><td>$111</td><td>$111</td><td>$—</td></tr><tr><td>Changes in amounts refunded to customers related to Federal Tax Reform</td><td>54</td><td>15</td><td>39</td></tr><tr><td>Changes in income taxes paid/refunded</td><td>26</td><td>31</td><td>(43)</td></tr><tr><td>Contributions to qualified defined benefit pension plans in 2019</td><td>(32)</td><td>(16)</td><td>(16)</td></tr><tr><td>Changes in levels of production fuel</td><td>(27)</td><td>(10)</td><td>(17)</td></tr><tr><td>Changes in interest payments</td><td>(20)</td><td>(1)</td><td>(4)</td></tr><tr><td>Decreased collections from IPL&#x27;s and WPL&#x27;s retail customers caused by temperature impacts on electric and gas sales</td><td>(13)</td><td>(6)</td><td>(7)</td></tr><tr><td>Timing of intercompany payments and receipts</td><td>—</td><td>37</td><td>4</td></tr><tr><td>Other (primarily due to other changes in working capital)</td><td>34</td><td>17</td><td>10</td></tr><tr><td></td><td>$133</td><td>$178</td><td>($34)</td></tr></table>

Income Tax Payments and Refunds - Income tax (payments) refunds, including refunds of alternative minimum tax credits, were as follows (in millions):

<table><tr><td></td><td>2019</td><td>2018</td></tr><tr><td>IPL</td><td>$7</td><td>($24)</td></tr><tr><td>WPL</td><td>(29)</td><td>14</td></tr><tr><td>Other subsidiaries</td><td>43</td><td>5</td></tr><tr><td>Alliant Energy</td><td>$21</td><td>($5)</td></tr></table>

Alliant Energy, IPL and WPL currently do not expect to make any significant federal income tax payments through 2024 based on their current federal net operating loss and credit carryforward positions. While no significant federal income tax payments through 2024 are expected to occur, some tax payments and refunds may occur for state taxes and between consolidated group members (including IPL and WPL) under the tax sharing agreement between Alliant Energy and its subsidiaries. Refer to Note 12 for discussion of the carryforward positions.

Pension Plan Contributions - Alliant Energy, IPL and WPL currently expect to make $60 million, $19 million and $22 million of pension plan contributions in 2020, respectively, based on the funded status and assumed return on assets for each plan as of the December 31, 2019 measurement date. Refer to Note 13(a) for discussion of the current funded levels of pension plans.

Investing Activities - The following items contributed to increased (decreased) investing activity cash flows for 2019 compared to 2018 (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Changes in the amount of cash receipts on sold receivables</td><td>($192)</td><td>($192)</td><td>$—</td></tr><tr><td>Expenditures for new acquisitions at AEF in 2019</td><td>(13)</td><td>—</td><td>—</td></tr><tr><td>Lower (higher) utility construction and acquisition expenditures (a)</td><td>30</td><td>(29)</td><td>59</td></tr><tr><td>Other</td><td>(46)</td><td>(17)</td><td>(9)</td></tr><tr><td></td><td>($221)</td><td>($238)</td><td>$50</td></tr></table>

(a) Largely due to lower expenditures related to WPL’s acquisition of a partial interest in the Forward Wind Energy Center in 2018, WPL’s West Riverside facility and IPL’s advanced metering infrastructure, partially offset by higher expenditures related to expansion of wind generation at IPL and WPL.

Construction and Acquisition Expenditures - Construction and acquisition expenditures and financing plans are reviewed, approved and updated as part of the financial planning process. Changes may result from a number of reasons, including regulatory requirements, changing legislation, not obtaining favorable and acceptable regulatory approval on certain projects, improvements in technology and improvements to ensure reliability of the electric and gas distribution systems. Alliant Energy, IPL and WPL have not yet entered into contractual commitments relating to the majority of their anticipated future construction and acquisition expenditures. As a result, they have some discretion with regard to the level and timing of these expenditures. The table below summarizes anticipated construction and acquisition expenditures (in millions). Cost estimates represent Alliant Energy's, IPL's and WPL's portion of construction expenditures and exclude AFUDC and capitalized interest, if applicable. Such amounts do not include IPL's expected $110 million buyout payment in September 2020 related to the DAEC PPA. Such estimates reflect reductions to Alliant Energy's and WPL's capital expenditures resulting from purchase options by certain electric cooperatives for a partial ownership interest in West Riverside; however, such estimates do not reflect any



potential proceeds if neighboring utilities exercise options for a partial ownership in West Riverside. Refer to “Customer Investments” for further discussion of certain key projects impacting construction and acquisition plans related to the utility business.

<table><tr><td rowspan="2"></td><td colspan="4">Alliant Energy</td><td colspan="4">IPL</td><td colspan="4">WPL</td></tr><tr><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>2020</td><td>2011</td><td>2022</td><td>2023</td></tr><tr><td>Generation:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Renewable projects</td><td>$260</td><td>$110</td><td>$275</td><td>$390</td><td>$135</td><td>$—</td><td>$—</td><td>$—</td><td>$125</td><td>$110</td><td>$275</td><td>$390</td></tr><tr><td>Other</td><td>205</td><td>140</td><td>170</td><td>90</td><td>90</td><td>85</td><td>125</td><td>50</td><td>115</td><td>55</td><td>45</td><td>40</td></tr><tr><td>Distribution:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Electric systems</td><td>570</td><td>535</td><td>525</td><td>540</td><td>320</td><td>285</td><td>270</td><td>310</td><td>250</td><td>250</td><td>255</td><td>230</td></tr><tr><td>Gas systems</td><td>185</td><td>80</td><td>130</td><td>105</td><td>50</td><td>45</td><td>95</td><td>65</td><td>135</td><td>35</td><td>35</td><td>40</td></tr><tr><td>Other</td><td>205</td><td>180</td><td>235</td><td>245</td><td>30</td><td>10</td><td>10</td><td>15</td><td>15</td><td>10</td><td>20</td><td>15</td></tr><tr><td></td><td>$1,425</td><td>$1,045</td><td>$1,335</td><td>$1,370</td><td>$625</td><td>$425</td><td>$500</td><td>$440</td><td>$640</td><td>$460</td><td>$630</td><td>$715</td></tr></table>

Financing Activities - The following items contributed to increased (decreased) financing activity cash flows for 2019 compared to 2018 (in millions):

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Lower (higher) payments to retire long-term debt</td><td>$599</td><td>$350</td><td>($250)</td></tr><tr><td>Higher net proceeds from common stock issuances</td><td>194</td><td>—</td><td>—</td></tr><tr><td>Higher (lower) net proceeds from issuance of long-term debt</td><td>(550)</td><td>100</td><td>350</td></tr><tr><td>Net changes in the amount of commercial paper and other short-term borrowings outstanding</td><td>(130)</td><td>(101)</td><td>(18)</td></tr><tr><td>Lower capital contributions from IPL&#x27;s and WPL&#x27;s parent company, Alliant Energy</td><td>—</td><td>(300)</td><td>(75)</td></tr><tr><td>Other</td><td>(25)</td><td>2</td><td>(13)</td></tr><tr><td></td><td>$88</td><td>$51</td><td>($6)</td></tr></table>

FERC and Public Utility Holding Company Act Financing Authorizations - Under the Public Utility Holding Company Act of 2005, FERC has authority over the issuance of utility securities, except to the extent that a public utility's primary state regulatory commission has retained jurisdiction over such matters. FERC currently has authority over the issuance of securities by IPL. FERC does not have authority over the issuance of securities by Alliant Energy, WPL, AEF or Corporate Services. In 2019, IPL received authorization from FERC to issue securities in 2020 and 2021 as follows (in millions):

<table><tr><td></td><td>Initial Authorization and Remaining Capacity as of December 31, 2019</td></tr><tr><td>Long-term debt securities issuances in aggregate</td><td>$700</td></tr><tr><td>Short-term debt securities outstanding at any time (including borrowings from its parent)</td><td>400</td></tr><tr><td>Preferred stock issuances in aggregate</td><td>300</td></tr></table>

State Regulatory Financing Authorizations - In 2017, WPL received authorization from the PSCW to have up to $400 million of short-term borrowings and/or letters of credit outstanding at any time through the earlier of the expiration date of WPL's credit facility agreement (including extensions) or December 2024. In October 2019, WPL received authorization from the PSCW to issue up to $350 million of long-term debt securities in aggregate in 2020.

Shelf Registrations - Alliant Energy, IPL and WPL have current shelf registration statements on file with the SEC for availability to issue unspecified amounts of securities through December 2020. Alliant Energy’s shelf registration statement may be used to issue common stock, debt and other securities. IPL’s and WPL’s shelf registration statements may be used to issue preferred stock and debt securities.

Common Stock Dividends - Payment of common stock dividends is subject to dividend declaration by Alliant Energy’s Board of Directors. Alliant Energy’s general long-term goal is to maintain a dividend payout ratio that is competitive with the industry average. Based on that, Alliant Energy’s goal is to maintain a dividend payout ratio of approximately 60% to 70% of consolidated earnings from continuing operations. IPL’s and WPL’s goal is to maintain dividend payout ratios of approximately 65% to 75%. Alliant Energy’s, IPL’s and WPL’s dividend payout ratios were 61%, 59% and 62% of their consolidated earnings from continuing operations in 2019, respectively. Refer to “Results of Operations” for discussion of expected common stock dividends in 2020.

Common Stock Issuances - Refer to Note 7 for discussion of common stock issuances by Alliant Energy in 2018 and 2019, and “Results of Operations” for discussion of expected issuances of common stock in 2020.



Short-term Debt - In 2017, Alliant Energy, IPL and WPL entered into a single revolving credit facility agreement, which expires in August 2023 and is discussed in Note 9(a). There are currently 13 lenders that participate in the credit facility, with respective commitments ranging from $20 million to $130 million. The credit facility includes a $100 million letter of credit commitment and $50 million swingline commitment, which are available to each of Alliant Energy, IPL and WPL. Subject to certain conditions, Alliant Energy, IPL and WPL may exercise one extension option, extending the maturity date by one year. The credit facility has a provision to expand the facility size up to an additional $300 million, for a potential total commitment of $1.3 billion, subject to lender approval for Alliant Energy and subject to lender and regulatory approvals for IPL and WPL.

The credit agreement contains customary events of default, including a cross-default provision that would be triggered if Alliant Energy or certain of its significant subsidiaries (including IPL and WPL) defaults on debt (other than non-recourse debt) totaling $100 million or more. IPL and WPL are subject to a similar cross-default provision with respect to their own respective consolidated debt. A default by Alliant Energy or its non-utility subsidiaries would not trigger a cross-default at IPL or WPL, nor would a default by either of IPL or WPL constitute a cross-default event for the other. If an event of default under the credit agreement occurs and is continuing, then the lenders may declare any outstanding obligations of the defaulting borrower under the credit agreement immediately due and payable. At December 31, 2019, Alliant Energy, IPL and WPL were in compliance with financial covenants of the credit agreement.

Long-term Debt - Refer to Note 9(b) for discussion of issuances and retirements of long-term debt in 2019 and “Results of Operations” for discussion of expected issuances of long-term debt in 2020. In 2018, IPL issued $500 million of 4.1% senior debentures (green bonds) due September 2028. In 2018, AEF entered into a $300 million variable-rate term loan credit agreement due April 2020. In 2018, AEF issued $400 million of 3.75% senior notes due June 2023 and $300 million of 4.25% senior notes due June 2028, and a portion of the proceeds from the issuances were used by AEF to retire its $500 million and $95 million variable-rate term loan credit agreements expiring in 2018. In addition, IPL retired $250 million of 7.25% senior debentures and $100 million of 5.875% senior debentures in 2018.

## Impact of Credit Ratings on Liquidity and Collateral Obligations -

Ratings Triggers - The long-term debt of Alliant Energy and its subsidiaries is not subject to any repayment requirements as a result of explicit credit rating downgrades or so-called “ratings triggers.” However, Alliant Energy and its subsidiaries are parties to various agreements that contain provisions dependent on credit ratings. In the event of a significant downgrade, Alliant Energy or its subsidiaries may need to provide credit support, such as letters of credit or cash collateral equal to the amount of any exposure, or may need to unwind contracts or pay underlying obligations. In the event of a significant downgrade, management believes Alliant Energy, IPL and WPL have sufficient liquidity to cover counterparty credit support or collateral requirements under these various agreements. In addition, a downgrade in the credit ratings of Alliant Energy, IPL or WPL, could also result in them paying higher interest rates in future financings, reduce flexibility with future financing plans, reduce their pool of potential lenders, increase their borrowing costs under existing credit facilities or limit their access to the commercial paper market. Credit ratings and outlooks as of the date of this report are as follows:

<table><tr><td></td><td></td><td>Standard &amp; Poor&#x27;s Ratings Services</td><td>Moody&#x27;s Investors Service</td></tr><tr><td rowspan="3">Alliant Energy:</td><td>Corporate/issuer</td><td>A-</td><td>Baa2</td></tr><tr><td>Commercial paper</td><td>A-2</td><td>P-2</td></tr><tr><td>Senior unsecured long-term debt</td><td>N/A</td><td>N/A</td></tr><tr><td></td><td>Outlook</td><td>Stable</td><td>Stable</td></tr><tr><td rowspan="3">IPL:</td><td>Corporate/issuer</td><td>A-</td><td>Baa1</td></tr><tr><td>Commercial paper</td><td>A-2</td><td>P-2</td></tr><tr><td>Senior unsecured long-term debt</td><td>A-</td><td>Baa1</td></tr><tr><td></td><td>Preferred stock</td><td>BBB</td><td>Baa3</td></tr><tr><td></td><td>Outlook</td><td>Stable</td><td>Stable</td></tr><tr><td rowspan="3">WPL:</td><td>Corporate/issuer</td><td>A</td><td>A3</td></tr><tr><td>Commercial paper</td><td>A-1</td><td>P-2</td></tr><tr><td>Senior unsecured long-term debt</td><td>A</td><td>A3</td></tr><tr><td></td><td>Outlook</td><td>Stable</td><td>Stable</td></tr></table>

Standard & Poor’s Ratings Services and Moody’s Investors Service issued credit ratings of BBB+ and Baa2, respectively, for the senior notes issued by AEF in 2018 (with Alliant Energy as guarantor). Credit ratings are not recommendations to buy or sell securities and are subject to change, and each rating should be evaluated independently of any other rating. Each of Alliant Energy, IPL or WPL assumes no obligation to update their respective credit ratings. Refer to Note 15 for additional information on ratings triggers for commodity contracts accounted for as derivatives.



## Off-Balance Sheet Arrangements -

Special Purpose Entities - IPL maintains a Receivables Agreement whereby it may sell its customer accounts receivables, unbilled revenues and certain other accounts receivables to a third party through wholly-owned and consolidated special purpose entities. The purchase commitment from the third party to which IPL sells its receivables expires in March 2021. In 2019 and 2018, IPL evaluated the third party that purchases IPL's receivable assets under the Receivables Agreement and believes that the third party is a VIE. However, IPL concluded consolidation of the third party was not required.

In addition, IPL's sales of accounts receivable program agreement contains a cross-default provision that is triggered if IPL or Alliant Energy incurs an event of default on debt totaling $100 million or more. If an event of default under IPL's sales of accounts receivable program agreement occurs, then the counterparty could terminate such agreement. Refer to Note 5(b) for additional information regarding IPL's sales of accounts receivable program.

Guarantees and Indemnifications - At December 31, 2019, various guarantees and indemnifications are outstanding related to Alliant Energy's cash equity ownership interest in a non-utility wind farm and Alliant Energy's and IPL's prior divestiture activities. Refer to Note 17(d) for additional information.

## Certain Financial Commitments -

Contractual Obligations - Consolidated long-term contractual obligations as of December 31, 2019 were as follows (in millions):

<table><tr><td>Alliant Energy</td><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>2024</td><td>Thereafter</td><td>Total</td></tr><tr><td>Other purchase obligations (Note 17(b))</td><td>$499</td><td>$223</td><td>$160</td><td>$128</td><td>$84</td><td>$199</td><td>$1,293</td></tr><tr><td>Long-term debt maturities (Note 9(b))</td><td>657</td><td>8</td><td>333</td><td>408</td><td>509</td><td>4,325</td><td>6,240</td></tr><tr><td>Interest - long-term debt obligations</td><td>251</td><td>237</td><td>237</td><td>220</td><td>213</td><td>2,182</td><td>3,340</td></tr><tr><td>IPL&#x27;s DAEC PPA buyout payment (Note 2)</td><td>110</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>110</td></tr><tr><td>Capital purchase obligations (Note 17(a))</td><td>77</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>77</td></tr><tr><td>Operating leases (Note 10)</td><td>2</td><td>2</td><td>2</td><td>2</td><td>2</td><td>10</td><td>20</td></tr><tr><td></td><td>$1,596</td><td>$470</td><td>$732</td><td>$758</td><td>$808</td><td>$6,716</td><td>$11,080</td></tr></table>

At December 31, 2019, Alliant Energy, IPL and WPL had no uncertain tax positions recorded as liabilities. Refer to Note 13(a) for anticipated pension and OPEB funding amounts, which are not included in the above table. Refer to “Construction and Acquisition Expenditures” above for additional information on construction and acquisition programs. In addition, at December 31, 2019, there were various other liabilities included on the balance sheet that, due to the nature of the liabilities, the timing of payments cannot be estimated and are therefore excluded from the above table.

## OTHER MATTERS

Market Risk Sensitive Instruments and Positions - Primary market risk exposures are associated with commodity prices, investment prices and interest rates. Risk management policies are used to monitor and assist in mitigating these market risks and derivative instruments are used to manage some of the exposures related to commodity prices. Refer to Notes 1(h) and 15 for further discussion of derivative instruments, and Note 1(g) for details of utility cost recovery mechanisms that significantly reduce commodity risk.

Commodity Price - Alliant Energy, IPL and WPL are exposed to the impact of market fluctuations in the price and transportation costs of commodities they procure and market. Established policies and procedures mitigate risks associated with these market fluctuations, including the use of various commodity derivatives and contracts of various durations for the forward sale and purchase of these commodities. Exposure to commodity price risks in the utility businesses is also significantly mitigated by current rate-making structures in place for recovery of fuel-related costs as well as the cost of natural gas purchased for resale. IPL's electric and gas tariffs and WPL's wholesale electric and gas tariffs provide for subsequent monthly adjustments to their tariff rates for material changes in prudently incurred commodity costs. IPL's and WPL's rate mechanisms, combined with commodity derivatives, significantly reduce commodity risk associated with their electric and gas margins. WPL's retail electric margins have modest exposure to the impact of changes in commodity prices due largely to the current retail recovery mechanism in place in Wisconsin for fuel-related costs.

Investment Price - Alliant Energy, IPL and WPL are exposed to investment price risk as a result of their investments in securities, largely related to securities held by their pension and OPEB plans. Refer to Note 13(a) for details of the securities held by their pension and OPEB plans. Refer to “Critical Accounting Policies and Estimates” for the impact on retirement plan costs of changes in the rate of returns earned by plan assets.



Interest Rate - Alliant Energy, IPL and WPL are exposed to risk resulting from changes in interest rates associated with variable-rate borrowings. In addition, Alliant Energy and IPL are exposed to risk resulting from changes in interest rates on cash amounts outstanding under IPL's sales of accounts receivable program. Assuming the impact of a hypothetical 100 basis point increase in interest rates on variable-rate borrowings and cash amounts outstanding under IPL's sales of accounts receivable program at December 31, 2019, Alliant Energy's, IPL's and WPL's annual pre-tax expense would increase by approximately $7 million, $0 and $2 million, respectively. Refer to Notes 5(b) and 9 for additional information on cash amounts outstanding under IPL's sales of accounts receivable program, and short- and long-term variable-rate borrowings, respectively. Refer to “Critical Accounting Policies and Estimates” for the impacts of changes in discount rates on retirement plan obligations and costs.

New Accounting Standards - Refer to Note 1(o) for discussion of new accounting standards impacting Alliant Energy, IPL and WPL.

Critical Accounting Policies and Estimates - Alliant Energy’s financial statements are prepared in conformity with GAAP, which requires management to apply accounting policies, judgments and assumptions, and make estimates that affect results of operations and the amounts of assets and liabilities reported in the financial statements. The following accounting policies and estimates are critical to the business and the understanding of financial results as they require critical assumptions and judgments by management. The results of these assumptions and judgments form the basis for making estimates regarding the results of operations and the amounts of assets and liabilities that are not readily apparent from other sources. Actual financial results may differ materially from estimates. Management has discussed these critical accounting policies and estimates with the Audit Committee of the Board of Directors. Refer to Note 1 for additional discussion of accounting policies and estimates used in the preparation of the financial statements.

Contingencies - Assumptions and judgments are made each reporting period regarding the future outcome of contingent events. Loss contingency amounts are recorded for any contingent events for which the likelihood of loss is probable and able to be reasonably estimated based upon current available information. The amounts recorded may differ from actuals when the uncertainty is resolved. The estimates made in accounting for contingencies, and the gains and losses that are recorded upon the ultimate resolution of these uncertainties, could have a significant effect on results of operations and the amount of assets and liabilities in the financial statements. Note 17 provides further discussion of contingencies assessed at December 31, 2019, including impacts to Alliant Energy's ATC Holdings equity earnings as a result of future changes in FERC's evaluation of certain MISO return on equity complaints, various pending legal proceedings, guarantees and indemnifications that may have a material impact on financial condition and results of operations.

Regulatory Assets and Regulatory Liabilities - IPL and WPL are regulated by various federal and state regulatory agencies. As a result, they are subject to GAAP for regulated operations, which recognizes that the actions of a regulator can provide reasonable assurance of the existence of an asset or liability. Regulatory assets or regulatory liabilities arise as a result of a difference between GAAP and actions imposed by the regulatory agencies in the rate-making process. Regulatory assets generally represent incurred costs that have been deferred as such costs are probable of recovery in future customer rates. Regulatory liabilities generally represent obligations to make refunds to customers or amounts collected in rates for which the related costs have not yet been incurred. Regulatory assets and regulatory liabilities are recognized in accordance with the rulings of applicable federal and state regulators, and future regulatory rulings may impact the carrying value and accounting treatment of regulatory assets and regulatory liabilities.

Assumptions and judgments are made each reporting period regarding whether regulatory assets are probable of future recovery and regulatory liabilities are probable future obligations by considering factors such as regulatory environment changes, rate orders issued by the applicable regulatory agencies, historical decisions by such regulatory agencies regarding similar regulatory assets and regulatory liabilities, and subsequent events of such regulatory agencies. The decisions made by regulatory authorities have an impact on the recovery of costs, the rate of return on invested capital and the timing and amount of assets to be recovered by rates. A change in these decisions may result in a material impact on results of operations and the amount of assets and liabilities in the financial statements. Note 2 provides details of the nature and amounts of regulatory assets and regulatory liabilities assessed at December 31, 2019.

Long-Lived Assets - Periodic assessments regarding the recoverability of certain long-lived assets are completed when factors indicate the carrying value of such assets may not be recoverable or such assets are planned to be sold. These assessments require significant assumptions and judgments by management. The long-lived assets assessed for impairment generally include certain assets within regulated operations that may not be fully recovered from IPL's and WPL's customers as a result of regulatory decisions in the future, and assets within non-utility operations that are proposed to be sold or are currently generating operating losses.



Regulated Operations - Certain long-lived assets within regulated operations are reviewed for possible impairment whenever events or changes in circumstances indicate all or a portion of the carrying value of the assets may be disallowed for rate-making purposes. If IPL or WPL is disallowed recovery of any portion of the carrying value of its regulated property, plant and equipment that is under construction, has been recently completed or is probable of being retired early, an impairment charge is recognized equal to the amount of the carrying value that was disallowed recovery. If IPL or WPL is disallowed a full or partial return on the carrying value of its regulated property, plant and equipment that is under construction, has been recently completed or is probable of being retired early, an impairment charge is recognized equal to the difference between the carrying amount of the asset and the present value of the future revenues expected from its regulated property, plant and equipment. Alliant Energy's, IPL's and WPL's long-lived assets within their regulated operations that were assessed for impairment and plant abandonment in 2019 included IPL's and WPL's generating units subject to early retirement, and IPL's analog electric meters retired in 2019.

Generating Units Subject to Early Retirement - Alliant Energy, IPL and WPL evaluate future plans for their electric generation fleet and have announced the early retirement of certain older and less-efficient EGUs. When it becomes probable that an EGU will be retired before the end of its useful life, Alliant Energy, IPL and WPL must assess whether the EGU meets the criteria to be considered probable of abandonment. EGUs that are considered probable of abandonment generally have material remaining net book values and are expected to cease operations in the near term significantly before the end of their original estimated useful lives. If an EGU meets such criteria to be considered probable of abandonment, Alliant Energy, IPL and WPL must assess the probability of full recovery of the remaining carrying value of such EGU. If it is probable that regulators will not allow full recovery of and a full return on the remaining net book value of the abandoned EGU, an impairment charge is recognized equal to the difference between the remaining carrying value and the present value of the future revenues expected from the abandoned EGU. Alliant Energy, IPL and WPL evaluated their EGUs that are subject to early retirement and determined that no EGUs meet the criteria to be considered probable of abandonment as of December 31, 2019.

IPL’s Analog Electric Meters - Upon completion of the installation of an advanced metering infrastructure program, IPL retired certain analog electric meters in 2019. As permitted in the recent IPL rate review, IPL will recover the remaining net book value of these meters but will not recover a return on these meters when final rates are implemented, which are expected by the end of the first quarter of 2020. Alliant Energy and IPL recorded a $4 million pre-tax charge in 2019 as a result of the decision not to allow a return on the remaining net book value of IPL’s analog electric meters.

Unbilled Revenues - Unbilled revenues are primarily associated with utility operations. Energy sales to individual customers are based on the reading of customers' meters, which occurs on a systematic basis throughout the month. Amounts of energy delivered to customers since the date of the last meter reading are estimated at the end of each reporting period and the corresponding estimated unbilled revenue is recorded. The unbilled revenue is based on estimates of daily system demand volumes, customer usage by class, temperature impacts, line losses and the most recent customer rates. Such process involves the use of various judgments and assumptions and significant changes in these judgments and assumptions could have a material impact on results of operations. As of December 31, 2019, unbilled revenues related to Alliant Energy's utility operations were $178 million ($96 million at IPL and $82 million at WPL).

