UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No.     )

Filed by the Registrant  x

Filed by a Party other than the Registrant  ¨

Check the appropriate box:

Wisconsin Power and Light Company

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

Notes:

Reg. (S) 240.14a-101.

SEC 1913 (3-99)

YOUR VOTE IS IMPORTANT

Wisconsin

Power and Light

Company

NOTICEOF 2009 ANNUAL MEETING

PROXY STATEMENTAND

2008 ANNUAL REPORT

WISCONSIN POWER AND LIGHT COMPANY

ANNUAL MEETING OF SHAREOWNERS

SHAREOWNER INFORMATION

Wells Fargo Shareowner Services

161 North Concord Exchange

P. O. Box 64854

St. Paul, MN 55164-0854

1-800-356-5343

www.wellsfargo.com/shareownerservices

Wisconsin Power and Light Company

4902 North Biltmore Lane

P. O. Box 256814720

Madison, WI 53701-256853708-0720

Phone: 608.458.3110

608-458-3110

NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

Dear Wisconsin Power and Light Company Shareowner:

On Wednesday, May 23, 2007,20, 2009, Wisconsin Power and Light Company (the “Company”) will hold its 20072009 Annual Meeting of Shareowners at the offices of Alliant Energy Corporation, 4902 North Biltmore Lane, YangtzeMississippi Meeting Room, Madison, Wis.Wisconsin. The meeting will begin at 2:00 p.m. Central(Central Daylight Time.

Time).

Only the sole common shareowner, Alliant Energy Corporation, and preferred shareowners who owned stock at the close of business on April 10, 20077, 2009 may vote at this meeting. All shareowners are requested to be present at the meeting in person or by proxy so that a quorum may be ensured. At the meeting, the Company’sour shareowners will be asked to:

TheOur Board of Directors of the Company presently knows of no other business to come before the meeting.

Please sign and return the enclosed proxy card as soon as possible.

The Company’s 2006A copy of our 2008 Annual Report appears as Appendix A to this proxy statement. The proxy statement and Annual Report have been combined into a single document to improve the effectiveness of our financial communication and to reduce costs, although the Annual Report does not constitute a part of the proxy statement.

Important Notice Regarding the Availability of Proxy Materials for the Shareowner Meeting to Be Held on May 20, 2009: Our 2009 Notice of Annual Meeting, Proxy Statement and the 2008 Annual Report to Shareowners are available at http://www.alliantenergy.com/WPLproxy.

Any Wisconsin Power and Light Company preferred shareowner who desires to receive a copy of the Alliant Energy Corporation 20062008 Annual Report, 2009 Notice of Annual Meeting and Proxy Statement may do so by calling the Company’sour Shareowner Services Department at (608) 458-3110(800) 353-1089 or writing to the Companyus at the address shown above.

The Alliant Energy Corporation proxy statement for the 2009 Annual Meeting of Shareowners and the 2008 Annual Report to Shareowners are available at http://www.alliantenergy.com/eproxy.

By Order of the Board of Directors,

F. J. Buri

Corporate Secretary

Dated and mailed on or about April 17, 2007.16, 2009.

TABLE OF CONTENTS

QUESTIONS AND ANSWERS

Attendance at the Annual Meeting will not cause your previously appointed proxy to be revoked unless you specifically so request in writing.

10.  Q:

Who may attend the Annual Meeting?

A:

All shareowners who owned shares of the Company’sour common stock and preferred stock on April 10, 20077, 2009 may attend the Annual Meeting.

16.  Q: How can I obtain a copy of the Company’s Annual Report on Form 10-K?

ELECTION OF DIRECTORS

At the Annual Meeting, one director will be elected for a term expiring in 2008 and fourthree directors will be elected for terms expiring in 2010.2012. The nominees for election as recommended by the Nominating and Governance Committee and selected by the Board of Directors are James A. Leach, for a term expiring in 2008;Ann K. Newhall, Dean C. Oestreich and Michael L. Bennett, Darryl B. Hazel, David A. Perdue and Judith D. Pyle for terms expiring in 2010. With the exception, of James A. Leach, eachCarol P. Sanders. Each of the nominees is currently serving as a directoron our Board of the Company.Directors. Each person elected as a director will serve until theour Annual Meeting of Shareowners of the Company in 2008 or 2010, as applicable,2012, or until his or her successor has been duly qualified and elected. Anthony R. Weiler will be retiring as a director at the Annual Meeting.

Directors will be elected by a plurality of the votes cast at the meeting (assuming a quorum is present). Consequently, any shares not voted at the meeting will have no effect on the election of directors. The proxies solicited may be voted for a substitute nominee or nominees if any of the nominees are unable to serve, or for good reason will not serve, a contingency not now anticipated.

Brief biographies of the director nominees and continuing directors follow. These biographies include their ages (as of Dec. 31, 2006)2008), an account of their business experience and the names of publicly held and certain other corporations of which they are also directors. Except as otherwise indicated, each nominee and continuing director has been engaged in his or her present occupation for at least the past five years.

Prior to Nov. 25, 2008, each of our directors served on the Board of Directors of Resources during the period they served as a director of our company. On Nov. 25, 2008, Resources was converted to a limited liability company and, as a result, no longer has a Board of Directors.

NOMINEES

		JAMES A. LEACHANN K. NEWHALL Age 6457		Director since 2003 Nominated Term expires in 20082012
		Former Congressman LeachMs. Newhall retired in August 2008 from her position as Executive Vice President, Chief Operating Officer, Secretary and a Director of Rural Cellular Corporation (“RCC”), a cellular communications corporation located in Alexandria, Minn., following RCC’s sale to Verizon. Ms. Newhall held this position from 2000 to 2008. Ms. Newhall has served as a Director of AEC and IPL since 2003. Ms. Newhall is Chairperson of the John L. Weinberg ProfessorCompensation and Personnel Committee.
		DEAN C. OESTREICH Age 56		Director since 2005 Nominated Term expires in 2012
		Mr. Oestreich has been Chairman of PublicPioneer Hi-Bred International, Inc., developer and supplier of advanced plant genetics, and a wholly-owned subsidiary of DuPont Corporation, located in Johnston, Iowa, since November 2007. He has served as Vice President of DuPont Corporation since 2004. He previously served as President of Pioneer Hi-Bred International, Policy at the Woodrow Wilson SchoolInc. from 2004 to 2007. Mr. Oestreich previously served as Vice President and Business Director of Princeton University in Princeton, N.J. since 2007. Congressman LeachNorth America from 2002 to 2004. Mr. Oestreich has served as a memberDirector of AEC and IPL since 2005. Mr. Oestreich is Chairperson of the United States HouseEnvironmental, Nuclear, Health and Safety Committee.
		CAROL P. SANDERS Age 41		Director since 2005 Nominated Term expires in 2012
		Ms. Sanders has served as Chief Financial Officer and Corporate Secretary of RepresentativesJewelers Mutual Insurance Company of Neenah, Wis., a nationwide insurer that specializes in protecting jewelers and personal jewelry, since 2004. She previously served as Controller and Assistant Treasurer of Sentry Insurance located in Stevens Point, Wis. from 2001 to 2004. Ms. Sanders has served as a Director of AEC and IPL since 2005. Ms. Sanders is Chairperson of the StateAudit Committee.

The Board of Directors unanimously recommends a vote FOR all nominees for election as directors.

CONTINUING DIRECTORS

		MICHAEL L. BENNETT Age 55		Director since 2003 Term expires in 2010
		Mr. Bennett has served as President and Chief Executive Officer of Terra Industries Inc., an international producer of nitrogen products and methanol ingredients headquartered in Sioux City, Iowa, during the periodsince April 2001. He also serves as Chairman of 1977 through 2006. He serves on the Board for Terra Nitrogen GP Inc., a subsidiary of Directors of United Fire and Casualty Company. Congressman Leach was originally identifiedTerra Industries Inc. Mr. Bennett has served as a nominee in 2006 byDirector of AEC and IPL since 2003. Mr. Bennett is Chairperson of the Nominating and Governance Committee duringand the Committee’s search for an appropriate director candidate. If elected byLead Independent Director.
		WILLIAM D. HARVEY Age 59		Director since 2005 Term expires in 2011
		Mr. Harvey has served as Chairman of the AEC shareowners at AEC’s Annual Meeting on May 10, 2007, thenBoard of the Company, expects that he will also be elected by AEC in its capacityand IPL since February 2006. He has served as sole common shareowner to serve as our director and onChief Executive Officer of the Boards of Directors ofCompany, AEC, IPL and Resources commencing in 2007.and as President and Chief Executive Officer of AEC since July 2005 and as President of Resources since January 2005. He previously served as President and Chief Operating Officer of AEC and Chief Operating Officer of IPL, WPL and Resources since January 2004. He served as President of the Company and as Executive Vice President – Generation for AEC, IPL and Resources from 1998 to January 2004.
		DARRYL B. HAZEL Age 5860		Director since 2006 Nominated Term expires in 2010
		Mr. Hazel has served as President of the Customer Service Division and Senior Vice President of Ford Motor Company, an automobile manufacturer, since March 2006. He previously served as President of Marketing of Ford Motor Company from September 2005 to March 2006; President of the Ford Division from April 2005 to September 2005; and President of the Lincoln Mercury Division from August 2002 to April 2005; and General Manager of the Ford Customer Service Division from December 2001 to July 2002.2005. Mr. Hazel was appointed ahas served as Director of the Company, AEC and IPL and Resources in Septembersince 2006. He was originally recommended as a nominee in 2006 by a third-party search firm acting on behalf of the Nominating and Governance Committee.
		MICHAEL L. BENNETTJAMES A. LEACH Age 5366		Director since 20032007 Nominated Term expires in 20102011
		Mr. BennettFormer Congressman Leach is the John L. Weinberg Professor of Public and International Policy at the Woodrow Wilson School of Princeton University in Princeton, N.J., a position he has held since 2007. From January 2008 through December 2008, he served as President and Chief Executive Officer of Terra Industries Inc., an international producer of nitrogen products and methanol ingredients headquartered in Sioux City, Iowa, since April 2001. He also serves as Chairmanthe Director of the Institute of Politics at the John F. Kennedy School of Government at Harvard University in Boston, MA while on leave from Princeton. Congressman Leach served as a member of the United States House of Representatives from the State of Iowa during the period of 1977 through 2006. He serves on the Board for Terra Nitrogen GP Inc.,of Directors of United Fire and Casualty Company and on a subsidiaryseries of Terra Industries Inc.non-profit organization boards. Mr. BennettLeach has served as a Director of AEC and IPL and Resources since 2003. Mr. Bennett is Chairperson2007.
		SINGLETON B. MCALLISTER Age 56		Director since 2001 Term expires in 2011
		Ms. McAllister has been a partner in the Washington D. C. office of the Audit Committee.law firm of LeClair & Ryan LLP since October 2007. She previously served as a partner in the law firm of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo P. C. from July 2005 to October 2007. Ms. McAllister served as the Corporate Diversity Counsel practice group chair and in the public law and policy strategies group of the Washington, D.C. law firm office of Sonnenschein, Nath & Rosenthal, LLP from 2003 to July 2005. She serves on the Board of Directors of United Rentals, Inc. Ms. McAllister has served as a Director of AEC and IPL since 2001.
		DAVID A. PERDUE Age 5759		Director since 2001 Nominated Term expires in 2010
		Mr. Perdue isretired in July 2007 from his position as Chairman of the Board and Chief Executive Officer of Dollar General Corporation, a retail organization headquartered in Goodlettsville, Tenn., following its sale to a private equity firm. He was named Chief Executive Officer and a Director in April 2003 and elected Chairman of the Board in June 2003. From July 2002 to March 2003, he was Chairman and Chief Executive Officer of Pillowtex Corporation, a textile manufacturing company located in Kannapolis, N.C. From 1998 to 2002, he was employed by Reebok International Limited, where he served as PresidentMr. Perdue serves on the Board of the Reebok Brand from 2000 to 2002.Directors of Jo-Ann Stores, Inc. Mr. Perdue has served as a Director of AEC IPL (or predecessor companies) and ResourcesIPL since 2001.

