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Fair Value Measurements | 12 Months Ended
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Dec. 31, 2016
Fair Value Measurements | FAIR VALUE MEASUREMENTS Valuation Hierarchy - Fair value measurement accounting establishes three levels of fair value hierarchy that prioritize the inputs to valuation techniques used to measure fair value. Level 1 pricing inputs are quoted prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 pricing inputs are quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active as of the reporting date. Level 3 pricing inputs are unobservable inputs for assets or liabilities for which little or no market data exist and require significant management judgment or estimation. The fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. The lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability. Valuation Techniques - Derivative assets and derivative liabilities - Derivative instruments are used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices, transmission congestion costs and rail transportation costs. Risk policies are maintained that govern the use of such derivative instruments. 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 and physical forward contracts (IPL and WPL)
| Natural gas options (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 contracts (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)
Manage rail transportation costs | Diesel fuel swap contracts (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 auction prices and were categorized as Level 3. Refer to Note 15 for additional details of derivative assets and derivative liabilities. 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 amounts 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 5(b) 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, and was substantially classified as Level 2. Refer to Note 9(b) for additional information regarding long-term debt. 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, and was classified as Level 1. Refer to Note 8 for additional information regarding cumulative preferred stock. 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 at December 31 were as follows (in millions):
Alliant Energy | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $41.4 |  |  |  | $— |  |  |  | $4.6 |  |  |  | $36.8 |  |  |  | $41.4 |  |  |  | $18.4 |  |  |  | $— |  |  |  | $2.5 |  |  |  | $15.9 |  |  |  | $18.4 |
Deferred proceeds | 211.1 |  |  | — |  |  | — |  |  | 211.1 |  |  | 211.1 |  |  | 172.0 |  |  | — |  |  | — |  |  | 172.0 |  |  | 172.0 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 28.6 |  |  | — |  |  | 0.5 |  |  | 28.1 |  |  | 28.6 |  |  | 64.6 |  |  | — |  |  | 16.0 |  |  | 48.6 |  |  | 64.6 |
Long-term debt (including current maturities) | 4,320.2 |  |  | — |  |  | 4,795.7 |  |  | 3.3 |  |  | 4,799.0 |  |  | 3,835.6 |  |  | — |  |  | 4,332.4 |  |  | 3.7 |  |  | 4,336.1 |
IPL’s cumulative preferred stock | 200.0 |  |  | 194.8 |  |  | — |  |  | — |  |  | 194.8 |  |  | 200.0 |  |  | 206.6 |  |  | — |  |  | — |  |  | 206.6 |
IPL | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $20.8 |  |  |  | $— |  |  |  | $2.8 |  |  |  | $18.0 |  |  |  | $20.8 |  |  |  | $15.5 |  |  |  | $— |  |  |  | $2.0 |  |  |  | $13.5 |  |  |  | $15.5 |
Deferred proceeds | 211.1 |  |  | — |  |  | — |  |  | 211.1 |  |  | 211.1 |  |  | 172.0 |  |  | — |  |  | — |  |  | 172.0 |  |  | 172.0 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 8.3 |  |  | — |  |  | 0.4 |  |  | 7.9 |  |  | 8.3 |  |  | 23.4 |  |  | — |  |  | 8.0 |  |  | 15.4 |  |  | 23.4 |
Long-term debt (including current maturities) | 2,153.5 |  |  | — |  |  | 2,352.3 |  |  | — |  |  | 2,352.3 |  |  | 1,856.9 |  |  | — |  |  | 2,092.7 |  |  | — |  |  | 2,092.7 |
