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Fair Value Measurements | 3 Months Ended
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Mar. 31, 2014
Fair Value Measurements | FAIR VALUE MEASUREMENTS 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 were as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
March 31, 2014 | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
Assets: |  |  |  |  |  |  |  |  |  |  |
Derivative assets (Note 12) |  | $41.3 |  |  |  | $41.3 |  |  |  | $15.9 |  |  |  | $15.9 |  |  |  | $25.4 |  |  |  | $25.4 |
Deferred proceeds (sales of receivables) (Note 3(a)) | 170.8 |  |  | 170.8 |  |  | 170.8 |  |  | 170.8 |  |  | — |  |  | — |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,339.4 |  |  | 3,819.8 |  |  | 1,558.6 |  |  | 1,779.6 |  |  | 1,332.2 |  |  | 1,582.5 |
Cumulative preferred stock (Note 6) | 200.0 |  |  | 183.8 |  |  | 200.0 |  |  | 183.8 |  |  | — |  |  | — |
Derivative liabilities (Note 12) | 9.0 |  |  | 9.0 |  |  | 2.2 |  |  | 2.2 |  |  | 6.8 |  |  | 6.8 |
| Alliant Energy |  | IPL |  | WPL
December 31, 2013 | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
Assets: |  |  |  |  |  |  |  |  |  |  |
Derivative assets (Note 12) |  | $26.7 |  |  |  | $26.7 |  |  |  | $21.1 |  |  |  | $21.1 |  |  |  | $5.6 |  |  |  | $5.6 |
Deferred proceeds (sales of receivables) (Note 3(a)) | 203.5 |  |  | 203.5 |  |  | 203.5 |  |  | 203.5 |  |  | — |  |  | — |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,336.3 |  |  | 3,712.3 |  |  | 1,558.4 |  |  | 1,726.4 |  |  | 1,332.1 |  |  | 1,532.9 |
Cumulative preferred stock (Note 6) | 200.0 |  |  | 167.0 |  |  | 200.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivative liabilities (Note 12) | 20.8 |  |  | 20.8 |  |  | 5.2 |  |  | 5.2 |  |  | 15.6 |  |  | 15.6 |
Valuation Hierarchy - As of March 31, 2014 and December 31, 2013, Level 1 items included IPL’s 5.1% cumulative preferred stock. As of March 31, 2014 and December 31, 2013, Level 2 items included certain of IPL’s and WPL’s non-exchange traded commodity contracts and substantially all of the long-term debt instruments. As of March 31, 2014 and December 31, 2013, Level 3 items included IPL’s deferred proceeds, and IPL’s and WPL’s FTRs and certain non-exchange traded commodity contracts. Valuation Techniques - Derivative assets and derivative liabilities - Derivative instruments are periodically used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices and transmission congestion costs, and risk policies are maintained that govern the use of such derivative instruments. As of March 31, 2014 and December 31, 2013, derivative instruments were not designated as hedging instruments and included the following:
Risk management purpose | Type of instrument
Mitigate pricing volatility for: |
Electricity purchased to supply customers | Electric swap and physical forward contracts (IPL and WPL)
Fuel used to supply natural gas-fired EGUs | Natural gas swap contracts (IPL and WPL)
| Natural gas options and physical forward contracts (WPL)
Natural gas supplied to retail customers | Natural gas options and physical forward contracts (IPL and WPL)
| Natural gas swap contracts (IPL)
Fuel used at coal-fired EGUs | Coal physical forward contract with volumetric optionality (IPL and WPL)
Optimize the value of natural gas pipeline capacity | Natural gas physical forward contracts (IPL and WPL)
| Natural gas swap contracts (IPL)
Manage transmission congestion costs | FTRs (IPL and WPL)
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 predominately at liquid trading points. FTRs were valued using monthly or annual auction shadow prices from relevant auctions and were categorized as Level 3. Refer to Note 12 for additional details of derivative assets and derivative liabilities. Level 3 inputs include observable and unobservable inputs used in the fair value measurements of commodity contracts. The observable inputs are obtained from third-party pricing sources, counterparties and brokers and include bids, offers, historical transactions (including historical price differences between locations with both observable and unobservable prices) and executed trades. The significant unobservable inputs used in the fair value measurement of commodity contracts are forecasted electricity, natural gas and coal prices, and the expected volatility of such prices. Significant changes in any of those inputs would result in a significantly lower or higher fair value measurement. 