Pensions and Other Postretirement Benefits - Alliant Energy, IPL and WPL sponsor various defined benefit pension and OPEB plans that provide benefits to a significant portion of their employees and retirees. Assumptions and judgments are made periodically to estimate the obligations and costs related to their retirement plans. There are many judgments and assumptions involved in determining an entity's pension and other postretirement liabilities and costs each period including employee demographics (including life expectancies and compensation levels), discount rates, assumed rates of return and funding. Changes made to plan provisions may also impact current and future benefits costs. Judgments and assumptions are supported by historical data and reasonable projections and are reviewed at least annually. The following table shows the impacts of changing certain key actuarial assumptions discussed above (in millions):

<table><tr><td rowspan="2">Change in Actuarial Assumption</td><td colspan="2">Defined Benefit Pension Plans</td><td colspan="2">OPEB Plans</td></tr><tr><td>Impact on Projected Benefit Obligation at December 31, 2019</td><td>Impact on 2020 Net Periodic Benefit Costs</td><td>Impact on Accumulated Benefit Obligation at December 31, 2019</td><td>Impact on 2020 Net Periodical Benefit Costs</td></tr><tr><td>Alliant Energy</td><td></td><td></td><td></td><td></td></tr><tr><td>1% change in discount rate</td><td>$163</td><td>$10</td><td>$20</td><td>$2</td></tr><tr><td>1% change in expected rate of return</td><td>N/A</td><td>9</td><td>N/A</td><td>1</td></tr></table>



Income Taxes - Alliant Energy, IPL and WPL are subject to income taxes in various jurisdictions. Assumptions and judgments are made each reporting period to estimate income tax assets, liabilities, benefits and expenses. Judgments and assumptions are supported by historical data and reasonable projections. Significant changes in these judgments and assumptions could have a material impact on financial condition and results of operations. Alliant Energy's and IPL's critical assumptions and judgments for 2019 include estimates of qualifying deductions for repairs expenditures and allocation of mixed service costs due to the impact of Iowa rate-making principles on such property-related differences. Critical assumptions and judgments also include projections of future taxable income used to determine the ability to utilize net operating losses and credit carryforwards prior to their expiration. Refer to Note 12 for further discussion of tax matters.

Effect of Rate-making on Property-related Differences - Alliant Energy’s and IPL’s effective income tax rates are normally impacted by certain property-related differences at IPL for which deferred tax is not recorded in the income statement pursuant to Iowa rate-making principles. Changes in methods or assumptions regarding the amount of IPL’s qualifying repairs expenditures, allocation of mixed service costs, and costs related to retirement or removal of depreciable property could result in a material impact on Alliant Energy’s and IPL’s financial condition and results of operations.

Carryforward Utilization - Significant federal tax credit carryforwards and federal and state net operating loss carryforwards exist for Alliant Energy, IPL and WPL as of December 31, 2019. Based on projections of current and future taxable income, Alliant Energy, IPL and WPL plan to utilize substantially all of these carryforwards prior to their expiration. Taxable income must be reduced by federal net operating losses carryforwards prior to utilizing federal tax credit carryforwards. Alliant Energy does not expect to utilize all of its federal net operating loss carryforwards until 2024, and therefore, currently does not expect to utilize 2002 and 2003 vintage federal credit carryforwards prior to their expiration in 2022 and 2023, respectively. This resulted in valuation allowance charges recorded to “Income taxes” in the income statement in 2017. Federal credit carryforwards generated from 2004 through 2008, which amount to $7 million for Alliant Energy, are expected to be utilized within five years of expiration. All other federal credit carryforwards and federal net operating loss carryforwards are expected to be utilized more than five years before expiration. Changes in tax regulations or assumptions regarding current and future taxable income could require changes to valuation allowances in the future resulting in a material impact on financial condition and results of operations.

## MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The management of Alliant Energy, IPL and WPL are responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Alliant Energy’s, IPL’s and WPL’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP.

Because of the inherent limitations of internal control over financial reporting, misstatements may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Alliant Energy’s, IPL’s and WPL’s management assessed the effectiveness of their respective internal control over financial reporting as of December 31, 2019 using the criteria set forth in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on these assessments, Alliant Energy’s, IPL’s and WPL’s management concluded that, as of December 31, 2019, their respective internal control over financial reporting was effective.

Deloitte & Touche LLP, Alliant Energy’s independent registered public accounting firm, has audited Alliant Energy’s internal control over financial reporting. That report is included herein.



## REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareowners and the Board of Directors of Alliant Energy Corporation:

## Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Alliant Energy Corporation and subsidiaries (the "Company") as of December 31, 2019, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2019, of the Company and our report dated February 21, 2020, expressed an unqualified opinion on those financial statements.

## Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

## Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

## Delite + Touche 14P

Milwaukee, Wisconsin
February 21, 2020



## REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareowners and the Board of Directors of Alliant Energy Corporation:

## Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Alliant Energy Corporation and subsidiaries (the "Company") as of December 31, 2019 and 2018, the related consolidated statements of income, equity, and cash flows, for each of the three years in the period ended December 31, 2019, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2019, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 21, 2020, expressed an unqualified opinion on the Company’s internal control over financial reporting.

## Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

## Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Regulatory Assets and Regulatory Liabilities – Impact of rate regulation on the financial statements – Refer to Notes 1 and 2 to the financial statements

## Critical Audit Matter Description

Alliant Energy Corporation, through its wholly-owned subsidiaries, Interstate Power and Light Company and Wisconsin Power and Light Company (collectively, the "Company") is subject to rate regulation by the Federal Energy Regulatory Commission and the respective state commissions in Wisconsin and Iowa (collectively the "regulatory agencies"). Management has determined it meets the requirements under accounting principles generally accepted in the United States of America to prepare its financial statements applying the Regulated Operations Topic 980 of the Financial Accounting Standards Board's Accounting Standards Codification. As of December 31, 2019, the Company had a recorded consolidated regulatory assets balance of $1,844.7 million and regulatory liabilities balance of $1,423.6 million.



The Company’s rates are subject to regulatory rate-setting processes and annual earnings oversight. The regulation of rates is premised on the full recovery of prudently incurred costs and a reasonable rate of return on invested capital. Regulatory assets represent incurred costs that have been deferred and are probable of recovery in future customer rates. Regulatory liabilities represent obligations to make refunds to customers or amounts collected in rates for which the costs have not yet been incurred. The Company’s regulatory assets and regulatory liabilities are recognized in accordance with the rulings of the regulatory agencies. A change in these rulings may result in a material impact on results of operations and the amount of assets and liabilities in the financial statements. Future regulatory rulings may impact the carrying value and accounting treatment of the regulatory assets and regulatory liabilities.

We identified the impact of rate regulation as a critical audit matter due to the significant judgments made by management to support its assertions about impacted account balances and disclosures and the high degree of subjectivity involved in assessing the impact of future regulatory orders on the financial statements. Management judgments include assessing the likelihood of the recovery of incurred costs and refund of obligations to customers in future rates. Given that management’s accounting judgments are based on assumptions about the outcome of future decisions by the regulatory agencies, auditing these judgments required specialized knowledge of accounting for rate regulation and the rate-setting process due to its inherent complexities.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the regulatory filings by management and the uncertainty of future decisions by the regulatory agencies included the following, among others:

- We tested the design and operating effectiveness of management’s controls over the evaluation of regulatory assets and liabilities, including the monitoring and evaluation of regulatory developments that may affect the likelihood of recovering costs in future rates or of a future reduction in rates.

- We inspected the Company’s analysis supporting the probability of recovery for regulatory assets or refund or future reduction in rates for regulatory liabilities not yet addressed in a regulatory order to assess the reasonability of management’s assertions.

- We inquired of management regarding current events impacting the Company and inspected minutes of the board of directors and other committees of the Company and evaluated whether matters were identified that may have an impact on recorded regulatory asset and liability balances.

- We read relevant regulatory orders, regulatory statutes, interpretations, procedural memorandums, filings made by interveners, and other publicly available information issued by the regulatory agencies that pertain to the Company as well as to other relevant public utilities. We evaluated the external information and assessed whether there were matters in such information that would be contradictory to the assessment of recovery of the Company’s regulatory assets or refund of regulatory liabilities.

- We obtained representation letters from management, as well as legal letters from internal and external legal counsel and evaluated such letters to assess whether information was present that would be relevant to the assessment of recovery of the Company’s regulatory assets or refund of regulatory liabilities.

- We evaluated the Company’s disclosures related to the impacts of rate regulation and regulatory developments, including disclosures related to the regulatory balances recorded.

## Deloitte & Touche LLP

Milwaukee, Wisconsin
February 21, 2020

We have served as the Company’s auditor since 2002.



## CONSOLIDATED FINANCIAL STATEMENTS

## ALLIANT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF INCOME

<table><tr><td rowspan="3"></td><td colspan="3">Year Ended December 31,</td></tr><tr><td>2019</td><td>2018</td><td>2017</td></tr><tr><td colspan="3">(in millions, except per share amounts)</td></tr><tr><td>Revenues:</td><td></td><td></td><td></td></tr><tr><td>Electric utility</td><td>$3,063.6</td><td>$3,000.3</td><td>$2,894.7</td></tr><tr><td>Gas utility</td><td>455.2</td><td>446.6</td><td>400.9</td></tr><tr><td>Other utility</td><td>46.5</td><td>48.0</td><td>47.5</td></tr><tr><td>Non-utility</td><td>82.4</td><td>39.6</td><td>39.1</td></tr><tr><td>Total revenues</td><td>3,647.7</td><td>3,534.5</td><td>3,382.2</td></tr><tr><td>Operating expenses:</td><td></td><td></td><td></td></tr><tr><td>Electric production fuel and purchased power</td><td>776.7</td><td>855.0</td><td>818.1</td></tr><tr><td>Electric transmission service</td><td>481.4</td><td>495.7</td><td>480.9</td></tr><tr><td>Cost of gas sold</td><td>221.7</td><td>232.3</td><td>211.4</td></tr><tr><td>Other operation and maintenance</td><td>712.2</td><td>645.8</td><td>633.2</td></tr><tr><td>Depreciation and amortization</td><td>567.2</td><td>506.9</td><td>461.8</td></tr><tr><td>Taxes other than income taxes</td><td>110.8</td><td>104.4</td><td>105.6</td></tr><tr><td>Total operating expenses</td><td>2,870.0</td><td>2,840.1</td><td>2,711.0</td></tr><tr><td>Operating income</td><td>777.7</td><td>694.4</td><td>671.2</td></tr><tr><td>Other (income) and deductions:</td><td></td><td></td><td></td></tr><tr><td>Interest expense</td><td>272.9</td><td>247.0</td><td>215.6</td></tr><tr><td>Equity income from unconsolidated investments, net</td><td>(53.0)</td><td>(54.6)</td><td>(44.8)</td></tr><tr><td>Allowance for funds used during construction</td><td>(92.7)</td><td>(75.6)</td><td>(49.7)</td></tr><tr><td>Other</td><td>14.4</td><td>7.6</td><td>17.3</td></tr><tr><td>Total other (income) and deductions</td><td>141.6</td><td>124.4</td><td>138.4</td></tr><tr><td>Income from continuing operations before income taxes</td><td>636.1</td><td>570.0</td><td>532.8</td></tr><tr><td>Income taxes</td><td>68.7</td><td>47.7</td><td>66.7</td></tr><tr><td>Income from continuing operations, net of tax</td><td>567.4</td><td>522.3</td><td>466.1</td></tr><tr><td>Income from discontinued operations, net of tax</td><td>—</td><td>—</td><td>1.4</td></tr><tr><td>Net income</td><td>567.4</td><td>522.3</td><td>467.5</td></tr><tr><td>Preferred dividend requirements of Interstate Power and Light Company</td><td>10.2</td><td>10.2</td><td>10.2</td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td>$557.2</td><td>$512.1</td><td>$457.3</td></tr><tr><td>Weighted average number of common shares outstanding:</td><td></td><td></td><td></td></tr><tr><td>Basic</td><td>238.5</td><td>233.6</td><td>229.7</td></tr><tr><td>Diluted</td><td>239.0</td><td>233.6</td><td>229.7</td></tr><tr><td>Earnings per weighted average common share attributable to Alliant Energy common shareowners:</td><td></td><td></td><td></td></tr><tr><td>Basic</td><td>$2.34</td><td>$2.19</td><td>$1.99</td></tr><tr><td>Diluted</td><td>$2.33</td><td>$2.19</td><td>$1.99</td></tr><tr><td>Amounts attributable to Alliant Energy common shareowners:</td><td></td><td></td><td></td></tr><tr><td>Income from continuing operations, net of tax</td><td>$557.2</td><td>$512.1</td><td>$455.9</td></tr><tr><td>Income from discontinued operations, net of tax</td><td>—</td><td>—</td><td>1.4</td></tr><tr><td>Net income</td><td>$557.2</td><td>$512.1</td><td>$457.3</td></tr></table>

Refer to accompanying Notes to Consolidated Financial Statements.



## ALLIANT ENERGY CORPORATION
CONSOLIDATED BALANCE SHEETS

<table><tr><td rowspan="3"></td><td colspan="2">December 31,</td></tr><tr><td>2019</td><td>2018</td></tr><tr><td colspan="2">(in millions, except per share and share amounts)</td></tr><tr><td>ASSETS</td><td></td><td></td></tr><tr><td>Current assets:</td><td></td><td></td></tr><tr><td>Cash and cash equivalents</td><td>$16.3</td><td>$20.9</td></tr><tr><td>Accounts receivable, less allowance for doubtful accounts</td><td>402.1</td><td>350.4</td></tr><tr><td>Production fuel, at weighted average cost</td><td>77.7</td><td>61.4</td></tr><tr><td>Gas stored underground, at weighted average cost</td><td>49.1</td><td>49.0</td></tr><tr><td>Materials and supplies, at weighted average cost</td><td>100.5</td><td>101.4</td></tr><tr><td>Regulatory assets</td><td>86.4</td><td>79.8</td></tr><tr><td>Prepaid gross receipts tax</td><td>41.7</td><td>42.2</td></tr><tr><td>Other</td><td>101.7</td><td>80.0</td></tr><tr><td>Total current assets</td><td>875.5</td><td>785.1</td></tr><tr><td>Property, plant and equipment, net</td><td>13,527.1</td><td>12,462.4</td></tr><tr><td>Investments:</td><td></td><td></td></tr><tr><td>ATC Holdings</td><td>320.1</td><td>293.6</td></tr><tr><td>Other</td><td>147.7</td><td>137.7</td></tr><tr><td>Total investments</td><td>467.8</td><td>431.3</td></tr><tr><td>Other assets:</td><td></td><td></td></tr><tr><td>Regulatory assets</td><td>1,758.3</td><td>1,657.5</td></tr><tr><td>Deferred charges and other</td><td>72.0</td><td>89.7</td></tr><tr><td>Total other assets</td><td>1,830.3</td><td>1,747.2</td></tr><tr><td>Total assets</td><td>$16,700.7</td><td>$15,426.0</td></tr><tr><td>LIABILITIES AND EQUITY</td><td></td><td></td></tr><tr><td>Current liabilities:</td><td></td><td></td></tr><tr><td>Current maturities of long-term debt</td><td>$657.2</td><td>$256.5</td></tr><tr><td>Commercial paper</td><td>337.4</td><td>441.2</td></tr><tr><td>Accounts payable</td><td>422.3</td><td>543.3</td></tr><tr><td>Regulatory liabilities</td><td>212.0</td><td>142.7</td></tr><tr><td>Other</td><td>425.2</td><td>260.4</td></tr><tr><td>Total current liabilities</td><td>2,054.1</td><td>1,644.1</td></tr><tr><td>Long-term debt, net (excluding current portion)</td><td>5,533.0</td><td>5,246.3</td></tr><tr><td>Other liabilities:</td><td></td><td></td></tr><tr><td>Deferred tax liabilities</td><td>1,714.0</td><td>1,603.1</td></tr><tr><td>Regulatory liabilities</td><td>1,211.6</td><td>1,350.5</td></tr><tr><td>Pension and other benefit obligations</td><td>484.0</td><td>509.1</td></tr><tr><td>Other</td><td>298.9</td><td>287.2</td></tr><tr><td>Total other liabilities</td><td>3,708.5</td><td>3,749.9</td></tr><tr><td>Commitments and contingencies (Note 17)</td><td></td><td></td></tr><tr><td>Equity:</td><td></td><td></td></tr><tr><td>Alliant Energy Corporation common equity:</td><td></td><td></td></tr><tr><td>Common stock - $0.01 par value - 480,000,000 shares authorized; 245,022,800 and 236,063,279 shares outstanding</td><td>2.5</td><td>2.4</td></tr><tr><td>Additional paid-in capital</td><td>2,445.9</td><td>2,045.5</td></tr><tr><td>Retained earnings</td><td>2,765.4</td><td>2,545.9</td></tr><tr><td>Accumulated other comprehensive income</td><td>1.3</td><td>1.7</td></tr><tr><td>Shares in deferred compensation trust - 381,232 and 384,580 shares at a weighted average cost of $26.24 and $25.60 per share</td><td>(10.0)</td><td>(9.8)</td></tr><tr><td>Total Alliant Energy Corporation common equity</td><td>5,205.1</td><td>4,585.7</td></tr><tr><td>Cumulative preferred stock of Interstate Power and Light Company</td><td>200.0</td><td>200.0</td></tr><tr><td>Total equity</td><td>5,405.1</td><td>4,785.7</td></tr><tr><td>Total liabilities and equity</td><td>$16,700.7</td><td>$15,426.0</td></tr></table>

Refer to accompanying Notes to Consolidated Financial Statements.



## ALLIANT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS

<table><tr><td rowspan="3"></td><td colspan="3">Year Ended December 31,</td></tr><tr><td>2019</td><td>2018</td><td>2017</td></tr><tr><td colspan="3">(in millions)</td></tr><tr><td>Cash flows from operating activities:</td><td></td><td></td><td></td></tr><tr><td>Net income</td><td>$567.4</td><td>$522.3</td><td>$467.5</td></tr><tr><td>Adjustments to reconcile net income to net cash flows from operating activities:</td><td></td><td></td><td></td></tr><tr><td>Depreciation and amortization</td><td>567.2</td><td>506.9</td><td>461.8</td></tr><tr><td>Deferred tax expense and tax credits</td><td>55.6</td><td>67.0</td><td>139.6</td></tr><tr><td>Equity component of allowance for funds used during construction</td><td>(65.5)</td><td>(51.4)</td><td>(33.6)</td></tr><tr><td>Other</td><td>19.9</td><td>7.7</td><td>21.7</td></tr><tr><td>Other changes in assets and liabilities:</td><td></td><td></td><td></td></tr><tr><td>Accounts receivable</td><td>(471.7)</td><td>(475.4)</td><td>(441.2)</td></tr><tr><td>Regulatory assets</td><td>(16.2)</td><td>(16.2)</td><td>(130.8)</td></tr><tr><td>Regulatory liabilities</td><td>(40.3)</td><td>1.3</td><td>(83.8)</td></tr><tr><td>Deferred income taxes</td><td>53.8</td><td>55.9</td><td>81.7</td></tr><tr><td>Other</td><td>(9.8)</td><td>(90.4)</td><td>38.7</td></tr><tr><td>Net cash flows from operating activities</td><td>660.4</td><td>527.7</td><td>521.6</td></tr><tr><td>Cash flows used for investing activities:</td><td></td><td></td><td></td></tr><tr><td>Construction and acquisition expenditures:</td><td></td><td></td><td></td></tr><tr><td>Utility business</td><td>(1,538.4)</td><td>(1,568.3)</td><td>(1,281.8)</td></tr><tr><td>Other</td><td>(101.7)</td><td>(65.6)</td><td>(185.1)</td></tr><tr><td>Cash receipts on sold receivables</td><td>413.2</td><td>605.3</td><td>461.8</td></tr><tr><td>Other</td><td>(60.4)</td><td>(38.2)</td><td>(28.3)</td></tr><tr><td>Net cash flows used for investing activities</td><td>(1,287.3)</td><td>(1,066.8)</td><td>(1,033.4)</td></tr><tr><td>Cash flows from financing activities:</td><td></td><td></td><td></td></tr><tr><td>Common stock dividends</td><td>(337.7)</td><td>(312.2)</td><td>(288.3)</td></tr><tr><td>Proceeds from issuance of common stock, net</td><td>390.3</td><td>196.6</td><td>149.6</td></tr><tr><td>Proceeds from issuance of long-term debt</td><td>950.0</td><td>1,500.0</td><td>550.0</td></tr><tr><td>Payments to retire long-term debt</td><td>(256.5)</td><td>(855.7)</td><td>(4.6)</td></tr><tr><td>Net change in commercial paper and other short-term borrowings</td><td>(103.8)</td><td>26.0</td><td>171.1</td></tr><tr><td>Other</td><td>(23.2)</td><td>(24.0)</td><td>(45.2)</td></tr><tr><td>Net cash flows from financing activities</td><td>619.1</td><td>530.7</td><td>532.6</td></tr><tr><td>Net increase (decrease) in cash, cash equivalents and restricted cash</td><td>(7.8)</td><td>(8.4)</td><td>20.8</td></tr><tr><td>Cash, cash equivalents and restricted cash at beginning of period</td><td>25.5</td><td>33.9</td><td>13.1</td></tr><tr><td>Cash, cash equivalents and restricted cash at end of period</td><td>$17.7</td><td>$25.5</td><td>$33.9</td></tr><tr><td>Supplemental cash flows information:</td><td></td><td></td><td></td></tr><tr><td>Cash (paid) refunded during the period for:</td><td></td><td></td><td></td></tr><tr><td>Interest</td><td>($267.9)</td><td>($247.5)</td><td>($212.6)</td></tr><tr><td>Income taxes, net</td><td>$20.5</td><td>($5.0)</td><td>($11.3)</td></tr><tr><td>Significant non-cash investing and financing activities:</td><td></td><td></td><td></td></tr><tr><td>Accrued capital expenditures</td><td>$195.8</td><td>$299.5</td><td>$196.5</td></tr><tr><td>Beneficial interest obtained in exchange for securitized accounts receivable</td><td>$187.7</td><td>$119.4</td><td>$222.1</td></tr></table>

Refer to accompanying Notes to Consolidated Financial Statements.



## ALLIANT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF EQUITY

<table><tr><td rowspan="3"></td><td colspan="7">Total Alliant Energy Common Equity</td></tr><tr><td rowspan="2">Common Stock</td><td rowspan="2">Additional Paid-In Capital</td><td rowspan="2">Retained Earnings</td><td>Accumulated Other Comprehensive Income (Loss)</td><td>Shares in Deferred Compensation Trust</td><td>Cumulative Preferred Stock of IPL</td><td>Total Equity</td></tr><tr><td colspan="4">(in millions)</td><td></td></tr><tr><td>2017:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Beginning balance</td><td>$2.3</td><td>$1,693.1</td><td>$2,177.0</td><td>($0.4)</td><td>($10.0)</td><td>$200.0</td><td>$4,062.0</td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td></td><td></td><td>457.3</td><td></td><td></td><td></td><td>457.3</td></tr><tr><td>Common stock dividends ($1.26 per share)</td><td></td><td></td><td>(288.3)</td><td></td><td></td><td></td><td>(288.3)</td></tr><tr><td>At-the-market offering program and Shareowner Direct Plan issuances</td><td></td><td>149.6</td><td></td><td></td><td></td><td></td><td>149.6</td></tr><tr><td>Equity-based compensation plans and other</td><td></td><td>2.8</td><td></td><td></td><td>(1.1)</td><td></td><td>1.7</td></tr><tr><td>Other comprehensive loss, net of tax</td><td></td><td></td><td></td><td>(0.1)</td><td></td><td></td><td>(0.1)</td></tr><tr><td>Ending balance</td><td>2.3</td><td>1,845.5</td><td>2,346.0</td><td>(0.5)</td><td>(11.1)</td><td>200.0</td><td>4,382.2</td></tr><tr><td>2018:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td></td><td></td><td>512.1</td><td></td><td></td><td></td><td>512.1</td></tr><tr><td>Common stock dividends ($1.34 per share)</td><td></td><td></td><td>(312.2)</td><td></td><td></td><td></td><td>(312.2)</td></tr><tr><td>At-the-market offering program and Shareowner Direct Plan issuances</td><td>0.1</td><td>196.5</td><td></td><td></td><td></td><td></td><td>196.6</td></tr><tr><td>Equity-based compensation plans and other</td><td></td><td>3.5</td><td></td><td></td><td>1.3</td><td></td><td>4.8</td></tr><tr><td>Other comprehensive income, net of tax</td><td></td><td></td><td></td><td>2.2</td><td></td><td></td><td>2.2</td></tr><tr><td>Ending balance</td><td>2.4</td><td>2,045.5</td><td>2,545.9</td><td>1.7</td><td>(9.8)</td><td>200.0</td><td>4,785.7</td></tr><tr><td>2019:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td></td><td></td><td>557.2</td><td></td><td></td><td></td><td>557.2</td></tr><tr><td>Common stock dividends ($1.42 per share)</td><td></td><td></td><td>(337.7)</td><td></td><td></td><td></td><td>(337.7)</td></tr><tr><td>Equity forward settlements and Shareowner Direct Plan issuances</td><td>0.1</td><td>390.2</td><td></td><td></td><td></td><td></td><td>390.3</td></tr><tr><td>Equity-based compensation plans and other</td><td></td><td>10.2</td><td></td><td></td><td>(0.2)</td><td></td><td>10.0</td></tr><tr><td>Other comprehensive loss, net of tax</td><td></td><td></td><td></td><td>(0.4)</td><td></td><td></td><td>(0.4)</td></tr><tr><td>Ending balance</td><td>$2.5</td><td>$2,445.9</td><td>$2,765.4</td><td>$1.3</td><td>($10.0)</td><td>$200.0</td><td>$5,405.1</td></tr></table>

Refer to accompanying Notes to Consolidated Financial Statements.