Cumulative preferred stock | 200.0 |  |  | 194.8 |  |  | — |  |  | — |  |  | 194.8 |  |  | 200.0 |  |  | 206.6 |  |  | — |  |  | — |  |  | 206.6 |
WPL | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $20.6 |  |  |  | $— |  |  |  | $1.8 |  |  |  | $18.8 |  |  |  | $20.6 |  |  |  | $2.9 |  |  |  | $— |  |  |  | $0.5 |  |  |  | $2.4 |  |  |  | $2.9 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 20.3 |  |  | — |  |  | 0.1 |  |  | 20.2 |  |  | 20.3 |  |  | 41.2 |  |  | — |  |  | 8.0 |  |  | 33.2 |  |  | 41.2 |
Long-term debt (including current maturities) | 1,535.2 |  |  | — |  |  | 1,807.4 |  |  | — |  |  | 1,807.4 |  |  | 1,533.9 |  |  | — |  |  | 1,793.0 |  |  | — |  |  | 1,793.0 |
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
| 2016 |  | 2015 |  | 2016 |  | 2015
Beginning balance, January 1 |  | ($32.7 | ) |  |  | $17.9 |  |  |  | $172.0 |  |  |  | $177.2 |
Total net gains (losses) included in changes in net assets (realized/unrealized) | 30.7 |  |  | (63.5 | ) |  | — |  |  | — |
Transfers into Level 3 | 0.9 |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 | 1.2 |  |  | 0.3 |  |  | — |  |  | — |
Purchases | 22.0 |  |  | 36.9 |  |  | — |  |  | — |
Sales | (1.0 | ) |  | (1.9 | ) |  | — |  |  | — |
Settlements (a) | (12.4 | ) |  | (22.4 | ) |  | 39.1 |  |  | (5.2 | )
Ending balance, December 31 |  | $8.7 |  |  |  | ($32.7 | ) |  |  | $211.1 |  |  |  | $172.0 |
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 December 31 |  | $32.7 |  |  |  | ($56.0 | ) |  |  | $— |  |  |  | $— |
IPL | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
| 2016 |  | 2015 |  | 2016 |  | 2015
Beginning balance, January 1 |  | ($1.9 | ) |  |  | $19.4 |  |  |  | $172.0 |  |  |  | $177.2 |
Total net gains (losses) included in changes in net assets (realized/unrealized) | 7.3 |  |  | (29.6 | ) |  | — |  |  | — |
Transfers into Level 3 | 0.5 |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 | 0.2 |  |  | — |  |  | — |  |  | — |
Purchases | 20.6 |  |  | 33.1 |  |  | — |  |  | — |
Sales | (1.0 | ) |  | (1.8 | ) |  | — |  |  | — |
Settlements (a) | (15.6 | ) |  | (23.0 | ) |  | 39.1 |  |  | (5.2 | )
Ending balance, December 31 |  | $10.1 |  |  |  | ($1.9 | ) |  |  | $211.1 |  |  |  | $172.0 |
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 December 31 |  | $8.5 |  |  |  | ($23.1 | ) |  |  | $— |  |  |  | $— |
WPL | Commodity Contract Derivative
| Assets and (Liabilities), net
| 2016 |  | 2015
Beginning balance, January 1 |  | ($30.8 | ) |  |  | ($1.5 | )
Total net gains (losses) included in changes in net assets (realized/unrealized) | 23.4 |  |  | (33.9 | )
Transfers into Level 3 | 0.4 |  |  | — |
Transfers out of Level 3 | 1.0 |  |  | 0.3 |
Purchases | 1.4 |  |  | 3.8 |
Sales | — |  |  | (0.1 | )
Settlements | 3.2 |  |  | 0.6 |
Ending balance, December 31 |  | ($1.4 | ) |  |  | ($30.8 | )
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 December 31 |  | $24.2 |  |  |  | ($32.9 | )
(a) | 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 amounts 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) at December 31 as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
| Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs
2016 |  | ($2.3 | ) |  |  | $11.0 |  |  |  | $0.1 |  |  |  | $10.0 |  |  |  | ($2.4 | ) |  |  | $1.0 |
2015 | (43.1 | ) |  | 10.4 |  |  | (12.3 | ) |  | 10.4 |  |  | (30.8 | ) |  | — |