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 proceeds 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 3(a) for additional information regarding deferred proceeds. Long-term debt (including current maturities) - The fair value of long-term debt instruments was based on quoted market prices for similar liabilities at each reporting date or on a discounted cash flow methodology, which utilizes assumptions of current market pricing curves at each reporting date. Cumulative preferred stock - The fair value of IPL’s 5.1% cumulative preferred stock was based on its closing market price quoted by the New York Stock Exchange at each reporting date. Refer to Note 6 for additional information regarding cumulative preferred stock. Items subject to fair value measurement disclosure requirements were as follows (in millions):
Alliant Energy | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $41.3 |  |  |  | $— |  |  |  | $11.2 |  |  |  | $30.1 |  |  |  | $26.7 |  |  |  | $— |  |  |  | $4.7 |  |  |  | $22.0 |
Deferred proceeds | 170.8 |  |  | — |  |  | — |  |  | 170.8 |  |  | 203.5 |  |  | — |  |  | — |  |  | 203.5 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,819.8 |  |  | — |  |  | 3,816.5 |  |  | 3.3 |  |  | 3,712.3 |  |  | — |  |  | 3,711.8 |  |  | 0.5 |
Cumulative preferred stock | 183.8 |  |  | 183.8 |  |  | — |  |  | — |  |  | 167.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivatives - commodity contracts | 9.0 |  |  | — |  |  | 2.8 |  |  | 6.2 |  |  | 20.8 |  |  | — |  |  | 3.2 |  |  | 17.6 |
IPL | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $15.9 |  |  |  | $— |  |  |  | $6.8 |  |  |  | $9.1 |  |  |  | $21.1 |  |  |  | $— |  |  |  | $3.0 |  |  |  | $18.1 |
Deferred proceeds | 170.8 |  |  | — |  |  | — |  |  | 170.8 |  |  | 203.5 |  |  | — |  |  | — |  |  | 203.5 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 1,779.6 |  |  | — |  |  | 1,779.6 |  |  | — |  |  | 1,726.4 |  |  | — |  |  | 1,726.4 |  |  | — |
Cumulative preferred stock | 183.8 |  |  | 183.8 |  |  | — |  |  | — |  |  | 167.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivatives - commodity contracts | 2.2 |  |  | — |  |  | 0.9 |  |  | 1.3 |  |  | 5.2 |  |  | — |  |  | 1.7 |  |  | 3.5 |
WPL | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $25.4 |  |  |  | $— |  |  |  | $4.4 |  |  |  | $21.0 |  |  |  | $5.6 |  |  |  | $— |  |  |  | $1.7 |  |  |  | $3.9 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 1,582.5 |  |  | — |  |  | 1,582.5 |  |  | — |  |  | 1,532.9 |  |  | — |  |  | 1,532.9 |  |  | — |
Derivatives - commodity contracts | 6.8 |  |  | — |  |  | 1.9 |  |  | 4.9 |  |  | 15.6 |  |  | — |  |  | 1.5 |  |  | 14.1 |
Gains and losses from IPL’s and WPL’s derivative instruments are generally recorded with offsets to regulatory assets or regulatory liabilities, based on fuel and natural gas cost recovery mechanisms, as well as other specific regulatory authorizations. Based on these recovery mechanisms, the changes in the fair value of derivative liabilities resulted in comparable changes to regulatory assets, and the changes in the fair value of derivative assets resulted in comparable changes to regulatory liabilities on the balance sheets. Information for fair value measurements using significant unobservable inputs (Level 3 inputs) was as follows (in millions):
Alliant Energy | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
Three Months Ended March 31 | 2014 |  | 2013 |  | 2014 |  | 2013
Beginning balance, January 1 |  | $4.4 |  |  |  | $11.9 |  |  |  | $203.5 |  |  |  | $66.8 |
Total net gains (losses) (realized/unrealized) included in changes in net assets (a) | 38.4 |  |  | (2.4 | ) |  | — |  |  | — |
Transfers out of Level 3 (b) | — |  |  | 3.6 |  |  | — |  |  | — |
Settlements (c) | (18.9 | ) |  | (8.2 | ) |  | (32.7 | ) |  | 55.3 |
Ending balance, March 31 |  | $23.9 |  |  |  | $4.9 |  |  |  | $170.8 |  |  |  | $122.1 |
