US Closes $5.1bn Loan to Alliant Energy for Gas Plants and Storage

The US Department of Energy has closed a $5.1bn loan package to Alliant Energy to help pay for new gas-fired power plants, battery storage and upgrades at existing plants in Iowa and Wisconsin. The department’s Office of Energy Dominance Financing (EDF), formerly the Loan Programs Office, announced the financial close in a release on 28 October.

Alliant, a Madison, Wisconsin, utility group listed on Nasdaq, confirmed the deal in its own release the same day. It said the package is made up of 30-year, lower-interest loans.

What the loans will pay for

According to the department’s project page for Alliant, the money is split between two loans to Alliant’s subsidiaries, Interstate Power & Light in Iowa and Wisconsin Power & Light. The department says they will support about 1,500 megawatts (MW) of new gas generation, 240MW of extra capacity at existing generating units, about 1,000MW of battery storage and 2 billion cubic feet of liquefied natural gas (LNG) storage. LNG storage lets a utility hold gas on site for cold snaps, when pipeline supply is tight.

Alliant’s list is close but not identical. It says it “may pursue, but is not limited to” 1.6 gigawatts (GW) of new gas generation, 240MW at existing gas plants, 1GW of energy storage and 2 billion cubic feet of LNG storage. It says every proposed project will go through “a transparent regulatory process”, and that its access to the full $5.1bn is “subject to project advancement, qualification and financing terms”.

The department’s claims on savings and homes

The department says the investments will add more than 2.6GW of new or upgraded capacity, “enough electricity to power the equivalent of nearly 2 million homes”, and deliver “more than $1 billion” in electricity cost savings for families and businesses in the two states. Its project page puts the figure at $1.2bn over the life of the loans, and says the loans could cut Alliant’s interest bill by more than $46m a year. Alliant itself projects “up to $1.2 billion in cumulative customer savings” over the 30 years.

Jobs figures also vary by document. The release speaks of “hundreds of construction-related jobs”. The project page estimates 1,630 construction jobs and 46 permanent ones, and Alliant projects more than 1,600 construction jobs.

“The Energy Department is delivering on President Trump’s promise to lower electricity costs and unleash the full potential of American energy,” said Energy Secretary Chris Wright. EDF director Gregory Beard said that “by bringing new, dependable power online, we are strengthening our nation’s energy security and lowering electricity costs for families and businesses across Iowa and Wisconsin.”

Lisa Barton, Alliant’s chief executive, said the “federally backed financing helps lower the cost of building the generation and critical energy infrastructure our customers depend on”.

The department calls this the administration’s tenth financial close, and the sixth and seventh utility financings under its EDF programme. It came a day after the same office offered Constellation a conditional loan of up to $5bn for nuclear uprates.

From wind and batteries to gas plants

The Alliant deal did not start under this administration. On 16 January 2025, days before the change of president, the Loan Programs Office announced conditional commitments of more than $3bn to the same two Alliant subsidiaries. That article said Alliant “will deploy wind power and battery storage”, adding about 2,000MW of “clean energy generation and storage” through a programme created by the Inflation Reduction Act. The article no longer appears on the department’s website.

The closed package is larger and points the other way on fuel. Batteries survive, at about 1,000MW, but wind is not mentioned by either the department or Alliant. Gas plants, gas upgrades and LNG storage take its place. The department now frames the loans around an executive order on grid reliability, not emissions. It is the same department that this month put up to $42m behind the proposed Constitution gas pipeline and up to $50m behind transmission upgrades in Virginia and West Virginia.

The savings claims need reading with that in mind. They rest on Alliant borrowing more cheaply than in the bond market, not on the cost of the plants. Neither side has published an interest rate, and the department’s own “$46m a year” comes with conditions. State regulators still have to approve the projects. Gas turbines are also in heavy demand: GE Vernova booked 55 heavy-duty units in one quarter. Elsewhere, batteries are taking on more of the peak, as Australia’s evening grid shows. Cheaper money helps, but it does not set the build cost.

What to watch

The next step is Alliant’s regulatory filings in Iowa and Wisconsin naming the plants it wants to build, and the first drawdowns under the loans.

Sources

1. US Department of Energy, “Energy Department Closes $5.1 Billion Loan to Lower Electricity Costs and Strengthen Grid Reliability in Iowa and Wisconsin”, 28 October 2026
2. US Department of Energy, Office of Energy Dominance Financing, “EDF Project: Alliant”
3. Alliant Energy, “Alliant Energy Projects up to $1.2 Billion in Customer Savings With $5.1 Billion Loan Package”, 28 October 2026
4. US Department of Energy, Loan Programs Office, “LPO Announces Conditional Commitment to Alliant Energy to Improve Grid Resilience in Iowa and Wisconsin”, 16 January 2025 (archived copy)

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