IPL [Member] |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Valuation Hierarchy - Fair value measurement accounting establishes three levels of fair value hierarchy that prioritize the inputs to valuation techniques used to measure fair value. Level 1 pricing inputs are quoted prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 pricing inputs are quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active as of the reporting date. Level 3 pricing inputs are unobservable inputs for assets or liabilities for which little or no market data exist and require significant management judgment or estimation. The fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. The lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability. Valuation Techniques - Derivative assets and derivative liabilities - Derivative instruments are used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices, transmission congestion costs and rail transportation costs. Risk policies are maintained that govern the use of such derivative instruments. 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 and physical forward contracts (IPL and WPL)
| Natural gas options (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 contracts (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)
Manage rail transportation costs | Diesel fuel swap contracts (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 auction prices and were categorized as Level 3. Refer to Note 15 for additional details of derivative assets and derivative liabilities. 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 amounts 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 5(b) 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, and was substantially classified as Level 2. Refer to Note 9(b) for additional information regarding long-term debt. 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, and was classified as Level 1. Refer to Note 8 for additional information regarding cumulative preferred stock. 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 at December 31 were as follows (in millions):
Alliant Energy | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $41.4 |  |  |  | $— |  |  |  | $4.6 |  |  |  | $36.8 |  |  |  | $41.4 |  |  |  | $18.4 |  |  |  | $— |  |  |  | $2.5 |  |  |  | $15.9 |  |  |  | $18.4 |
Deferred proceeds | 211.1 |  |  | — |  |  | — |  |  | 211.1 |  |  | 211.1 |  |  | 172.0 |  |  | — |  |  | — |  |  | 172.0 |  |  | 172.0 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 28.6 |  |  | — |  |  | 0.5 |  |  | 28.1 |  |  | 28.6 |  |  | 64.6 |  |  | — |  |  | 16.0 |  |  | 48.6 |  |  | 64.6 |
Long-term debt (including current maturities) | 4,320.2 |  |  | — |  |  | 4,795.7 |  |  | 3.3 |  |  | 4,799.0 |  |  | 3,835.6 |  |  | — |  |  | 4,332.4 |  |  | 3.7 |  |  | 4,336.1 |
IPL’s cumulative preferred stock | 200.0 |  |  | 194.8 |  |  | — |  |  | — |  |  | 194.8 |  |  | 200.0 |  |  | 206.6 |  |  | — |  |  | — |  |  | 206.6 |
IPL | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $20.8 |  |  |  | $— |  |  |  | $2.8 |  |  |  | $18.0 |  |  |  | $20.8 |  |  |  | $15.5 |  |  |  | $— |  |  |  | $2.0 |  |  |  | $13.5 |  |  |  | $15.5 |
Deferred proceeds | 211.1 |  |  | — |  |  | — |  |  | 211.1 |  |  | 211.1 |  |  | 172.0 |  |  | — |  |  | — |  |  | 172.0 |  |  | 172.0 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 8.3 |  |  | — |  |  | 0.4 |  |  | 7.9 |  |  | 8.3 |  |  | 23.4 |  |  | — |  |  | 8.0 |  |  | 15.4 |  |  | 23.4 |
Long-term debt (including current maturities) | 2,153.5 |  |  | — |  |  | 2,352.3 |  |  | — |  |  | 2,352.3 |  |  | 1,856.9 |  |  | — |  |  | 2,092.7 |  |  | — |  |  | 2,092.7 |
Cumulative preferred stock | 200.0 |  |  | 194.8 |  |  | — |  |  | — |  |  | 194.8 |  |  | 200.0 |  |  | 206.6 |  |  | — |  |  | — |  |  | 206.6 |
WPL | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $20.6 |  |  |  | $— |  |  |  | $1.8 |  |  |  | $18.8 |  |  |  | $20.6 |  |  |  | $2.9 |  |  |  | $— |  |  |  | $0.5 |  |  |  | $2.4 |  |  |  | $2.9 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 20.3 |  |  | — |  |  | 0.1 |  |  | 20.2 |  |  | 20.3 |  |  | 41.2 |  |  | — |  |  | 8.0 |  |  | 33.2 |  |  | 41.2 |
