ALLIANT ENERGY OUTLINES UTILITY GENERATION PLAN.

Alliant Energy Corp. (NYSE:LNT), Madison, Wis., has announced its domestic utility supply plan and a refined role for Alliant Energy Generation, its non-regulated generation subsidiary.

"We are building on our strengths with actions that clearly signal that our domestic regulated utilities will serve not only as our foundation, but also as our primary growth platform," said Erroll B. Davis, Jr., chairman, president and CEO of Alliant Energy Corp. "We will rely on a diversified portfolio of generation resources, resulting in a plan that is balanced, flexible and financially viable."

Domestic Utility Generation Summary

The company's plan would add a diversified portfolio of approximately 1,600 megawatts (MW) of nameplate generation to serve its 1.4 million domestic utility customers in Iowa, Wisconsin, Minnesota and Illinois between 2004 and 2010. Of the 1,600MW, 985MW are planned for Iowa and 615MW are planned for Wisconsin. This total includes the completion in June 2004 of the 550MW combined-cycle Emery plant near Mason City, Iowa. This new generation is expected to be comprised of approximately:

-- 1,140MW of natural gas-fired generation (840MW-Iowa, 300MW-Wisconsin) with 590MW installed as natural gas combustion turbines for peaking generation

-- 230MW of wind generation (130MW-Iowa, 100MW-Wisconsin) currently anticipated to be added under purchased power agreements

-- 30MW of anaerobic digesters (15MW-Iowa, 15MW-Wisconsin)

-- 200MW share of a larger base load coal plant in Wisconsin in the later years of the plan

The capital expenditures associated with the new Alliant Energy-owned generation listed above are expected to be approximately $650 million between 2004 and 2010. Timelines and sites will be announced as plans for specific projects are finalized over the course of the plan timeframe.

"The approach we are taking to address our energy infrastructure needs not only helps ensure the lights stay on, but that the environment is protected, our prices are fair and our investors are provided a fair return for the important investments we make in the process," said Davis.

The company also announced that its analysis shows that the base load coal plant originally announced as part of the Power Iowa initiative will not be needed in the 2004-2010 timeframe. While not a formal part of the plan, the company said it is exploring participation in approximately 200MW of coal- fired cogeneration in Iowa some time after 2010.

Bill Harvey, executive vice president-generation for Alliant Energy, said the company has conducted a thorough review of future demand and believes that new generation will be needed to meet increasing customer demand, reduce reliance on purchased power agreements and mitigate the impacts of potential future plant retirements. The company will continue to purchase energy and capacity in the market and intends to remain a net purchaser of both, but at a reduced level. Harvey also indicated the company will work within the legislative and regulatory arenas to ensure its successful energy efficiency programs continue to play a significant role in meeting customers' current and future energy needs.

The company also has options to purchase two existing natural gas plants in Wisconsin: the 450-megawatt RockGen simple-cycle facility southeast of Madison and the soon-to-be-completed 600-megawatt Riverside plant near Beloit. The current contracts with Calpine have buy-out options at a set price for RockGen in 2009 and for Riverside in 2014. The future options will be evaluated based on market conditions and provide flexibility in either owning the plants or contracting for the capacity and/or energy from the plants.

"Much of the new generation called for in our plan is added in the later years," said Harvey. "While we have some near-term actions either planned or underway, we believe we have the flexibility to appropriately adjust our plans as technology, market conditions, the economy and environmental regulations change."

Greater Regulatory Certainty

Alliant Energy's CFO Eliot Protsch noted that progressive legislation passed in Iowa relating to the ratemaking principles of rate-based utility plants and the lease-back structure that has been approved in Wisconsin for an affiliate plant both create opportunities to invest in generation that did not exist a few years ago through increased regulatory certainty. For the 550MW Emery plant in Iowa, the principles included a 12.23 percent return on the common equity and a 28- year depreciation schedule. For generation in Wisconsin, the company expects to use a similar financial structure to that recently approved by the Public Service Commission of Wisconsin in its Power the Future II decision.

"The potential for reasonable and known returns based on generation built to service our domestic regulated utility customers has been enhanced," said Protsch. "We intend to utilize these opportunities to the benefit of our customers, our investors and our employees."

Environmental Protection

The company also announced its plan to undertake a number of emissions reduction actions as part of its on-going efforts to improve the environmental profile of its generation fleet. The actions will include the highly-successful and proven SmartBurn(TM) approach of reducing emissions, and be augmented, where necessary, with scrubbers, active carbon injection, selective catalytic reduction and other pollution abatement technologies. The company also plans to be active in the emission trading marketplace and expects to retire some smaller, older, less-efficient power plants in the later years of the plan.

"Our core value of environmental stewardship has been a hallmark of Alliant Energy and has played a critical role in our success," said Harvey. "As we supply reliable energy to our customers, we commit to building new plants and operating our existing plants in a way that reduces our overall environmental footprint."

Refined Role for Alliant Energy Generation

The company also announced that Alliant Energy Generation will refine its focus to support the development, financing and construction of generation to meet the needs of Alliant Energy's domestic regulated utilities. It will defer pursuit of other new non-regulated generation projects or further acquisitions of existing tolled generation in the near-term.

"We have people with significant expertise in the development, financing and construction of power plants within Alliant Energy Generation and plan on deploying that talent in supporting our focus on power plant construction to meet the needs of our domestic regulated utilities," said Harvey.

Conclusion

"Rather than a return to basics, we are moving forward and building upon the strong base provided by our domestic utility operations," said Davis. "By focusing on that strong base, we believe we are positioned to provide a sound energy value to our customers and a solid return to our investors."

Alliant Energy is an energy-services provider that serves more than three million customers worldwide. Providing its regulated customers in the Midwest with electricity and natural gas service remains the company's primary focus. Alliant Energy, headquartered in Madison, Wis., is a Fortune 1000 company traded on the New York Stock Exchange under the symbol LNT.

Alliant Energy is the parent company of two public utility companies--Interstate Power and Light Company (IPL) and Wisconsin Power and Light Company (WPL)--and of Alliant Energy Resources, Inc. (AER), the parent company of Alliant Energy's non-regulated operations.

For more information, visit http://www.alliantenergy.com or call 608/458-3924.