		JUDITH D. PYLE Age 6365		Director since 1994 Nominated Term expires in 2010
		Ms. Pyle is President of Judith Dion Pyle and Associates, a financial services company located in Middleton, Wis. Prior to assuming her current position in 2003, she served as Vice Chair of The Pyle Group, a financial services company located in Madison, Wis. She previously served as Vice Chair and Senior Vice President of Corporate Marketing of Rayovac Corporation, a battery and lighting products manufacturer located in Madison, Wis. In addition, Ms. Pyle is a Director of Uniek, Inc. Ms. Pyle has served as a Director of AEC and Resources since 1992 and of IPL (or predecessor companies) since 1998.

The Board of Directors unanimously recommends a vote FOR all nominees for election as directors.

CONTINUING DIRECTORS

		WILLIAM D. HARVEY Age 57		Director since 2005 Term expires in 2008
		Mr. Harvey has served as Chairman of the Board of the Company, AEC, IPL and Resources since February 2006. He has served as Chief Executive Officer of the Company and as the Chief Executive Officer of AEC, IPL and Resources since July 2005 and as President of Resources since January 2005. He previously served as President and Chief Operating Officer of AEC, and Chief Operating Officer of the Company, IPL and Resources since January 2004. He served as President of the Company and as Executive Vice President – Generation for AEC, IPL and Resources from 1998 to January 2004.
		SINGLETON B. MCALLISTER Age 54		Director since 2001 Term expires in 2008
		Ms. McAllister has been a partner in the Washington D. C. law firm of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo P. C. since July 2005. She previously served as the Corporate Diversity Counsel practice group chair and in the public law and policy strategies group of the Washington, D.C. law firm office of Sonnenschein, Nath & Rosenthal, LLP from 2003 to July 2005. She was previously a partner at Patton Boggs LLP, a Washington, D.C. law firm, from 2001 to 2003. She serves on the Board of Directors of United Rentals, Inc. Ms. McAllister has served as a Director of AEC, IPL (or predecessor companies) and Resources since 2001. Ms. McAllister is Chairperson of the Compensation and Personnel Committee.
		ANN K. NEWHALL Age 55		Director since 2003 Term expires in 2009
		Ms. Newhall is Executive Vice President, Chief Operating Officer, Secretary and a Director of Rural Cellular Corporation, a cellular communications corporation located in Alexandria, Minn. She has served as Executive Vice President and Chief Operating Officer since August 2000, as Secretary since February 2000 and as a Director since August 1999. Ms. Newhall has served as a Director of AEC, IPL and Resources since 2003.
		DEAN C. OESTREICH Age 54		Director since 2005 Term expires in 2009
		Mr. Oestreich has served as President of Pioneer Hi-Bred International, Inc., a developer and supplier of advanced plant genetics, and a wholly-owned subsidiary of DuPont Corporation, located in Johnston, Iowa, since 2004. He previously served as Vice President and Business Director of North America from 2002 to 2004, Vice President and Director of Supply Management from 2001 to 2002 and Vice President and Director for Africa, Middle East, Asia and Pacific from 1999-2001. Mr. Oestreich has served as a Director of AEC, IPL and Resources since 2005. Mr. Oestreich is Chairperson of the Environmental, Nuclear, Health and Safety Committee.
		CAROL P. SANDERS Age 39		Director since 2005 Term expires in 2009
		Ms. Sanders has served as Chief Financial Officer and Corporate Secretary of Jewelers Mutual Insurance Company of Neenah, Wis., a nationwide insurer that specializes in protecting jewelers and personal jewelry, since 2004. She previously served as Controller and Assistant Treasurer of Sentry Insurance located in Stevens Point, Wis. from 2001 to 2004. From 1999 to 2001, she served as Vice President and Treasurer of American Medical Security, Inc. located in Green Bay, Wis. Ms. Sanders has served as a Director of AEC, IPL and Resources since 2005.

MEETINGS AND COMMITTEES OF THE BOARD

The Board of Directors has standing Audit; Compensation and Personnel; Nominating and Governance; Environmental, Nuclear, Health and Safety; Capital Approval; and Executive Committees. The Board of Directors has adopted formal written charters for each of the Audit, Compensation and Personnel, and Nominating and Governance Committees, which are available, free of charge, on the Alliant Energy’s WebEnergy web site atwww.alliantenergy.com/investors under the “Corporate Governance” caption or in print to any shareowner who requests them from the Company’sour Corporate Secretary. The following is a description of each of these committees. Joint meetings in the descriptions below refer to meetings of the committees of the Company, Alliant Energy, IPL and Resources.

Audit Committee

The Audit Committee held tenseven joint meetings in 2006.2008. The Committee currently consists of C. P. Sanders (Chair), M. L. Bennett, (Chair), D. B. Hazel, A. K. Newhall,and D. A. Perdue and C. P. Sanders.Perdue. Each of the members of the Committee is independent as defined by the New York Stock Exchange (“NYSE”) listing standards and SEC rules. The Board of Directors has determined that Mr. BennettMs. Sanders and the other three additional Audit Committee members qualify as “audit committee financial experts” as defined by SEC rules. The Audit Committee is responsible for assisting Board oversight of: (1) the integrity of our financial statements; (2) our compliance with legal and regulatory requirements; (3) the independent registered public accounting firm’s qualifications and independence; and (4) the performance of our internal audit function and independent registered public accounting firm. The Audit Committee is also directly responsible for the appointment, retention, termination, compensation and oversight of our independent registered public accounting firm.

Compensation and Personnel Committee

The Compensation and Personnel Committee held fiveseven joint meetings in 2006.2008. The Committee currently consists of S. B. McAllisterA. K. Newhall (Chair), M. L. Bennett, D. B. Hazel, and D. C. Oestreich.Oestreich and C. P. Sanders. Each of the members of the Committee is independent as defined by the NYSE listing standards and SEC rules. This Committee reviews and approves corporate goals and objectives relevant to Chief Executive Officerchief executive officer compensation and the compensation of the other principal executive officers, evaluates the Chief Executive Officer’schief executive officer’s performance and determines and approves as a committee, or together with the other independent directors, the Chief Executive Officer’schief executive officer’s compensation level based on theits evaluation of the Chief Executive Officer’s performance. Inchief executive officer’s performance in addition to reviewing and approving the recommendations of the chief executive officer with regard to the other executive officers. The Committee has responsibilities with respect to our executive compensation and incentive programs and management development programs. It also makes recommendations to the Nominating and Governance Committee regarding compensation for the non-management directors.

To support the Committee in carrying out its mission, the Committee has the authority to engage the services of outside advisors, experts and others to assist the Committee with the expense of such outside consultants provided for by us. TheFor 2008, the Committee engagesformally engaged Towers Perrin as an outside compensation consultant to serve as an advisor in evaluating the compensation of our Chief Executive Officer,chief executive officer, other named executive officers and our outside non-management directors. The Committee retains the authority to terminate the services of the outside compensation consultant. During 2006 and previously, Towers Perrin also servedprovides assistance and serves as thean advisor and provides market information and trends regarding executive compensation consultant providing the Committee with executive managementprograms; provides benchmarking and competitive compensation market reviews for the Chief Executive Officer and other namedof our executive officer total compensation. Towers Perrin alsocompensation; assists the Committee inwith the design of shortour short- and long termlong-term incentive programs and executive retirement programs as well as assisting management with the implementation of these programs.programs; and provides technical considerations and actuarial services. Alliant Energy provides for the appropriate funding, as determined by the Committee, for payment of fees and out of pocket expenses to Towers Perrin’sPerrin. The Committee has the authority to retain and terminate the outside compensation consultant. During 2008 and previously, Towers Perrin, through a separate part of its organization, also provided certain services for management purposes that are recommended and approved by the Chief Executive Officer, Vice PresidentAlliant Energy’s chief executive

officer, vice president of Shared Services, Chief Human Resources Officer,shared services, chief human resources officer, and/or the Directordirector of Executive, Board and Total Compensation.total rewards. In the capacity as a consultant to management, Towers Perrin provides competitive market data and business and technical insight, but does not recommend pay program and pay level changes.