The amount of total net gains (losses) for the period included in changes in net assets attributable to the change in unrealized gains (losses) relating to assets and liabilities held at March 31 (a) |  | $31.0 |  |  |  | ($2.4 | ) |  |  | $— |  |  |  | $— |
IPL | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
Three Months Ended March 31 | 2014 |  | 2013 |  | 2014 |  | 2013
Beginning balance, January 1 |  | $14.6 |  |  |  | $12.5 |  |  |  | $203.5 |  |  |  | $66.8 |
Total net gains (losses) (realized/unrealized) included in changes in net assets (a) | 4.2 |  |  | (2.9 | ) |  | — |  |  | — |
Transfers out of Level 3 (b) | — |  |  | 1.1 |  |  | — |  |  | — |
Settlements (c) | (11.0 | ) |  | (6.4 | ) |  | (32.7 | ) |  | 55.3 |
Ending balance, March 31 |  | $7.8 |  |  |  | $4.3 |  |  |  | $170.8 |  |  |  | $122.1 |
The amount of total net gains (losses) for the period included in changes in net assets attributable to the change in unrealized gains (losses) relating to assets and liabilities held at March 31 (a) |  | $3.1 |  |  |  | ($2.9 | ) |  |  | $— |  |  |  | $— |
WPL | Commodity Contract Derivative
| Assets and (Liabilities), net
Three Months Ended March 31 | 2014 |  | 2013
Beginning balance, January 1 |  | ($10.2 | ) |  |  | ($0.6 | )
Total net gains (realized/unrealized) included in changes in net assets (a) | 34.2 |  |  | 0.5 |
Transfers out of Level 3 (b) | — |  |  | 2.5 |
Settlements | (7.9 | ) |  | (1.8 | )
Ending balance, March 31 |  | $16.1 |  |  |  | $0.6 |
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 March 31 (a) |  | $27.9 |  |  |  | $0.5 |
(a) | Gains and losses related to derivative assets and derivative liabilities are recorded in regulatory assets and regulatory liabilities on the balance sheets.
(b) | Observable market inputs became available for certain commodity contracts previously classified as Level 3 for transfers out of Level 3. The transfers were valued as of the beginning of the period.
(c) | 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 proceeds received from the receivables sold.
Commodity Contracts - The fair value of electric, natural gas and coal commodity contracts categorized as Level 3 was recognized as net derivative assets (liabilities) as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
| Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs
March 31, 2014 |  | $16.5 |  |  |  | $7.4 |  |  |  | $1.1 |  |  |  | $6.7 |  |  |  | $15.4 |  |  |  | $0.7 |
December 31, 2013 | (13.9 | ) |  | 18.3 |  |  | (2.1 | ) |  | 16.7 |  |  | (11.8 | ) |  | 1.6 |
IPL [Member] |
Fair Value Measurements | FAIR VALUE MEASUREMENTS 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 were as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
March 31, 2014 | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
Assets: |  |  |  |  |  |  |  |  |  |  |
Derivative assets (Note 12) |  | $41.3 |  |  |  | $41.3 |  |  |  | $15.9 |  |  |  | $15.9 |  |  |  | $25.4 |  |  |  | $25.4 |
Deferred proceeds (sales of receivables) (Note 3(a)) | 170.8 |  |  | 170.8 |  |  | 170.8 |  |  | 170.8 |  |  | — |  |  | — |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,339.4 |  |  | 3,819.8 |  |  | 1,558.6 |  |  | 1,779.6 |  |  | 1,332.2 |  |  | 1,582.5 |
Cumulative preferred stock (Note 6) | 200.0 |  |  | 183.8 |  |  | 200.0 |  |  | 183.8 |  |  | — |  |  | — |
Derivative liabilities (Note 12) | 9.0 |  |  | 9.0 |  |  | 2.2 |  |  | 2.2 |  |  | 6.8 |  |  | 6.8 |
| Alliant Energy |  | IPL |  | WPL
December 31, 2013 | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
Assets: |  |  |  |  |  |  |  |  |  |  |
Derivative assets (Note 12) |  | $26.7 |  |  |  | $26.7 |  |  |  | $21.1 |  |  |  | $21.1 |  |  |  | $5.6 |  |  |  | $5.6 |
Deferred proceeds (sales of receivables) (Note 3(a)) | 203.5 |  |  | 203.5 |  |  | 203.5 |  |  | 203.5 |  |  | — |  |  | — |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,336.3 |  |  | 3,712.3 |  |  | 1,558.4 |  |  | 1,726.4 |  |  | 1,332.1 |  |  | 1,532.9 |
Cumulative preferred stock (Note 6) | 200.0 |  |  | 167.0 |  |  | 200.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivative liabilities (Note 12) | 20.8 |  |  | 20.8 |  |  | 5.2 |  |  | 5.2 |  |  | 15.6 |  |  | 15.6 |