Long-term debt (including current maturities) | 1,535.2 |  |  | — |  |  | 1,807.4 |  |  | — |  |  | 1,807.4 |  |  | 1,533.9 |  |  | — |  |  | 1,793.0 |  |  | — |  |  | 1,793.0 |
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
| 2016 |  | 2015 |  | 2016 |  | 2015
Beginning balance, January 1 |  | ($32.7 | ) |  |  | $17.9 |  |  |  | $172.0 |  |  |  | $177.2 |
Total net gains (losses) included in changes in net assets (realized/unrealized) | 30.7 |  |  | (63.5 | ) |  | — |  |  | — |
Transfers into Level 3 | 0.9 |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 | 1.2 |  |  | 0.3 |  |  | — |  |  | — |
Purchases | 22.0 |  |  | 36.9 |  |  | — |  |  | — |
Sales | (1.0 | ) |  | (1.9 | ) |  | — |  |  | — |
Settlements (a) | (12.4 | ) |  | (22.4 | ) |  | 39.1 |  |  | (5.2 | )
Ending balance, December 31 |  | $8.7 |  |  |  | ($32.7 | ) |  |  | $211.1 |  |  |  | $172.0 |
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 December 31 |  | $32.7 |  |  |  | ($56.0 | ) |  |  | $— |  |  |  | $— |
IPL | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
| 2016 |  | 2015 |  | 2016 |  | 2015
Beginning balance, January 1 |  | ($1.9 | ) |  |  | $19.4 |  |  |  | $172.0 |  |  |  | $177.2 |
Total net gains (losses) included in changes in net assets (realized/unrealized) | 7.3 |  |  | (29.6 | ) |  | — |  |  | — |
Transfers into Level 3 | 0.5 |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 | 0.2 |  |  | — |  |  | — |  |  | — |
Purchases | 20.6 |  |  | 33.1 |  |  | — |  |  | — |
Sales | (1.0 | ) |  | (1.8 | ) |  | — |  |  | — |
Settlements (a) | (15.6 | ) |  | (23.0 | ) |  | 39.1 |  |  | (5.2 | )
Ending balance, December 31 |  | $10.1 |  |  |  | ($1.9 | ) |  |  | $211.1 |  |  |  | $172.0 |
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 December 31 |  | $8.5 |  |  |  | ($23.1 | ) |  |  | $— |  |  |  | $— |
WPL | Commodity Contract Derivative
| Assets and (Liabilities), net
| 2016 |  | 2015
Beginning balance, January 1 |  | ($30.8 | ) |  |  | ($1.5 | )
Total net gains (losses) included in changes in net assets (realized/unrealized) | 23.4 |  |  | (33.9 | )
Transfers into Level 3 | 0.4 |  |  | — |
Transfers out of Level 3 | 1.0 |  |  | 0.3 |
Purchases | 1.4 |  |  | 3.8 |
Sales | — |  |  | (0.1 | )
Settlements | 3.2 |  |  | 0.6 |
Ending balance, December 31 |  | ($1.4 | ) |  |  | ($30.8 | )
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 December 31 |  | $24.2 |  |  |  | ($32.9 | )
(a) | 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 amounts 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) at December 31 as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
| Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs
2016 |  | ($2.3 | ) |  |  | $11.0 |  |  |  | $0.1 |  |  |  | $10.0 |  |  |  | ($2.4 | ) |  |  | $1.0 |
2015 | (43.1 | ) |  | 10.4 |  |  | (12.3 | ) |  | 10.4 |  |  | (30.8 | ) |  | — |
WPL [Member] |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Valuation Hierarchy - Fair value measurement accounting establishes three levels of fair value hierarchy that prioritize the inputs to valuation techniques used to measure fair value. Level 1 pricing inputs are quoted prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 pricing inputs are quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active as of the reporting date. Level 3 pricing inputs are unobservable inputs for assets or liabilities for which little or no market data exist and require significant management judgment or estimation. The fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3). In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. The lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in the fair value hierarchy. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability. Valuation Techniques - Derivative assets and derivative liabilities - Derivative instruments are used for risk management purposes to mitigate exposures to fluctuations in certain commodity prices, transmission congestion costs and rail transportation costs. Risk policies are maintained that govern the use of such derivative instruments. 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 and physical forward contracts (IPL and WPL)
| Natural gas options (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 contracts (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)
Manage rail transportation costs | Diesel fuel swap contracts (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 auction prices and were categorized as Level 3. Refer to Note 15 for additional details of derivative assets and derivative liabilities. 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 amounts 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 5(b) 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, and was substantially classified as Level 2. Refer to Note 9(b) for additional information regarding long-term debt. 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, and was classified as Level 1. Refer to Note 8 for additional information regarding cumulative preferred stock. 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 at December 31 were as follows (in millions):
Alliant Energy | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $41.4 |  |  |  | $— |  |  |  | $4.6 |  |  |  | $36.8 |  |  |  | $41.4 |  |  |  | $18.4 |  |  |  | $— |  |  |  | $2.5 |  |  |  | $15.9 |  |  |  | $18.4 |
Deferred proceeds | 211.1 |  |  | — |  |  | — |  |  | 211.1 |  |  | 211.1 |  |  | 172.0 |  |  | — |  |  | — |  |  | 172.0 |  |  | 172.0 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 28.6 |  |  | — |  |  | 0.5 |  |  | 28.1 |  |  | 28.6 |  |  | 64.6 |  |  | — |  |  | 16.0 |  |  | 48.6 |  |  | 64.6 |
Long-term debt (including current maturities) | 4,320.2 |  |  | — |  |  | 4,795.7 |  |  | 3.3 |  |  | 4,799.0 |  |  | 3,835.6 |  |  | — |  |  | 4,332.4 |  |  | 3.7 |  |  | 4,336.1 |
IPL’s cumulative preferred stock | 200.0 |  |  | 194.8 |  |  | — |  |  | — |  |  | 194.8 |  |  | 200.0 |  |  | 206.6 |  |  | — |  |  | — |  |  | 206.6 |
IPL | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $20.8 |  |  |  | $— |  |  |  | $2.8 |  |  |  | $18.0 |  |  |  | $20.8 |  |  |  | $15.5 |  |  |  | $— |  |  |  | $2.0 |  |  |  | $13.5 |  |  |  | $15.5 |
Deferred proceeds | 211.1 |  |  | — |  |  | — |  |  | 211.1 |  |  | 211.1 |  |  | 172.0 |  |  | — |  |  | — |  |  | 172.0 |  |  | 172.0 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 8.3 |  |  | — |  |  | 0.4 |  |  | 7.9 |  |  | 8.3 |  |  | 23.4 |  |  | — |  |  | 8.0 |  |  | 15.4 |  |  | 23.4 |
Long-term debt (including current maturities) | 2,153.5 |  |  | — |  |  | 2,352.3 |  |  | — |  |  | 2,352.3 |  |  | 1,856.9 |  |  | — |  |  | 2,092.7 |  |  | — |  |  | 2,092.7 |
Cumulative preferred stock | 200.0 |  |  | 194.8 |  |  | — |  |  | — |  |  | 194.8 |  |  | 200.0 |  |  | 206.6 |  |  | — |  |  | — |  |  | 206.6 |
WPL | 2016 |  | 2015
|  |  | Fair Value |  |  |  | Fair Value
| Carrying |  | Level |  | Level |  | Level |  |  |  | Carrying |  | Level |  | Level |  | Level |  |
| Amount |  | 1 |  | 2 |  | 3 |  | Total |  | Amount |  | 1 |  | 2 |  | 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives |  | $20.6 |  |  |  | $— |  |  |  | $1.8 |  |  |  | $18.8 |  |  |  | $20.6 |  |  |  | $2.9 |  |  |  | $— |  |  |  | $0.5 |  |  |  | $2.4 |  |  |  | $2.9 |
