Utility Plant In Service

12 Months Ended

Dec. 31, 2012

Utility Plant In Service

4. UTILITY PLANT IN SERVICE

The original cost of utility plant in service segregated by functional classifications, follows:

	As of December 31,
	2012		2011
	(In Thousands)
Production	$	2,708,826	$	2,684,443
Transmission		249,577		238,762
Distribution		1,249,445		1,219,070
General plant		174,686		170,740
Total utility plant in service	$	4,382,534	$	4,313,015

Substantially all of IPL's property is subject to a $965.3 million direct first mortgage lien, as of December 31, 2012, securing IPL's first mortgage bonds. Property under capital leases as of December 31, 2012 and 2011 was insignificant. Total non-legal removal costs of utility plant in service at December 31, 2012 and 2011 were $575.9 million and $552.0 million, respectively and total legal removal costs of utility plant in service at December 31, 2012 and 2011 were $17.6 million and $16.6 million, respectively. Please see Note 7, "Asset Retirement Obligations" for further information.

IPL anticipates material additional costs to comply with various pending and final federal legislation and regulations and it is IPL's intent to seek recovery of any additional costs. The majority of the expenditures for construction projects designed to reduce sulfur dioxides and mercury emissions are recoverable from jurisdictional retail customers as part of IPL's CCT projects, however, since jurisdictional retail rates are subject to regulatory approval, there can be no assurance that all costs will be recovered in rates.

Indianapolis Power And Light Company [Member]

Utility Plant In Service

4. UTILITY PLANT IN SERVICE

The original cost of utility plant in service segregated by functional classifications, follows:

	As of December 31,
	2012		2011
	(In Thousands)
Production	$	2,708,826	$	2,684,443
Transmission		249,577		238,762
Distribution		1,249,445		1,219,070
General plant		174,686		170,740
Total utility plant in service	$	4,382,534	$	4,313,015

Substantially all of IPL's property is subject to a $965.3 million direct first mortgage lien, as of December 31, 2012, securing IPL's first mortgage bonds. Property under capital leases as of December 31, 2012 and 2011 was insignificant. Total non-legal removal costs of utility plant in service at December 31, 2012 and 2011 were $575.9 million and $552.0 million, respectively and total legal removal costs of utility plant in service at December 31, 2012 and 2011 were $17.6 million and $16.6 million, respectively. Please see Note 7, "Asset Retirement Obligations" for further information.

IPL anticipates material additional costs to comply with various pending and final federal legislation and regulations and it is IPL's intent to seek recovery of any additional costs. The majority of the expenditures for construction projects designed to reduce sulfur dioxides and mercury emissions are recoverable from jurisdictional retail customers as part of IPL's CCT projects, however, since jurisdictional retail rates are subject to regulatory approval, there can be no assurance that all costs will be recovered in rates.