Valuation Hierarchy - As of March 31, 2014 and December 31, 2013, Level 1 items included IPL’s 5.1% cumulative preferred stock. As of March 31, 2014 and December 31, 2013, Level 2 items included certain of IPL’s and WPL’s non-exchange traded commodity contracts and substantially all of the long-term debt instruments. As of March 31, 2014 and December 31, 2013, Level 3 items included IPL’s deferred proceeds, and IPL’s and WPL’s FTRs and certain non-exchange traded commodity contracts. Valuation Techniques - Derivative assets and derivative liabilities - Derivative instruments are periodically used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices and transmission congestion costs, and risk policies are maintained that govern the use of such derivative instruments. As of March 31, 2014 and December 31, 2013, derivative instruments were not designated as hedging instruments and included the following:
Risk management purpose | Type of instrument
Mitigate pricing volatility for: |
Electricity purchased to supply customers | Electric swap and physical forward contracts (IPL and WPL)
Fuel used to supply natural gas-fired EGUs | Natural gas swap contracts (IPL and WPL)
| Natural gas options and physical forward contracts (WPL)
Natural gas supplied to retail customers | Natural gas options and physical forward contracts (IPL and WPL)
| Natural gas swap contracts (IPL)
Fuel used at coal-fired EGUs | Coal physical forward contract with volumetric optionality (IPL and WPL)
Optimize the value of natural gas pipeline capacity | Natural gas physical forward contracts (IPL and WPL)
| Natural gas swap contracts (IPL)
Manage transmission congestion costs | FTRs (IPL and WPL)
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 predominately at liquid trading points. FTRs were valued using monthly or annual auction shadow prices from relevant auctions and were categorized as Level 3. Refer to Note 12 for additional details of derivative assets and derivative liabilities. Level 3 inputs include observable and unobservable inputs used in the fair value measurements of commodity contracts. The observable inputs are obtained from third-party pricing sources, counterparties and brokers and include bids, offers, historical transactions (including historical price differences between locations with both observable and unobservable prices) and executed trades. The significant unobservable inputs used in the fair value measurement of commodity contracts are forecasted electricity, natural gas and coal prices, and the expected volatility of such prices. Significant changes in any of those inputs would result in a significantly lower or higher fair value measurement. 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 proceeds 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 3(a) for additional information regarding deferred proceeds. Long-term debt (including current maturities) - The fair value of long-term debt instruments was based on quoted market prices for similar liabilities at each reporting date or on a discounted cash flow methodology, which utilizes assumptions of current market pricing curves at each reporting date. Cumulative preferred stock - The fair value of IPL’s 5.1% cumulative preferred stock was based on its closing market price quoted by the New York Stock Exchange at each reporting date. Refer to Note 6 for additional information regarding cumulative preferred stock. Items subject to fair value measurement disclosure requirements were as follows (in millions):
Alliant Energy | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $41.3 |  |  |  | $— |  |  |  | $11.2 |  |  |  | $30.1 |  |  |  | $26.7 |  |  |  | $— |  |  |  | $4.7 |  |  |  | $22.0 |
Deferred proceeds | 170.8 |  |  | — |  |  | — |  |  | 170.8 |  |  | 203.5 |  |  | — |  |  | — |  |  | 203.5 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,819.8 |  |  | — |  |  | 3,816.5 |  |  | 3.3 |  |  | 3,712.3 |  |  | — |  |  | 3,711.8 |  |  | 0.5 |
Cumulative preferred stock | 183.8 |  |  | 183.8 |  |  | — |  |  | — |  |  | 167.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivatives - commodity contracts | 9.0 |  |  | — |  |  | 2.8 |  |  | 6.2 |  |  | 20.8 |  |  | — |  |  | 3.2 |  |  | 17.6 |