# ALLIANT ENERGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

## NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

## NOTE 1(a) General -

Description of Business - Alliant Energy’s financial statements include the accounts of Alliant Energy and its consolidated subsidiaries. Alliant Energy is a Midwest U.S. energy holding company, whose primary wholly-owned subsidiaries are IPL, WPL, AEF and Corporate Services.

IPL is a direct subsidiary of Alliant Energy and is a public utility engaged principally in the generation and distribution of electricity and the distribution and transportation of natural gas to retail customers in select markets in Iowa. IPL also sells electricity to wholesale customers in Minnesota, Illinois and Iowa, and is engaged in the generation and distribution of steam for two customers in Cedar Rapids, Iowa.

WPL is a direct subsidiary of Alliant Energy and is a public utility engaged principally in the generation and distribution of electricity and the distribution and transportation of natural gas to retail customers in select markets in Wisconsin. WPL also sells electricity to wholesale customers in Wisconsin.

AEF is comprised of Transportation, ATI, a non-utility wind farm, the Sheboygan Falls Energy Facility and other non-utility holdings. Transportation includes a short-line railway that provides freight service between Cedar Rapids, Iowa and Iowa City, Iowa; a barge terminal and hauling services on the Mississippi River; customized supply chain solution capabilities; freight and logistics brokering services; and other transfer and storage services. ATI, a wholly-owned subsidiary of AEF, holds all of Alliant Energy's interest in ATC Holdings. The non-utility wind farm includes a 50% cash equity ownership interest in a 225 MW wind farm located in Oklahoma. The Sheboygan Falls Energy Facility is a 347 MW, simple-cycle, natural gas-fired EGU near Sheboygan Falls, Wisconsin, which is leased to WPL for an initial period of 20 years ending in 2025.

Corporate Services is the subsidiary formed to provide administrative services to Alliant Energy and its subsidiaries.

Basis of Presentation - The financial statements reflect investments in controlled subsidiaries on a consolidated basis and Alliant Energy’s, IPL’s and WPL’s proportionate shares of jointly-owned utility EGUs. Unconsolidated investments that Alliant Energy and WPL do not control are accounted for under the equity method of accounting. Under the equity method of accounting, Alliant Energy and WPL initially record the investment at cost, and adjust the carrying amount of the investment to recognize their respective share of the earnings or losses of the investee. Dividends received from an investee reduce the carrying amount of the equity investment. Investments that do not meet the criteria for consolidation or the equity method of accounting are accounted for under the cost method.

All intercompany balances and transactions, other than certain transactions affecting the rate-making process at IPL and WPL, have been eliminated from the financial statements. Such transactions not eliminated include costs that are recoverable from customers through rate-making processes. The financial statements are prepared in conformity with GAAP, which give recognition to the rate-making practices of FERC and state commissions having regulatory jurisdiction.

Certain prior period amounts in the Financial Statements and Notes have been reclassified to conform to the current period presentation for comparative purposes. Discontinued operations reported in Alliant Energy’s income statements are related to various warranty claims associated with the sale of RMT, Inc. in 2013, which has resulted in income subsequent to the sale. Alliant Energy presents cash flows from continuing operations together with cash flows from discontinued operations in its cash flows statements.

Use of Estimates - The preparation of the financial statements requires management to make estimates and assumptions that affect: (a) the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements; and (b) the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

NOTE 1(b) Regulatory Assets and Regulatory Liabilities - Alliant Energy, IPL and WPL are subject to regulation by FERC and various state regulatory commissions. As a result, Alliant Energy, IPL and WPL are subject to GAAP provisions for regulated operations, which provide that rate-regulated public utilities record certain costs and credits allowed in the rate-making process in different periods than for non-utility entities. Regulatory assets generally represent incurred costs that have been deferred as such costs are probable of recovery in future customer rates. Regulatory liabilities generally represent obligations to make refunds to customers or amounts collected in rates for which the related costs have not yet been incurred. Amounts recorded as regulatory assets or regulatory liabilities are generally recognized in the income statements at the time they are reflected in rates.



NOTE 1(c) Income Taxes - The liability method of accounting is followed for deferred taxes, which requires the establishment of deferred tax assets and liabilities, as appropriate, for temporary differences between the tax basis of assets and liabilities and the amounts reported in the financial statements. Deferred taxes are recorded using currently enacted tax rates and estimates of state apportionment. Changes in deferred tax assets and liabilities associated with certain property-related differences at IPL are accounted for differently than other subsidiaries of Alliant Energy due to rate-making practices in Iowa. Rate-making practices in Iowa do not include the impact of certain deferred tax expenses (benefits) in the determination of retail rates. Based on these rate-making practices, deferred tax expense (benefit) related to these property-related differences at IPL is not recorded in the income statement but instead recorded to regulatory assets or regulatory liabilities until these temporary differences reverse. In Wisconsin, the PSCW allows rate recovery of deferred tax expense on all temporary differences.

Investment tax credits are deferred and amortized to income over the average lives of the related property. Federal Tax Reform repealed corporate federal alternative minimum tax and allows unutilized alternative minimum tax credits to be refunded over four tax years beginning with the U.S. federal tax return for calendar year 2018. Other tax credits reduce income tax expense in the year claimed.

Alliant Energy files a consolidated federal income tax return and a combined return in Wisconsin, which include Alliant Energy and its subsidiaries. Alliant Energy subsidiaries with a presence in Iowa file as part of a consolidated return in Iowa.

NOTE 1(d) Cash, Cash Equivalents and Restricted Cash - Cash and cash equivalents include short-term liquid investments that have original maturities of less than 90 days. At December 31, 2019 and 2018, restricted cash primarily related to requirements in Sheboygan Power, LLC's debt agreement.

## NOTE 1(e) Property, Plant and Equipment -

## Utility Plant -

General - Utility plant is recorded at the original cost of acquisition or construction, which includes material, labor, contractor services, AFUDC and allocable overheads, such as supervision, engineering, benefits, certain taxes and transportation. Repairs, replacements and renewals of items of property determined to be less than a unit of property or that do not increase the property's life or functionality are charged to maintenance expense. Property, plant and equipment that is probable of being retired early is classified as plant anticipated to be retired early. Generally, ordinary retirements of utility plant and salvage value are netted and charged to accumulated depreciation upon removal from utility plant accounts and no gain or loss is recognized consistent with rate-making principles. However, if regulators have approved recovery of the remaining net book value of property, plant and equipment that is retired early, or such approval by regulators is probable, the remaining net book value is reclassified from property, plant and equipment to regulatory assets upon retirement.

Depreciation - IPL and WPL use a combination of remaining life and straight-line depreciation methods as approved by their respective regulatory commissions. The composite or group method of depreciation is used, in which a single depreciation rate is applied to the gross investment in a particular class of property. This method pools similar assets and then depreciates each group as a whole. Periodic depreciation studies are performed to determine the appropriate group lives, net salvage, estimated cost of removal and group depreciation rates. These depreciation studies are subject to review and approval by IPL's and WPL's respective regulatory commissions. Depreciation expense is included within the recoverable cost of service component of rates collected from customers. The average rates of depreciation for electric, gas and other properties, consistent with current rate-making practices, were as follows:

<table><tr><td rowspan="2"></td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Electric - generation</td><td>3.8%</td><td>3.6%</td><td>3.5%</td><td>3.6%</td><td>3.6%</td><td>3.5%</td></tr><tr><td>Electric - distribution</td><td>2.9%</td><td>2.8%</td><td>2.4%</td><td>2.6%</td><td>2.6%</td><td>2.6%</td></tr><tr><td>Electric - other</td><td>5.3%</td><td>4.7%</td><td>4.5%</td><td>5.8%</td><td>5.7%</td><td>6.9%</td></tr><tr><td>Gas</td><td>3.3%</td><td>3.2%</td><td>3.4%</td><td>2.5%</td><td>2.5%</td><td>2.5%</td></tr><tr><td>Other</td><td>5.9%</td><td>5.2%</td><td>4.0%</td><td>5.6%</td><td>5.8%</td><td>6.0%</td></tr></table>



AFUDC - AFUDC represents costs to finance construction additions, including a return on equity component and cost of debt component as required by regulatory accounting. AFUDC for IPL's construction projects is calculated in accordance with FERC guidelines. AFUDC for WPL's retail and wholesale jurisdiction construction projects is calculated in accordance with PSCW and FERC guidelines, respectively. The AFUDC rates, computed in accordance with the prescribed regulatory formula, were as follows:

<table><tr><td></td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>IPL (Marshalltown CWIP)</td><td>N/A</td><td>N/A</td><td>7.8%</td></tr><tr><td>IPL (Wind generation CWIP)</td><td>7.4%</td><td>7.5%</td><td>7.6%</td></tr><tr><td>IPL (other CWIP)</td><td>7.5%</td><td>7.5%</td><td>7.6%</td></tr><tr><td>WPL (retail jurisdiction)</td><td>6.8%</td><td>7.7%</td><td>7.6%</td></tr><tr><td>WPL (wholesale jurisdiction)</td><td>6.9%</td><td>7.2%</td><td>6.0%</td></tr></table>

In accordance with their respective regulatory commission decisions, IPL applies its AFUDC rates to 100% of applicable CWIP balances and WPL generally applies its AFUDC rates to 50% of applicable CWIP balances. WPL may apply its AFUDC rates to 100% of the retail portion of the CWIP balances for construction projects requiring a CA or CPCN that were approved by the PSCW after its most recent rate order, including West Riverside.

## Non-utility and Other Property -

General - Non-utility property is recorded at the original cost of acquisition or construction, which includes material, labor and contractor services. Repairs, replacements and renewals of items of property determined to be less than a unit of property or that do not increase the property's life or functionality are charged to maintenance expense. Upon retirement or sale of non-utility property, the original cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in the income statements.

Costs related to software developed or obtained for internal use are capitalized and amortized on a straight-line basis over the estimated useful life of the related software. If software is retired prior to being fully amortized, the remaining book value is recorded as a loss in the income statements.

## NOTE 1(f) Revenue Recognition -

Utility - Revenues from Alliant Energy’s utility business are primarily from electric and gas sales to customers. Utility revenues are recognized over time as services are rendered or commodities are delivered to customers, and include billed and unbilled components. The billed component is based on the reading of customers’ meters, which occurs on a systematic basis throughout each reporting period and represents the fair value of the services provided or commodities delivered. The unbilled component is estimated and recorded at the end of each reporting period based on estimated amounts of energy delivered to customers since the end of each customer’s last billing period. The unbilled revenue is based on estimates of daily system demand volumes, customer usage by class, temperature impacts, line losses and the most recent customer rates.

IPL and WPL accrue revenues from their wholesale customers to the extent that the actual net revenue requirements calculated in accordance with FERC-approved formula rates for the reporting period are higher or lower than the amounts billed to wholesale customers during such period. Regulatory assets or regulatory liabilities are recorded as the offset for these accrued revenues under formulaic rate-making programs. As of December 31, 2019, the related amounts accrued for IPL and WPL were not material.

IPL and WPL participate in bid/offer-based wholesale energy and ancillary services markets operated by MISO. The MISO transactions are grouped together, resulting in a net supply to or net purchase from MISO for each hour of each day. The net supply to MISO is recorded as bulk power sales in “Electric utility revenues” and the net purchase from MISO is recorded in “Electric production fuel and purchased power” in the income statements.

Non-utility - Revenues from Alliant Energy’s non-utility businesses are primarily from its Transportation business and are recognized over time as services are rendered to customers.

Taxes Collected from Customers - Sales or various other taxes collected by certain of Alliant Energy’s subsidiaries on behalf of other agencies are recorded on a net basis and are not included in revenues.

Other - Alliant Energy, IPL and WPL do not disclose the value of unsatisfied performance obligations for: (i) contracts with an original expected length of one year or less; and (ii) contracts for which revenue is recognized at the amount to which they have the right to invoice for services performed.



## NOTE 1(g) Utility Cost Recovery Mechanisms

Electric Production Fuel and Purchased Power (Fuel-related Costs) - Fuel-related costs are incurred to generate and purchase electricity to meet the demand of IPL's and WPL's electric customers. These fuel-related costs include the cost of fossil fuels (primarily natural gas and coal) used to produce electricity at their EGUs, and electricity purchased from MISO wholesale energy markets and under PPAs. These fuel-related costs are recorded in "Electric production fuel and purchased power" in the income statements.

IPL Retail - The cost recovery mechanisms for IPL's retail electric customers provide for monthly adjustments to their electric rates for changes in fuel-related costs. Changes in the under-/over-collection of these costs are recognized in "Electric production fuel and purchased power" in Alliant Energy's income statements. The cumulative effects of the under-/over-collection of these costs are recorded in regulatory assets or regulatory liabilities on Alliant Energy's balance sheets until they are reflected in future billings to customers.

WPL Retail - 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. If WPL's actual fuel-related costs fall outside these fuel monitoring ranges, WPL is authorized to defer the incremental under-/over-collection of fuel-related costs that are outside the approved ranges. Deferral of under-collections are reduced to the extent actual return on common equity earned by WPL during the fuel cost plan year exceeds the most recently authorized return on common equity. Deferred amounts for fuel-related costs outside the approved fuel monitoring ranges are recognized in "Electric production fuel and purchased power" in Alliant Energy's income statements. The cumulative effects of these deferred amounts are recorded in regulatory assets or regulatory liabilities on Alliant Energy's balance sheets until they are reflected in future billings to customers.

IPL and WPL Wholesale - The cost recovery mechanisms for IPL's and WPL's wholesale electric customers provide for subsequent adjustments to their electric rates for changes in fuel-related costs. Changes in the under-/over-collection of these costs are recognized in "Electric production fuel and purchased power" in the income statements. The cumulative effects of the under-/over-collection of these costs are recorded in regulatory assets or regulatory liabilities on the balance sheets until they are reflected in future billings to customers.

Purchased Electric Capacity - PPAs help meet the electricity demand of IPL's and WPL's customers. Certain PPAs include minimum payments for IPL's and WPL's rights to electric generating capacity, which are charged each period to "Electric production fuel and purchased power" in the income statements. Purchased electric capacity expenses are recovered from IPL's and WPL's retail electric customers through changes in base rates determined during periodic rate proceedings. Purchased electric capacity expenses are recovered from IPL's and WPL's wholesale electric customers through annual changes in base rates determined by a formula rate structure.

Electric Transmission Service - Costs incurred for the transmission of electricity to meet the demands of IPL's and WPL's customers are charged to "Electric transmission service" in the income statements.

IPL Retail - Electric transmission service expense is recovered from IPL's retail electric customers through a transmission cost rider. This cost recovery mechanism provides for annual adjustments to electric rates charged to retail electric customers for changes in electric transmission service expense. Changes in the under-/over-collection of these costs are recognized in "Electric transmission service" in Alliant Energy's income statements. The cumulative effects of the under-/over-collection of these costs are recorded in regulatory assets or regulatory liabilities on Alliant Energy's balance sheets until they are reflected in future billings to customers.

WPL Retail - Electric transmission service expense is recovered from WPL's retail electric customers through changes in base rates determined during periodic rate proceedings. Pursuant to escrow accounting treatment approved by the PSCW, the difference between actual electric transmission service expense incurred and the amount of electric transmission service costs collected from customers as electric revenues is recognized in "Electric transmission service" in Alliant Energy's income statements. An offsetting amount is recorded in regulatory assets or regulatory liabilities on Alliant Energy's balance sheets until reflected in future billings to customers.

IPL and WPL Wholesale - IPL and WPL arrange transmission service for the majority of their respective wholesale electric customers. Electric transmission service expense is allocated to and recovered from these customers based on a load ratio share computation.

Cost of Gas Sold - Costs are incurred for the purchase, transportation and storage of natural gas to serve IPL's and WPL's gas customers and the costs associated with the natural gas delivered to customers are charged to "Cost of gas sold" in the income statements. The tariffs for IPL's and WPL's retail gas customers provide for subsequent adjustments to their rates each month for changes in the cost of gas sold. Changes in the under-/over-collection of these costs are also recognized in "Cost of gas sold" in the income statements. The cumulative effects of the under-/over-collection of these costs are recorded in regulatory assets or regulatory liabilities on the balance sheets until they are reflected in future billings to customers.



Energy Efficiency Costs - Costs incurred to fund energy efficiency programs and initiatives that help customers reduce their energy usage are charged to “Other operation and maintenance” in the income statements. Energy efficiency costs incurred by IPL are recovered from its retail electric and gas customers through an additional tariff called an energy efficiency cost recovery factor, which is revised annually and includes a reconciliation to eliminate any under-/over-collection of energy efficiency costs from prior periods. Energy efficiency costs incurred by WPL are recovered from retail electric and gas customers through changes in base rates determined during periodic rate proceedings. Reconciliations of any under-/over-collection of energy efficiency costs from prior periods are also addressed in WPL’s periodic rate proceedings. Changes in the under-/over-collection of energy efficiency costs for IPL and WPL are recognized in “Other operation and maintenance” in the income statements. The cumulative effects of the under-/over-collection of these costs for IPL and WPL are recorded in regulatory assets or regulatory liabilities on the balance sheets until they are reflected in future billings to customers.

Renewable Energy Rider - Effective with the implementation of final rates covering the 2020 forward-looking Test Period, IPL will recover a return of, as well as earn a return on, its 1,000 MW of new wind generation placed in service in 2019 and 2020 from its retail electric customers through a renewable energy rider. Other applicable costs and tax benefits associated with the new wind generation, excluding operation and maintenance expenses, will also be included in the rider. This cost recovery mechanism provides for annual adjustments to electric rates charged to IPL's retail electric customers for actual renewable energy costs and tax benefits. Changes in the under-/over-collection of these costs will be recognized in "Electric utility revenue" in Alliant Energy's income statements. The cumulative effects of the under-/over-collection of these costs for IPL will be recorded in regulatory assets or regulatory liabilities on Alliant Energy's balance sheets until they are reflected in future billings to customers.

NOTE 1(h) Financial Instruments - Financial instruments are periodically used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices and transmission congestion costs. The fair value of those financial instruments that are determined to be derivatives are recorded as assets or liabilities on the balance sheets. Certain commodity purchase and sales contracts qualify for and have been designated under the normal purchase and sale exception and are accounted for on the accrual basis of accounting. Alliant Energy, IPL and WPL have elected to not net the fair value amounts of derivatives subject to a master netting arrangement by counterparty. Alliant Energy, IPL and WPL do not offset fair value amounts recognized for the right to reclaim cash collateral (receivable) or the obligation to return cash collateral (payable) against fair value amounts recognized for derivative instruments that are executed with the same counterparty under the same master netting arrangement. Refer to Note 2 for discussion of the recognition of regulatory assets and regulatory liabilities related to the unrealized losses and gains on derivative instruments. Refer to Notes 15, 16 and 17(f) for further discussion of derivatives and related credit risk.

## NOTE 1(i) Asset Impairments -

Property, Plant and Equipment of Regulated Operations - Property, plant and equipment of regulated operations are reviewed for possible impairment whenever events or changes in circumstances indicate all or a portion of the carrying value of the assets may be disallowed for rate-making purposes. If IPL or WPL are disallowed recovery of any portion of the carrying value of their regulated property, plant and equipment that is under construction, has been recently completed or is probable of abandonment, or conclude it is probable recovery will be disallowed, an impairment charge is recognized equal to the amount of the carrying value that was disallowed or is probable of being disallowed. If IPL or WPL are only allowed a partial return on the carrying value of their regulated property, plant and equipment that is under construction, has been recently completed or is probable of abandonment, or conclude it is probable a full return will not be allowed, an impairment charge is recognized equal to the difference between the carrying value and the present value of the future revenues expected from their regulated property, plant and equipment.

Property, Plant and Equipment of Non-utility Operations - Property, plant and equipment of non-utility operations are reviewed for possible impairment whenever events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Impairment is indicated if the carrying value of an asset exceeds its undiscounted future cash flows. If an impairment is indicated, a charge is recognized equal to the amount the carrying value exceeds the asset's fair value.

Unconsolidated Equity Investments - If events or circumstances indicate the carrying value of investments accounted for under the equity method of accounting exceeds fair value and the decline in value is other than temporary, potential impairment is assessed. If an impairment is indicated, a charge is recognized equal to the amount the carrying value exceeds the investment’s fair value.



NOTE 1(j) Asset Retirement Obligations - The fair value of a legal obligation associated with the retirement of an asset is recorded as a liability when an asset is placed in service, when a legal obligation is subsequently identified or when sufficient information becomes available to determine a reasonable estimate of the fair value of future retirement costs. When an ARO is recorded as a liability, an equivalent amount is added to the asset cost. The fair value of AROs at inception is determined using discounted cash flows analyses. The liability is accreted to its present value and the capitalized cost is depreciated over the useful life of the related asset. Accretion and depreciation expenses related to AROs for IPL's and WPL's regulated operations are recorded to regulatory assets on the balance sheets. Upon regulatory approval to recover IPL's AROs expenditures, its regulatory assets are amortized to depreciation and amortization expenses in Alliant Energy's income statements over the same time period the ARO expenditures are recovered from IPL's customers. WPL's regulatory assets related to AROs are being recovered as a component of depreciation rates pursuant to PSCW and FERC orders. Accretion and depreciation expenses related to AROs for Alliant Energy's non-utility operations are recorded to depreciation and amortization expenses in Alliant Energy's income statements. Upon settlement of the ARO liability, an entity settles the obligation for its recorded amount or incurs a gain or loss. Any gains or losses related to AROs for IPL's and WPL's regulated operations are recorded to regulatory liabilities or regulatory assets on the balance sheets.

NOTE 1(k) Debt Issuance and Retirement Costs - Debt issuance costs and debt premiums or discounts are presented on the balance sheet as a direct adjustment to the carrying amount of the related debt liability, and are deferred and amortized over the expected life of each debt issue, considering maturity dates and, if applicable, redemption rights held by others. Alliant Energy's non-utility businesses and Corporate Services record to interest expense in the period of retirement any unamortized debt issuance costs and debt premiums or discounts on debt retired early.

NOTE 1(l) Allowance for Doubtful Accounts - Allowances for doubtful accounts are recorded for estimated losses resulting from the inability of customers to make required payments. Allowances for doubtful accounts are estimated based on historical write-offs, customer arrears and other economic factors within IPL's and WPL's service territories.

NOTE 1(m) Variable Interest Entities - An entity is considered a VIE if its equity investors do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties, the entity is structured with disproportionate voting rights and substantially all of the entity's activities are conducted on behalf of the investor with disproportionately fewer voting rights, or its equity investors lack any of the following characteristics: (1) power, through voting rights or similar rights, to direct the activities of the entity that most significantly impact the entity's economic performance; (2) the obligation to absorb expected losses of the entity; or (3) the right to receive expected benefits of the entity. The primary beneficiary of a VIE is required to consolidate the VIE. The financial statements do not reflect any consolidation of VIEs.

NOTE 1(n) Leases - The determination of whether an arrangement qualifies as a lease occurs at the inception of the arrangement. Arrangements that qualify as leases are classified as either operating or finance. Operating and finance lease liabilities represent obligations to make payments arising from the lease. Operating and finance lease assets represent the right to use an underlying asset for the lease term and are recognized at the lease commencement date based on the present value of the lease payments over the lease term. Leases with initial terms less than 12 months are not recognized as leases. For operating leases, an incremental borrowing rate, as determined at the lease commencement date, is used to determine the present value of the lease payments. For finance leases, the rate implicit in the lease, if known, is used to determine the present value of the lease payments. Lease terms include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Operating lease expense is recognized on a straight-line basis over the expected lease term. Finance lease expense is comprised of depreciation and interest expenses. Finance lease assets are depreciated on a straight-line basis over the shorter of the useful life of the underlying asset or the lease term.

## NOTE 1(o) New Accounting Standards -

Credit Losses - In June 2016, the FASB issued an accounting standard requiring use of a current expected credit loss model rather than an incurred loss method, which is intended to result in more timely recognition of credit losses on trade receivables and certain other assets. Alliant Energy, IPL and WPL adopted this standard on January 1, 2020 using a modified retrospective method of adoption, which requires cumulative effect adjustments to retained earnings on January 1, 2020. IPL and WPL did not record a cumulative effect adjustment to retained earnings and do not expect a material change to their financial condition or results of operations as a result of adopting this standard. Alliant Energy's non-regulated entities continue to evaluate the final adoption impact for credit loss exposures related to their existing guarantees (described in Note 17(d)); however, Alliant Energy does not expect a material change in its financial condition or results of operations as a result of adopting this standard.

Cloud Computing Arrangements - In August 2018, the FASB issued an accounting standard that clarifies capitalization and presentation requirements of implementation costs incurred in cloud computing arrangements. Alliant Energy, IPL and WPL adopted this standard on January 1, 2020 and do not expect a material change to their financial condition or results of operations as a result of adopting this standard.



Leases - In February 2016, the FASB issued an accounting standard requiring lease assets and lease liabilities, including operating leases, to be recognized on the balance sheet. The accounting for capital leases, referred to as finance leases, remains unchanged with the adoption of this standard. Alliant Energy, IPL and WPL adopted this standard on January 1, 2019 using an optional transition approach and there was no cumulative effect adjustment to the balance sheets as of January 1, 2019. Prior period amounts have not been restated to reflect the adoption of this standard and continue to be reported under the accounting standards in effect for those periods. Upon transition to the new standard, Alliant Energy, IPL and WPL elected the land easement transition practical expedient, which does not require existing land easements that were not previously accounted for as leases under the original accounting standards to be reassessed under the new standard. In addition, Alliant Energy, IPL and WPL evaluated land easements that were previously accounted for as leases and determined that the majority of these land easements relate to joint-use land sites, which under the new standard, do not meet the criteria for leases. Therefore, these land easement arrangements are no longer reflected as operating leases effective January 1, 2019. Refer to Note 10 for further discussion of leases.