A more complete descriptionThe Committee reviews and approves all elements of the Committee’s practices, including the scope and authority ofour executive compensation programs. Our chief executive officer provides input to the Committee in the extent to which the Committee may delegate its authority,assessment, design and the role of any executive officers in determining or recommending the amountrecommendation of executive compensation can be foundprograms, plans and awards. Annually, the chief executive officer reviews with the Committee market data provided by Towers Perrin about the comparable companies that are identified as our peer group to help verify survey job information adequately captures officers’ duties. Based on that data, the chief executive officer recommends to the Committee base salary adjustments and short- and long-term incentive targets in relation to external market data while also considering internal equity considerations and executive officers’ individual performance. The chief executive officer provides recommendations to the Committee for total annual compensation of executive officers. The chief executive officer does not, however, make any recommendation to the Committee regarding his own compensation. Further, the chief executive officer and other executive officers assess the performance of those executive officers reporting to them. The chief executive officer is invited to attend all Committee meetings to provide an update of progress made towards achievement of annual performance goals and to provide management’s views on compensation program design features and components.

The Committee has reviewed and approved the charter for our internal Total Compensation DiscussionCommittee made up of vice presidents of our energy delivery, generation, finance/treasury, shared services and Analysis sectionoperations business units. The Committee has delegated to the Total Compensation Committee various powers of this Proxy Statement.

design and administration associated with our employee benefit plans for salaried and hourly employees. The Committee has also reviewed and approved the charter for our internal Investment Committee made up of voting members and non-voting members. The voting members include vice presidents of our finance/treasury, accounting and shared services business units. Non-voting members include assistant treasurers, director of business and financial performance for shared services, lead treasury analyst and director of total rewards. The Committee has delegated to the Investment Committee various powers regarding managing investment assets of our benefit and compensation plans and programs.

Nominating and Governance Committee

The Nominating and Governance Committee held fourthree joint meetings in 2006.2008. The Committee currently consists of A. R. WeilerM. L. Bennett (Chair), J. A. K. Newhall,Leach, S. B. McAllister, D. A. Perdue and J. D. Pyle. Each of the members of the Committee is independent as defined by the NYSE listing standards and SEC rules. This Committee’s responsibilities are to: (1) identify individuals qualified to become Board members, consistent with the criteria approved by the Board, and to recommend nominees for directorships to be filled by the Board or shareowners; (2) identify and recommend Board members qualified to serve on Board committees; (3) develop and recommend to the Board a set of corporate governance principles; (4) oversee the

evaluation of the Board and our management; (5) oversee our related person transaction policy; and (6) advise the Board with respect to other matters relating to our corporate governance.

In making recommendations of nominees to serve as directors to the Board of Directors, the Nominating and Governance Committee will examine each director nominee on a case-by-case basis regardless of who recommended the nominee and take into account all factors it considers appropriate, which may include strength of character, mature judgment, career specialization, relevant technical skills or financial acumen, diversity of viewpoint and industry knowledge. However, the Committee believes that, to be recommended as a director nominee, each candidate must:

The Committee also believes the following qualities or skills are necessary for one or more directors to possess:

The Nominating and Governance Committee will consider nominees recommended by shareowners in accordance with our Nominating and Governance Committee Charter and the Corporate Governance Principles. Any shareowner wishing to make a recommendation should write to our Corporate Secretary and include appropriate biographical information concerning each proposed nominee. The Corporate Secretary will forward all recommendations to the Committee. Our Bylaws also set forth certain requirements for shareowners wishing to nominate director candidates directly for consideration by shareowners. These provisions require such nominations to be made pursuant to timely notice (as specified in the Bylaws) in writing to our Corporate Secretary.

We and the Committee maintain a file of recommended potential director nominees, which is reviewed at the time a search for a new director needs to be performed. To assist the Committee in its identification of qualified director candidates, the Committee may engage an outside search firm.

Environmental, Nuclear, Health and Safety Committee

The Environmental, Nuclear, Health and Safety Committee held three joint meetings in 2006.2008. The Committee currently consists of D. C. Oestreich (Chair), J. A. Leach, S. B. McAllister, A. K. Newhall, and J. D. Pyle, C. P. Sanders and A. R. Weiler.Pyle. Each of the members of the Committee is independent as defined by the NYSE listing standards and SEC rules. The Committee’s responsibilities are to review environmental policy and planning issues of interest to us, including matters involving our company before environmental regulatory agencies and compliance with air, water and waste regulations. The Committee also reviews healthhealth- and safety-relatedsafety- related policies, activities and operational issues as they affect employees, customers and the general public. In addition, the Committee reviews issues related to nuclear generating facilities from which our utility subsidiarieswe and IPL purchase power.

Capital Approval Committee

The Capital Approval Committee held no meetingsone meeting in 2006.2008. The Committee currently consists of M. L. Bennett, A. K. Newhall and D. A. Perdue.C. Oestreich. Mr. Harvey is the Chair and a non-voting member of this Committee. The purpose of this Committee is to evaluate certain investment proposals where (1) an iterative bidding process is required, and/or (2) the required timelines for a proposal would not permit the proposal to be brought before a regular meeting of the Board of Directors and/or a special meeting of the full Board of Directors is not practical or merited.

Executive Committee

The Executive Committee held no meetings in 2006.2008. The Committee currently consists of M. L. Bennett, S. B. McAllister,A. K. Newhall, D. C. Oestreich and A. R. Weiler.C. P. Sanders. Mr. Harvey is the Chair and a non-voting member of this Committee. The purpose of this Committee is to possess all the powers and authorities of the Board of Directors when the Board is not in session, except for the powers and authorities excluded for such a Committee under the Wisconsin Business Corporation Law.

Attendance and Performance Evaluations

The Board of Directors held nineseven joint meetings during 2006.2008. Each director attended at least 75% of the aggregate number of meetings of the Board and Board committees on which he or she served, except for Ms. Pyle, who attended 67% due to health related issues.

served.

The Board and each Board committee conduct performance evaluations annually to determine their effectiveness and suggest improvements for consideration and implementation. In addition, the Compensation and Personnel Committee evaluates Mr. Harvey’s performance as Chief Executive Officerchief executive officer on an annual basis.

Board members are not expected to attend our annual meetings of shareowners. None of the Board members were present for our 20062008 Annual Meeting.

CORPORATE GOVERNANCE

Corporate Governance Principles

The Board of Directors has adopted Corporate Governance Principles that, in conjunction with the Board committee charters, establish processes and procedures to help ensure effective and responsive governance by the Board. The Corporate Governance Principles are available, free of charge, on the Alliant Energy Webweb site atwww.alliantenergy.com/investors under the “Corporate Governance” caption or in print to any shareowner who requests them from our Corporate Secretary.

The Board of Directors has adopted certain categorical standards of independence to assist it in making determinations of director independence under the NYSE listing standards. Under these categorical standards, the following relationships that currently exist or that have existed, including during the preceding three years, willnot be considered to be material relationships that would impair a director’s independence:

In addition, any relationship that a director (or an “immediate family member” of the director) previously had that constituted an automatic bar to independence under NYSE listing standards will not be considered to be a material relationship that would impair a director’s independence three years after the end of such relationship in accordance with NYSE listing standards.

The Board of Directors also gave consideration to certain other factors in relation to an independence determination. Messrs. Bennett, Hazel, Oestreich and Perdue and Ms. Pyle serve as executive officers and/or directors of companies that are customers of our companyus or our public utility affiliates. These customer relationships do not constitute a material relationship under the standards cited above or the SEC rules governing related person transactions. Mr. Leach is a shareowner in an electrical supply company whichthat has not done any business with our companyus or our public utility affiliates in a substantial number of years. However, each of these circumstances was evaluated under the applicable SEC rules and, in the case of Mr. Leach, the Federal Energy Regulatory Commission regulations. The Board determined that these factors did not impair the independence of these directors.

Based on these standards and this evaluation, the Board of Directors has affirmatively determined by resolution that each of Messrs. Bennett, Hazel, Oestreich, Perdue Weiler and Leach and Mses. McAllister, Newhall, Pyle and Sanders has no material relationship with us and, therefore, is independent in accordance with the NYSE listing standards. The Board of Directors will regularly review the continuing independence of the directors.

The Corporate Governance Principles provide that at least 75% of the members of the Board of Directors must be independent directors under the NYSE listing standards. The Audit, Compensation and Personnel, and Nominating and Governance Committees must consist of all independent directors.

Related Person Transactions

We have adopted a written policy that we will annually disclose information regarding related person transactions that is required by regulations of the SEC to be disclosed, or incorporated by reference, in our Annual Report on Form 10-K. For purposes of the policy:

The term related person means any of our directors or executive officers, or nominee for director, and any member of the “immediate family” of such person.