IPL | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $15.9 |  |  |  | $— |  |  |  | $6.8 |  |  |  | $9.1 |  |  |  | $21.1 |  |  |  | $— |  |  |  | $3.0 |  |  |  | $18.1 |
Deferred proceeds | 170.8 |  |  | — |  |  | — |  |  | 170.8 |  |  | 203.5 |  |  | — |  |  | — |  |  | 203.5 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 1,779.6 |  |  | — |  |  | 1,779.6 |  |  | — |  |  | 1,726.4 |  |  | — |  |  | 1,726.4 |  |  | — |
Cumulative preferred stock | 183.8 |  |  | 183.8 |  |  | — |  |  | — |  |  | 167.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivatives - commodity contracts | 2.2 |  |  | — |  |  | 0.9 |  |  | 1.3 |  |  | 5.2 |  |  | — |  |  | 1.7 |  |  | 3.5 |
WPL | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $25.4 |  |  |  | $— |  |  |  | $4.4 |  |  |  | $21.0 |  |  |  | $5.6 |  |  |  | $— |  |  |  | $1.7 |  |  |  | $3.9 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 1,582.5 |  |  | — |  |  | 1,582.5 |  |  | — |  |  | 1,532.9 |  |  | — |  |  | 1,532.9 |  |  | — |
Derivatives - commodity contracts | 6.8 |  |  | — |  |  | 1.9 |  |  | 4.9 |  |  | 15.6 |  |  | — |  |  | 1.5 |  |  | 14.1 |
Gains and losses from IPL’s and WPL’s derivative instruments are generally recorded with offsets to regulatory assets or regulatory liabilities, based on fuel and natural gas cost recovery mechanisms, as well as other specific regulatory authorizations. Based on these recovery mechanisms, the changes in the fair value of derivative liabilities resulted in comparable changes to regulatory assets, and the changes in the fair value of derivative assets resulted in comparable changes to regulatory liabilities on the balance sheets. Information for fair value measurements using significant unobservable inputs (Level 3 inputs) was as follows (in millions):
Alliant Energy | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
Three Months Ended March 31 | 2014 |  | 2013 |  | 2014 |  | 2013
Beginning balance, January 1 |  | $4.4 |  |  |  | $11.9 |  |  |  | $203.5 |  |  |  | $66.8 |
Total net gains (losses) (realized/unrealized) included in changes in net assets (a) | 38.4 |  |  | (2.4 | ) |  | — |  |  | — |
Transfers out of Level 3 (b) | — |  |  | 3.6 |  |  | — |  |  | — |
Settlements (c) | (18.9 | ) |  | (8.2 | ) |  | (32.7 | ) |  | 55.3 |
Ending balance, March 31 |  | $23.9 |  |  |  | $4.9 |  |  |  | $170.8 |  |  |  | $122.1 |
The amount of total net gains (losses) for the period included in changes in net assets attributable to the change in unrealized gains (losses) relating to assets and liabilities held at March 31 (a) |  | $31.0 |  |  |  | ($2.4 | ) |  |  | $— |  |  |  | $— |
IPL | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
Three Months Ended March 31 | 2014 |  | 2013 |  | 2014 |  | 2013
Beginning balance, January 1 |  | $14.6 |  |  |  | $12.5 |  |  |  | $203.5 |  |  |  | $66.8 |
Total net gains (losses) (realized/unrealized) included in changes in net assets (a) | 4.2 |  |  | (2.9 | ) |  | — |  |  | — |
Transfers out of Level 3 (b) | — |  |  | 1.1 |  |  | — |  |  | — |
Settlements (c) | (11.0 | ) |  | (6.4 | ) |  | (32.7 | ) |  | 55.3 |
Ending balance, March 31 |  | $7.8 |  |  |  | $4.3 |  |  |  | $170.8 |  |  |  | $122.1 |
The amount of total net gains (losses) for the period included in changes in net assets attributable to the change in unrealized gains (losses) relating to assets and liabilities held at March 31 (a) |  | $3.1 |  |  |  | ($2.9 | ) |  |  | $— |  |  |  | $— |
WPL | Commodity Contract Derivative
| Assets and (Liabilities), net
Three Months Ended March 31 | 2014 |  | 2013
Beginning balance, January 1 |  | ($10.2 | ) |  |  | ($0.6 | )
Total net gains (realized/unrealized) included in changes in net assets (a) | 34.2 |  |  | 0.5 |
Transfers out of Level 3 (b) | — |  |  | 2.5 |
Settlements | (7.9 | ) |  | (1.8 | )
Ending balance, March 31 |  | $16.1 |  |  |  | $0.6 |
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 March 31 (a) |  | $27.9 |  |  |  | $0.5 |
(a) | Gains and losses related to derivative assets and derivative liabilities are recorded in regulatory assets and regulatory liabilities on the balance sheets.
