DES MOINES (AP) — The federal tax cut could save up to $147 million in utility bills for Iowa residents as the state's investor-owned utility companies pass along some of their giant tax reductions.
Investor-owned utility companies in Iowa such as MidAmerican and Alliant will save millions as part of the new tax law signed by President Donald Trump in December. Legislation lowering the corporate federal income tax rate from 35 percent to 21 percent took effect Jan. 1.
Companies have yet to decide how they'll return savings to customers, the Des Moines Register reported. Some are considering lowering rates or providing monthly bill credits.
"It's hard to say what the dollar amount will be at this time," said Mark Schuling, state consumer advocate. "You have to get to how utilities will give it back. What's the method you look at when you give it back. Is it per gallon of water? Will you do a megawatt of electricity, a therm of gas?"
Schuling said all companies expressed interest in passing the tax break back to consumers as soon as possible.
MidAmerican Energy estimates returning between $90 million and $112 million to customers. The Des Moines utility has suggested retaining between $7.5 million and $8.4 million from gas customers in order to improve infrastructure and offset future rate increases.
Interstate Power & Light, an Alliant Energy subsidiary in Cedar Rapids, said it may return between $18.6 million and $19.6 million.
Alliant's gas customers could see between $500,000 and $3.7 million. Black Hills Energy may return $1.6 million and Iowa-American Water Co. would provide up to $1.8 million back to customers.