A related person transaction is generally a consummated or currently proposed transaction in which we were or are to be a participant and the amount involved exceeds $120,000, and in which the related person had or will have a direct or indirect material interest. A related person transaction doesnot include:

Furthermore, a related person is not deemed to have a material interest in a transaction if the person’s interest arises only (i) from the person’s position as a director of another party to the transaction; (ii) from the ownership by such person and all other related persons, in the aggregate, of less than a 10% equity interest in another person (other than a partnership )partnership) that is a party to the transaction; (iii) from such person’s position as a limited partner in a partnership and all other related persons have an interest of less than 10% of and the person is not a general partner of or holdholds another position in, the partnership; and

(iv) from both such director position and ownership interest. Pursuant to the policy, each of our executive officers, directors and nominees for director is required to disclose to the Nominating and Governance Committee of the Board of Directors certain information regarding the related person transaction for review, approval or ratification by the Nominating and Governance Committee. Such disclosure to the Nominating and Governance Committee should occur before, if possible, or as soon as practicable after the related person transaction is effected, but in any event as soon as practicable after the executive officer, director or nominee for director becomes aware of the related person transaction.

The Nominating and Governance Committee’s decision whether or not to approve or ratify the related person transaction should be made in light of the Nominating and Governance Committee’s determination as to whether consummation of the transaction is believed by the Committee to not be, or to have been contrary to, the best interests of our company.Company. The Nominating and Governance Committee may take into account the effect of a director’s related person transaction on such person’s status as an independent member of our board of directors and eligibility to serve on board committees under SEC and NYSE rules.

Based on these standards, none of our directors engaged in awe had no related person transactiontransactions in 2006 or has a2008, and no related person transactiontransactions are currently proposed.

Lead Independent Director; Executive Sessions

The Corporate Governance Principles provide that the chairperson of the Nominating and Governance Committee will be the designated “Lead Independent Director” and will preside as the chair at meetings or executive sessions of the independent directors. As the Chairperson of the Nominating and Governance Committee, Mr. WeilerBennett is currently designated as the Lead Independent Director. Because Mr. Weiler will retire as a Director at the 2007 Annual Meeting, Mr. Bennett is expected to be appointed as the chairperson of the Nominating and Governance Committee and, therefore, assume the role of Lead Independent Director. At every regular in-person meeting of the Board of Directors, the independent directors meet in executive session with no member of our management present.

Communication with Directors

Shareowners and other interested parties may communicate with the full Board, non-management directors as a group or individual directors, including the Lead Independent Director, by providing such communication in writing to our Corporate Secretary, who will post such communications directly to our Board of Directors’ Webweb site.

Ethical and Legal Compliance Policy

We have adopted a Code of Conduct that applies to all employees, including our Chief Executive Officer, Chief Financial Officerchief executive officer, chief financial officer and Chief Accounting Officer,chief accounting officer, as well as our Board of Directors. We make our Code of Conduct available, free of charge, on the Alliant Energy Webweb site atwww.alliantenergy.com/investors under the “Corporate Governance” caption or in print to any shareowner who requests it from our Corporate Secretary. We intend to satisfy the disclosure requirements under Item 5.05 of Form 8-K regarding amendments to, or waivers from, the Code of Conduct by posting such information on the Alliant Energy Webweb site.

OWNERSHIP OF VOTING SECURITIES

All of our common stock is held by Alliant Energy. None of our directors or officers own any shares of our preferred stock. Listed in the following table are the number of shares of Alliant Energy’s common stock beneficially owned as of February 28, 2007Feb. 27, 2009 by (1) the executive officers listed in the Summary Compensation Table, (2) all of our director nominees and directors and (3) all director nominees, directors and the executive officers as of Dec. 31, 2006 as a group. The directors and executive officers as a group owned less than 1% of the outstanding shares of Alliant EnergyEnergy’s common stock on that date. No individual director or officer owned more than 1% of the outstanding shares of Alliant EnergyEnergy’s common stock on that date.

To our knowledge, no shareowner beneficially owned 5% or more of any class of our preferred stock as of Dec. 31, 2006.2008. The following table sets forth information, as of Dec. 31, 2006,2008, regarding beneficial ownership by the only persons known to Alliant Energyus to own more than 5% of Alliant Energy’s common stock. The beneficial ownership set forth below has been reported on Schedule 13G filings with the SEC by the beneficial owners.

Amount and Nature of Beneficial Ownership

COMPENSATION DISCUSSION AND ANALYSIS

Objectives of Compensation Programs:

The following is a discussion and analysis with respect to the compensation paid by Alliant Energy to our executive officers listed in the Summary Compensation Table for services performed for us, Alliant Energy and Alliant Energy’s other subsidiaries. References to “we,” “us,” “our,” and similar references in the following discussion and analysis include us, Alliant Energy and Alliant Energy’s other subsidiaries to our executive officers.

together unless the context indicates otherwise.

We are committed to implementingmaintaining a total compensation program for executive officers that:

We believe these objectives will attract, retain and motivate a highly proficient workforce that will work in the interests of our shareowners and customers.

workforce.

We adhere to the following compensation principles, which are intended to facilitate the achievement of our business strategies:

Benchmarking

We utilize compensation data from companies comparable companiesto Alliant Energy to assess our competitiveness in base salary and incentive compensation for all officer level positions and target the value of each component of compensation to the median level of comparable companies. The companies that we use for comparison consist of companies of similar revenue size as Alliant Energy’s both in the energy and utility industry as well as in general industry.positions. We believe compensation programs at these comparable companies should serve as a benchmark for what constitutes competitive compensation. The comparable companies in the energy and utility industry that we used for benchmarking in 20062008 were drawn from Towers Perrin’s 20062007 Energy Services Industry Executive Compensation Database (the “2007 Energy Services database”), a survey of approximately 100 companies that includes compensation data fromwhich comprises nearly all investor-owned U.S. utilities. The general industry data were obtained from Towers Perrin’s 20062007 Executive Compensation Database, a survey of over 820 companies.800 companies the majority of which are Fortune 1000 companies (the “2007 General Industry database”). In using these broad-based surveys, we considered only aggregate data and did not select any individual companies for comparison. All of the survey data were aged to Jan. 1, 2008 using a 3.75% annual update factor. The data from both

databases were adjusted to reflect how the data compare to companies of similar revenue size using regression analysis.

Our Compensation Consultant

To assistand Personnel Committee used this adjusted data, among other factors, to determine appropriate levels of pay in establishing2008 to our compensation program,named executive officers. We refer to this adjusted data of companies comparable to Alliant Energy used by our Compensation and Personnel Committee to determine appropriate levels of pay to our Board of Directors, which we refer toexecutive officers as the Committee and which is comprised“peer group” throughout the following discussion. For general management, including four of the same directorsnamed executive officers, and staff positions, equally blended energy industry and general industry data from these databases are used as the target market reflecting the broader talent market for these jobs and the fact that we operate in some diversified businesses. For utility-specific operating positions, including Mr. Aller’s, one of the named executive officers, energy industry data are used as the target market. Overall, Alliant Energy’s revenue is ranked between the median and the average revenue of the companies in the 2007 Energy Services database. Towers Perrin advised our Compensation and Personnel Committee on setting compensation for our named executive officers for 2008. See “Meetings and Committees of the Board of Directors of Alliant Energy, engages the services of Towers Perrin as the Committee’s outside compensation consultant. Towers Perrin provides assistance– Compensation and serves as an advisor in evaluating the compensation of our non-management directors, the chief executive officer and the other executive officers; provides market information and trends regarding executive compensation programs; provides benchmarking and competitive market reviews of our executive officer total compensation; assists with the design of our short-and long-term incentive programs and executive retirement programs; and provides technical considerations and actuarial services. We providePersonnel Committee” for the appropriate funding, as determined by the Committee, for payment of fees and out of pocket expenses to Towers Perrin. The Committee retains the authority to retain and terminate the outside compensation consultant.more details.

Roles of Executives in Establishing Compensation

The Committee reviews and approves all elements of our executive compensation programs. Our chief executive officer provides input to the Committee in the assessment, design and recommendation of executive compensation programs, plans and awards. Annually, the chief executive officer reviews with the Committee market data provided by Towers Perrin to help verify survey job information adequately captures officers’ duties. Based on that data, the chief executive officer recommends to the Committee base salary adjustments and short-and long-term incentive targets in relation to external market data while also considering internal equity considerations and executive officers’ individual performance. The chief executive officer provides recommendations to the Committee for total annual compensation of executive officers. The chief executive officer does not, however, make any recommendation to the Committee regarding his own compensation. Further, the chief executive officer and other executive officers assess the performance of those executive officers reporting to them. The chief executive officer is invited to attend all Committee meetings to provide an update of progress made towards achievement of annual performance goals and to provide management’s views on compensation program design features and components.

Compensation Elements and Design

The major elements of the executive compensation program are base salary, short-term (annual) incentives, long-term (equity) incentives and other benefits. In setting the level for each major component of compensation, we consider an executive officer’s total compensation (which consists of all elements of compensation including employee benefit and perquisite programs), the current market for talent, our historic levels of compensation, company culture, individual and company performance, and internal equity. We aim to strike an appropriate balance among base salary, short-term incentive compensation and long-term incentive compensation. Our goal is to provide an overall compensation package for each executive officer that is competitive with the packages offered to similarly situated executive officers at comparable companies.within the peer group. To achieve that goal, we target each element of compensation to the median levels within the peer group. Total direct compensation of our named executive officers includes a pay mix betweenconsists of base salary and incentive pay (both short-term and long-term) that is weightedwe weight such that targeted incentive pay accounts for 50-75%52-77% of total direct compensation. Mr. Harvey’s target incentive pay for 2008 was 77% of total direct compensation. In establishing the 2008 compensation reported, in the aggregate, our named executive officers were paid, on average, base salaries 2% below the median of the peer group, target cash compensation 3% below the median of the peer group and total direct compensation 6% below the median of the peer group. The following table shows the breakdown for each of our named executive officers in 2008 of the total direct compensation pay mix. The amounts in this table were calculated using targeted compensation for 2008 and therefore may differ from the actual payments for 2008 as reported in the Summary Compensation Table below.

The column titled “Short-Term Incentive as a % of Total” is the percentage of the total direct compensation represented by a target payout of incentive compensation under Alliant Energy’s short-term incentive plan. We made no payment to named executive officers for 2008 under the short-term incentive plan.