(b) | Observable market inputs became available for certain commodity contracts previously classified as Level 3 for transfers out of Level 3. The transfers were valued as of the beginning of the period.
(c) | 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 proceeds received from the receivables sold.
Commodity Contracts - The fair value of electric, natural gas and coal commodity contracts categorized as Level 3 was recognized as net derivative assets (liabilities) as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
| Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs
March 31, 2014 |  | $16.5 |  |  |  | $7.4 |  |  |  | $1.1 |  |  |  | $6.7 |  |  |  | $15.4 |  |  |  | $0.7 |
December 31, 2013 | (13.9 | ) |  | 18.3 |  |  | (2.1 | ) |  | 16.7 |  |  | (11.8 | ) |  | 1.6 |
WPL [Member] |
Fair Value Measurements | FAIR VALUE MEASUREMENTS 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 were as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
March 31, 2014 | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
Assets: |  |  |  |  |  |  |  |  |  |  |
Derivative assets (Note 12) |  | $41.3 |  |  |  | $41.3 |  |  |  | $15.9 |  |  |  | $15.9 |  |  |  | $25.4 |  |  |  | $25.4 |
Deferred proceeds (sales of receivables) (Note 3(a)) | 170.8 |  |  | 170.8 |  |  | 170.8 |  |  | 170.8 |  |  | — |  |  | — |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,339.4 |  |  | 3,819.8 |  |  | 1,558.6 |  |  | 1,779.6 |  |  | 1,332.2 |  |  | 1,582.5 |
Cumulative preferred stock (Note 6) | 200.0 |  |  | 183.8 |  |  | 200.0 |  |  | 183.8 |  |  | — |  |  | — |
Derivative liabilities (Note 12) | 9.0 |  |  | 9.0 |  |  | 2.2 |  |  | 2.2 |  |  | 6.8 |  |  | 6.8 |
| Alliant Energy |  | IPL |  | WPL
December 31, 2013 | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
Assets: |  |  |  |  |  |  |  |  |  |  |
Derivative assets (Note 12) |  | $26.7 |  |  |  | $26.7 |  |  |  | $21.1 |  |  |  | $21.1 |  |  |  | $5.6 |  |  |  | $5.6 |
Deferred proceeds (sales of receivables) (Note 3(a)) | 203.5 |  |  | 203.5 |  |  | 203.5 |  |  | 203.5 |  |  | — |  |  | — |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,336.3 |  |  | 3,712.3 |  |  | 1,558.4 |  |  | 1,726.4 |  |  | 1,332.1 |  |  | 1,532.9 |
Cumulative preferred stock (Note 6) | 200.0 |  |  | 167.0 |  |  | 200.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivative liabilities (Note 12) | 20.8 |  |  | 20.8 |  |  | 5.2 |  |  | 5.2 |  |  | 15.6 |  |  | 15.6 |
Valuation Hierarchy - As of March 31, 2014 and December 31, 2013, Level 1 items included IPL’s 5.1% cumulative preferred stock. As of March 31, 2014 and December 31, 2013, Level 2 items included certain of IPL’s and WPL’s non-exchange traded commodity contracts and substantially all of the long-term debt instruments. As of March 31, 2014 and December 31, 2013, Level 3 items included IPL’s deferred proceeds, and IPL’s and WPL’s FTRs and certain non-exchange traded commodity contracts. Valuation Techniques - Derivative assets and derivative liabilities - Derivative instruments are periodically used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices and transmission congestion costs, and risk policies are maintained that govern the use of such derivative instruments. As of March 31, 2014 and December 31, 2013, derivative instruments were not designated as hedging instruments and included the following:
Risk management purpose | Type of instrument
Mitigate pricing volatility for: |
Electricity purchased to supply customers | Electric swap and physical forward contracts (IPL and WPL)
Fuel used to supply natural gas-fired EGUs | Natural gas swap contracts (IPL and WPL)
| Natural gas options and physical forward contracts (WPL)
Natural gas supplied to retail customers | Natural gas options and physical forward contracts (IPL and WPL)
| Natural gas swap contracts (IPL)
Fuel used at coal-fired EGUs | Coal physical forward contract with volumetric optionality (IPL and WPL)
Optimize the value of natural gas pipeline capacity | Natural gas physical forward contracts (IPL and WPL)
| Natural gas swap contracts (IPL)
Manage transmission congestion costs | FTRs (IPL and WPL)