## NOTE 2. 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, 2019 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):

<table><tr><td rowspan="2"></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Tax-related</td><td>$817.6</td><td>$820.6</td><td>$776.8</td><td>$783.1</td><td>$40.8</td><td>$37.5</td></tr><tr><td>Pension and OPEB costs</td><td>524.0</td><td>542.3</td><td>262.5</td><td>274.0</td><td>261.5</td><td>268.3</td></tr><tr><td>Assets retired early</td><td>134.0</td><td>111.6</td><td>87.9</td><td>55.4</td><td>46.1</td><td>56.2</td></tr><tr><td>AROs</td><td>111.8</td><td>110.8</td><td>76.2</td><td>76.3</td><td>35.6</td><td>34.5</td></tr><tr><td>IPL&#x27;s DAEC PPA amendment</td><td>108.2</td><td>—</td><td>108.2</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Derivatives</td><td>39.5</td><td>28.0</td><td>18.3</td><td>15.1</td><td>21.2</td><td>12.9</td></tr><tr><td>Emission allowances</td><td>21.1</td><td>23.6</td><td>21.1</td><td>23.6</td><td>—</td><td>—</td></tr><tr><td>Other</td><td>88.5</td><td>100.4</td><td>48.3</td><td>51.5</td><td>40.2</td><td>48.9</td></tr><tr><td></td><td>$1,844.7</td><td>$1,737.3</td><td>$1,399.3</td><td>$1,279.0</td><td>$445.4</td><td>$458.3</td></tr></table>

At December 31, 2019, IPL and WPL had $78 million and $6 million, respectively, of regulatory assets that were not earning a return. IPL's regulatory assets that were not earning a return consisted primarily of certain assets retired early, emission allowances, debt redemption costs and costs for clean air compliance projects. WPL's regulatory assets that were not earning a return consisted primarily of environmental-related costs and costs for future expansion 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.

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 the 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:

<table><tr><td>Entity</td><td>Asset</td><td>Retirement Date</td><td>Regulatory Asset Balance as of Dec. 31, 2019</td><td>Recovery</td><td>Regulatory Approval</td></tr><tr><td>IPL</td><td>Sutherland Units 1 and 3</td><td>2017</td><td>$28.5</td><td>Return of and return on remaining net book value over 10 years (return on effective with new rates expected to be implemented by the end of the first quarter of 2020)</td><td>IUB and FERC</td></tr><tr><td>IPL</td><td>M.L. Kapp Unit 2</td><td>2018</td><td>23.6</td><td>Return of and return on remaining net book value over 10 years</td><td>IUB and FERC</td></tr><tr><td>IPL</td><td>Analog electric meters</td><td>2019</td><td>35.8</td><td>Return of remaining net book value over 10 years (effective with new rates expected to be implemented by the end of the first quarter of 2020)</td><td>IUB</td></tr><tr><td>WPL</td><td>Nelson Dewey Units 1 and 2 and Edgewater Unit 3</td><td>2015</td><td>20.2</td><td>Return of and return on remaining net book value over 10 years</td><td>PSCW and FERC</td></tr><tr><td>WPL</td><td>Edgewater Unit 4</td><td>2018</td><td>25.9</td><td>Return of and return on remaining net book value over 10 years</td><td>PSCW and FERC</td></tr></table>

AROs - Alliant Energy, IPL and WPL believe it is probable that certain differences between expenses accrued for legal 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.

IPL’s DAEC PPA Amendment - In January 2019, IPL incurred an obligation to make a September 2020 buyout payment of $110 million in exchange for shortening the term of IPL’s DAEC nuclear generation PPA by 5 years. The IUB approved recovery of the buyout payment with IPL’s 2020 Test Period retail electric rate review, which will be recovered from IPL’s retail customers over a 5-year period following the payment. The offsetting obligation has been discounted and is recorded in “Other current liabilities” on Alliant Energy’s balance sheets.

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.

Emission allowances - IPL entered into forward contracts in 2007 to purchase sulfur dioxide emission allowances with vintage years of 2014 through 2017 from various counterparties to meet expected future emission reduction standards. Alliant Energy and IPL have recorded a regulatory asset for amounts paid under the forward contracts and are authorized to recover these amounts from its retail customers over a 10-year period.

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

<table><tr><td rowspan="2"></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Tax-related</td><td>$835.6</td><td>$890.6</td><td>$350.9</td><td>$390.1</td><td>$484.7</td><td>$500.5</td></tr><tr><td>Cost of removal obligations</td><td>387.7</td><td>401.2</td><td>257.0</td><td>273.3</td><td>130.7</td><td>127.9</td></tr><tr><td>Electric transmission cost recovery</td><td>88.6</td><td>104.0</td><td>51.3</td><td>47.7</td><td>37.3</td><td>56.3</td></tr><tr><td>Commodity cost recovery</td><td>24.2</td><td>16.8</td><td>8.8</td><td>11.9</td><td>15.4</td><td>4.9</td></tr><tr><td>WPL&#x27;s earnings sharing mechanism</td><td>21.9</td><td>25.4</td><td>—</td><td>—</td><td>21.9</td><td>25.4</td></tr><tr><td>Derivatives</td><td>19.9</td><td>18.5</td><td>17.4</td><td>10.2</td><td>2.5</td><td>8.3</td></tr><tr><td>Other</td><td>45.7</td><td>36.7</td><td>29.3</td><td>21.7</td><td>16.4</td><td>15.0</td></tr><tr><td></td><td>$1,423.6</td><td>$1,493.2</td><td>$714.7</td><td>$754.9</td><td>$708.9</td><td>$738.3</td></tr></table>

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 expended through depreciation rates, reduce rate base. A significant portion of the remaining regulatory liabilities are 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 Federal Tax Reform. 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 legal 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.

Electric transmission cost recovery - Refer to Note 1(g) for details of IPL's and WPL's electric transmission cost recovery mechanisms. Beginning in March 2018, amounts billed by transmission providers decreased due to the impacts from Federal Tax Reform. During 2018, Alliant Energy, IPL and WPL recorded the benefits associated with lower transmission expense as regulatory liabilities. In May 2018, IPL began providing these benefits back to its retail electric customers utilizing the transmission cost rider. WPL is currently reflecting these benefits for its retail electric customers in 2019 and 2020 through transmission expense amortizations as authorized in its retail electric rate review (2019/2020 Test Period).

Commodity cost recovery - Refer to Note 1(g) for details of IPL's and WPL's commodity cost recovery mechanisms.

WPL’s earnings sharing mechanism - Pursuant to PSCW orders, WPL must defer a portion of its earnings if its annual regulatory return on common equity exceeds certain levels during the related test periods. The timing of the refund to customers for the majority of these regulatory liabilities will be determined in a future WPL regulatory proceeding.

## Utility Rate Reviews -

IPL’s Retail Electric Rate Review (2020 Forward-looking Test Period) - In March 2019, IPL filed a request with the IUB to increase annual electric base rates for its Iowa retail electric customers based on a 2020 forward-looking Test Period. The key drivers for IPL’s request included recovery of capital projects, including new wind generation. IPL concurrently filed for interim retail electric rates based on 2018 historical data as adjusted for certain known and measurable changes occurring in the first quarter of 2019. An interim retail electric base rate increase of $90 million, on an annual basis, was implemented effective April 1, 2019. In October 2019, IPL reached a settlement agreement with certain intervenor groups for an annual retail electric base rate increase of $127 million. The agreement includes both the recovery of and a return on IPL’s early retired EGUs, and the recovery of IPL’s retired analog electric meters. In addition, as discussed in Note 1(g), the net impact of certain costs and benefits resulting from IPL’s 1,000 MW expansion of wind generation in 2019 and 2020 will be recovered from its retail electric customers through a new renewable energy rider. The settlement agreement also includes IPL providing retail electric billing credits over a 12-month period beginning with final rates, including $27 million of excess deferred tax benefits and $8 million from a partial refund of interim rates implemented in 2019. In January 2020, the IUB issued an order approving the settlement with final rates, which are expected to be effective by the end of the first quarter of 2020.

IPL’s Retail Gas Rate Review (2020 Forward-looking Test Period) - In March 2019, IPL filed a request with the IUB to increase annual gas base rates for its Iowa retail gas customers based on a 2020 forward-looking Test Period. In October 2019, IPL reached a settlement agreement with intervenor groups for an annual retail gas base rate increase of $12 million. In December 2019, the IUB issued an order approving the settlement with final rates, which were effective January 10, 2020.

IPL’s Retail Electric Rate Review (2016 Test Year) - In April 2017, IPL filed a request with the IUB to increase annual electric base rates for its Iowa retail electric customers based on a 2016 historical Test Year. An interim retail electric base rate increase of $102 million, on an annual basis, was implemented effective April 13, 2017. In September 2017, IPL reached a partial, non-unanimous settlement agreement with intervenor groups for an annual retail electric base rate increase of $130 million. In February 2018, the IUB issued an order approving the settlement with final rates effective May 1, 2018.

WPL’s Retail Electric and Gas Rate Review (2019/2020 Test Period) - In December 2018, the PSCW issued an order approving WPL’s proposed settlement for its retail electric and gas rate review covering the 2019/2020 Test Period, which was based on a stipulated agreement between WPL and intervenor groups. Under the settlement, WPL retail electric and gas base rates will not change from current levels through the end of 2020.



## NOTE 3. PROPERTY, PLANT AND EQUIPMENT

At December 31, details of property, plant and equipment on the balance sheets were as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td></td></tr><tr><td>Utility:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Electric plant:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr></table>

(a) Less accumulated amortization of $88.7 million and $82.8 million for WPL as of December 31, 2019 and 2018, respectively. The Sheboygan Falls Energy Facility is eliminated from WPL upon consolidation and is included in the “Non-utility Generation, net” line within Alliant Energy’s consolidated property, plant and equipment.

(b) Less accumulated depreciation of $58.5 million and $54.5 million for Alliant Energy as of December 31, 2019 and 2018, respectively.

(c) Less accumulated depreciation of $172.4 million and $167.5 million for Alliant Energy as of December 31, 2019 and 2018, respectively.

AFUDC - AFUDC represents costs to finance construction additions, including a return on equity component and cost of debt component as required by regulatory accounting. The concurrent credit for the amount of AFUDC capitalized is recorded as “Allowance for funds used during construction” in the income statements. The amount of AFUDC generated by equity and debt components was as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td></td></tr><tr><td>Equity</td><td>$65.5</td><td>$51.4</td><td>$33.6</td><td>$35.2</td><td>$28.6</td><td>$21.1</td><td>$30.3</td><td>$22.8</td><td>$12.5</td></tr><tr><td>Debt</td><td>27.2</td><td>24.2</td><td>16.1</td><td>14.2</td><td>13.6</td><td>10.3</td><td>13.0</td><td>10.6</td><td>5.8</td></tr><tr><td></td><td>$92.7</td><td>$75.6</td><td>$49.7</td><td>$49.4</td><td>$42.2</td><td>$31.4</td><td>$43.3</td><td>$33.4</td><td>$18.3</td></tr></table>

Non-utility and Other - The non-utility and other property, plant and equipment recorded on Alliant Energy’s balance sheets include the following:

Non-utility Generation - The Sheboygan Falls Energy Facility was placed into service in 2005 and is depreciated using the straight-line method over a 35-year period.

Corporate Services and Other - Property, plant and equipment related to Corporate Services include a customer billing and information system for IPL and WPL and other computer software, and the corporate headquarters building located in Madison, Wisconsin. The customer billing and information system is amortized using the straight-line method over a 12-year period. The majority of the remaining software is amortized over a 5-year period. Other property, plant and equipment include Transportation assets (a short-line railway in Iowa and a barge terminal on the Mississippi River). All Corporate Services and Other property, plant and equipment are depreciated using the straight-line method over periods ranging from 5 to 30 years.



Transportation Acquisitions - In the first quarter of 2019, Alliant Energy, through its wholly-owned non-utility subsidiaries, completed acquisitions of freight management companies located in Cedar Rapids, Iowa and Stoughton, Wisconsin. These acquisitions were purchased for $21 million, including contingent consideration of $8 million, which was paid in January 2020. The purchase price was largely allocated to intangibles and the remainder was allocated to working capital and property.

## NOTE 4. JOINTLY-OWNED ELECTRIC UTILITY PLANT

Under joint ownership agreements with other utilities, IPL and WPL have undivided ownership interests in jointly-owned EGUs. Each of the respective owners is responsible for the financing of its portion of the construction costs. KWh generation and operating expenses are primarily divided between the joint owners on the same basis as ownership. IPL's and WPL's shares of expenses from jointly-owned EGUs are included in the corresponding operating expenses (e.g., electric production fuel, other operation and maintenance, etc.) in the income statements. Information relative to IPL's and WPL's ownership interest in these jointly-owned EGUs at December 31, 2019 was as follows (dollars in millions):

<table><tr><td></td><td>Ownership Interest %</td><td>Electric Plant</td><td>Accumulated Provision for Depreciation</td><td>Construction Work in Progress</td></tr><tr><td>IPL</td><td></td><td></td><td></td><td></td></tr><tr><td>Ottumwa Unit 1</td><td>48.0%</td><td>$571.5</td><td>$180.8</td><td>$18.8</td></tr><tr><td>George Neal Unit 4</td><td>25.7%</td><td>191.8</td><td>93.5</td><td>0.8</td></tr><tr><td>George Neal Unit 3</td><td>28.0%</td><td>163.7</td><td>63.2</td><td>0.9</td></tr><tr><td>Louisa Unit 1</td><td>4.0%</td><td>39.9</td><td>24.9</td><td>0.2</td></tr><tr><td></td><td></td><td>966.9</td><td>362.4</td><td>20.7</td></tr><tr><td>WPL</td><td></td><td></td><td></td><td></td></tr><tr><td>Columbia Units 1-2</td><td>53.3%</td><td>777.0</td><td>264.7</td><td>5.5</td></tr><tr><td>FWEC</td><td>42.6%</td><td>120.2</td><td>43.6</td><td>—</td></tr><tr><td>West Riverside</td><td>91.8%</td><td>—</td><td>—</td><td>647.5</td></tr><tr><td></td><td></td><td>897.2</td><td>308.3</td><td>653.0</td></tr><tr><td>Alliant Energy</td><td></td><td>$1,864.1</td><td>$670.7</td><td>$673.7</td></tr></table>

## NOTE 5. RECEIVABLES

NOTE 5(a) Accounts Receivable - Details for accounts receivable included on the balance sheets as of December 31 were as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Customer</td><td>$91.6</td><td>$91.0</td><td>$—</td><td>$—</td><td>$83.5</td><td>$84.8</td></tr><tr><td>Unbilled utility revenues</td><td>82.1</td><td>74.2</td><td>—</td><td>—</td><td>82.1</td><td>74.2</td></tr><tr><td>Deferred proceeds</td><td>187.7</td><td>119.4</td><td>187.7</td><td>119.4</td><td>—</td><td>—</td></tr><tr><td>Other</td><td>48.0</td><td>76.3</td><td>16.3</td><td>37.2</td><td>31.4</td><td>38.5</td></tr><tr><td>Allowance for doubtful accounts</td><td>(7.3)</td><td>(10.5)</td><td>(1.2)</td><td>(3.1)</td><td>(6.1)</td><td>(7.4)</td></tr><tr><td></td><td>$402.1</td><td>$350.4</td><td>$202.8</td><td>$153.5</td><td>$190.9</td><td>$190.1</td></tr></table>

NOTE 5(b) Sales of Accounts Receivable - IPL maintains a Receivables Agreement whereby it may sell its customer accounts receivables, unbilled revenues and certain other accounts receivables to a third party through wholly-owned and consolidated special purpose entities. The purchase commitment from the third party to which it sells its receivables expires in March 2021. IPL pays a monthly fee to the third party that varies based on interest rates, limits on cash proceeds and cash amounts received from the third party. Deferred proceeds represent IPL's interest in the receivables sold to the third party. At IPL's request, deferred proceeds are paid to IPL from collections of receivables, after paying any required expenses incurred by the third party and the collection agent. Corporate Services acts as collection agent for the third party and receives a fee for collection services. The Receivables Agreement can be terminated by the third party if arrears or write-offs exceed certain levels. The transfers of receivables meet the criteria for sale accounting established by the transfer of financial assets accounting rules. IPL believes that the allowance for doubtful accounts related to its sales of receivables is a reasonable approximation of credit risk of the customers that generated the receivables. Refer to Note 16 for discussion of the fair value of deferred proceeds.



Under the Receivables Agreement, IPL has the right to receive cash proceeds, up to a certain limit, from the third party in exchange for the receivables sold. The limit on cash proceeds fluctuates between $90 million and $110 million. Cash proceeds are used by IPL to meet short-term financing needs, and cannot exceed the current limit or amount of receivables available for sale, whichever is less. As of December 31, 2019, IPL had $83 million of available capacity under its sales of accounts receivable program. IPL's maximum and average outstanding aggregate cash proceeds (based on daily outstanding balances) related to the sales of accounts receivable program were as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Maximum</td><td colspan="3">Average</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Outstanding aggregate cash proceeds</td><td>$108.0</td><td>$116.0</td><td>$112.0</td><td>$35.9</td><td>$53.4</td><td>$62.2</td></tr></table>

As of December 31, the attributes of IPL's receivables sold under the Receivables Agreement were as follows (in millions):

<table><tr><td></td><td>2019</td><td>2018</td></tr><tr><td>Customer accounts receivable</td><td>$124.7</td><td>$140.1</td></tr><tr><td>Unbilled utility revenues</td><td>95.5</td><td>97.1</td></tr><tr><td>Other receivables</td><td>0.9</td><td>0.1</td></tr><tr><td>Receivables sold to third party</td><td>221.1</td><td>237.3</td></tr><tr><td>Less: cash proceeds</td><td>27.0</td><td>108.0</td></tr><tr><td>Deferred proceeds</td><td>194.1</td><td>129.3</td></tr><tr><td>Less: allowance for doubtful accounts</td><td>6.4</td><td>9.9</td></tr><tr><td>Fair value of deferred proceeds</td><td>$187.7</td><td>$119.4</td></tr><tr><td>Outstanding receivables past due</td><td>$26.0</td><td>$35.5</td></tr></table>

Additional attributes of IPL’s receivables sold under the Receivables Agreement were as follows (in millions):

<table><tr><td></td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Collections</td><td>$2,192.8</td><td>$2,076.7</td><td>$1,647.1</td></tr><tr><td>Write-offs, net of recoveries</td><td>19.2</td><td>21.3</td><td>17.7</td></tr></table>

## NOTE 6. INVESTMENTS

Unconsolidated Equity Investments - Alliant Energy’s unconsolidated investments accounted for under the equity method of accounting are as follows (in millions):

<table><tr><td rowspan="2"></td><td rowspan="2">Ownership Interest at December 31, 2019</td><td colspan="2">Carrying Value at December 31,</td><td colspan="3">Equity (Income) / Loss</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>ATC Holdings</td><td>16%, 20%</td><td>$320.1</td><td>$293.6</td><td>($45.3)</td><td>($38.1)</td><td>($42.4)</td></tr><tr><td>Non-utility wind farm in Oklahoma</td><td>50%</td><td>105.3</td><td>105.1</td><td>(5.2)</td><td>(15.6)</td><td>(1.8)</td></tr><tr><td>Other</td><td>Various</td><td>32.9</td><td>22.6</td><td>(2.5)</td><td>(0.9)</td><td>(0.6)</td></tr><tr><td></td><td></td><td>$458.3</td><td>$421.3</td><td>($53.0)</td><td>($54.6)</td><td>($44.8)</td></tr></table>

ATC Holdings - As of December 31, 2019, Alliant Energy has a 16% ownership interest in ATC and a 20% ownership interest in ATC Holdco LLC, collectively referred to as ATC Holdings. ATC is an independent, for-profit, transmission-only company. ATC Holdco LLC holds Duke-American Transmission Company, LLC, a joint venture between Duke Energy Corporation and ATC, that owns electric transmission infrastructure in North America.

Non-utility Wind Farm in Oklahoma - The non-utility wind farm located in Oklahoma provides electricity to a third-party under a long-term PPA, and has both cash and tax equity ownership. The equity income recognized in 2018 was primarily related to the impacts of Federal Tax Reform. The liquidation method utilized to recognize Alliant Energy's share of the wind farm's earnings includes utilizing the federal income tax rate in effect as of the end of the measurement period. The lower federal income tax rate effective as of January 1, 2018 resulted in an acceleration of earnings attributable to Alliant Energy's interest in the Oklahoma wind farm. This increase in earnings is expected to reverse over time. Alliant Energy does not maintain or operate the wind farm, and provided a parent guarantee of its subsidiary's indemnification obligations under the operating agreement and PPA. Refer to Note 17(d) for discussion of the guarantee.



## NOTE 7. COMMON EQUITY

Common Share Activity - A summary of Alliant Energy’s common stock activity was as follows:

<table><tr><td></td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Shares outstanding, January 1</td><td>236,063,279</td><td>231,348,646</td><td>227,673,654</td></tr><tr><td>Equity forward agreements</td><td>8,358,973</td><td>—</td><td>—</td></tr><tr><td>At-the-market offering programs</td><td>—</td><td>4,171,013</td><td>3,074,931</td></tr><tr><td>Shareowner Direct Plan</td><td>501,808</td><td>576,965</td><td>640,723</td></tr><tr><td>Equity-based compensation plans</td><td>101,478</td><td>5,078</td><td>5,185</td></tr><tr><td>Other</td><td>(2,738)</td><td>(38,423)</td><td>(45,847)</td></tr><tr><td>Shares outstanding, December 31</td><td>245,022,800</td><td>236,063,279</td><td>231,348,646</td></tr></table>

At December 31, 2019, Alliant Energy had a total of 12.1 million shares available for issuance in the aggregate, pursuant to its Amended and Restated OIP, Shareowner Direct Plan and 401(k) Savings Plan.

Equity Forward Agreements - In December 2018, Alliant Energy entered into forward sale agreements with various counterparties in connection with a public offering of 8,358,973 shares of Alliant Energy common stock. In 2019, Alliant Energy settled $366 million under the forward sale agreements by delivering 8,358,973 shares of newly issued Alliant Energy common stock at a weighted average forward sale price of $43.75 per share. Alliant Energy used the net proceeds from the settlements for general corporate purposes.

In November 2019, Alliant Energy entered into forward sale agreements with a counterparty in connection with a public offering of 4,275,127 shares of Alliant Energy common stock. In the forward sale transaction, the counterparty, or its affiliates, borrowed an aggregate of 4,275,127 shares of Alliant Energy common stock from third parties and sold such shares to the related underwriter. Alliant Energy has not yet received any proceeds from this offering and no amounts have been or will be recorded in equity on Alliant Energy's balance sheets until the forward sale agreements settle. Alliant Energy expects to settle the forward sale agreements prior to December 31, 2020 through physical delivery of shares of common stock in exchange for cash proceeds at the then-applicable forward sale price; however, Alliant Energy may elect cash settlement or net share settlement for all or a portion of the obligations under the forward sale agreements. The initial forward sale price of $52.235 per share, is subject to daily adjustment based on a floating interest rate factor, and will decrease by other fixed amounts specified in the forward sale agreement.

Alliant Energy has concluded that the forward sale agreements meet the derivative scope exception for certain contracts involving an entity’s own equity. Until settlement of the forward sale agreements, Alliant Energy’s EPS dilution resulting from the agreements, if any, is determined using the treasury stock method. Share dilution occurs when the average market price of Alliant Energy stock during the reporting period is higher than the forward sale price as of the end of the reporting period. As of December 31, 2019, 67,689 incremental shares were included in the calculation of diluted EPS related to the securities under the forward sale agreements.

At-the-Market Offering Programs - In 2018 and 2017, Alliant Energy filed prospectus supplements under which it could sell up to $175 million and $125 million of its common stock, respectively, through at-the-market offering programs. In 2018, Alliant Energy issued 4,171,013 shares of common stock through this program and received cash proceeds of $173 million, net of $2 million in commissions and fees. In 2017, Alliant Energy issued 3,074,931 shares of common stock through this program and received cash proceeds of $124 million, net of $1 million in commissions and fees. The 2017 and 2018 at-the-market offering programs have expired.

Shareowner Direct Plan - Alliant Energy satisfies its requirements under the Shareowner Direct Plan (dividend reinvestment and stock purchase plan) by acquiring Alliant Energy common stock through original issue, rather than on the open market.

Comprehensive Income (Loss) - In 2019, 2018 and 2017, Alliant Energy’s other comprehensive income (loss) was ($0.4) million, $2.2 million and ($0.1) million, respectively; therefore, its comprehensive income was substantially equal to its net income and its comprehensive income attributable to Alliant Energy common shareowners was substantially equal to its net income attributable to Alliant Energy common shareowners for such periods.



## NOTE 8. PREFERRED STOCK

IPL is authorized to issue up to 16,000,000 shares of cumulative preferred stock in aggregate. Information related to the carrying value of IPL's cumulative preferred stock at December 31 was as follows:

<table><tr><td>Series</td><td>Liquidation Preference/Stated Value</td><td>Shares Authorized</td><td>Shares Outstanding</td><td>2019</td><td>2018</td></tr><tr><td></td><td></td><td></td><td></td><td colspan="2">(in millions)</td></tr><tr><td>5.1%</td><td>$25</td><td>8,000,000</td><td>8,000,000</td><td>$200.0</td><td>$200.0</td></tr></table>

IPL may, at its option, redeem the 5.1% cumulative preferred stock for cash at a redemption price of $25 per share plus accrued and unpaid dividends up to the redemption date. The current articles of incorporation of IPL contain a provision that grants the holders of its cumulative preferred stock voting rights to elect two members of IPL's Board of Directors if preferred dividends equal to six or more quarterly dividend requirements (whether or not consecutive) are in arrears. Such voting rights would not provide the holders of IPL's preferred stock control of the Board of Directors and could not force IPL to redeem its preferred stock.