Base Salary

We pay base salaries to assure management with a level of fixed compensation at competitive levels to reflect their professional skills, responsibilities and performance to attract and retain key executives. We adjust base salaries taking into consideration both changes in the market and performance against job expectations. Base salaries represent 15-50% of our executive officers’ total direct compensation.

The Committee generally seeks to set baseconsiders salaries for all executive officers at approximatelythat fall within 15% above or below the 50th percentile ofmedian salaries for similar positions at comparable companies.in the peer group to be competitive. The Committee will also consider the nature of the position, the responsibilities, skills and experience of the officer, and his or her past performance. AdjustmentsWe may be made inadjust base salaries to keep current with comparable companies,the peer group, to recognize outstanding individual performance or to recognize an increase in responsibility.

For 2006, aggregate base salaries for our

The Committee adjusted Mr. Harvey’s salary from $810,000 to $845,000 in 2008 based on a review of comparable chairman and chief executive officers were slightlywithin the peer group. Mr. Harvey’s base salary was 9% below the median of similarly situated executives at comparable companies. Our below market positioning was due in part to fairly recent promotions of several executives including Mr. Harvey into the chief executive officer role in July 2005. The Committee set his base salary at that time at $700,000,peer group and 1% below the median baseof Towers Perrin’s 2007 Energy Services database. We believe Mr. Harvey’s salary for chief executive officers at comparable companies, in recognition of his recent promotion. When he became Chairmanis competitive as it is near the median of the Board2007 Energy Services database and within 15% of Directors in February 2006, the Committee raisedpeer group. In addition, we target Mr. Harvey’s base salaryincentive compensation elements to $750,000the median of the peer group, and believe they are generally higher than the 2007 Energy Services database. This results in recognition of his additional responsibilities as Chairman. The Committee set his base salary at $810,000more emphasis on incentive pay for 2007.

our CEO, which we believe creates a stronger link between pay and performance.

The Committee adjusted basethe salaries in 2006 forof our other named executive officers as reportedfollows: Mr. Protsch from $476,000 to $495,000; Ms. Swan from $361,000 to $375,000; Mr. Aller from $257,500 to $267,500; and Ms. Doyle from $236,000 to $255,000. The Committee adjusted the salaries based on the peer group information provided by Towers Perrin as well as the internal considerations described earlier. We believe the salaries are all competitive with similar positions in the Summary Compensation Table below based upon the review of market information on salaries of comparable companies. Mr. Protsch’s base salary was increased from $450,000 to $455,000. Ms. Swan’s base salary was increased from $315,000 to $345,000. Mr. Aller’s base salary was increased from $245,000 to $250,000. Mr. Kratchmer’s base salary was increased from $200,000 to $219,000. Each of the executive officers base salary increases were set to target their salaries to the median of similarly situated executive officers at comparable companies with the exception of Mr. Harvey, whose salary was below median as discussed above.

peer group.

Short-Term Incentives

Our executive officers, including our named executive officers, are eligible to participate in the Management Incentive Compensation Plan, or MICP, which is Alliant Energy’s short-term (annual) incentive plan. The MICP provides executive officers with direct financial incentives in the form of annual cash bonuses tied to the achievement of our and Alliant EnergyEnergy’s financial, and strategic goals and individual performance goals. The MICP encourages executive officers to achieve superior annual performance on key financial, strategic and operational goals. By setting annual goals, the Committee endeavors to drive annual performance and align the interests of management with the interests of our shareowners and customers. Our target MICP compensation represents 20-25% of our executive officers’ total direct compensation. This pay mix aligns with our desire to emphasize variable at-risk compensation based on meeting predetermined company, subsidiary, business unit and individual performance goals.

The Committee seeks to set MICP payment levelsopportunities at the median short-term incentive payments,target levels, measured as a percentage of base salary, for comparable positions at comparable companies.in the peer group. MICP targets in 2006 ranged from 90%2008 were 95% of base salary for Mr. Harvey to 35% of base salaryHarvey; 70% for other executive officers, with aMr. Protsch; 55% for Ms. Swan; 45% for Mr. Aller; and 40% for Ms. Doyle. The maximum possible individual payout for all executive officers ofwas two times the target percentage. The 2006This range aligns with our desire to emphasize variable at risk compensation.

We pay incentives from a pool of funds that Alliant Energy establishes for MICP targets were slightly below market due to Mr. Harvey’s recent promotion to chief executive officer. MICP targets represent the percentage of base salary that would be paid to the executive if the targeted company-wide performance goals were met and the targeted individual performance goals were met.

payments. The Committee establishes threshold company-wide goals, which determine the funding level of an incentive pool. EarningsDiluted earnings per share from continuing operations of Alliant Energy’sour Company and IPL, which together we refer to as the utilities, determines the funding level of 85% of the incentive pool. For 2006,If the threshold utility earnings per share was $2.15, the midpoint of our utility earnings per share guidance provided at the beginning of 2006. The utility earnings per share from continuing operations in 2006 was $2.21. If the earnings per share thresholdtarget is not met, then no incentives are paid under the MICP. IfFor 2008, the threshold utility earnings per share threshold is met, thenwas $2.33, which was the MICP is funded at a level determined by multiplyingmidpoint of the corporate score, which is based on how well we did compared to our2008 utility earnings per share threshold as well as whether we met our cash flow target,guidance provided by Alliant Energy at the total aggregate target bonus amounts up to an established maximum funding amount.end of 2007. Cash flowflows from the utilities and our servicesAlliant Energy’s service company affiliate, Alliant Energy Corporate Services, Inc., determinessubsidiary determine the funding level for 15% of the incentive pool. The cash flow target for 20062008 was $450 million and the level of cash flow achieved was $427$502 million. If the cash flow target is not met, the Committee is not required to fund the 15% of the incentive pool represented by cash flow. The minimum funding level is 20% of

We factor the incentive pool target and the maximum funding level is 150%.

The Committee may exercise its discretion and waive the earnings per share threshold or cash flow target if they are not met. For 2006, the Committee exercised its discretion and waived the Alliant Energy cash flow performance measure for 2006 and funded the MICP at 150% of target. The only reason the cash flow performance measure was not attained in 2006 was because in December 2006, management used available cash to make discretionary pension plan contributions, which would

have been required in 2007 through 2009. As a result of the discretionary pension plan contributions, the cash flow performance measure was not met and, without the waiver, the MICP would have been funded at 127.5%. The Committee granted this waiver in recognition of the discretionary pension plan contributions being voluntary and a good use of the cash held by Alliant Energy. As a result of the waiver, named executive officers received a larger MICP payment than they would have without the waiver. The differences between the MICP payments as a result of the waiver and what the MICP payments would have been without the waiver were: for Mr. Harvey, $151,875; for Mr. Protsch, $65,213; for Ms. Swan, $36,872; for Mr. Aller, $23,625; and for Mr. Kratchmer, $16,384.

Individual performance goals are reviewed and established by the Committee to assist in the determination of individual awards under the MICP. The Committee is presented with significant corporate goals for evaluation in conjunction with the establishment of individual performance goals for the chief executive officer and the other named executive officers. The chief executive officer provides recommendations to the Committee in reference to the applicable performance goals that should be implemented for each of the named executive officers depending on the strategic and functional responsibility of these officers. The chief executive officer is afforded discretion on the implementation of the performance goals for the other executive officers to keep continuity between the goals of the chief executive officer and those of the other executive officers. The goals are weighted. Individual performance goals are designed to be achievable but substantially challenging.

Mr. Harvey’s performance goals for 2006 specifically included financial goals of earnings per share from utility continuing operations of $2.15, earning a targeted return on equity at each utility and achieving cash flow of $450 million. In addition, Mr. Harvey’s goals included asset sale execution goals consistent with our strategic plan. These financial goals were weighted at 70%. Corporate well-being goals included achieving safety, employee engagement and diversity goals, weighted at 30%. The Committee determined that Mr. Harvey met his goals at a level of 100%.

Mr. Protsch’s goals for 2006 included the same financial goals as Mr. Harvey. In addition, Mr. Protsch had financial goals related to the performance of business units under his control. These financial goals were weighted at 70%. Mr. Protsch also had internal performance goals for the finance divisions he oversees, weighted at 15% in addition to corporate well-being goals weighted at 15%. Mr. Protsch achieved his goals at 98%.

Ms. Swan’s financial goals for 2006 included completion of asset divestitures consistent with our strategic plan, achieving a targeted return on equity for our company, and achieving regulatory outcomes to enhance financial performance of our company. These financial goals were weighted at 70%. She also had customer service and customer satisfaction benchmarks with a 15% weighting and corporate well-being goals, including employee engagement and diversity goals, weighted at 15%. Ms. Swan achieved her goals at 95%.

Mr. Aller’s financial goals for 2006 included earning a targeted return on equity at our Iowa utility affiliate, achieving a specified earnings per share target, meeting benchmarks from certain utility functions, and meeting certain financial targets related to our non-regulated transportation operations. These financial goals were weighted at 60%. Mr. Aller also had goals to achieve specified customer service and reliability standards, weighted at 25%. His corporate well-being goals included diversity, safety, employee engagement and leadership benchmarks, weighted at 15%. Mr. Aller achieved his goals at 105%.

Mr. Kratchmer’s financial goals for 2006 were to execute tax planning strategies and to evaluate and use key process inputs to develop reporting and tracking enhancements. These financial goals were weighted at 40%. He also had an internal customer satisfaction goal to provide appropriate support to the organization measured by customer satisfaction surveys. This customer goal was weighted at 30%. His corporate well-being goals included implementing and administering a financial employee development program and diversity goals. These goals were weighted at 30%. Mr. Kratchmer achieved his goals at 95%.

