Town chief executive Derek Bowden is said: "We're delighted to have the continued support of E.ON for the next two seasons, especially as they will become the lead partner of the FA Cup from 1st August - increasing their commitment to football.
"Following the rescheduling of our debt earlier in the year and the signing of all key players on longer term contracts, we're in a strong position for the season ahead. E.ON's commitment to the club demonstrates their belief in our ability to challenge for promotion next season and in particular, their financial support, in no small way, has enabled us to keep a promotion challenging squad together."
Mike Thompson, E.ON's head of sponsorship added that Ipswich fans will be entitled to a discount on the first replaced shirts:
"To celebrate the renewal of our sponsorship we will be offering the first 2006 fans a discount on the newly branded home shirt, which will carry the E.ON logo for the 2006/07 season. Further details regarding the offer will be released shortly."
ITFM reported earlier in the day that this would anger fans who have already snapped up the 2,000 limited edition white away shirts, which were printed and sold bearing the logo "powergen" on.
However, the club have now confirmed that the white shirts are not due to be sent out until early May and WILL NOT bear the Powergen logo on them and will include the new E.ON logo.
Town fans now have to decide if they are prepared to update their home jerseys for next seasons introduction of the E.ON logo.
E.ON will be the main sponsors of the FA Cup as of next season.