## NOTE 9. DEBT

NOTE 9(a) Short-term Debt - Alliant Energy and its subsidiaries maintain committed bank lines of credit to provide short-term borrowing flexibility and back-stop liquidity for commercial paper outstanding. At December 31, 2019, the short-term borrowing capacity under a single credit facility agreement, which expires in August 2023, totaled $1 billion ($450 million for Alliant Energy at the parent company level, $250 million for IPL and $300 million for WPL). Subject to certain conditions, Alliant Energy (at the parent company level), IPL and WPL may each reallocate and change its sublimit up to $500 million, $400 million and $500 million, respectively, within the $1 billion total commitment. Information regarding commercial paper classified as short-term debt and back-stopped by the credit facility was as follows (dollars in millions):

<table><tr><td></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>December 31</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Commercial paper outstanding</td><td>$337.4</td><td>$441.2</td><td>$—</td><td>$50.4</td><td>$168.2</td><td>$105.5</td></tr><tr><td>Commercial paper weighted average interest rates</td><td>1.9%</td><td>2.8%</td><td>N/A</td><td>2.8%</td><td>1.8%</td><td>2.5%</td></tr><tr><td>Available credit facility capacity</td><td>$662.6</td><td>$558.8</td><td>$250.0</td><td>$199.6</td><td>$131.8</td><td>$244.5</td></tr></table>

<table><tr><td>For the year ended</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Maximum amount outstanding (based on daily outstanding balances)</td><td>$600.6</td><td>$446.5</td><td>$50.4</td><td>$50.4</td><td>$195.1</td><td>$126.0</td></tr><tr><td>Average amount outstanding (based on daily outstanding balances)</td><td>$453.5</td><td>$221.4</td><td>$0.1</td><td>$1.5</td><td>$92.6</td><td>$36.6</td></tr><tr><td>Weighted average interest rates</td><td>2.5%</td><td>2.2%</td><td>2.8%</td><td>2.3%</td><td>2.4%</td><td>2.1%</td></tr></table>

Financial Covenants - The single credit facility agreement contains a financial covenant, which requires Alliant Energy, IPL and WPL to maintain certain debt-to-capital ratios in order to borrow under the credit facility. AEF's term loan credit agreement contains a financial covenant, which requires Alliant Energy to maintain a certain debt-to-capital ratio in order to borrow under the term loan credit agreement. The required debt-to-capital ratios compared to the actual debt-to-capital ratios at December 31, 2019 were as follows:

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Requirement, not to exceed</td><td>65%</td><td>65%</td><td>65%</td></tr><tr><td>Actual</td><td>55%</td><td>48%</td><td>48%</td></tr></table>

The debt component of the capital ratios includes, when applicable, long- and short-term debt (excluding non-recourse debt and hybrid securities to the extent the total carrying value of such hybrid securities does not exceed 15% of consolidated capital of the applicable borrower), finance lease obligations, certain letters of credit, guarantees of the foregoing and new synthetic leases. Unfunded vested benefits under qualified pension plans and sales of accounts receivable are not included in the debt-to-capital ratios. The equity component of the capital ratios excludes accumulated other comprehensive income (loss).



## NOTE 9(b) Long-Term Debt - Long-term debt, net as of December 31 was as follows (dollars in millions):

<table><tr><td rowspan="2"></td><td colspan="4">2019</td><td colspan="4">2018</td></tr><tr><td>Alliant Energy</td><td>IPL</td><td>WPL</td><td>Alliant Energy</td><td>IPL</td><td>WPL</td><td></td><td></td></tr><tr><td>Senior Debentures (a):</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>3.65%, due 2020</td><td>$200.0</td><td>$200.0</td><td>$—</td><td>$200.0</td><td>$200.0</td><td>$—</td><td></td><td></td></tr><tr><td>3.25%, due 2024</td><td>500.0</td><td>500.0</td><td>—</td><td>500.0</td><td>500.0</td><td>—</td><td></td><td></td></tr><tr><td>3.4%, due 2025</td><td>250.0</td><td>250.0</td><td>—</td><td>250.0</td><td>250.0</td><td>—</td><td></td><td></td></tr><tr><td>5.5%, due 2025</td><td>50.0</td><td>50.0</td><td>—</td><td>50.0</td><td>50.0</td><td>—</td><td></td><td></td></tr><tr><td>4.1%, due 2028</td><td>500.0</td><td>500.0</td><td>—</td><td>500.0</td><td>500.0</td><td>—</td><td></td><td></td></tr><tr><td>3.6%, due 2029 (b)</td><td>300.0</td><td>300.0</td><td>—</td><td>—</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>6.45%, due 2033</td><td>100.0</td><td>100.0</td><td>—</td><td>100.0</td><td>100.0</td><td>—</td><td></td><td></td></tr><tr><td>6.3%, due 2034</td><td>125.0</td><td>125.0</td><td>—</td><td>125.0</td><td>125.0</td><td>—</td><td></td><td></td></tr><tr><td>6.25%, due 2039</td><td>300.0</td><td>300.0</td><td>—</td><td>300.0</td><td>300.0</td><td>—</td><td></td><td></td></tr><tr><td>4.7%, due 2043</td><td>250.0</td><td>250.0</td><td>—</td><td>250.0</td><td>250.0</td><td>—</td><td></td><td></td></tr><tr><td>3.7%, due 2046</td><td>300.0</td><td>300.0</td><td>—</td><td>300.0</td><td>300.0</td><td>—</td><td></td><td></td></tr><tr><td>3.5%, due 2049 (b)</td><td>300.0</td><td>300.0</td><td>—</td><td>—</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td></td><td>3,175.0</td><td>3,175.0</td><td>—</td><td>2,575.0</td><td>2,575.0</td><td>—</td><td></td><td></td></tr><tr><td>Debentures (a):</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>4.6%, due 2020</td><td>150.0</td><td>—</td><td>150.0</td><td>150.0</td><td>—</td><td>150.0</td><td></td><td></td></tr><tr><td>2.25%, due 2022</td><td>250.0</td><td>—</td><td>250.0</td><td>250.0</td><td>—</td><td>250.0</td><td></td><td></td></tr><tr><td>3.05%, due 2027</td><td>300.0</td><td>—</td><td>300.0</td><td>300.0</td><td>—</td><td>300.0</td><td></td><td></td></tr><tr><td>3%, due 2029 (c)</td><td>350.0</td><td>—</td><td>350.0</td><td>—</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>6.25%, due 2034</td><td>100.0</td><td>—</td><td>100.0</td><td>100.0</td><td>—</td><td>100.0</td><td></td><td></td></tr><tr><td>6.375%, due 2037</td><td>300.0</td><td>—</td><td>300.0</td><td>300.0</td><td>—</td><td>300.0</td><td></td><td></td></tr><tr><td>7.6%, due 2038</td><td>250.0</td><td>—</td><td>250.0</td><td>250.0</td><td>—</td><td>250.0</td><td></td><td></td></tr><tr><td>4.1%, due 2044</td><td>250.0</td><td>—</td><td>250.0</td><td>250.0</td><td>—</td><td>250.0</td><td></td><td></td></tr><tr><td>5% (Retired in 2019)</td><td>—</td><td>—</td><td>—</td><td>250.0</td><td>—</td><td>250.0</td><td></td><td></td></tr><tr><td></td><td>1,950.0</td><td>—</td><td>1,950.0</td><td>1,850.0</td><td>—</td><td>1,850.0</td><td></td><td></td></tr><tr><td>Other:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>AEF term loan credit agreement through April 2020, 2% at December 31, 2019 (with Alliant Energy as guarantor)</td><td>300.0</td><td>—</td><td>—</td><td>300.0</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>Corporate Services 3.45% senior notes, due 2022 (a)</td><td>75.0</td><td>—</td><td>—</td><td>75.0</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>AEF 3.75% senior notes, due 2023 (with Alliant Energy as guarantor) (a)</td><td>400.0</td><td>—</td><td>—</td><td>400.0</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>AEF 4.25% senior notes, due 2028 (with Alliant Energy as guarantor) (a)</td><td>300.0</td><td>—</td><td>—</td><td>300.0</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>Sheboygan Power, LLC 5.06% senior secured notes, due 2020 to 2024 (secured by the Sheboygan Falls Energy Facility and related assets) (a)</td><td>38.2</td><td>—</td><td>—</td><td>44.3</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>Other, 1% at December 31, 2019, due 2020 to 2025</td><td>2.1</td><td>—</td><td>—</td><td>2.4</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td></td><td>1,115.3</td><td>—</td><td>—</td><td>1,121.7</td><td>—</td><td>—</td><td></td><td></td></tr><tr><td>Subtotal</td><td>6,240.3</td><td>3,175.0</td><td>1,950.0</td><td>5,546.7</td><td>2,575.0</td><td>1,850.0</td><td></td><td></td></tr><tr><td>Current maturities</td><td>(657.2)</td><td>(200.0)</td><td>(150.0)</td><td>(256.5)</td><td>—</td><td>(250.0)</td><td></td><td></td></tr><tr><td>Unamortized debt issuance costs</td><td>(36.9)</td><td>(21.0)</td><td>(11.3)</td><td>(32.1)</td><td>(17.2)</td><td>(9.6)</td><td></td><td></td></tr><tr><td>Unamortized debt (discount) and premium, net</td><td>(13.2)</td><td>(6.7)</td><td>(6.0)</td><td>(11.8)</td><td>(5.5)</td><td>(5.5)</td><td></td><td></td></tr><tr><td>Long-term debt, net (d)</td><td>$55,533.0</td><td>$2,947.3</td><td>$1,782.7</td><td>$5,246.3</td><td>$2,552.3</td><td>$1,584.9</td><td></td><td></td></tr></table>

(a) Contains optional redemption provisions which, if elected by the issuer at its sole discretion, could require material redemption premium payments by the issuer. The redemption premium payments under these optional redemption provisions are variable and dependent on applicable U.S. Treasury rates at the time of redemption.

(b) In April 2019, IPL issued $300 million of 3.6% senior debentures due 2029. In September 2019, IPL issued $300 million of 3.5% senior debentures due 2049. The senior debentures were issued as green bonds, and all of the net proceeds were allocated for the construction and development of IPL's wind projects.

(c) In June 2019, WPL issued $350 million of 3% debentures due 2029. The net proceeds from the issuance were used by WPL to reduce its outstanding commercial paper and retire its $250 million 5% debentures that matured in July 2019.

(d) There were no significant sinking fund requirements related to the outstanding long-term debt.



Five-Year Schedule of Long-term Debt Maturities - At December 31, 2019, long-term debt maturities for 2020 through 2024 were as follows (in millions):

<table><tr><td></td><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>2024</td></tr><tr><td>IPL</td><td>$200</td><td>$—</td><td>$—</td><td>$—</td><td>$500</td></tr><tr><td>WPL</td><td>150</td><td>—</td><td>250</td><td>—</td><td>—</td></tr><tr><td>Corporate Services</td><td>—</td><td>—</td><td>75</td><td>—</td><td>—</td></tr><tr><td>AEF</td><td>307</td><td>8</td><td>8</td><td>408</td><td>9</td></tr><tr><td>Alliant Energy</td><td>$657</td><td>$8</td><td>$333</td><td>$408</td><td>$509</td></tr></table>

Fair Value of Long-term Debt - Refer to Note 16 for information on the fair value of long-term debt outstanding.

## NOTE 10. LEASES

Operating Leases - Alliant Energy’s, IPL’s and WPL’s operating leases primarily include leases of space on telecommunication towers and leases of property. Operating lease details are as follows (dollars in millions):

<table><tr><td rowspan="2"></td><td colspan="3">December 31, 2019</td></tr><tr><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Property, plant and equipment, net</td><td>$16</td><td>$10</td><td>$6</td></tr><tr><td>Other current liabilities</td><td>$2</td><td>$1</td><td>$1</td></tr><tr><td>Other liabilities</td><td>14</td><td>9</td><td>5</td></tr><tr><td>Total operating lease liabilities</td><td>$16</td><td>$10</td><td>$6</td></tr><tr><td>Weighted average remaining lease term</td><td>11 years</td><td>12 years</td><td>10 years</td></tr><tr><td>Weighted average discount rate</td><td>4%</td><td>4%</td><td>4%</td></tr><tr><td rowspan="2"></td><td colspan="3">2019</td></tr><tr><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Operating lease cost</td><td>$2</td><td>$1</td><td>$1</td></tr></table>

Expected Maturities - As of December 31, 2019, expected maturities of lease liabilities were as follows (in millions):

<table><tr><td></td><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>2024</td><td>Thereafter</td><td>Total</td><td>Less: amount representing interest</td><td>Present value of minimum lease payments</td></tr><tr><td>Operating Leases:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Alliant Energy</td><td>$2</td><td>$2</td><td>$2</td><td>$2</td><td>$2</td><td>$10</td><td>$20</td><td>$4</td><td>$16</td></tr><tr><td>IPL</td><td>1</td><td>1</td><td>1</td><td>1</td><td>1</td><td>7</td><td>12</td><td>2</td><td>10</td></tr><tr><td>WPL</td><td>1</td><td>1</td><td>1</td><td>1</td><td>1</td><td>3</td><td>8</td><td>2</td><td>6</td></tr></table>

Prior period amounts have not been restated to reflect the adoption of the new lease accounting standard and continue to be reported under the accounting standards in effect for those periods. As of December 31, 2018, future minimum operating (excluding contingent rentals) lease payments were as follows (in millions):

<table><tr><td></td><td>2019</td><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>Thereafter</td><td>Total</td></tr><tr><td>Operating Leases:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Alliant Energy</td><td>$5</td><td>$5</td><td>$3</td><td>$3</td><td>$2</td><td>$12</td><td>$30</td></tr><tr><td>IPL</td><td>3</td><td>2</td><td>2</td><td>2</td><td>2</td><td>12</td><td>23</td></tr><tr><td>WPL</td><td>2</td><td>3</td><td>1</td><td>—</td><td>—</td><td>—</td><td>6</td></tr></table>

## NOTE 11. REVENUES

Revenues from Alliant Energy’s, IPL’s and WPL’s utility businesses are primarily from electric and gas sales provided to customers based on approved tariffs or specific contracts with customers. IPL’s and WPL’s primary performance obligations under such arrangements are to deliver electricity and gas, and their customers simultaneously receive and consume the electricity and gas. For such arrangements, revenues are recognized equivalent to the value of the electricity or gas supplied during each period, including amounts billed during each period and changes in amounts estimated to be billed at the end of each period. IPL and WPL apply the right to invoice method to measure progress towards completing performance obligations to transfer electricity and gas to their customers.



IPL provides retail electric and gas service to customers in Iowa, and WPL provides retail and wholesale electric and retail gas service to customers in Wisconsin. IPL also sells electricity to wholesale customers in Minnesota, Illinois and Iowa, as well as steam from its Prairie Creek Generating Station to high-pressure steam customers in Iowa.

IPL’s and WPL’s retail electric and gas revenues include sales to residential, commercial and industrial customers. IPL’s and WPL’s retail electric and gas customer prices are based on IPL’s and WPL’s cost of service and are determined through general rate review proceedings and various tariff filings with the IUB and PSCW, respectively. Such tariff-based services provide electricity or gas to customers without a defined contractual term.

IPL and WPL have wholesale electric market-based rate authority from FERC allowing them to participate in wholesale energy markets (e.g. MISO) and transact directly with third parties. This authority from FERC allows sales of electricity referred to as bulk power sales based on current market values. FERC also allows IPL and WPL to enter into power supply agreements with municipalities and rural electric cooperatives with defined contractual terms, which include standard pricing mechanisms that are detailed in current tariffs accepted by FERC through wholesale rate review proceedings.

Revenues from Alliant Energy’s non-utility business customers are primarily from its Transportation business, which includes a short-line railway that provides freight service; a barge terminal and hauling services on the Mississippi River; customized supply chain solution capabilities; freight and logistics brokering services; and other transfer and storage services.

Disaggregation of revenues from contracts with customers, which correlates to revenues for each reportable segment, was as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2 017</td></tr><tr><td>Electric Utility:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Retail - residential</td><td>$1,092.4</td><td>$1,063.4</td><td>$1,006.2</td><td>$601.5</td><td>$590.6</td><td>$535.6</td><td>$490.9</td><td>$472.8</td><td>$470.6</td></tr><tr><td>Retail - commercial</td><td>769.7</td><td>735.6</td><td>710.3</td><td>510.3</td><td>486.8</td><td>452.7</td><td>259.4</td><td>248.8</td><td>257.6</td></tr><tr><td>Retail - industrial</td><td>889.1</td><td>888.8</td><td>853.1</td><td>503.9</td><td>500.8</td><td>459.7</td><td>385.2</td><td>388.0</td><td>393.4</td></tr><tr><td>Wholesale</td><td>176.4</td><td>188.4</td><td>238.4</td><td>63.5</td><td>71.2</td><td>95.5</td><td>112.9</td><td>117.2</td><td>142.9</td></tr><tr><td>Bulk power and other</td><td>136.0</td><td>124.1</td><td>86.7</td><td>102.0</td><td>81.7</td><td>55.4</td><td>34.0</td><td>42.4</td><td>31.3</td></tr><tr><td>Total Electric Utility</td><td>3,063.6</td><td>3,000.3</td><td>2,894.7</td><td>1,781.2</td><td>1,731.1</td><td>1,598.9</td><td>1,282.4</td><td>1,269.2</td><td>1,295.8</td></tr><tr><td>Gas Utility:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Retail - residential</td><td>259.4</td><td>254.4</td><td>224.7</td><td>149.3</td><td>152.3</td><td>123.2</td><td>110.1</td><td>102.1</td><td>101.5</td></tr><tr><td>Retail - commercial</td><td>133.0</td><td>133.0</td><td>123.2</td><td>74.9</td><td>75.9</td><td>67.9</td><td>58.1</td><td>57.1</td><td>55.3</td></tr><tr><td>Retail - industrial</td><td>16.0</td><td>14.9</td><td>16.7</td><td>11.7</td><td>10.2</td><td>11.1</td><td>4.3</td><td>4.7</td><td>5.6</td></tr><tr><td>Transportation/other</td><td>46.8</td><td>44.3</td><td>36.3</td><td>28.3</td><td>27.8</td><td>23.8</td><td>18.5</td><td>16.5</td><td>12.5</td></tr><tr><td>Total Gas Utility</td><td>455.2</td><td>446.6</td><td>400.9</td><td>264.2</td><td>266.2</td><td>226.0</td><td>191.0</td><td>180.4</td><td>174.9</td></tr><tr><td>Other Utility:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Steam</td><td>37.2</td><td>35.2</td><td>34.6</td><td>37.2</td><td>35.2</td><td>34.6</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Other utility</td><td>9.3</td><td>12.8</td><td>12.9</td><td>7.0</td><td>9.8</td><td>10.8</td><td>2.3</td><td>3.0</td><td>2.1</td></tr><tr><td>Total Other Utility</td><td>46.5</td><td>48.0</td><td>47.5</td><td>44.2</td><td>45.0</td><td>45.4</td><td>2.3</td><td>3.0</td><td>2.1</td></tr><tr><td>Non-Utility and Other:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Transportation and other</td><td>82.4</td><td>39.6</td><td>39.1</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Total Non-Utility and Other</td><td>82.4</td><td>39.6</td><td>39.1</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Total revenues</td><td>$3,647.7</td><td>$3,534.5</td><td>$3,382.2</td><td>$2,089.6</td><td>$2,042.3</td><td>$1,870.3</td><td>$1,475.7</td><td>$1,452.6</td><td>$1,472.8</td></tr></table>



## NOTE 12. INCOME TAXES

Income Tax Expense (Benefit) - The components of “Income tax expense (benefit)” in the income statements were as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>217</td></tr><tr><td>Current tax expense (benefit):</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Federal</td><td>($6.6)</td><td>($1.0)</td><td>($41.0)</td><td>($11.0)</td><td>$14.9</td><td>($27.9)</td><td>$12.0</td><td>($9.2)</td><td>$5.5</td></tr><tr><td>State</td><td>24.2</td><td>(5.1)</td><td>8.5</td><td>24.3</td><td>(7.1)</td><td>1.6</td><td>13.7</td><td>(4.4)</td><td>2.5</td></tr><tr><td>IPL&#x27;s tax benefit riders</td><td>(4.5)</td><td>(13.2)</td><td>(40.4)</td><td>(4.5)</td><td>(13.2)</td><td>(40. 4)</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Deferred tax expense (benefit):</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Federal</td><td>69.7</td><td>67.9</td><td>159.5</td><td>26.4</td><td>9.5</td><td>72.5</td><td>30.7</td><td>43.8</td><td>55.0</td></tr><tr><td>State</td><td>41.4</td><td>29.8</td><td>12.3</td><td>30.9</td><td>7.3</td><td>(2.2)</td><td>6.3</td><td>22.1</td><td>16.6</td></tr><tr><td>Production tax credits</td><td>(54.7)</td><td>(29.5)</td><td>(31.1)</td><td>(41.8)</td><td>(14.0)</td><td>(14.1)</td><td>(12.8)</td><td>(15.5)</td><td>(17.0)</td></tr><tr><td>Investment tax credits</td><td>(0.8)</td><td>(1.2)</td><td>(1.1)</td><td>(0.2)</td><td>(0.6)</td><td>(0.4)</td><td>(0.6)</td><td>(0.6)</td><td>(0.7)</td></tr><tr><td></td><td>$68.7</td><td>$47.7</td><td>$66.7</td><td>$24.1</td><td>($3.2)</td><td>($10.9)</td><td>$49.3</td><td>$36.2</td><td>$61.9</td></tr></table>

Income Tax Rates - The overall income tax rates shown in the following table were computed by dividing income tax expense (benefit) by income from continuing operations before income taxes.

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>217</td></tr><tr><td>Statutory federal income tax rate</td><td>21.0%</td><td>21.0%</td><td>35.0%</td><td>21.0%</td><td>21.0%</td><td>35.0%</td><td>210%</td><td>21.0%</td><td>35.0%</td></tr><tr><td>State income taxes, net of federal benefits</td><td>6.8</td><td>7.0</td><td>5.5</td><td>8.5</td><td>7.7</td><td>6.5</td><td>6.2</td><td>6.2</td><td>5.1</td></tr><tr><td>Production tax credits</td><td>(8.6)</td><td>(5.2)</td><td>(6.1)</td><td>(13.1)</td><td>(5.2)</td><td>(6.7)</td><td>(4.5)</td><td>(6.4)</td><td>(7.1)</td></tr><tr><td>Effect of rate-making on property-related differences</td><td>(6.1)</td><td>(7.6)</td><td>(8.5)</td><td>(9.8)</td><td>(14.0)</td><td>(19.1)</td><td>(2.7)</td><td>(2.3)</td><td>(1.7)</td></tr><tr><td>Amortization of excess deferred taxes</td><td>(1.0)</td><td>(0.3)</td><td>(0.1)</td><td>(0.3)</td><td>—</td><td>(0.1)</td><td>(1.8)</td><td>(0.2)</td><td>(0.1)</td></tr><tr><td>IPL&#x27;s tax benefit riders</td><td>(0.7)</td><td>(2.3)</td><td>(7.6)</td><td>(1.4)</td><td>(4.9)</td><td>(18.7)</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Adjustment for prior period taxes</td><td>0.6</td><td>(2.3)</td><td>(1.5)</td><td>3.1</td><td>(4.8)</td><td>(3.4)</td><td>(0.3)</td><td>(0.2)</td><td>—</td></tr><tr><td>Federal Tax Reform adjustments</td><td>—</td><td>(1.0)</td><td>(3.4)</td><td>—</td><td>(0.4)</td><td>1.7</td><td>—</td><td>(2.3)</td><td>(5.8)</td></tr><tr><td>Other items, net</td><td>(1.2)</td><td>(0.9)</td><td>(0.8)</td><td>(0.4)</td><td>(0.6)</td><td>(0.2)</td><td>(0.4)</td><td>(1.0)</td><td>(0.5)</td></tr><tr><td>Overall income tax rate</td><td>10.8%</td><td>8.4%</td><td>12.5%</td><td>7.6%</td><td>(1.2%)</td><td>(5.0%)</td><td>17.5%</td><td>14.8%</td><td>24.9%</td></tr></table>

Deferred Tax Assets and Liabilities - The deferred tax assets and liabilities included on the balance sheets at December 31 arise from the following temporary differences (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>217</td><td>217</td></tr><tr><td>Deferred tax liabilities:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Property</td><td>$2,021.5</td><td>$1,975.5</td><td>$1,183.5</td><td>$1,158.4</td><td>$770.0</td><td>$735.2</td><td></td><td></td><td></td></tr><tr><td>ATC Holdings</td><td>110.8</td><td>102.4</td><td>—</td><td>—</td><td>—</td><td>—</td><td></td><td></td><td></td></tr><tr><td>Other</td><td>85.1</td><td>80.5</td><td>76.5</td><td>69.4</td><td>32.1</td><td>34.4</td><td></td><td></td><td></td></tr><tr><td>Total deferred tax liabilities</td><td>2,217.4</td><td>2,158.4</td><td>1,260.0</td><td>1,227.8</td><td>802.1</td><td>769.6</td><td></td><td></td><td></td></tr><tr><td>Deferred tax assets:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Federal credit carryforwards</td><td>355.4</td><td>299.1</td><td>175.0</td><td>133.2</td><td>160.3</td><td>147.4</td><td></td><td></td><td></td></tr><tr><td>Net operating losses carryforwards - federal</td><td>60.5</td><td>158.6</td><td>56.3</td><td>114.1</td><td>0.5</td><td>26.4</td><td></td><td></td><td></td></tr><tr><td>Net operating losses carryforwards - state</td><td>36.6</td><td>47.0</td><td>0.6</td><td>0.9</td><td>0.1</td><td>0.5</td><td></td><td></td><td></td></tr><tr><td>Other</td><td>60.5</td><td>59.8</td><td>20.6</td><td>22.8</td><td>15.8</td><td>14.1</td><td></td><td></td><td></td></tr><tr><td>Subtotal deferred tax assets</td><td>513.0</td><td>564.5</td><td>252.5</td><td>271.0</td><td>176.7</td><td>188.4</td><td></td><td></td><td></td></tr><tr><td>Valuation allowances</td><td>(9.6)</td><td>(9.2)</td><td>(0.5)</td><td>(0.5)</td><td>(0.8)</td><td>(0.8)</td><td></td><td></td><td></td></tr><tr><td>Total deferred tax assets</td><td>503.4</td><td>555.3</td><td>252.0</td><td>270.5</td><td>175.9</td><td>187.6</td><td></td><td></td><td></td></tr><tr><td>Total deferred tax liabilities, net</td><td>$1,714.0</td><td>$1,603.1</td><td>$1,008.0</td><td>$957.3</td><td>$626.2</td><td>$582.0</td><td></td><td></td><td></td></tr></table>



Carryforwards - At December 31, 2019, carryforwards and expiration dates were estimated as follows (in millions):

<table><tr><td></td><td>Range of Expiration Dates</td><td>Alliant Energy</td><td>IPL</td><td>WPL</td></tr><tr><td>Federal net operating losses</td><td>2037</td><td>$297</td><td>$276</td><td>$2</td></tr><tr><td>State net operating losses</td><td>2020-2039</td><td>615</td><td>9</td><td>2</td></tr><tr><td>Federal tax credits</td><td>2022-2039</td><td>355</td><td>175</td><td>160</td></tr></table>

Valuation Allowances - Due to the anticipated future reductions in revenues from utility customers due to Federal Tax Reform, Alliant Energy expects its federal net operating losses carryforwards will not be fully utilized until 2024. Because taxable income must be reduced by federal net operating losses carryforwards prior to utilizing federal tax credit carryforwards, Alliant Energy currently does not expect to utilize 2002 and 2003 vintage federal credit carryforwards prior to their expiration in 2022 and 2023, respectively. As a result, Alliant Energy established valuation allowances for the 2002 and 2003 vintage federal credit carryforwards in 2017 that remain as of December 31, 2019.