The level of individual performance as compared to the individual performance goals is factored into individual award amounts after the pool has been funded. Individual awards may range from 0% to 200% of the targeted payment based on an individual’s achievement of performance goals. The Committee makes judgments about achievement of performance goals by the chief executive officer. Achievement of performance goals for the other executive officers is judged by the chief executive officer or the executive to whom the executive officer reports, in consultation with the Committee.

Individual performance goals are reviewed and established by the Committee to assist in the determination of individual awards under the MICP. Individual performance goals are derived from Alliant Energy’s strategic plan and from operational benchmarks intended to benefit our shareowners, customers and employees. Our Committee believes that using Alliant Energy’s strategic plan to set individual performance goals aligns the executives’ incentive compensation with Alliant Energy shareowner interests. Our Committee also believes that using operational benchmarks to set individual performance goals aligns the executives’ incentive compensation with customer interests.

Mr. Harvey’s performance goals for 2008 included financial goals of achieving Alliant Energy consolidated earnings per diluted share from continuing operations of $2.65, which was the midpoint of the 2008 earnings guidance issued by Alliant Energy in December 2007, and achieving cash flows from operations at the utilities and Alliant Energy’s service company subsidiary of $502 million in aggregate. These financial goals were weighted at 50%. In addition, Mr. Harvey’s goals included meeting certain milestones related to the proposed coal plants for us and IPL; meeting certain milestones related to the proposed wind projects for us and IPL; meeting certain milestones related to clean air compliance program projects; achieving no fines for non-compliance with environmental laws and regulations; and obtaining targeted savings from Lean

Six Sigma and related process improvements. These goals, which are referred to as execution goals, were weighted at 30%. Mr. Harvey’s corporate well-being goals included achieving safety targets and employee and supplier diversity goals. The Committee established several targets for each of the safety and diversity goals. The Committee determined that the goals in the diversity category were to be graded on a sliding scale to reward significant gains in diversity even if the full target was not achieved. The Committee determined that the goals in the safety category were to be graded on a pass/fail system whereby if one milestone for safety was not met, then the whole category of safety could not be considered accomplished. The corporate well-being goals were weighted at 20%.

Mr. Protsch’s financial goals for 2008 were the same as for Mr. Harvey. These financial goals were weighted at 50%. Mr. Protsch also had execution goals of meeting certain milestones related to the proposed coal plants for us and IPL; achieving reasonable and timely approval of our base rate case; and obtaining targeted savings from Lean Six Sigma and related process improvements. These execution goals were weighted at 30%. In addition, Mr. Protsch had corporate well-being goals similar to Mr. Harvey’s, which were weighted at 20%.

Ms. Swan’s performance goals for 2008 included financial goals of earnings per share from utility continuing operations of $2.33, which was the midpoint of Alliant Energy’s 2008 utility earnings guidance issued in December 2007, and achieving cash flows from operations at the utilities and Alliant Energy’s service company subsidiary of $502 million in aggregate. These financial goals were weighted at 50%. Ms. Swan also had execution goals, including meeting certain milestones related to the proposed coal plants for us and IPL; meeting certain milestones related to the proposed wind projects for us; obtaining targeted savings from Lean Six Sigma and related process improvements; and achieving specified customer service and reliability standards for us. These execution goals were weighted at 30%. Finally, Ms. Swan had corporate well-being goals similar to Mr. Harvey’s weighted at 20%.

Mr. Aller’s financial goals for 2008 included the same financial goals as Mr. Harvey. In addition, Mr. Aller had financial goals related to the consumer products, fleet services and transportation divisions of Alliant Energy that he oversees. These financial goals were weighted at 50%. Mr. Aller also had execution goals, including meeting certain milestones related to the proposed coal plants for us and IPL; meeting certain milestones related to the proposed wind projects of IPL; achieving no fines for non-compliance with environmental laws and regulations; obtaining targeted savings from Lean Six Sigma and related process improvements; and achieving specified customer service and reliability standards for IPL. These execution goals were weighted at 30%. In addition, Mr. Aller had corporate well-being goals similar to Mr. Harvey’s, which were weighted at 20%.

Ms. Doyle’s financial goals for 2008 were the same as for Ms. Swan and were weighted at 50%. Ms. Doyle’s execution goals included meeting certain milestones related to the proposed coal plants for us and IPL; meeting certain milestones related to the proposed wind projects for us and IPL; meeting certain milestones related to clean air compliance program projects; meeting certain regulatory milestones related to our base rate case; and obtaining targeted savings from Lean Six Sigma and related process improvements. These execution goals were weighted at 30%. Finally, Ms. Doyle had corporate well-being goals similar to Mr. Harvey’s weighted at 20%.

Alliant Energy’s strategic planning department is responsible for initial drafting of the performance goals, which is done to ensure that the individual performance goals are closely aligned with the strategic plan. The chief executive officer provides recommendations to the Committee in reference to the applicable performance goals that should be implemented for each of the named executive officers (other than for himself) depending on the strategic and functional responsibility of these officers. The chief executive officer is afforded discretion on the implementation of the performance goals for the other executive officers to keep continuity between the goals of the chief executive officer and those of the other executive officers. The Committee evaluates and ultimately approves all of the corporate and individual performance goals under the MICP for all of the executive officers. The goals are weighted. Individual performance goals are designed to be achievable but substantially challenging.

Alliant Energy’s utility earnings per share for 2008 was $2.19, which fell below the threshold utility earnings per share of $2.33 established to fund the incentive pool. The Committee determined that the threshold utility earnings per share was not met. Therefore, Alliant Energy did not pay incentives to our named executive officers under the MICP for 2008. The Committee did not consider achievement of individual performance goals when determining awards under the MICP because the threshold for incentive payments under the 2008 MICP was not met.

Long-Term Incentives

Alliant Energy awards long-term incentive compensation based on the achievement of longer-term, multi-year financial goals. We believe long-term incentive compensation aligns executives’ interests with those of Alliant EnergyEnergy’s and our shareowners by

compensating executive officers for long-term achievement of financial goals.Long-termgoals. Long-term incentive compensation takes the form of equity awards granted under Alliant Energy’sour 2002 Equity Incentive Plan. Long-term incentive compensation is targeted at 30-50% of our executive officers’ total direct compensationPlan, as amended and along with the MICP, further emphasizes variable at-risk compensation based on meeting predetermined company, subsidiary, business unit and individual performance goals.

restated.

Alliant Energy determines the amountvalue of equity awardslong-term incentive amounts by benchmarking to our executive officers by setting a dollarthe median value as a percentage of base salary at the level it believes appropriate based on the long-term incentives comparable companies provide,paid by the peer group, assessing the individual performance of the executive officer and internal equity among our executives. Alliant Energy then grantsexecutives, and considering the competitiveness of the total direct compensation package. Based on these factors, the Committee approved, as a percentage of base salary, the following values of the long-term incentives awarded to the named executive officers for 2008: 250% for Mr. Harvey; 150% for Mr. Protsch; 125% for Ms. Swan; 70% for Mr. Aller; and 70% for Ms. Doyle. The Committee approves the dollar value of the long-term equity awards prior to the grant date. We grant the number of Alliant Energy shares of its common stock necessary to reachapproximate that dollar value based on the fair market value of itsAlliant Energy’s share price on the grant date. The levels in 2006 were 200%grant price used for Mr. Harvey, 120%accounting purposes is fair market value of Alliant Energy’s common stock on the grant date. Our shares are not used for Mr. Protsch, 100% for Ms. Swan, 60% for Mr. Aller and 50% for Mr. Kratchmer. The long-term incentive targeted payout amounts were benchmarked to the median of comparable companies as to their levels paid.

compensation.

The long-term incentive awards consist of performance contingent restricted stock and performance shares. We believe the use ofAlliant Energy believes these two componentstypes of long-term equity compensation providesawards provide incentives for our executive officers to produce value for our and Alliant Energy shareowners and ourEnergy’s shareowners over the long-term on both an absolute basis and a relative basis. Performance contingent restricted stock granted in 2008 vests if Alliant Energy’s earnings per share grows at a specified level of 5% compounded year-over-yearincome from continuing operations achieves 19% growth, which rewards absolute long-term growth. Performance shares vest and pay-out at varying levels depending on Alliant Energy’s total shareowner return as compared to a specified peer group,the S&P Midcap Utilities Index, which rewards relative total shareowner return. The Committee granted long-term equity awards in 2008 consisting of 50% performance contingent restricted stock and 50% performance shares to equally reward both relative long term growth and total shareowner return.

The Committee approves the value of the long-term equity awardsPerformance contingent restricted stock granted prior to the grant date. The grant date of the awards made to our executive officers2008 vests if Alliant Energy consolidated earnings per share from continuing operations achieves 116% growth, which is the first business day of the5% compounded year which maximizes the time periodover year growth for the incentives associated with the awards. The grant price used for accounting purposes is fair market value of Alliant Energy’s common stock on the grant date.

Long-term equity awards granted in 2006 consisted of 60%three years. For performance contingent restricted stock and 40%granted in 2008, the Committee changed the performance shares.

criteria from earnings per share from continuing operations to income from continuing operations to mitigate volatility in earnings per share that can be caused by increasing or decreasing the number of shares outstanding. The Committee increased the growth rate of income that must be achieved for the performance criteria to be met from 5% to 6% compounded year over year growth for three years. The Committee believed that the increase would better align management’s interests with the high expected growth in earnings during the planned new generation build out period.