Liabilities and equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivatives | 20.3 |  |  | — |  |  | 0.1 |  |  | 20.2 |  |  | 20.3 |  |  | 41.2 |  |  | — |  |  | 8.0 |  |  | 33.2 |  |  | 41.2 |
Long-term debt (including current maturities) | 1,535.2 |  |  | — |  |  | 1,807.4 |  |  | — |  |  | 1,807.4 |  |  | 1,533.9 |  |  | — |  |  | 1,793.0 |  |  | — |  |  | 1,793.0 |
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
| 2016 |  | 2015 |  | 2016 |  | 2015
Beginning balance, January 1 |  | ($32.7 | ) |  |  | $17.9 |  |  |  | $172.0 |  |  |  | $177.2 |
Total net gains (losses) included in changes in net assets (realized/unrealized) | 30.7 |  |  | (63.5 | ) |  | — |  |  | — |
Transfers into Level 3 | 0.9 |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 | 1.2 |  |  | 0.3 |  |  | — |  |  | — |
Purchases | 22.0 |  |  | 36.9 |  |  | — |  |  | — |
Sales | (1.0 | ) |  | (1.9 | ) |  | — |  |  | — |
Settlements (a) | (12.4 | ) |  | (22.4 | ) |  | 39.1 |  |  | (5.2 | )
Ending balance, December 31 |  | $8.7 |  |  |  | ($32.7 | ) |  |  | $211.1 |  |  |  | $172.0 |
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 December 31 |  | $32.7 |  |  |  | ($56.0 | ) |  |  | $— |  |  |  | $— |
IPL | Commodity Contract Derivative |  |
| Assets and (Liabilities), net |  | Deferred Proceeds
| 2016 |  | 2015 |  | 2016 |  | 2015
Beginning balance, January 1 |  | ($1.9 | ) |  |  | $19.4 |  |  |  | $172.0 |  |  |  | $177.2 |
Total net gains (losses) included in changes in net assets (realized/unrealized) | 7.3 |  |  | (29.6 | ) |  | — |  |  | — |
Transfers into Level 3 | 0.5 |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 | 0.2 |  |  | — |  |  | — |  |  | — |
Purchases | 20.6 |  |  | 33.1 |  |  | — |  |  | — |
Sales | (1.0 | ) |  | (1.8 | ) |  | — |  |  | — |
Settlements (a) | (15.6 | ) |  | (23.0 | ) |  | 39.1 |  |  | (5.2 | )
Ending balance, December 31 |  | $10.1 |  |  |  | ($1.9 | ) |  |  | $211.1 |  |  |  | $172.0 |
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 December 31 |  | $8.5 |  |  |  | ($23.1 | ) |  |  | $— |  |  |  | $— |
WPL | Commodity Contract Derivative
| Assets and (Liabilities), net
| 2016 |  | 2015
Beginning balance, January 1 |  | ($30.8 | ) |  |  | ($1.5 | )
Total net gains (losses) included in changes in net assets (realized/unrealized) | 23.4 |  |  | (33.9 | )
Transfers into Level 3 | 0.4 |  |  | — |
Transfers out of Level 3 | 1.0 |  |  | 0.3 |
Purchases | 1.4 |  |  | 3.8 |
Sales | — |  |  | (0.1 | )
Settlements | 3.2 |  |  | 0.6 |
Ending balance, December 31 |  | ($1.4 | ) |  |  | ($30.8 | )
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 December 31 |  | $24.2 |  |  |  | ($32.9 | )
(a) | 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 amounts 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) at December 31 as follows (in millions):
| Alliant Energy |  | IPL |  | WPL
| Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs |  | Excluding FTRs |  | FTRs
2016 |  | ($2.3 | ) |  |  | $11.0 |  |  |  | $0.1 |  |  |  | $10.0 |  |  |  | ($2.4 | ) |  |  | $1.0 |
2015 | (43.1 | ) |  | 10.4 |  |  | (12.3 | ) |  | 10.4 |  |  | (30.8 | ) |  | — |

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- 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 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19207-110258 Reference 2: 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 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 825 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=73719730&loc=d3e13537-108611 Reference 5: 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=73719730&loc=d3e13504-108611 Reference 6: 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=73719730&loc=d3e13433-108611 + Details
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