Uncertain Tax Positions - At December 31, 2019, 2018 and 2017, there were no uncertain tax positions or penalties accrued related to uncertain tax positions. As of December 31, 2019, no material changes to unrecognized tax benefits are expected during the next 12 months.

Open tax years - Tax years that remain subject to the statute of limitations in the major jurisdictions for each of Alliant Energy, IPL and WPL are as follows:

<table><tr><td>Consolidated federal income tax returns (a)</td><td>2016 - 2018</td></tr><tr><td>Consolidated Iowa income tax returns (b)</td><td>2016 - 2018</td></tr><tr><td>Wisconsin combined tax returns (c)</td><td>2015 - 2018</td></tr></table>

(a) The 2016 and 2017 federal tax returns are effectively settled as a result of participation in the IRS Compliance Assurance Program, which allows Alliant Energy and the IRS to work together to resolve issues related to Alliant Energy’s current tax year before filing its federal income tax return. The statute of limitations for these federal tax returns expires three years from each filing date.

(b) The statute of limitations for these Iowa tax returns expires three years from each filing date.

(c) The statute of limitations for these Wisconsin combined tax returns expires four years from each filing date.

Federal Tax Reform Adjustments - In December 2017, Federal Tax Reform was enacted, which had a material impact on Alliant Energy's 2017 financial statements since changes in tax laws must be recognized in the period in which the law is enacted. The most significant provision of Federal Tax Reform that impacts Alliant Energy, IPL and WPL was the reduction in the federal corporate tax rate from 35% to 21%. As a result of Federal Tax Reform, at December 31, 2017, Alliant Energy's regulated utility operations in IPL and WPL recorded the net impacts from re-measuring deferred tax assets and liabilities as a change in regulatory liabilities or regulatory assets. Alliant Energy's non-utility operations recorded the net change in deferred tax assets and liabilities to "Income taxes" in the income statement or as an increase to "Other liabilities" or decrease in "ATC Holdings" on the balance sheet. As a result of Federal Tax Reform, Alliant Energy recorded tax benefits of $18.1 million in the 2017 income statement.

In 2018, additional rules were issued related to Federal Tax Reform, including clarifications of the treatment of bonus depreciation deductions, which impacted the federal income tax return for the calendar year 2017. As a result of these clarifying rules, Alliant Energy recorded tax benefits of $5.6 million in 2018.

Iowa Tax Reform - In May 2018, Iowa tax reform was enacted, resulting in a reduction in the Iowa income tax rate from 12% to 9.8%, effective January 1, 2021 and the elimination of the deduction for federal income taxes, effective January 1, 2022.

## NOTE 13. BENEFIT PLANS

NOTE 13(a) Pension and Other Postretirement Benefits Plans - Retirement benefits are provided to substantially all employees through various qualified and non-qualified non-contributory defined benefit pension plans (currently closed to new hires), and/or through defined contribution plans (including 401(k) savings plans). Benefits of the non-contributory defined benefit pension plans are based on the plan participant's years of service, age and compensation. Benefits of the defined contribution plans are based on the plan participant's years of service, age, compensation and contributions. Certain defined benefit postretirement health care and life benefits are provided to eligible retirees. In general, the retiree health care plans consist of fixed benefit subsidy structures and the retiree life insurance plans are non-contributory.



Assumptions - The assumptions for defined benefit pension and OPEB plans at the measurement date of December 31 were as follows:

<table><tr><td rowspan="2">Alliant Energy</td><td colspan="3">Defined Benefit Pension Plans</td><td colspan="3">OPEB Plans</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Discount rate for benefit obligations</td><td>3.48%</td><td>4.34%</td><td>3.66%</td><td>3.40%</td><td>4.24%</td><td>3.53%</td></tr><tr><td>Discount rate for net periodic cost</td><td>4.34%</td><td>3.66%</td><td>4.19%</td><td>4.24%</td><td>3.53%</td><td>3.98%</td></tr><tr><td>Expected rate of return on plan assets</td><td>7.60%</td><td>7.60%</td><td>7.60%</td><td>5.44%</td><td>5.44%</td><td>5.80%</td></tr><tr><td>Interest crediting rate for Alliant Energy Cash Balance Pension Plan</td><td>5.52%</td><td>5.04%</td><td>4.64%</td><td>N/A</td><td>N/A</td><td>N/A</td></tr><tr><td>Rate of compensation increase</td><td>3.65% - 4.50%</td><td>3.65% - 4.50%</td><td>3.65% - N/A</td><td>N/A</td><td>N/A</td><td>N/A</td></tr></table>

Expected rate of return on plan assets - The expected rate of return on plan assets is based on projected asset class returns using target allocations. A forward-looking building blocks approach is used, and historical returns, survey information and capital market information are analyzed to support the expected rate of return on plan assets assumption. Refer to “Investment Strategy for Plan Assets” below for additional information related to investment strategy and mix of assets for the pension and OPEB plans.

Life Expectancy - The life expectancy assumption is used in determining the benefit obligation and net periodic benefit cost for defined benefit pension and OPEB plans. This assumption utilizes base mortality tables that were released in 2019 by the Society of Actuaries.

Net Periodic Benefit Costs - The components of net periodic benefit costs for sponsored defined benefit pension and OPEB plans are included below (in millions). The service cost component of net periodic benefit costs is included in “Other operation and maintenance” expenses in the income statements and all other components of net periodic benefit costs are included in “Other (income) and deductions” in the income statements.

<table><tr><td rowspan="2">Alliant Energy</td><td colspan="3">Defined Benefit Pension Plans</td><td colspan="3">OPEB Plans</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Service cost</td><td>$9.7</td><td>$12.1</td><td>$12.5</td><td>$3.3</td><td>$4.2</td><td>$5.0</td></tr><tr><td>Interest cost</td><td>49.8</td><td>46.8</td><td>51.0</td><td>8.5</td><td>7.7</td><td>8.6</td></tr><tr><td>Expected return on plan assets (a)</td><td>(60.1)</td><td>(69.7)</td><td>(65.5)</td><td>(5.0)</td><td>(6.0)</td><td>(6.1)</td></tr><tr><td>Amortization of prior service credit (b)</td><td>(0.7)</td><td>(0.7)</td><td>(0.4)</td><td>(0.2)</td><td>(0.2)</td><td>(0.2)</td></tr><tr><td>Amortization of actuarial loss (c)</td><td>36.4</td><td>35.2</td><td>37.6</td><td>3.3</td><td>3.4</td><td>3.8</td></tr><tr><td>Settlement losses (d)</td><td>—</td><td>—</td><td>0.9</td><td>—</td><td>—</td><td>—</td></tr><tr><td></td><td>$35.1</td><td>$23.7</td><td>$36.1</td><td>$9.9</td><td>$9.1</td><td>$11.1</td></tr></table>

(a) The expected return on plan assets is based on the expected rate of return on plan assets and the fair value approach to the market-related value of plan assets.

(b) Unrecognized prior service costs (credits) for the OPEB plans are amortized over the average future service period to fulfill eligibility of the participants of each plan.

(c) Unrecognized net actuarial gains or losses in excess of 10% of the greater of the plans' benefit obligations or assets are amortized over the average future service lives of plan participants, except for the Alliant Energy Cash Balance Pension Plan where gains or losses outside the 10% threshold are amortized over the time period the participants are expected to receive benefits.

(d) Settlement losses related to payments made to retired executives of Alliant Energy.



Benefit Plan Assets and Obligations - A reconciliation of the funded status of qualified and non-qualified defined benefit pension and OPEB plans to the amounts recognized on the balance sheets at December 31 was as follows (in millions):

<table><tr><td rowspan="2">Alliant Energy</td><td colspan="2">Defined Benefit Pension Plans</td><td colspan="2">OPEB Plans</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Change in benefit obligation:</td><td></td><td></td><td></td><td></td></tr><tr><td>Net benefit obligation at January 1</td><td>$1,175.0</td><td>$1,303.1</td><td>$206.1</td><td>$222.3</td></tr><tr><td>Service cost</td><td>9.7</td><td>12.1</td><td>3.3</td><td>4.2</td></tr><tr><td>Interest cost</td><td>49.8</td><td>46.8</td><td>8.5</td><td>7.7</td></tr><tr><td>Plan participants&#x27; contributions</td><td>—</td><td>—</td><td>3.4</td><td>3.1</td></tr><tr><td>Actuarial (gain) loss</td><td>124.6</td><td>(96.2)</td><td>13.6</td><td>(8.2)</td></tr><tr><td>Gross benefits paid</td><td>(79.4)</td><td>(90.8)</td><td>(21.3)</td><td>(23.0)</td></tr><tr><td>Net benefit obligation at December 31</td><td>1,279.7</td><td>1,175.0</td><td>213.6</td><td>206.1</td></tr><tr><td>Change in plan assets:</td><td></td><td></td><td></td><td></td></tr><tr><td>Fair value of plan assets at January 1</td><td>808.6</td><td>950.7</td><td>99.1</td><td>111.1</td></tr><tr><td>Actual return on plan assets</td><td>168.1</td><td>(57.8)</td><td>14.6</td><td>(2.6)</td></tr><tr><td>Employer contributions</td><td>33.1</td><td>6.5</td><td>9.1</td><td>10.5</td></tr><tr><td>Plan participants&#x27; contributions</td><td>—</td><td>—</td><td>3.4</td><td>3.1</td></tr><tr><td>Gross benefits paid</td><td>(79.4)</td><td>(90.8)</td><td>(21.3)</td><td>(23.0)</td></tr><tr><td>Fair value of plan assets at December 31</td><td>930.4</td><td>808.6</td><td>104.9</td><td>99.1</td></tr><tr><td>Under funded status at December 31</td><td>($349.3)</td><td>($366.4)</td><td>($108.7)</td><td>($107.0)</td></tr><tr><td></td><td colspan="2">Defined Benefit Pension Plans</td><td colspan="2">OPEB Plans</td></tr><tr><td>Alliant Energy</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Amounts recognized on the balance sheets consist of:</td><td></td><td></td><td></td><td></td></tr><tr><td>Non-current assets</td><td>$—</td><td>$—</td><td>$9.8</td><td>$7.5</td></tr><tr><td>Current liabilities</td><td>(14.3)</td><td>(2.3)</td><td>(8.1)</td><td>(9.6)</td></tr><tr><td>Pension and other benefit obligations</td><td>(335.0)</td><td>(364.1)</td><td>(110.4)</td><td>(104.9)</td></tr><tr><td>Net amounts recognized at December 31</td><td>($349.3)</td><td>($366.4)</td><td>($108.7)</td><td>($107.0)</td></tr><tr><td>Amounts recognized in Regulatory Assets consist of:</td><td></td><td></td><td></td><td></td></tr><tr><td>Net actuarial loss</td><td>$485.3</td><td>$505.2</td><td>$45.2</td><td>$44.5</td></tr><tr><td>Prior service credit</td><td>(5.1)</td><td>(5.8)</td><td>(0.9)</td><td>(1.1)</td></tr><tr><td></td><td>$480.2</td><td>$499.4</td><td>$44.3</td><td>$43.4</td></tr></table>

Actuarial losses related to benefit obligations in 2019 for defined benefit pension and OPEB plans were primarily due to decreases in the discount rates and experience losses, partially offset by the impact of the updated base mortality table. Actuarial gains related to benefit obligations in 2018 for defined benefit pension and OPEB plans were primarily due to increases in the discount rates and the impact of the updated mortality table, partially offset by experience losses.

Included in the following table are accumulated benefit obligations, aggregate amounts applicable to defined benefit pension and OPEB plans with accumulated benefit obligations in excess of plan assets, as well as defined benefit pension plans with projected benefit obligations in excess of plan assets as of the December 31 measurement date (in millions):

<table><tr><td rowspan="2">Alliant Energy</td><td colspan="2">Defined Benefit Pension Plans</td><td colspan="2">OPEB Plans</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Accumulated benefit obligations</td><td>$1,234.4</td><td>$1,139.9</td><td>$213.6</td><td>$206.1</td></tr><tr><td>Plans with accumulated benefit obligations in excess of plan assets:</td><td></td><td></td><td></td><td></td></tr><tr><td>Accumulated benefit obligations</td><td>1,234.4</td><td>1,139.9</td><td>213.6</td><td>206.1</td></tr><tr><td>Fair value of plan assets</td><td>930.4</td><td>808.6</td><td>104.9</td><td>99.1</td></tr><tr><td>Plans with projected benefit obligations in excess of plan assets:</td><td></td><td></td><td></td><td></td></tr><tr><td>Projected benefit obligations</td><td>1,279.7</td><td>1,175.0</td><td>N/A</td><td>N/A</td></tr><tr><td>Fair value of plan assets</td><td>930.4</td><td>808.6</td><td>N/A</td><td>N/A</td></tr></table>



Estimated Future Employer Contributions and Benefit Payments - Estimated funding for the qualified and non-qualified defined benefit pension and OPEB plans for 2020 is as follows (in millions):

<table><tr><td></td><td>Alliant Energy</td></tr><tr><td>Defined benefit pension plans</td><td>$59.8</td></tr><tr><td>OPEB plans</td><td>8.1</td></tr></table>

Expected benefit payments for the qualified and non-qualified defined benefit plans, which reflect expected future service, as appropriate, are as follows (in millions):

<table><tr><td>Alliant Energy</td><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>2024</td><td>2025 - 2029</td></tr><tr><td>Defined benefit pension benefits</td><td>$86.4</td><td>$74.5</td><td>$76.6</td><td>$77.5</td><td>$78.2</td><td>$390.2</td></tr><tr><td>OPEB</td><td>17.7</td><td>17.7</td><td>17.5</td><td>17.1</td><td>16.8</td><td>76.6</td></tr><tr><td></td><td>$104.1</td><td>$92.2</td><td>$94.1</td><td>$94.6</td><td>$95.0</td><td>$466.8</td></tr></table>

Investment Strategy for Plan Assets - Investment strategies for defined benefit pension and OPEB plan assets combine preservation of principal and prudent risk-taking to protect the integrity of plan assets, in order to meet the obligations to plan participants while minimizing benefit costs over the long term. Investment risk of plan assets is mitigated through diversification, including U.S. and international equity, fixed income, global asset and risk parity strategies. Global asset and risk parity strategies may include investments in global equity, global debt, commodities and currencies.

Defined Benefit Pension Plan Assets - The asset mix of defined benefit pension plans is governed by allocation targets. The asset allocation is monitored regularly and appropriate steps are taken as needed to rebalance the assets within the prescribed ranges. An overlay management service is also used to help maintain target allocations and meet liquidity needs. The overlay manager is authorized to use derivative financial instruments to facilitate this service. For separately managed accounts, prohibited investments include, but are not limited to, direct ownership of real estate, oil and gas limited partnerships, securities of the managers' firms or affiliate firms, and Alliant Energy securities.

At December 31, 2019, the current target ranges and actual allocations for the defined benefit pension plan assets were as follows:

<table><tr><td></td><td>Target Range Allocation</td><td>Actual Allocation</td></tr><tr><td>Cash and equivalents</td><td>0% - 5%</td><td>5%</td></tr><tr><td>Equity securities - U.S.</td><td>6% - 56%</td><td>25%</td></tr><tr><td>Equity securities - international</td><td>14% - 34%</td><td>22%</td></tr><tr><td>Global asset securities</td><td>5% - 15%</td><td>9%</td></tr><tr><td>Risk parity securities</td><td>5% - 15%</td><td>10%</td></tr><tr><td>Fixed income securities</td><td>20% - 40%</td><td>29%</td></tr></table>

Other Postretirement Benefits Plan Assets - OPEB plan assets are comprised of specific assets within certain defined benefit pension plans (401(h) assets) as well as assets held in VEBA trusts. The investment strategy of the Corporate Services 401(h) assets mirrors those of the defined benefit pension plans, which are discussed above. For VEBA trusts with assets greater than $5 million and the WPL 401(h) assets, the mix among asset classes is governed by allocation targets. The asset allocation is monitored regularly and appropriate steps are taken as needed to rebalance the assets within the prescribed ranges. At December 31, 2019, the current target ranges and actual allocations for VEBA trusts with assets greater than $5 million and the WPL 401(h) assets were as follows:

<table><tr><td></td><td>Target Range Allocation</td><td>Actual Allocation</td></tr><tr><td>Cash and equivalents</td><td>0% - 5%</td><td>3%</td></tr><tr><td>Equity securities - U.S.</td><td>0% - 46%</td><td>25%</td></tr><tr><td>Equity securities - international</td><td>0% - 34%</td><td>2%</td></tr><tr><td>Fixed income securities</td><td>20% - 100%</td><td>70%</td></tr></table>

Fair Value Measurements - Fair value measurement accounting establishes three levels of fair value hierarchy that prioritize the inputs to valuation techniques used to measure fair value. Refer to Note 16 for discussion of levels within the fair value hierarchy. Level 1 items include investments in securities held in registered investment companies, treasury bills and directly held equity securities, which are valued at the closing price reported in the active market in which the securities are traded. Level 2 items include fixed income securities consisting of corporate and government bonds, which are valued at the closing price reported in the active market for similar assets in which the individual securities are traded or based on yields currently available on comparable securities of issuers with similar credit ratings. Certain investments that are measured at fair value



using the net asset value practical expedient have not been classified in the fair value hierarchy. These fair value amounts are included below to reconcile the fair value hierarchy to the respective total plan assets.

At December 31, the fair values of qualified and non-qualified defined benefit pension plan assets were as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="4">2019</td><td colspan="4">2018</td></tr><tr><td>Fair Value</td><td>1</td><td>Level</td><td>Level</td><td>Fair Value</td><td>Level</td><td>Level</td><td>Level</td></tr><tr><td>Alliant Energy</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash and equivalents</td><td>$45.7</td><td>$3.7</td><td>$42.0</td><td>$—</td><td>$36.4</td><td>$3.0</td><td>$33.4</td><td>$—</td></tr><tr><td>Equity securities - U.S.</td><td>160.6</td><td>160.6</td><td>—</td><td>—</td><td>130.2</td><td>130.2</td><td>—</td><td>—</td></tr><tr><td>Equity securities - international</td><td>135.9</td><td>135.9</td><td>—</td><td>—</td><td>116.0</td><td>116.0</td><td>—</td><td>—</td></tr><tr><td>Global asset securities</td><td>47.2</td><td>47.2</td><td>—</td><td>—</td><td>42.1</td><td>42.1</td><td>—</td><td>—</td></tr><tr><td>Fixed income securities</td><td>130.7</td><td>58.0</td><td>72.7</td><td>—</td><td>127.8</td><td>52.5</td><td>75.3</td><td>—</td></tr><tr><td>Total assets in fair value hierarchy</td><td>520.1</td><td>$405.4</td><td>$114.7</td><td>$—</td><td>452.5</td><td>$343.8</td><td>$108.7</td><td>$—</td></tr><tr><td>Assets measured at net asset value</td><td>410.1</td><td></td><td></td><td></td><td>355.4</td><td></td><td></td><td></td></tr><tr><td>Accrued investment income</td><td>0.9</td><td></td><td></td><td></td><td>1.2</td><td></td><td></td><td></td></tr><tr><td>Due to brokers, net (pending trades with brokers)</td><td>(0.7)</td><td></td><td></td><td></td><td>(0.5)</td><td></td><td></td><td></td></tr><tr><td>Total pension plan assets</td><td>$930.4</td><td></td><td></td><td></td><td>$808.6</td><td></td><td></td><td></td></tr></table>

At December 31, the fair values of OPEB plan assets were as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="4">2019</td><td colspan="4">2018</td></tr><tr><td>Fair Value</td><td>1</td><td>Level</td><td>Level</td><td>Fair Value</td><td>Level</td><td>Level</td><td>Level</td></tr><tr><td>Alliant Energy</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Cash and equivalents</td><td>$3.4</td><td>$3.0</td><td>$0.4</td><td>$—</td><td>$1.4</td><td>$1.1</td><td>$0.3</td><td>$—</td></tr><tr><td>Equity securities - U.S.</td><td>3.7</td><td>3.7</td><td>—</td><td>—</td><td>3.9</td><td>3.9</td><td>—</td><td>—</td></tr><tr><td>Equity securities - international</td><td>2.8</td><td>2.8</td><td>—</td><td>—</td><td>2.9</td><td>2.9</td><td>—</td><td>—</td></tr><tr><td>Global asset securities</td><td>0.5</td><td>0.5</td><td>—</td><td>—</td><td>0.4</td><td>0.4</td><td>—</td><td>—</td></tr><tr><td>Fixed income securities</td><td>68.5</td><td>67.8</td><td>0.7</td><td>—</td><td>68.2</td><td>67.5</td><td>0.7</td><td>—</td></tr><tr><td>Total assets in fair value hierarchy</td><td>78.9</td><td>$77.8</td><td>$1.1</td><td>$—</td><td>76.8</td><td>$75.8</td><td>$1.0</td><td>$—</td></tr><tr><td>Assets measured at net asset value</td><td>26.0</td><td></td><td></td><td></td><td>22.3</td><td></td><td></td><td></td></tr><tr><td>Total OPEB plan assets</td><td>$104.9</td><td></td><td></td><td></td><td>$99.1</td><td></td><td></td><td></td></tr></table>

For the various defined benefit pension and OPEB plans, Alliant Energy common stock represented less than 1% of assets directly held in the plans at December 31, 2019 and 2018.

401(k) Savings Plans - A significant number of employees participate in defined contribution retirement plans (401(k) savings plans). Alliant Energy common stock directly held by participants represented 11.5% and 11.5% of total assets in the 401(k) savings plans at December 31, 2019 and 2018, respectively. Costs related to the 401(k) savings plans, which are partially based on the participants' contributions and include allocated costs associated with Corporate Services employees for IPL and WPL, were as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td></td></tr><tr><td>401(k) costs</td><td>$25.5</td><td>$25.1</td><td>$24.8</td><td>$13.0</td><td>$13.0</td><td>$12.8</td><td>$11.5</td><td>$11.2</td><td>$11.1</td></tr></table>

NOTE 13(b) Equity-based Compensation Plans - In 2015, Alliant Energy’s shareowners approved the Amended and Restated OIP, which permits the grant of shares of Alliant Energy common stock, restricted stock, restricted stock units, performance shares, performance units, and other stock-based or cash-based awards to key employees. At December 31, 2019, performance shares and restricted stock units (performance- and time-vesting) were outstanding under the Amended and Restated OIP, and 6.4 million shares of Alliant Energy common stock remained available for grants under the Amended and Restated OIP. Alliant Energy satisfies share payouts related to equity awards under the Amended and Restated OIP through the issuance of new shares of its common stock. Alliant Energy also has the DLIP, which permits the grant of cash-based long-term awards, including performance units, restricted cash awards and restricted units, to certain key employees. At December 31, 2019, performance units and restricted units (performance- and time-vesting) were outstanding under the DLIP, and the amount of nonvested restricted units was not material. There is no limit to the number of grants that can be made under the DLIP and Alliant Energy satisfies all payouts under the DLIP through cash payments. Nonvested awards generally do not have non-forfeitable rights to dividends or dividend equivalents when dividends are paid to common shareowners. A summary of compensation expense, including amounts allocated to IPL and WPL, and the related income tax benefits recognized for share-based compensation awards was as follows (in millions):



<table><tr><td rowspan="2"></td><td colspan="3">Alliant Energy</td><td colspan="3">IPL</td><td colspan="3">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td></td></tr><tr><td>Compensation expense</td><td>$26.0</td><td>$17.0</td><td>$15.1</td><td>$14.5</td><td>$9.4</td><td>$8.3</td><td>$10.3</td><td>$6.9</td><td>$6.4</td></tr><tr><td>Income tax benefits</td><td>7.3</td><td>4.9</td><td>6.2</td><td>4.2</td><td>2.8</td><td>3.4</td><td>2.8</td><td>1.9</td><td>2.6</td></tr></table>

As of December 31, 2019, Alliant Energy’s, IPL’s and WPL’s total unrecognized compensation cost related to share-based compensation awards was $5.4 million, $3.0 million and $2.2 million, respectively, which is expected to be recognized over a weighted average period of between one and two years. Share-based compensation expense is recognized on a straight-line basis over the requisite service periods and is recorded in “Other operation and maintenance” in the income statements. As of December 31, 2019, 343,396 shares were included in the calculation of diluted EPS related to the nonvested equity awards.