The vesting of the performance contingent restricted stock granted in 20062008 is based on Alliant Energy’s earnings per share growth. Specifically,growth in income from continuing operations using Alliant Energy’s final income from continuing operations in 2007 as the base, which was adjusted to remove the after tax gain on the sale of the electric transmission assets of Alliant Energy’s Iowa utility as this was a non-recurring event. The base adjusted income from continuing operations was $302 million. The performance contingent restricted stock granted in 2008 vests if Alliant Energy achieves earnings per shareincome from continuing operations growth of $2.68, which represents a 16% growth in earnings per share19% from 2005,2007, within a four year period. The 19% growth is based on achieving 6% compounded year over year growth over a three year period. The target income from continuing operations is $359.4 million. In no case may the restricted stock vest earlier than two years from the grant date, and all shares will be forfeited if the earnings per shareincome from continuing operations target is not met at the end of the four-year mark.

period.

The payout of performance shares granted in 20062008 is based on Alliant Energy’s total shareowner return over three years. Performance shares will provide a 100% payout, or target payout, if Alliant Energy’s relative total shareowner return over three years is equal to the median performance of a specific peer group selected by the Committee. The Committee selected the S&P Midcap Utilities Index wasas the peer group used for the 20062008 grants of performance shares.

Performance share payouts are capped at 200% of the target payout if Alliant Energy’s total shareowner return is at or above the 90^th percentile of the total shareowner return of Alliant Energy’s peer group.the S&P Midcap Utilities Index. The payout would be 50% of the target payout if Alliant Energy’s total shareowner return was in the 40^th percentile of the total shareowner return of Alliant Energy’s peer group.the S&P Midcap Utilities Index. There would be no payout if Alliant Energy’s total shareowner return fell below the 40^th percentile of Alliant Energy’s peer group.the S&P Midcap Utilities Index. Performance shares allow the executive to receive a payment in shares of Alliant Energy’sEnergy common stock, cash, or ina combination of Alliant Energy common stock and cash, the value of which is equal to the number of shares awarded, adjusted by the performance multiplier. The Committee generally requires an executive that has not met the share ownership guidelines to take a payment in Alliant Energy common stock or a combination of 50% common stock

and 50% cash in order to bring the executive closer to achieving the share ownership guideline. If the executive chooses to take the payment in cash, the amount of the payout is determined by multiplying the number of shares earned by the average of the high and low trading prices on a date chosen by the Committee. The Committee chooses this date in advance of issuing the shares.

In 2007,2009, the Committee determined that Alliant Energy achieved theits performance levels for the performance shares granted in 2004.2006. Alliant Energy’s relative total shareowner return performance for the three years ended Dec. 31, 20062008 was at the 69^th75th percentile. Due to the total shareowner return goal being achieved, weAlliant Energy had a performance share payout of 147.5%162.5% of target for the 20042006 grant. Also in 2007,2009, following the confirmation from Alliant Energy’s audited financial statements, the Committee determined that the performance contingent restricted stock granted in 2005 vested2007 did not vest due to the successful

achievement of Alliant Energy’s long-term goal of earnings per share from continuing operations growth targets after two years. Alliant Energy’s 20052007 diluted earnings per share from continuing operations growth goal was $2.13.$2.55. Alliant Energy’s adjusted earnings per share from continuing operations for the year ended Dec. 31, 20062008 was $2.20.$2.54.

The Committee approves the dollar value of the long-term equity awards prior to the grant date. The grant date of the awards that Alliant Energy made in 2008 to our executive officers was the first business day of the year, which maximized the time period for the incentives associated with the awards. The grant price used for accounting purposes was the fair market value of Alliant Energy’s common stock on the grant date and the value of the awards were reported in Alliant Energy’s financial statements in accordance with FAS 123(R).

Alliant Energy no longer grants stock options as incentive compensation. WeAlliant Energy determined that performance contingent restricted stock and performance shares provide equally motivating forms of equity incentive compensation and reduce potential dilution of ourAlliant Energy’s shareowners because fewer shares need be granted. Alliant Energy’s last stock options were granted in 2004 and expire in 2014.

Other Benefits

Alliant Energy also offers benefit programs to our executive officers with a focus towards their retirement.retirement consistent with those of the peer group. These plansprograms include 401(k), deferred compensation and pension benefits. These plansThe benefit programs are designed to be competitive in the market in attracting, retaining and motivating key executives and employees by providing competitive retirement benefits. We apply the same marketpeer group benchmarking approach in designing these programs in that we benchmark to median levels of benefit and design elements. The Committee reviews benefit programs on an annual basis to determine effectiveness and identify any necessary changes. These retirement relatedThe retirement-related benefit plans were all reviewed during 20062008 by the Committee with noseveral changes implemented. A brief description of the plans with associated changes follows.

401(k) Savings Plan

OurAll of our salaried employees, including our executive officers, are eligible to participate in the Alliant EnergyEnergy’s 401(k) Plan. Alliant Energy matches $0.50 on theeach dollar for the first six percent8% of compensation deferred by the employee up to the IRS maximum.

Beginning Aug. 3, 2008, we enhanced benefits under the 401(k) Plan to offset a freeze of the Alliant Energy Cash Balance Pension Plan. See “Pension Benefits” below for more information. Alliant Energy now contributes a percentage of salaried employees’ salaries to their 401(k) accounts in addition to the company match. The amount of Alliant Energy contribution ranges from 4% to 6% of an employee’s salary. The amount of Alliant Energy contribution depends on the employee’s age and number of years of service at the company.

Key EmployeeAlliant Energy Deferred Compensation Plan

The Alliant Energy Key Employee Deferred Compensation Plan, or KEDCP,AEDCP, enables participants, including our executive officers, to defer up to 100% of base salary and annual incentive awards earned on a pre-tax basis and to receive earnings or incur losses on the deferrals until the date of distribution. The KEDCPAEDCP provides tax deferred savings and post-retirement income to our executive officers. The shares of Alliant Energy common stock identified as obligations under the KEDCPAEDCP are held in a rabbi trust. Alliant Energy offers the KEDCPAEDCP as part of the executive’sexecutives’ competitive compensation package and believes itto permit executives to take advantage of the tax code in saving for their retirement. We believe the AEDCP is in line with offerings from comparable companies.the peer group. See “Nonqualified Deferred Compensation” below for more information regarding the KEDCP.AEDCP.

Cash Balance Pension Plan

OurCertain of our salaried employees, including our executive officers, are eligible to participate in the Alliant Energy Cash Balance Pension Plan. This defined benefit plan is portable, offers flexible payment options and steady growth of retirement funds. It is consistent with benefits that have been provided by other comparable companies.Future accruals to the Cash Balance Pension Plan were frozen for participants effective Aug. 2, 2008. See “Pension Benefits” below for more information regarding the Alliant Energy Cash Balance Pension Plan.

Excess Retirement Plan

Certain of our salaried employees, including our executive officers, participate in the unfunded Alliant Energy Excess Retirement Plan. The plan is intended to provide the accruals that the participants would have earned under the Alliant Energy Cash Balance Pension Plan and the Alliant Energy 401(k) Savings Plan but for statutory limitations on employer-provided benefits imposed on those tax-qualified plans.

Supplemental Executive Retirement Plan

Our executives who are vice presidents or above, including our named executive officers, participate in Alliant Energy’s unfunded Supplemental Executive Retirement Plan, or SERP. Alliant Energy provides the SERP as an incentive for key executives to remain in ourAlliant Energy’s service by providing additional retirement compensation in addition to the benefits provided by the pension plan, which are limited by the tax code, that is payable only if the executive remains with usAlliant Energy until retirement, disability or death. See “Pension Benefits” below for more information regarding the SERP.

Split Dollar / Reverse Split Dollar Life Insurance Plan

Certain executive officers, including Messrs. Harvey and Protsch and Ms. Swan, receive individually owned life insurance policies. Alliant Energy pays the premiums for this insurance and these payments are taxable to the individual officers. These specific policies were grandfathered in 1998 and we no longer offer the policies to other executive officers as part of total executive compensation.

Perquisites

Alliant Energy provides our officers, including our named executive officers, with a Flexible Perquisite Program. The program provides a specified amount of funds to our executives to use for benefits, including an annual fixed automobile allowance, financial planning and legal services, a variety of club memberships and long-term care insurance. The

Committee reviews this program on an annual basis as part of our total compensation offering to determine its merits and the use of similar programs by comparable companies.our peer group. The last review took place at our joint December 20062008 Committee meeting at which thewhere Towers Perrin provided an update on market trends for these programs. The Committee determined that the Flexible Perquisite Program wascontinued to be comparable to similarcontinuing programs at comparable companiesfound in the market and should continue as a component of total executive compensation. TheFor 2009, the Committee set the Flexible Perquisite Program funding amounts at $26,000 for Mr. Harvey,Harvey; $20,000 for Mr. Protsch,Protsch; $17,500 for Ms. Swan,Swan; $14,000 for Mr. AllerAller; and $11,000 for Mr. Kratchmer.Ms. Doyle which represented no change from 2008. Our executive officers are also eligible for moderately more generous health and dental insurance, accidental death insurance, disability insurance, vacation, and other similar benefit programs than the balance of our non-bargaining unit employees.

Post-Termination Compensation

KEESAs

Alliant Energy currently has in effect key executive employment and severance agreements, or KEESAs, with our executive officers, including our named executive officers, and certain of our key employees. The KEESA is designed to provide economic protection to key executives following a change in control of Alliant Energy so that executives can remain focused on our business without undue personal concern. Alliant Energy recognizesWe recognize that circumstances may arise in which itwe may consider a change of control transaction. We believe the security afforded the executives by the KEESA will help the executives to remain focused on business continuity and reduce the distraction of the executive’s reasonable personal concerns regarding future employment. We also believe that the KEESA allows the executive to better consider the best interests of our company and Alliant Energy and its shareowners due to the economic security provided by the KEESA benefits.

