July 1, 2001
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Minnesota Approves "Interstate" Merger
The Minnesota Public Utilities Commission has approved the merger of Interstate Power Co., IES Industries Inc., and WPL Holdings Inc., joining Illinois, which has also signed off on the deal. (See, Headlines, this issue, p. 21.)
The commission estimated total merger-related savings of $592.1 million to $648.1 million over 10 years. Minnesota ratepayers could save nearly $15.5 million in electric costs and $6.4 million in gas over the same period. The commission also found that the merger would not have a negative impact on competition in the region's energy market nor would it compromise the quality of service received by the state's consumers.
As a condition to merger approval, Interstate Power agreed to freeze its rates for four years. The company also has agreed not to claim of federal preemption for any cost-of-service it might incur under the merged company's agreement if the commission disallows recovery. The commission asked for this agreement to address concerns regarding its ongoing jurisdiction over capacity purchase costs incurred by Interstate after the merger. The condition would remain in place until the commission finds an acceptable alternative to the coordination agreement is in place or it is no longer necessary. Re Interstate Power Co., Docket No. E, G-001/PA-96-184, March 24, 1997 (Minn.P.S.C.).
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