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 predominately at liquid trading points. FTRs were valued using monthly or annual auction shadow prices from relevant auctions and were categorized as Level 3. Refer to Note 12 for additional details of derivative assets and derivative liabilities. Level 3 inputs include observable and unobservable inputs used in the fair value measurements of commodity contracts. The observable inputs are obtained from third-party pricing sources, counterparties and brokers and include bids, offers, historical transactions (including historical price differences between locations with both observable and unobservable prices) and executed trades. The significant unobservable inputs used in the fair value measurement of commodity contracts are forecasted electricity, natural gas and coal prices, and the expected volatility of such prices. Significant changes in any of those inputs would result in a significantly lower or higher fair value measurement. 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 proceeds 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 3(a) for additional information regarding deferred proceeds. Long-term debt (including current maturities) - The fair value of long-term debt instruments was based on quoted market prices for similar liabilities at each reporting date or on a discounted cash flow methodology, which utilizes assumptions of current market pricing curves at each reporting date. Cumulative preferred stock - The fair value of IPL’s 5.1% cumulative preferred stock was based on its closing market price quoted by the New York Stock Exchange at each reporting date. Refer to Note 6 for additional information regarding cumulative preferred stock. Items subject to fair value measurement disclosure requirements were as follows (in millions):
Alliant Energy | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $41.3 |  |  |  | $— |  |  |  | $11.2 |  |  |  | $30.1 |  |  |  | $26.7 |  |  |  | $— |  |  |  | $4.7 |  |  |  | $22.0 |
Deferred proceeds | 170.8 |  |  | — |  |  | — |  |  | 170.8 |  |  | 203.5 |  |  | — |  |  | — |  |  | 203.5 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 3,819.8 |  |  | — |  |  | 3,816.5 |  |  | 3.3 |  |  | 3,712.3 |  |  | — |  |  | 3,711.8 |  |  | 0.5 |
Cumulative preferred stock | 183.8 |  |  | 183.8 |  |  | — |  |  | — |  |  | 167.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivatives - commodity contracts | 9.0 |  |  | — |  |  | 2.8 |  |  | 6.2 |  |  | 20.8 |  |  | — |  |  | 3.2 |  |  | 17.6 |
IPL | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $15.9 |  |  |  | $— |  |  |  | $6.8 |  |  |  | $9.1 |  |  |  | $21.1 |  |  |  | $— |  |  |  | $3.0 |  |  |  | $18.1 |
Deferred proceeds | 170.8 |  |  | — |  |  | — |  |  | 170.8 |  |  | 203.5 |  |  | — |  |  | — |  |  | 203.5 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 1,779.6 |  |  | — |  |  | 1,779.6 |  |  | — |  |  | 1,726.4 |  |  | — |  |  | 1,726.4 |  |  | — |
Cumulative preferred stock | 183.8 |  |  | 183.8 |  |  | — |  |  | — |  |  | 167.0 |  |  | 167.0 |  |  | — |  |  | — |
Derivatives - commodity contracts | 2.2 |  |  | — |  |  | 0.9 |  |  | 1.3 |  |  | 5.2 |  |  | — |  |  | 1.7 |  |  | 3.5 |
WPL | March 31, 2014 |  | December 31, 2013
| Fair |  | Level |  | Level |  | Level |  | Fair |  | Level |  | Level |  | Level
| Value |  | 1 |  | 2 |  | 3 |  | Value |  | 1 |  | 2 |  | 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives - commodity contracts |  | $25.4 |  |  |  | $— |  |  |  | $4.4 |  |  |  | $21.0 |  |  |  | $5.6 |  |  |  | $— |  |  |  | $1.7 |  |  |  | $3.9 |
Capitalization and liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-term debt (including current maturities) | 1,582.5 |  |  | — |  |  | 1,582.5 |  |  | — |  |  | 1,532.9 |  |  | — |  |  | 1,532.9 |  |  | — |
Derivatives - commodity contracts | 6.8 |  |  | — |  |  | 1.9 |  |  | 4.9 |  |  | 15.6 |  |  | — |  |  | 1.5 |  |  | 14.1 |