Performance Shares - Equity Awards - Payouts of 2019 performance shares under the Amended and Restated OIP are contingent upon achievement over a three-year period of specified performance criteria, which currently is total shareowner return relative to an investor-owned utility peer group. Performance shares granted in 2019 are to be paid out in shares of Alliant Energy common stock and are accounted for as equity awards. The fair value of each performance share granted in 2019 is based on the fair value of the underlying common stock on the grant date and the probability of satisfying the market condition contained in the agreement during a three-year performance period. The actual number of 2019 performance shares that will be paid out upon vesting is dependent upon actual performance and may range from zero to 200% of the target number of shares. Compensation expense is recorded ratably over the performance period based on the fair value of the awards at the grant date. A summary of the 2019 performance shares activity, with amounts representing the target number of awards, was as follows:

<table><tr><td rowspan="2"></td><td colspan="2">2019</td></tr><tr><td>Performance Shares - Equity</td><td>Weighted Average Grant Date Value</td></tr><tr><td>Nonvested awards, January 1</td><td>—</td><td>$—</td></tr><tr><td>Granted</td><td>91,816</td><td>47.23</td></tr><tr><td>Forfeited</td><td>(17,623)</td><td>46.35</td></tr><tr><td>Nonvested awards, December 31</td><td>74,193</td><td>47.44</td></tr></table>

Performance Shares and Performance Units - Liability Awards - Payouts of performance shares granted prior to 2019 under the Amended and Restated OIP and performance units under the DLIP to key employees are contingent upon achievement over three-year periods of specified performance criteria, which currently is total shareowner return relative to an investor-owned utility peer group. Performance shares granted prior to 2019 can be paid out in shares of Alliant Energy common stock, cash or a combination of cash and stock. Performance units must be paid out in cash. Alliant Energy assumes it will make future payouts of its performance shares granted prior to 2019 and performance units in cash; therefore, these performance shares and performance units are accounted for as liability awards. Compensation expense for these performance shares and performance units is recorded ratably over the performance period based on the fair value of the awards at each reporting period. A summary of these performance shares and performance units activity, with amounts representing the target number of awards, was as follows:

<table><tr><td rowspan="2"></td><td colspan="3">Performance Shares (granted prior to 2019)</td><td colspan="3">Performance Units (granted prior to 2019)</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Nonvested awards, January 1</td><td>203,188</td><td>223,511</td><td>257,599</td><td>57,761</td><td>71,737</td><td>93,320</td></tr><tr><td>Granted</td><td>—</td><td>74,163</td><td>65,350</td><td>—</td><td>19,840</td><td>21,558</td></tr><tr><td>Vested</td><td>(66,322)</td><td>(90,806)</td><td>(99,438)</td><td>(20,131)</td><td>(31,910)</td><td>(37,395)</td></tr><tr><td>Forfeited</td><td>(4,994)</td><td>(3,680)</td><td>—</td><td>(3,056)</td><td>(1,906)</td><td>(5,746)</td></tr><tr><td>Nonvested awards, December 31</td><td>131,872</td><td>203,188</td><td>223,511</td><td>34,574</td><td>57,761</td><td>71,737</td></tr></table>

Fair Value of Awards - The fair value of each performance share and performance unit is based on the closing market price of one share of Alliant Energy common stock at the end of the performance period. The actual payout for performance shares and performance units is dependent upon actual performance and may range from zero to 200% of the target number of awards. At December 31, 2019, the Alliant Energy common stock closing price was $54.72. Additional information related to the fair value of nonvested performance shares and performance units at December 31, 2019, by year of grant, was as follows:



<table><tr><td rowspan="2"></td><td colspan="2">Performance Shares (granted prior to 2019)</td><td colspan="2">Performance Units (granted prior to 2019)</td></tr><tr><td>2018 Grant</td><td>2017 Grant</td><td>2018 Grant</td><td>2017 Grant</td></tr><tr><td>Nonvested awards at target</td><td>68,307</td><td>63,565</td><td>17,622</td><td>16,952</td></tr><tr><td>Estimated payout percentage based on performance criteria</td><td>118%</td><td>155%</td><td>118%</td><td>155%</td></tr><tr><td>Fair values of each nonvested award</td><td>$64.57</td><td>$64.82</td><td>$64.57</td><td>$84.82</td></tr></table>

Vested Awards - Certain performance shares and performance units vested, resulting in payouts (a combination of cash and common stock for the performance shares and cash only for the performance units) as follows:

<table><tr><td rowspan="3"></td><td colspan="3">Performance Shares (granted prior to 2019)</td><td colspan="3">Performance Units (granted prior to 2019)</td></tr><tr><td>2019</td><td>2018</td><td>2017</td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>2016 Grant</td><td>2015 Grant</td><td>2014 Grant</td><td>2016 Grant</td><td>2015 Grant</td><td>2014 Grant</td></tr><tr><td>Performance awards vested</td><td>66,322</td><td>90,806</td><td>99,438</td><td>20,131</td><td>31,910</td><td>37,395</td></tr><tr><td>Percentage of target number of performance awards</td><td>142.5%</td><td>137.5%</td><td>147.5%</td><td>142.5%</td><td>137.5%</td><td>147.5%</td></tr><tr><td>Aggregate payout value (in millions)</td><td>$4.3</td><td>$5.3</td><td>$5.6</td><td>$1.3</td><td>$1.4</td><td>$1.5</td></tr><tr><td>Payout - cash (in millions)</td><td>$3.7</td><td>$4.9</td><td>$5.1</td><td>$1.3</td><td>$1.4</td><td>$1.5</td></tr><tr><td>Payout - common stock shares issued</td><td>6,447</td><td>5,078</td><td>5,185</td><td>N/A</td><td>N/A</td><td>N/A</td></tr></table>

Restricted Stock Units - Equity Awards - Payouts of 2019 restricted stock units under the Amended and Restated OIP are based on the expiration of a three-year time-vesting period. Restricted stock units granted in 2019 are to be paid out in shares of Alliant Energy common stock and are accounted for as equity awards. The fair value of each restricted stock unit granted in 2019 is based on the closing market price of one share of Alliant Energy common stock on the grant date of the award. Compensation expense is recorded ratably over the performance period based on the fair value of the awards on the grant date. A summary of the 2019 restricted stock units activity was as follows:

<table><tr><td rowspan="2"></td><td colspan="2">2019</td></tr><tr><td>Restricted Stock Units - Equity</td><td>Weighted Average Grant Date Value</td></tr><tr><td>Nonvested units, January 1</td><td>—</td><td>$—</td></tr><tr><td>Granted</td><td>105,348</td><td>45.98</td></tr><tr><td>Forfeited</td><td>(16,067)</td><td>45.63</td></tr><tr><td>Nonvested units, December 31</td><td>89,281</td><td>46.04</td></tr></table>

Restricted Stock Units - Liability Awards - Payouts of restricted stock units granted prior to 2019 under the Amended and Restated OIP are based on the expiration of a three-year time-vesting period. Restricted stock units granted prior to 2019 can be paid out in shares of Alliant Energy common stock, cash or a combination of cash and stock. Alliant Energy assumes it will make future payouts of its restricted stock units granted prior to 2019 in cash; therefore, restricted stock units granted prior to 2019 are accounted for as liability awards. The fair value of each restricted stock unit granted prior to 2019 is based on the closing market price of one share of Alliant Energy common stock at the end of the time-vesting period. Compensation expense is recorded ratably over the performance period based on the fair value of the awards at each reporting period. A summary of the restricted stock units granted prior to 2019 activity was as follows:

<table><tr><td></td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>Nonvested units, January 1</td><td>174,163</td><td>113,749</td><td>57,736</td></tr><tr><td>Granted</td><td>—</td><td>63,568</td><td>56,013</td></tr><tr><td>Vested</td><td>(56,849)</td><td>—</td><td>—</td></tr><tr><td>Forfeited</td><td>(4,281)</td><td>(3,154)</td><td>—</td></tr><tr><td>Nonvested units, December 31</td><td>113,033</td><td>174,163</td><td>113,749</td></tr></table>

Performance Restricted Stock Units - Equity Awards - Payouts of performance restricted stock units under the Amended and Restated OIP are based upon achievement of certain performance targets during a three-year performance period, which currently includes specified growth of consolidated net income from continuing operations. The actual number of units that will be paid out upon vesting is dependent upon actual performance and may range from zero to 200% of the target number of units. If performance targets are not met during the performance period, these units are forfeited. Performance restricted stock units generally must be paid out in shares and are accounted for as equity awards. The fair value of each performance restricted stock unit is based on the closing market price of one share of Alliant Energy common stock on the grant date of the award. Compensation expense is recorded ratably over the performance period based on a probability assessment of payouts for the awards at each reporting period. A summary of the performance restricted stock units activity, with amounts representing the target number of units, was as follows:



<table><tr><td rowspan="2"></td><td colspan="2">2019</td><td colspan="2">2018</td><td colspan="2">2017</td></tr><tr><td>Units</td><td>Weighted Average Grant Date Fair Value</td><td>Units</td><td>Weighted Average Grant Date Fair Value</td><td>Units</td><td>Weighted AverageGrant Date Fair Value</td></tr><tr><td>Nonvested units, January 1</td><td>203,188</td><td>$37.23</td><td>132,705</td><td>$36.50</td><td>67,355</td><td>$33.96</td></tr><tr><td>Granted</td><td>91,816</td><td>46.10</td><td>74,163</td><td>38.60</td><td>65,350</td><td>39.12</td></tr><tr><td>Vested</td><td>(66,322)</td><td>33.93</td><td>—</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Forfeited</td><td>(22,617)</td><td>44.00</td><td>(3,680)</td><td>38.60</td><td>—</td><td>—</td></tr><tr><td>Nonvested units, December 31</td><td>206,065</td><td>41.50</td><td>203,188</td><td>37.23</td><td>132,705</td><td>36.50</td></tr></table>

NOTE 13(c) Deferred Compensation Plan - Alliant Energy maintains a DCP under which key employees may defer up to 100% of base salary and short-term cash incentive compensation and directors may elect to defer all or part of their retainer and committee fees. Key employees who have made the maximum allowed contribution to the Alliant Energy 401(k) Savings Plan may receive an additional credit to the DCP. Key employees and directors may elect to have their deferrals credited to a company stock account, an interest account, equity accounts or mutual fund accounts based on certain benchmark funds.

Company Stock Account - The DCP does not permit diversification of deferrals credited to the company stock account and all distributions from participants' company stock accounts are made in the form of shares of Alliant Energy common stock. The deferred compensation obligations for participants' company stock accounts are recorded in "Additional paid-in capital" and the shares of Alliant Energy common stock held in a rabbi trust to satisfy this obligation are recorded in "Shares in deferred compensation trust" on Alliant Energy's balance sheets. At December 31, the carrying value of the deferred compensation obligation for the company stock account and the shares in the deferred compensation trust based on the historical value of the shares of Alliant Energy common stock contributed to the rabbi trust, and the fair market value of the shares held in the rabbi trust, were as follows (in millions):

<table><tr><td></td><td>2019</td><td>2018</td></tr><tr><td>Carrying value</td><td>$10.0</td><td>$9.8</td></tr><tr><td>Fair market value</td><td>20.9</td><td>16.2</td></tr></table>

Interest, Equity and Mutual Fund Accounts - Distributions from participants' interest, equity and mutual fund accounts are in the form of cash payments. The deferred compensation obligations for participants' interest, equity and mutual fund accounts are recorded in "Pension and other benefit obligations" on the balance sheets. At December 31, 2019 and 2018, the carrying value of Alliant Energy's deferred compensation obligations for participants' interest, equity and mutual fund accounts, which approximates fair market value, was $21.2 million and $21.0 million, respectively.

## NOTE 14. ASSET RETIREMENT OBLIGATIONS

Recognized AROs relate to legal obligations for the removal, closure or dismantlement of several assets including, but not limited to, wind farms, ash ponds, active ash landfills, above ground storage tanks and solar generation. Recognized AROs also include legal obligations for the management and final disposition of asbestos and polychlorinated biphenyls. AROs are recorded in “Other current liabilities” and “Other liabilities” on the balance sheets. Refer to Note 2 for information regarding regulatory assets related to AROs. A reconciliation of the changes in AROs associated with long-lived assets is as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Balance, January 1</td><td>$177.5</td><td>$184.5</td><td>$118.3</td><td>$134.1</td><td>$59.2</td><td>$50.4</td></tr><tr><td>Revisions in estimated cash flows</td><td>(5.5)</td><td>(10.1)</td><td>(6.7)</td><td>(10.1)</td><td>1.2</td><td>—</td></tr><tr><td>Liabilities settled</td><td>(8.8)</td><td>(10.4)</td><td>(8.4)</td><td>(9.7)</td><td>(0.4)</td><td>(0.7)</td></tr><tr><td>Liabilities incurred (a)</td><td>26.2</td><td>7.3</td><td>26.2</td><td>—</td><td>—</td><td>7.3</td></tr><tr><td>Accretion expense</td><td>6.9</td><td>6.2</td><td>4.5</td><td>4.0</td><td>2.4</td><td>2.2</td></tr><tr><td>Balance, December 31</td><td>$196.3</td><td>$177.5</td><td>$133.9</td><td>$118.3</td><td>$62.4</td><td>$59.2</td></tr></table>

(a) In 2019, Alliant Energy and IPL recognized additional AROs related to IPL's newly constructed Upland Prairie and English Farms wind sites. The increases in AROs resulted in corresponding increases in property, plant and equipment, net on the balance sheet.

## NOTE 15. DERIVATIVE INSTRUMENTS

## Commodity Derivatives -

Purpose - Derivative instruments are used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices, transmission congestion costs and rail transportation costs. Risk policies are maintained that govern the use of such derivative instruments. Derivative instruments were not designated as hedging instruments and included the following:



<table><tr><td>Risk management purpose</td><td>Type of instrument</td></tr><tr><td>Mitigate pricing volatility for:</td><td></td></tr><tr><td>Fuel used to supply natural gas-fired EGUs</td><td>Natural gas swap, options and physical forward contracts (IPL and WPL)</td></tr><tr><td>Natural gas supplied to retail customers</td><td>Natural gas swap, options and physical forward contracts (IPL and WPL)</td><td></td></tr><tr><td>Fuel used at coal-fired EGUs</td><td>Coal physical forward contracts (IPL and WPL)</td><td></td></tr><tr><td>Optimize the value of natural gas pipeline capacity</td><td>Natural gas physical forward contracts (IPL and WPL)</td><td></td></tr><tr><td></td><td>Natural gas swap contracts (IPL)</td><td></td></tr><tr><td>Manage transmission congestion costs</td><td>FTRs (IPL and WPL)</td><td></td></tr><tr><td>Manage rail transportation costs</td><td>Diesel fuel swap contracts (WPL)</td><td></td></tr></table>

Notional Amounts - As of December 31, 2019, gross notional amounts and settlement/delivery years related to outstanding swap contracts, option contracts, physical forward contracts and FTRs that were accounted for as commodity derivative instruments were as follows (units in thousands):

<table><tr><td rowspan="2"></td><td colspan="2">FTRs</td><td colspan="2">Natural Gas</td><td colspan="2">Coal</td><td colspan="2">Diesel Fuel</td></tr><tr><td>MWhs</td><td>Years</td><td>Dths</td><td>Years</td><td>Tons</td><td>Years</td><td>Gallons</td><td>Years</td></tr><tr><td>Alliant Energy</td><td>11,671</td><td>2020</td><td>189,287</td><td>2020-2026</td><td>6,194</td><td>2020-2021</td><td>5,040</td><td>2020-2021</td></tr><tr><td>IPL</td><td>5,497</td><td>2020</td><td>102,758</td><td>2020-2026</td><td>2,700</td><td>2020-2021</td><td>—</td><td></td></tr><tr><td>WPL</td><td>6,174</td><td>2020</td><td>86,529</td><td>2020-2026</td><td>3,494</td><td>2020-2021</td><td>5,040</td><td>2020-2021</td></tr></table>

Financial Statement Presentation - Derivative instruments are recorded at fair value each reporting date on the balance sheet as assets or liabilities. At December 31, the fair values of current derivative assets are included in “Other current assets,” non-current derivative assets are included in “Deferred charges and other,” current derivative liabilities are included in “Other current liabilities” and non-current derivative liabilities are included in “Other liabilities” on the balance sheets as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Current derivative assets</td><td>$15.8</td><td>$24.6</td><td>$12.1</td><td>$16.1</td><td>$3.7</td><td>$8.5</td></tr><tr><td>Non-current derivative assets</td><td>11.0</td><td>3.7</td><td>10.2</td><td>1.6</td><td>0.8</td><td>2.1</td></tr><tr><td>Current derivative liabilities</td><td>19.0</td><td>5.6</td><td>8.9</td><td>3.1</td><td>10.1</td><td>2.5</td></tr><tr><td>Non-current derivative liabilities</td><td>18.6</td><td>17.7</td><td>8.5</td><td>8.1</td><td>10.1</td><td>9.6</td></tr></table>

Credit Risk-related Contingent Features - Various agreements contain credit risk-related contingent features, including requirements to maintain certain credit ratings and/or limitations on liability positions under the agreements based on credit ratings. Certain of these agreements with credit risk-related contingency features are accounted for as derivative instruments. In the event of a material change in creditworthiness or if liability positions exceed certain contractual limits, credit support may need to be provided in the form of letters of credit or cash collateral up to the amount of exposure under the contracts, or the contracts may need to be unwound and underlying liability positions paid. At December 31, 2019 and 2018, the aggregate fair value of all derivative instruments with credit risk-related contingent features in a net liability position was not materially different than amounts that would be required to be posted as credit support to counterparties by Alliant Energy, IPL or WPL if the most restrictive credit risk-related contingent features for derivative agreements in a net liability position were triggered.

Balance Sheet Offsetting - The fair value amounts of derivative instruments subject to a master netting arrangement are not netted by counterparty on the balance sheets. However, if the fair value amounts of derivative instruments by counterparty were netted, amounts would not be materially different from gross amounts of derivative assets and derivative liabilities at December 31, 2019 and 2018. Fair value amounts recognized for the right to reclaim cash collateral (receivable) or the obligation to return cash collateral (payable) are not offset against fair value amounts recognized for derivative instruments executed with the same counterparty under the same master netting arrangement.

## NOTE 16. FAIR VALUE MEASUREMENTS

Valuation Hierarchy - Fair value measurement accounting establishes three levels of fair value hierarchy that prioritize the inputs to valuation techniques used to measure fair value. Level 1 pricing inputs are quoted prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 pricing inputs are quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active as of the reporting date. Level 3 pricing inputs are unobservable inputs for assets or liabilities for which little or no market data exist and require significant management judgment or estimation.

The fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. The lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in



the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability.

## Valuation Techniques -

Derivative assets and derivative liabilities - Swap, option and physical forward commodity contracts were non-exchange-based derivative instruments and were valued using indicative price quotations from a pricing vendor that provides daily exchange forward price settlements, from broker or dealer quotations, from market publications or from on-line exchanges. The indicative price quotations reflected the average of the bid-ask mid-point prices and were obtained from sources believed to provide the most liquid market for the commodity. A portion of these indicative price quotations were corroborated using quoted prices for similar assets or liabilities in active markets and categorized derivative instruments based on such indicative price quotations as Level 2. Commodity contracts that were valued using indicative price quotations based on significant assumptions such as seasonal or monthly shaping and indicative price quotations that could not be readily corroborated were categorized as Level 3. Swap, option and physical forward commodity contracts were predominantly at liquid trading points. FTRs were valued using auction prices and were categorized as Level 3. Refer to Note 15 for additional details of derivative assets and derivative liabilities.

Deferred proceeds (sales of receivables) - The fair value of IPL’s deferred proceeds related to its sales of accounts receivable program was calculated each reporting date using the cost approach valuation technique. The fair value represents the carrying amount of receivables sold less the allowance for doubtful accounts associated with the receivables sold and cash amounts received from the receivables sold due to the short-term nature of the collection period. These inputs were considered unobservable and deferred proceeds were categorized as Level 3. Deferred proceeds represent IPL’s maximum exposure to loss related to the receivables sold. Refer to Note 5(b) for additional information regarding deferred proceeds.

Long-term debt (including current maturities) - The fair value of long-term debt instruments was based on a discounted cash flow methodology using observable data from comparably traded securities with similar credit profiles, and was substantially classified as Level 2. Refer to Note 9(b) for additional information regarding long-term debt.

Fair Value of Financial Instruments - The carrying amounts of current assets and current liabilities approximate fair value because of the short maturity of such financial instruments. Carrying amounts and the related estimated fair values of other financial instruments at December 31 were as follows (in millions):

<table><tr><td rowspan="3">Alliant Energy</td><td colspan="4">2019</td><td colspan="4">2018</td></tr><tr><td rowspan="2">Carrying Amount</td><td colspan="3">Fair Value</td><td rowspan="2">Carrying Amount</td><td colspan="3">Fair Value</td></tr><tr><td>Level 1</td><td>Level 2</td><td>Level 3</td><td>Level 1</td><td>Level 2</td><td>Level 3</td></tr><tr><td>Assets:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Derivatives</td><td>$26.8</td><td>$—</td><td>$4.8</td><td>$22.0</td><td>$26.8</td><td>$28.3</td><td>$—</td><td>$8.9</td></tr><tr><td>Deferred proceeds</td><td>187.7</td><td>—</td><td>—</td><td>187.7</td><td>187.7</td><td>119.4</td><td>—</td><td>119.4</td></tr><tr><td>Liabilities and equity:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Derivatives</td><td>37.6</td><td>—</td><td>36.8</td><td>0.8</td><td>37.6</td><td>23.3</td><td>—</td><td>16.1</td></tr><tr><td>Long-term debt (incl. current maturities)</td><td>6,190.2</td><td>—</td><td>6,917.9</td><td>2.0</td><td>6,919.9</td><td>5,502.8</td><td>—</td><td>5,858.4</td></tr></table>

Information for fair value measurements using significant unobservable inputs (Level 3 inputs) was as follows (in millions):

<table><tr><td rowspan="3">Alliant Energy</td><td colspan="4">Commodity Contract Derivative</td></tr><tr><td colspan="2">Assets and (Liabilities), net</td><td colspan="2">Deferred Proceeds</td></tr><tr><td>2019</td><td>2018</td><td>2019</td><td>2018</td></tr><tr><td>Beginning balance, January 1</td><td>$12.2</td><td>($12.2)</td><td>$119.4</td><td>$222.1</td></tr><tr><td>Total net gains included in changes in net assets (realized/unrealized)</td><td>8.2</td><td>9.1</td><td>—</td><td>—</td></tr><tr><td>Transfers out of Level 3 (a)</td><td>4.0</td><td>16.1</td><td>—</td><td>—</td></tr><tr><td>Purchases</td><td>13.8</td><td>26.7</td><td>—</td><td>—</td></tr><tr><td>Sales</td><td>(0.2)</td><td>(0.5)</td><td>—</td><td>—</td></tr><tr><td>Settlements (b)</td><td>(16.8)</td><td>(27.0)</td><td>68.3</td><td>(102.7)</td></tr><tr><td>Ending balance, December 31</td><td>$21.2</td><td>$12.2</td><td>$187.7</td><td>$119.4</td></tr><tr><td>The amount of total net gains for the period included in changes in net assets attributable to the change in unrealized gains relating to assets and liabilities held at December 31</td><td>$11.4</td><td>$10.7</td><td>$—</td><td>$—</td></tr></table>



(a) Observable market inputs became available for certain commodity contracts previously classified as Level 3 for transfers out of Level 3.

(b) Settlements related to deferred proceeds are due to the change in the carrying amount of receivables sold less the allowance for doubtful accounts associated with the receivables sold and cash amounts received from the receivables sold.

Commodity Contracts - The fair value of FTR and natural gas commodity contracts categorized as Level 3 was recognized as net derivative assets at December 31 as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="2">Alliant Energy</td><td colspan="2">IPL</td><td colspan="2">WPL</td></tr><tr><td>Excluding FTRs</td><td>FTRs</td><td>Excluding FTRs</td><td>FTRs</td><td>Excluding FTRs</td><td>FTRs</td></tr><tr><td>2019</td><td>$14.6</td><td>$6.6</td><td>$13.6</td><td>$5.1</td><td>$1.0</td><td>$1.5</td></tr><tr><td>2018</td><td>3.2</td><td>9.0</td><td>1.8</td><td>7.2</td><td>1.4</td><td>1.8</td></tr></table>

## NOTE 17. COMMITMENTS AND CONTINGENCIES

NOTE 17(a) Capital Purchase Commitments - Various contractual obligations contain minimum future commitments related to capital expenditures for certain construction projects. IPL's and WPL's projects include the expansion of wind generation. At December 31, 2019, Alliant Energy's, IPL's and WPL's minimum future commitments for these projects were $77 million, $60 million and $17 million, respectively.

NOTE 17(b) Other Purchase Commitments - Various commodity supply, transportation and storage contracts help meet obligations to provide electricity and natural gas to utility customers. In addition, there are various purchase commitments associated with other goods and services. At December 31, 2019, the related minimum future commitments were as follows (in millions):

<table><tr><td>Alliant Energy</td><td>2020</td><td>2021</td><td>2022</td><td>2023</td><td>2024</td><td>Thereafter</td><td>Total</td></tr><tr><td>Purchased power (a)</td><td>$111</td><td>$—</td><td>$—</td><td>$—</td><td>$—</td><td>$—</td><td>$111</td></tr><tr><td>Natural gas</td><td>257</td><td>183</td><td>139</td><td>109</td><td>77</td><td>187</td><td>952</td></tr><tr><td>Coal</td><td>75</td><td>27</td><td>10</td><td>10</td><td>—</td><td>—</td><td>122</td></tr><tr><td>Other (b)</td><td>56</td><td>13</td><td>11</td><td>9</td><td>7</td><td>12</td><td>108</td></tr><tr><td></td><td>$499</td><td>$223</td><td>$160</td><td>$128</td><td>$84</td><td>$199</td><td>$1,293</td></tr></table>

(a) Includes payments required by PPAs for capacity rights and minimum quantities of MWhs required to be purchased. As a result of an amendment to shorten the term of the DAEC PPA, amounts include minimum future commitments related to IPL's purchase of capacity and the resulting energy from DAEC through September 2020, and do not include the September 2020 buyout payment of $110 million.

(b) Includes individual commitments incurred during the normal course of business that exceeded $1 million at December 31, 2019.

NOTE 17(c) Legal Proceedings - Alliant Energy, IPL and WPL are involved in legal and administrative proceedings before various courts and agencies with respect to matters arising in the ordinary course of business. Although unable to predict the outcome of these matters, Alliant Energy, IPL and WPL believe that appropriate reserves have been established and final disposition of these actions will not have a material effect on their financial condition or results of operations.