The KEESAs are triggered if, within a period of up to three years after a change in control of Alliant Energy for Mr. Harvey, Mr. Protsch or Ms. Swan and two years for Mr. Aller or Mr. Kratchmer,Ms. Doyle, there has occurred both a change in control and loss of employment, causing KEESA benefits to be subject to a “double trigger.” We implemented the double trigger mechanism to ensure that only those executives adversely affected by a change in control would receive benefits under the KEESA. The cash termination benefit under the KEESA is up to three times base salary and target bonus for Mr. Harvey, Mr. Protsch and Ms. Swan and two times base salary and target bonus for Mr. Aller and Mr. Kratchmer.Ms. Doyle.

The KEESAs for Mr. Aller and Mr. KratchmerMs. Doyle provide that if any portion of the benefits under the KEESA or under any other agreement for the officer would constitute an excess parachute payment for purposes of the Internal Revenue Code, benefits will be reduced so that the officer will be entitled to receive $1 less than the maximum amount which he or she could receive without becoming subject to the 20% excise tax imposed by the Code on certain excess parachute payments, or which we may pay without loss of deduction under the Code. The KEESAs for Mr. Harvey, Mr. Protsch and Ms. Swan provide that if any payments constitute an excess parachute payment, Alliant Energy will pay to the appropriate officer the amount necessary to offset the excise tax and any additional taxes on this additional payment.

We believe the level of the benefits provided by the KEESAs to each executive officer reflects the amount of work that would be required of them during a change in control transaction as well as the amount of opportunities they would be asked to forego to assist the change in control transaction rather than seek future employment. Top executives are required to put forth greater effort to ensure a smooth change in control of a company and we believe that it would take a longer time for them to find comparable employment based on their attained career status. The elevated positions held by Messrs. Harvey and Protsch and Ms. Swan cause us to believe that this analysis is especially true for them. Therefore, they receive the highest benefit level and a tax-gross up. We believe the benefits provided in the KEESA to our executive officers are comparable with industry practice.

In consideration of the KEESA benefits, the executive agrees not to compete with Alliant Energy and us for a period of one year after the executive leaves Alliant Energy and to keep in confidence any proprietary information or confidential information for a period of five years after the executive leaves Alliant Energy. Both of these conditions can be waived in writing by Alliant Energy’s board of directors.

See “Potential Payments upon Termination or Change in Control” for more information regarding the KEESAs.

Executive Severance Plan

Alliant Energy also maintains a general executive severance plan for executive officers in the event that an officer’s position has been eliminated or significantly altered by Alliant Energy. The executive severance plan is designed to provide economic protection to key executives following the elimination of their position so that executives can remain focused on our business without undue personal concern. We recognize that circumstances may arise in which we may consider eliminating certain key positions that are no longer necessary. We believe the security afforded the executives by the severance plan will keep the executives focused on their duties at our company rather than on their personal concerns of job security. The plan provides for a minimum level of severance equal to one times base salary, payment of pro-rated incentive compensation within the discretion of the chief executive officer, up to 18 months of paid COBRA coverage, six months of which are paid by Alliant Energy, outplacement services and/or tuition reimbursement of up to $10,000, and access to Alliant Energy’sour employee assistance program. All executive officer severance packages are approved by the Alliant Energy Compensation Committee. We believe our executive severance plan is consistent with plans throughout the industry.

See “Potential Payments upon Termination or Change in Control” for more information regarding the Executive Severance Plan.

Employment Agreements

Alliant Energy no longer hasWe do not have any employment agreements with our executive officers. Alliant Energy entered into an employment agreement with Mr. Davis to ensure the retention of his executive and industry experience during a period of our growth and diversification strategy. Upon Mr. Davis’ retirement on Feb. 1, 2006, this agreement expired. See footnote (9) to the Summary Compensation Table for further explanation of this agreement.

Share Ownership Guidelines

Alliant Energy established share ownership guidelines for our executive officers as a way to better align the financial interests of officers with those of shareowners. Under these guidelines, the requisite ownership numbers are 85,000 shares of Alliant Energy common stock for Mr. Harvey, 36,000 shares for Mr. Protsch and Ms. Swan and 12,000 shares for Messrs.Mr. Aller and Kratchmer.Ms. Doyle. The executive officers are expected to make continuing progress toward compliance with these guidelines and achieve their designated levels within five years of being appointed as an officer. Alliant Energy monitorsWe monitor each officer’s progression towards achievement of these guidelines on a semi-annual basis.

The share ownership guidelines have an impact upon the payout of awards by Alliant Energy for performance shares. If executives have not yet met their share ownership level, they are required to receive at least 50% of any performance share payout made upon the vesting of the performance shares in shares of Alliant EnergyEnergy’s common stock. In addition, once the performance or time-based restrictions lapse on shares of performance contingent or time-based restricted stock, these shares are counted towards

achievement of share ownership guidelines. Our chief executive officer retains the right to grant special dispensation for hardship, promotions or new hires. All of our named executive officers have met their share ownership guidelines. Their share holdings are shown in the “Ownership of Voting Securities” table above.

Impact of Regulatory Requirements

Section 162(m) of the Internal Revenue Code generally limits the corporate deduction for compensation paid to our chief executive officer and the three other most highly compensated executive officers named in the proxy statement(excluding our chief financial officer) to $1 million, unless such compensation is based upon performance objectives meeting certain regulatory criteria or is otherwise excluded from the limitation. Based on the Committee’s commitment to link compensation with performance as described above, the Committee intends to qualify future compensation paid to our executive officers for deductibility by us under Section 162(m) except in limited appropriate circumstances. All equity compensation plans are accounted for under FAS123(R)FAS 123(R).

At this time, plan compliance underIn 2008, Alliant Energy amended the SERP, KEESAs and Severance Plan to comply with the deferred compensation election and payment timing requirements of Internal Revenue Code Section 409A has been extended to January 1, 2008. We have engaged outside legal counsel to assist in conducting a preliminary review and analysis of our executive compensation plans for impending changes as a result of Section 409A. We expect this review to be completed in 2007 and any necessary plan modifications required for compliance to be recommended to the Committee for approval and implementation effective January 1, 2008.

The Public Service Commission of Wisconsin recently allowedallows us to recover from customers portions of our incentive compensation payments attributable to customer service and reliability goals. We plan to structurehave structured our compensation program to take advantage ofparticipate in this allowed recovery.

Conclusion

The Committee is provided with appropriate information and reviews all components of our chief executive officer’s and other executive officers’ compensation. This includes base salary, short-term incentive compensation; long-term incentive compensation; accumulated realized and unrealized stock option and restricted stock gains;Based on this information, the dollar valueCommittee seeks to implement executive compensation that is appropriately tied to the executiveperformance of the executives on behalf of shareowners, employees and cost to us of all perquisites and other personal benefits; the earnings and accumulated payout obligations under our non-qualified deferred compensation program; the actual projected payout obligations under our supplemental retirement income plan; and potential severance and change-in-control compensation scenarios. A tally sheet setting forth all the above components was prepared and reviewed by the Committee affixing dollar amounts under various payout scenarios.customers.

COMPENSATION AND PERSONNEL COMMITTEE REPORT

To Our Shareowners:

The Compensation and Personnel Committee (the “Committee”) of the Board of Directors of the Company is currently composed of four independent directors. The Committee assesses the effectiveness and competitiveness of, approves the design of and administers executive compensation programs within a consistent total compensation framework for the Company. The Committee also reviews and approves all salary arrangements and other remuneration for executive officers, evaluates executive officer performance, and considers related matters. It also makes recommendations to the Nominating and Governance Committee regarding compensation for the non-management Directors.

The Committee has reviewed and discussed the Compensation and Discussion and Analysis with our Audit Committee and our management. Based on the Committee’s reviews and discussions, the Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference in our Annual Report on Form 10-K for the year ended Dec. 31, 2006,2008, for filing with the SEC.

The Committee believes the existing executive compensation policies and programs provide the appropriate level of competitive compensation for our executive officers. In addition, the Committee believes that the long-short- and short-termlong-term performance incentives effectively align the interests of executive officers and shareowners toward a successful future for our company.

COMPENSATION AND PERSONNEL COMMITTEE

Singleton B. McAllisterAnn K. Newhall (Chairperson)

Michael L. Bennett

Darryl B. Hazel

Dean C. Oestreich

Carol P. Sanders

SUMMARY COMPENSATION TABLE

The table below summarizes the compensation paid to or earned by our chief executive officer, our chief financial officer (which for all of 2008 was Mr. Protsch) and our next three highest paid executive officers and our former chairman for all services rendered to us, Alliant Energy and Alliant Energy’s other subsidiaries in 2008, 2007 and 2006. We refer to such individuals in this proxy statement collectively as our named executive officers.

in footnote (1) to the Pension Benefits table below, which may include amounts that the named executive officer may not currently be entitled to receive because such amounts are not vested, and (b) amounts representing above market interest on non-qualified

deferred compensation. The above-marketabove market interest was calculated to be equal to the amount by which the interest on deferred compensation in 2006 (7.25%)a frozen legacy deferred compensation plan in 2008 (11% on deferrals made prior to July 1, 1993 and 9% on deferrals made on or after July 1, 1993) exceeded 120% of the applicable federal long-term interest rate, with compounding, at the time the interest rate was set (120% of this rate was 5.7%5.35%). The following represents the breakdown for each of the change in pension value and above market interest on deferred compensation, respectively, for each named executive officer: Mr. Harvey, $668,000/$2,103,000/$21,334;0; Mr. Protsch, $171,000/$651,000/$20,983;0; Ms. Swan, $122,000/$492,000/$1,800;0; Mr. Aller, $188,000/$0/$916; Mr. Kratchmer, $49,000/$1,971;0; and Mr. Davis, $484,000/Ms. Doyle, $89,000/$58,920.5,791.

GRANTS OF PLAN-BASED AWARDS

The following table sets forth information regarding all incentive plan awards that Alliant Energy granted to our named executive officers in 2006.2008.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

The following table sets forth information on outstanding Alliant Energy stock option awards and unvested stock awards held by our named executive officers on Dec. 31, 2006.2008.