Gains and losses from IPL’s and WPL’s derivative instruments are generally recorded with offsets to regulatory assets or regulatory liabilities, based on fuel and natural gas cost recovery mechanisms, as well as other specific regulatory authorizations. Based on these recovery mechanisms, the changes in the fair value of derivative liabilities resulted in comparable changes to regulatory assets, and the changes in the fair value of derivative assets resulted in comparable changes to regulatory liabilities on the balance sheets. Information for fair value measurements using significant unobservable inputs (Level 3 inputs) was as follows (in millions):
Alliant Energy | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
Three Months Ended March 31 | 2014 |  | 2013 |  | 2014 |  | 2013
Beginning balance, January 1 |  | $4.4 |  |  |  | $11.9 |  |  |  | $203.5 |  |  |  | $66.8 |
Total net gains (losses) (realized/unrealized) included in changes in net assets (a) | 38.4 |  |  | (2.4 | ) |  | — |  |  | — |
Transfers out of Level 3 (b) | — |  |  | 3.6 |  |  | — |  |  | — |
Settlements (c) | (18.9 | ) |  | (8.2 | ) |  | (32.7 | ) |  | 55.3 |
Ending balance, March 31 |  | $23.9 |  |  |  | $4.9 |  |  |  | $170.8 |  |  |  | $122.1 |
The amount of total net gains (losses) for the period included in changes in net assets attributable to the change in unrealized gains (losses) relating to assets and liabilities held at March 31 (a) |  | $31.0 |  |  |  | ($2.4 | ) |  |  | $— |  |  |  | $— |
IPL | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
Three Months Ended March 31 | 2014 |  | 2013 |  | 2014 |  | 2013
Beginning balance, January 1 |  | $14.6 |  |  |  | $12.5 |  |  |  | $203.5 |  |  |  | $66.8 |
Total net gains (losses) (realized/unrealized) included in changes in net assets (a) | 4.2 |  |  | (2.9 | ) |  | — |  |  | — |
Transfers out of Level 3 (b) | — |  |  | 1.1 |  |  | — |  |  | — |
Settlements (c) | (11.0 | ) |  | (6.4 | ) |  | (32.7 | ) |  | 55.3 |
Ending balance, March 31 |  | $7.8 |  |  |  | $4.3 |  |  |  | $170.8 |  |  |  | $122.1 |
The amount of total net gains (losses) for the period included in changes in net assets attributable to the change in unrealized gains (losses) relating to assets and liabilities held at March 31 (a) |  | $3.1 |  |  |  | ($2.9 | ) |  |  | $— |  |  |  | $— |
WPL | Commodity Contract Derivative
| Assets and (Liabilities), net
Three Months Ended March 31 | 2014 |  | 2013
Beginning balance, January 1 |  | ($10.2 | ) |  |  | ($0.6 | )
Total net gains (realized/unrealized) included in changes in net assets (a) | 34.2 |  |  | 0.5 |
Transfers out of Level 3 (b) | — |  |  | 2.5 |
Settlements | (7.9 | ) |  | (1.8 | )
Ending balance, March 31 |  | $16.1 |  |  |  | $0.6 |
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 March 31 (a) |  | $27.9 |  |  |  | $0.5 |
(a) | Gains and losses related to derivative assets and derivative liabilities are recorded in regulatory assets and regulatory liabilities on the balance sheets.
(b) | Observable market inputs became available for certain commodity contracts previously classified as Level 3 for transfers out of Level 3. The transfers were valued as of the beginning of the period.
(c) | 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 proceeds received from the receivables sold.
Commodity Contracts - The fair value of electric, natural gas and coal commodity contracts categorized as Level 3 was recognized as net derivative assets (liabilities) as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
| Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs
March 31, 2014 |  | $16.5 |  |  |  | $7.4 |  |  |  | $1.1 |  |  |  | $6.7 |  |  |  | $15.4 |  |  |  | $0.7 |
December 31, 2013 | (13.9 | ) |  | 18.3 |  |  | (2.1 | ) |  | 16.7 |  |  | (11.8 | ) |  | 1.6 |

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=28364263&loc=d3e13537-108611 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=28364263&loc=d3e13433-108611 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 28 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14064-108612 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=25499696&loc=d3e19207-110258 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 16 -URI http://asc.fasb.org/extlink&oid=28364263&loc=d3e13504-108611 + Details
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