## NOTE 17(d) Guarantees and Indemnifications -

Whiting Petroleum - In 2004, Alliant Energy sold its remaining interest in Whiting Petroleum. Whiting Petroleum is an independent oil and gas company. Alliant Energy Resources, LLC, as the successor to a predecessor entity that owned Whiting Petroleum, and a wholly-owned subsidiary of AEF, continues to guarantee the partnership obligations of an affiliate of Whiting Petroleum under general partnership agreements in the oil and gas industry, including with respect to the future abandonment of certain platforms off the coast of California and related onshore plant and equipment owned by the partnerships. The guarantees do not include a maximum limit. As of December 31, 2019, the present value of the abandonment obligations is estimated at $39 million. Alliant Energy is not aware of any material liabilities related to these guarantees of which it is probable that Alliant Energy Resources, LLC will be obligated to pay and therefore has not recognized any material liabilities related to this guarantee as of December 31, 2019 and 2018.

Non-utility Wind Farm in Oklahoma - In 2017, a wholly-owned subsidiary of AEF acquired a cash equity ownership interest in a non-utility wind farm located in Oklahoma. The wind farm provides electricity to a third-party under a long-term PPA. Alliant Energy provided a parent guarantee of its subsidiary's indemnification obligations under the related operating agreement and PPA. Alliant Energy's obligations under the operating agreement were $82 million as of December 31, 2019 and will reduce annually until expiring in July 2047. Alliant Energy's obligations under the PPA are subject to a maximum limit of $17 million and expire in December 2031, subject to potential extension. Alliant Energy is not aware of any material liabilities related to this guarantee that it is probable that it will be obligated to pay and therefore has not recognized any material liabilities related to this guarantee as of December 31, 2019 and 2018.



IPL’s Minnesota Electric Distribution Assets - IPL provided indemnifications associated with the 2015 sale of its Minnesota electric distribution assets for losses resulting from potential breach of IPL’s representations, warranties and obligations under the sale agreement. Alliant Energy and IPL believe the likelihood of having to make any material cash payments under these indemnifications is remote. IPL has not recorded any material liabilities related to these indemnifications as of December 31, 2019 and 2018. The general terms of the indemnifications provided by IPL included a maximum limit of $17 million and expire in October 2020.

NOTE 17(e) Environmental Matters - Alliant Energy, IPL and WPL are subject to environmental regulations as a result of their current and past operations. These regulations are designed to protect public health and the environment and have resulted in compliance, remediation, containment and monitoring obligations, which are recorded as current and non-current environmental liabilities. Substantially all of the environmental liabilities recorded on the balance sheets relate to MGP sites.

MGP Sites - IPL and WPL have current or previous ownership interests in various sites that are previously associated with the production of gas for which IPL and WPL have, or may have in the future, liability for investigation, remediation and monitoring costs. IPL and WPL are working pursuant to the requirements of various federal and state agencies to investigate, mitigate, prevent and remediate, where necessary, the environmental impacts to property, including natural resources, at and around these former MGP sites in order to protect public health and the environment. At December 31, 2019, estimated future costs expected to be incurred for the investigation, remediation and monitoring of the MGP sites, as well as environmental liabilities recorded on the balance sheets for these sites, which are not discounted, were as follows (in millions). At December 31, 2019, such amounts for WPL were not material.

<table><tr><td></td><td>Alliant Energy</td><td>IPL</td></tr><tr><td>Range of estimated future costs</td><td>$14 - $30</td><td>$12 - $25</td></tr><tr><td>Current and non-current environmental liabilities</td><td>18</td><td>15</td></tr></table>

IPL Consent Decree - In 2015, the U.S. District Court for the Northern District of Iowa approved a Consent Decree that IPL entered into with the EPA, the Sierra Club, the State of Iowa and Linn County in Iowa, thereby resolving potential CAA issues associated with emissions from IPL's coal-fired generating facilities in Iowa. IPL has completed various requirements under the Consent Decree. IPL's remaining requirements include fuel switching or retiring Burlington by December 31, 2021 and Prairie Creek Units 1 and 3 by December 31, 2025. Alliant Energy and IPL currently expect to recover material costs incurred by IPL related to compliance with the terms of the Consent Decree from IPL's electric customers.

Other Environmental Contingencies - In addition to the environmental liabilities discussed above, various environmental rules are monitored that may have a significant impact on future operations. Several of these environmental rules are subject to legal challenges, reconsideration and/or other uncertainties. Given uncertainties regarding the outcome, timing and compliance plans for these environmental matters, the complete financial impact of each of these rules is not able to be determined; however future capital investments and/or modifications to EGUs to comply with certain of these rules could be significant. Specific current, proposed or potential environmental matters include, among others: Effluent Limitation Guidelines, CCR Rule, and various legislation and EPA regulations to monitor and regulate the emission of GHG, including the CAA.

NOTE 17(f) Credit Risk - IPL provides retail electric and gas services in Iowa and wholesale electric service in Minnesota, Illinois and Iowa. WPL provides retail electric and gas services and wholesale electric service in Wisconsin. The geographic concentration of IPL's and WPL's customers did not contribute significantly to overall credit risk exposure. In addition, as a result of a diverse customer base, IPL and WPL did not have any significant credit risk concentration for receivables arising from the sale of electricity or gas services.

Alliant Energy, IPL and WPL are subject to credit risk related to the ability of counterparties to meet their contractual payment obligations or the potential non-performance of counterparties to deliver contracted commodities and other goods or services at the contracted price. Credit policies are maintained to mitigate credit risk. These credit policies include evaluation of the financial condition of certain counterparties, use of credit risk-related contingent provisions in certain agreements that require credit support from counterparties not meeting specific criteria, diversification of counterparties to reduce concentrations of credit risk and the use of standardized agreements that facilitate the netting of cash flows associated with certain counterparties. Based on these credit policies and counterparty diversification, as well as utility cost recovery mechanisms, it is unlikely that counterparty non-performance would have a material effect on financial condition or results of operations. However, there is no assurance that these items will protect against all losses from counterparty non-performance.

Refer to Notes 5(a) and 15 for details of allowances for doubtful accounts and credit risk-related contingent features, respectively.



NOTE 17(g) Collective Bargaining Agreements - At December 31, 2019, employees covered by collective bargaining agreements represented 54%, 62% and 83% of total employees of Alliant Energy, IPL and WPL, respectively. In August 2020, IPL's collective bargaining agreement with International Brotherhood of Electrical Workers Local 204 (Cedar Rapids) expires, representing 18% and 46% of total employees of Alliant Energy and IPL, respectively.

NOTE 17(h) MISO Transmission Owner Return on Equity Complaints - A group of MISO cooperative and municipal utilities previously filed two complaints with FERC requesting a reduction to the base return on equity used by MISO transmission owners, including ITC and ATC. The first complaint covered the period from November 12, 2013 through February 11, 2015. The second complaint covered the period from February 12, 2015 through May 11, 2016. In 2016, FERC issued an order on the first complaint and established a base return on equity of 10.32%, excluding any incentive adders granted by FERC, effective September 28, 2016. In 2017, IPL and WPL received the refunds for this first complaint period, which were subsequently refunded to their retail and wholesale customers.

In November 2019, FERC issued an order on the previously filed two complaints. The order adjusted the base return on equity to 9.88%, excluding any incentive adders granted by FERC, from the 10.32% previously established in the 2016 FERC order. The 9.88% base return on equity established in the November 2019 order is effective for the first complaint period and the period subsequent to September 28, 2016. Additional refunds for the first complaint period and the period subsequent to September 28, 2016 are currently expected to be issued later in 2020. The November 2019 FERC order also dismissed the second complaint, therefore FERC did not direct refunds to be made for that complaint. For the period ending December 31, 2019, Alliant Energy's share of earnings in ATC Holdings reflects the recent FERC Order including, (1) estimates of the additional reserves for refunds expected for the first complaint period and the period subsequent to September 28, 2016 and (2) reversals of the reserves that were previously established for the second complaint period. As of December 31, 2019, Alliant Energy's reserves related to both complaints was $5.8 million. Subsequent to the November 2019 FERC order, various rehearing requests were filed, and in January 2020, FERC issued an order providing an open-ended amount of time for FERC to consider these requests. Any changes in FERC's decision may have an impact on Alliant Energy's share of ATC's future earnings.

## NOTE 18. SEGMENTS OF BUSINESS

Alliant Energy - Alliant Energy’s principal businesses as of December 31, 2019 are:

- Utility - includes the operations of IPL and WPL, which primarily serve retail customers in Iowa and Wisconsin. The utility business has three reportable segments: a) utility electric operations; b) utility gas operations; and c) utility other, which includes steam operations and the unallocated portions of the utility business. Various line items in the following tables are not allocated to the electric and gas segments for management reporting purposes, and therefore, are included only in "Total Utility."

- ATC Holdings, Non-utility, Parent and Other - includes the operations of AEF and its subsidiaries, Corporate Services, the Alliant Energy parent company, and any Alliant Energy parent company consolidating adjustments. AEF is comprised of Alliant Energy's interest in ATC Holdings, Transportation, a non-utility wind farm, the Sheboygan Falls Energy Facility and other non-utility holdings.

Alliant Energy’s administrative support services are directly charged to the applicable segment where practicable. In all other cases, administrative support services are allocated to the applicable segment based on services agreements. Intersegment revenues were not material to Alliant Energy’s operations and there was no single customer whose revenues were 10% or more of Alliant Energy’s consolidated revenues. All of Alliant Energy’s operations and assets are located in the U.S. Certain financial information relating to Alliant Energy’s business segments, which represent the services provided to its customers, was as follows (in millions):

<table><tr><td rowspan="2"></td><td colspan="4">Utility</td><td colspan="2">ATC Holdings,</td></tr><tr><td>Electric</td><td>Gas</td><td>Other</td><td>Total</td><td>Non-utility, Parent and Other</td><td>Alliant Energy Consolidated</td></tr><tr><td>2019</td><td>$3,063.6</td><td>$455.2</td><td>$46.5</td><td>$3,565.3</td><td>$82.4</td><td>$3,647.7</td></tr><tr><td>Revenues</td><td>$3,063.6</td><td>$455.2</td><td>$46.5</td><td>$3,565.3</td><td>$82.4</td><td>$3,647.7</td></tr><tr><td>Depreciation and amortization</td><td>512.7</td><td>46.4</td><td>3.2</td><td>562.3</td><td>4.9</td><td>567.2</td></tr><tr><td>Operating income</td><td>678.9</td><td>69.8</td><td>1.3</td><td>750.0</td><td>27.7</td><td>777.7</td></tr><tr><td>Interest expense</td><td></td><td></td><td></td><td>229.1</td><td>43.8</td><td>272.9</td></tr><tr><td>Equity income from unconsolidated investments, net</td><td>(1.4)</td><td>—</td><td>—</td><td>(1.4)</td><td>(51.6)</td><td>(53.0)</td></tr><tr><td>Income tax expense (benefit)</td><td></td><td></td><td></td><td>73.4</td><td>(4.7)</td><td>68.7</td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td></td><td></td><td></td><td>517.1</td><td>40.1</td><td>557.2</td></tr><tr><td>Total assets</td><td>13,659.0</td><td>1,268.5</td><td>856.5</td><td>15,784.0</td><td>916.7</td><td>16,700.7</td></tr><tr><td>Investments in equity method subsidiaries</td><td>9.5</td><td>—</td><td>—</td><td>9.5</td><td>448.8</td><td>458.3</td></tr><tr><td>Construction and acquisition expenditures</td><td>1,438.4</td><td>99.7</td><td>0.3</td><td>1,538.4</td><td>101.7</td><td>1,640.1</td></tr></table>



<table><tr><td rowspan="2"></td><td colspan="5">Utility</td><td colspan="2">ATC Holdings,</td></tr><tr><td>Electric</td><td>Gas</td><td>Other</td><td>Total</td><td>Non-utility, Parent and Other</td><td>Alliant Energy Consolidated</td><td></td></tr><tr><td>2018</td><td>$3,000.3</td><td>$446.6</td><td>$48.0</td><td>$3,494.9</td><td>$39.6</td><td>$3,534.5</td><td></td></tr><tr><td>Revenues</td><td>457.3</td><td>42.0</td><td>3.6</td><td>502.9</td><td>4.0</td><td>506.9</td><td></td></tr><tr><td>Depreciation and amortization</td><td>610.2</td><td>53.2</td><td>0.3</td><td>663.7</td><td>30.7</td><td>694.4</td><td></td></tr><tr><td>Operating income</td><td></td><td></td><td></td><td>217.2</td><td>29.8</td><td>247.0</td><td></td></tr><tr><td>Interest expense</td><td></td><td></td><td></td><td>(0.9)</td><td>(53.7)</td><td>(54.6)</td><td></td></tr><tr><td>Equity income from unconsolidated investments, net</td><td>(0.9)</td><td>—</td><td>—</td><td>(0.9)</td><td>14.7</td><td>47.7</td><td></td></tr><tr><td>Income taxes</td><td></td><td></td><td></td><td>33.0</td><td></td><td></td><td></td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td></td><td></td><td></td><td>472.1</td><td>40.0</td><td>512.1</td><td></td></tr><tr><td>Total assets</td><td>12,486.3</td><td>1,184.4</td><td>893.2</td><td>14,563.9</td><td>862.1</td><td>15,426.0</td><td></td></tr><tr><td>Investments in equity method subsidiaries</td><td>8.1</td><td>—</td><td>—</td><td>8.1</td><td>413.2</td><td>421.3</td><td></td></tr><tr><td>Construction and acquisition expenditures</td><td>1,421.1</td><td>146.8</td><td>0.4</td><td>1,568.3</td><td>65.6</td><td>1,633.9</td><td></td></tr></table>

<table><tr><td rowspan="2">2017</td><td colspan="4">Utility</td><td colspan="2">ATC Holdings,</td></tr><tr><td>Electric</td><td>Gas</td><td>Other</td><td>Total</td><td>Non-utility, Parent and Other</td><td>Alliant Energy Consolidated</td></tr><tr><td>Revenues</td><td>$2,894.7</td><td>$400.9</td><td>$47.5</td><td>$3,343.1</td><td>$39.1</td><td>$3,382.2</td></tr><tr><td>Depreciation and amortization</td><td>412.0</td><td>38.2</td><td>7.7</td><td>457.9</td><td>3.9</td><td>461.8</td></tr><tr><td>Operating income (loss)</td><td>601.7</td><td>47.7</td><td>(11.6)</td><td>637.8</td><td>33.4</td><td>671.2</td></tr><tr><td>Interest expense</td><td></td><td></td><td></td><td>206.2</td><td>9.4</td><td>215.6</td></tr><tr><td>Equity income from unconsolidated investments, net</td><td>(0.7)</td><td>—</td><td>—</td><td>(0.7)</td><td>(44.1)</td><td>(44.8)</td></tr><tr><td>Income taxes</td><td></td><td></td><td></td><td>51.0</td><td>15.7</td><td>66.7</td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td></td><td></td><td></td><td>403.4</td><td>53.9</td><td>457.3</td></tr><tr><td>Total assets</td><td>11,396.2</td><td>1,199.8</td><td>766.5</td><td>13,362.5</td><td>825.3</td><td>14,187.8</td></tr><tr><td>Investments in equity method subsidiaries</td><td>8.3</td><td>—</td><td>—</td><td>8.3</td><td>373.1</td><td>381.4</td></tr><tr><td>Construction and acquisition expenditures</td><td>1,154.9</td><td>125.2</td><td>1.7</td><td>1,281.8</td><td>185.1</td><td>1,466.9</td></tr></table>

## NOTE 19. RELATED PARTIES

ATC - Pursuant to various agreements, WPL receives a range of transmission services from ATC. WPL provides operation, maintenance, and construction services to ATC. WPL and ATC also bill each other for use of shared facilities owned by each party. The related amounts billed between the parties were as follows (in millions):

<table><tr><td></td><td>2019</td><td>2018</td><td>2017</td></tr><tr><td>ATC billings to WPL</td><td>$109</td><td>$106</td><td>$105</td></tr><tr><td>WPL billings to ATC</td><td>13</td><td>11</td><td>10</td></tr></table>

As of December 31, 2019 and 2018, WPL owed ATC net amounts of $9 million and $8 million, respectively.

## NOTE 20. SELECTED CONSOLIDATED QUARTERLY FINANCIAL DATA (UNAUDITED)

Alliant Energy - All “per share” references refer to earnings per diluted share. Summation of the individual quarters may not equal annual totals due to rounding.

<table><tr><td rowspan="3"></td><td colspan="4">2019</td><td colspan="4">2018</td></tr><tr><td>March 31</td><td>June 30</td><td>Sep. 30</td><td>Dec. 31</td><td>March 31</td><td>June 30</td><td>Sep. 30</td><td>Dec.31</td></tr><tr><td colspan="8">(in millions, except per share data)</td></tr><tr><td>Revenues</td><td>$987.2</td><td>$790.2</td><td>$990.2</td><td>$880.1</td><td>$916.3</td><td>$816.1</td><td>$928.6</td><td>$873.5</td></tr><tr><td>Operating income</td><td>176.8</td><td>149.8</td><td>290.2</td><td>160.9</td><td>165.7</td><td>151.2</td><td>256.1</td><td>121.4</td></tr><tr><td>Net income attributable to Alliant Energy common shareowners</td><td>125.1</td><td>94.6</td><td>226.0</td><td>111.5</td><td>120.9</td><td>100.4</td><td>205.5</td><td>85.3</td></tr><tr><td>Earnings per weighted average common share attributable to Alliant Energy common shareowners</td><td>0.53</td><td>0.40</td><td>0.94</td><td>0.46</td><td>0.52</td><td>0.43</td><td>0.87</td><td>0.36</td></tr></table>



## Our leaders

## BOARD OF DIRECTORS



John O. Larsen
Chairman of the
Board, President and
Chief Executive Officer
Director since 2019
Age 56



Patrick E. Allen
Chief Financial Officer,
Collins Aerospace
Director since 2011
Age 55



Jillian C. Evanko
Chief Executive Officer,
President, Chief Financial
Officer and Treasurer,
Chart Industries, Inc.
Director since 2019
Age 42



Michael D. Garcia
President of the Pulp and
Paper Division of Domtar
Corporation
Director since 2020
Age 55



Singleton B. McAllister
Of Counsel,
Husch Blackwell
Director since 2001
Age 68



Roger K. Newport
Former Chief Executive
Officer, AK Steel
Holding Corp.
Director since 2018
Age 55



Dean C. Oestreich
Former Chairman,
Pioneer Hi-Bred
International, Inc.
Director since 2005
Age 68



Thomas F. O'Toole
Executive Director of
the Program for Data
Analytics at the Kellogg
School of Management of
Northwestern University
Director since 2015
Age 62



Carol P. Sanders
President,
Carol P. Sanders
Consulting LLC
Director since 2005
Age 53



Susan D. Whiting
Former Vice Chair,
Nielsen, N.V.
Director since 2013
Age 63

Information as of April 1, 2020. For detailed information on each board member, please refer to the proxy statement for the 2020 Annual Meeting of Shareowners.

## CORPORATE OFFICERS

John O. Larsen [1988] \( ^{*} \) 
Chairman, President and CEO

Robert J. Durian [1992] \( ^{*} \) 
Executive Vice President
and Chief Financial Officer

James H. Gallegos [2010] \( ^{*} \) 
Executive Vice President, General
Counsel and Corporate Secretary

David A. de Leon [1987] \( ^{*} \) 
Senior Vice President,
President – Wisconsin Power and Light

Terry L. Kouba [1981] \( ^{*} \) 
Senior Vice President,
President – Interstate Power and Light
James P. Brummond [2002]
Vice President

L. Diane Cooke [2019]
Vice President

Aimee L. Davis [2018]
Vice President

Linda K. Mattes [1982]
Vice President

Joel J. Schmidt [1988]
Vice President

Barbara P. Tormaschv [2016]
Vice President and Treasurer
Benjamin M. Bilitz [2011] \( ^{*} \) 
Chief Accounting Officer
and Controller

Daniel R. Culhane [2013]
Assistant Corporate Secretary

Melissa A. Kehoe [2016]
Assistant Controller

Neil M. Krebsbach [1995]
Assistant Treasurer

NON-UTILITY
BUSINESS OFFICER

Kevin P. Burke [1981]
President – Alliant Energy Transportation

 \( ^{*} \) Executive officer as of April 1, 2020.

Dates in brackets represent the year each person joined the company or a predecessor company that ultimately became part of Alliant Energy.



## Shareowner information

<table><tr><td>Stock exchange listings</td><td>Trading exchange</td><td>Trading symbol</td></tr><tr><td>Alliant Energy – Common stock</td><td>NASDAQ GSM</td><td>LNT</td></tr><tr><td>Interstate Power and Light Company – 5.1% Preferred</td><td>NASDAQ GSM</td><td>IPLDP</td></tr></table>

## Alliant Energy common stock quarterly price ranges and dividends

<table><tr><td></td><td colspan="3">2019</td><td colspan="3">2018</td></tr><tr><td>Quarter</td><td>High</td><td>Low</td><td>Dividend</td><td>High</td><td>Low</td><td>Dividend</td></tr><tr><td>First</td><td>$ 47.91</td><td>$ 40.75</td><td>$ 0.355</td><td>$ 42.72</td><td>$ 36.84</td><td>$ 0.335</td></tr><tr><td>Second</td><td>50.17</td><td>45.72</td><td>0.355</td><td>43.47</td><td>38.22</td><td>0.335</td></tr><tr><td>Third</td><td>54.59</td><td>48.48</td><td>0.355</td><td>44.18</td><td>41.39</td><td>0.335</td></tr><tr><td>Fourth</td><td>55.40</td><td>50.93</td><td>0.355</td><td>46.58</td><td>40.68</td><td>0.335</td></tr><tr><td>Year</td><td>55.40</td><td>40.75</td><td>1.42</td><td>46.58</td><td>36.84</td><td>1.34</td></tr></table>

Alliant Energy Corporation 2019 year-end common stock closing price: $54.72.

## Annual Meeting

The 2020 Annual Meeting of Shareowners will be a virtually meeting (no physical location). The meeting will be held on Thursday, May 21, at 9 a.m. Central Daylight Time. To access the meeting, you will need your 16-digit control number found on your proxy card.

Log in at virtualshareholder meeting.com/LNT2020 or listen by phone at 1-877-328-2502.

## Form 10-K information

Upon request, the company will provide, without charge, copies of the Annual Report on Form 10-K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission (SEC). All reports filed with the SEC are also available through our website at alliantenergy.com/investors.
Electronic access to Alliant Energy’s Annual Report, Proxy Statement and Form 10-K
Alliant Energy offers shareowners access to its Annual Report, Proxy Statement and Form 10-K online at alliantenergy.com/investors as a convenient alternative to mailing the printed materials.

Shareowners who have access to the internet are encouraged to enroll in the electronic access program at shareowneronline.com.

## Shareowner Direct Plan

The Shareowner Direct Plan is available to all shareowners of record and first-time investors. Through the plan, shareowners may buy common stock directly through the company without paying any brokerage commissions. Shareowners can also elect to reinvest the dividend. Full details are in the prospectus, which can be obtained through our website or by calling EQ Shareowner Services. Contact information is listed on this page.

## Direct deposit

Shareowners may choose to have their quarterly dividend electronically deposited into their checking or savings account. Electronic deposit may be initiated or changed at shareowneronline.com or by calling EQ Shareowner Services. Contact information is listed on this page.

## Duplicate mailings

Shares owned by one person but held in different forms of the same name result in duplicate mailing of shareowner information at added expense to the company. Such duplication can be eliminated only at the direction of the shareowner. Please notify EQ Shareowner Services to eliminate duplication. Contact information is listed on this page.

## Stock transfer agent, registrar and dividend payments

EQ Shareowner Services
1110 Centre Pointe Curve
Suite 101
Mendota Heights, MN 55120
Phone: 1-800-356-5343
7 a.m. to 7 p.m. CT, M-F
shareowneronline.com
Fax: 1-651-450-4033

## 2020 record and dividend payment dates

Anticipated record and payment dates are as follows:

Common stock

<table><tr><td>Record dates</td><td>Payment dates</td></tr><tr><td>Jan 31</td><td>Feb 18</td></tr><tr><td>Apr 30</td><td>May 15</td></tr><tr><td>Jul 31</td><td>Aug 17</td></tr><tr><td>Oct 30</td><td>Nov 16</td></tr></table>

Alliant Energy Corporation had 24,034 shareowners of record as of December 31, 2019. Shareowner records were maintained by EQ Shareowner Services in St. Paul, Minn.

## Historical research/other company information

For assistance with account history for calculating your cost basis or requests for copies of our Annual Report, Proxy Statement and Form 10-K, please contact Alliant Energy Shareowner Services in Madison, Wis., using the contact information below.

## Alliant Energy
Shareowner Services

4902 N. Biltmore Lane
P.O. Box 14720
Madison, WI 53708-0720
Phone: 1-800-353-1089
Email: shareownerservices@alliantenergy.com

## Questions? EQ

Shareowner Services
Phone: 1-800-356-5343
7 a.m. to 7 p.m. CT, M-F
shareowneronline.com



## View our clean energy vision in our Corporate Sustainability Report

Our Corporate Sustainability Report (CSR) shows how we are putting clean energy and technology to work for our customers and communities. It’s available online at alliantenergy.com/sustainability. We continue to make smart,

customer-focused investments. These include building more solar and wind, adding battery storage and making innovative upgrades to our power grid. Our CSR highlights our targets for reducing carbon dioxide emissions and water use, as well as eliminating existing coal from our energy mix. Take a look today!

alliantenergy.com/sustainability





Alliant Energy
Corporate Headquarters

4902 N. Biltmore Lane
Madison, WI 53718-2148

General information: 1-800-ALLIANT
alliantenergy.com

Individual shareowner questions
Alliant Energy Shareowner Services: 1-800-353-1089

Stock transfer agent and registrar
EQ Shareowner Services: 1-800-356-5343
shareowneronline.com

The common stock of Alliant Energy Corp. is traded on the Nasdaq Global Select Market (Nasdaq) under the symbol LNT.