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What changed in IDACORP INC's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of IDACORP INC's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+610 added−687 removedSource: 10-K (2024-02-15) vs 10-K (2023-02-16)

Top changes in IDACORP INC's 2023 10-K

610 paragraphs added · 687 removed · 456 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

104 edited+24 added−36 removed64 unchanged
Biggest changeYear Ended December 31, 2022 2021 2020 Retail revenues (thousands of dollars): Residential (includes $22,595, $34,835, and $34,409, respectively, related to the FCA (1) ) $ 645,236 $ 583,061 $ 547,404 Commercial (includes $922, $1,407, and $1,543, respectively, related to the FCA (1) ) 347,970 314,745 293,057 Industrial 217,368 195,214 181,258 Irrigation 170,964 168,664 154,791 Provision for sharing — (569) — Deferred revenue related to HCC relicensing AFUDC (2) (8,780) (8,780) (8,780) Total retail revenues 1,372,758 1,252,335 1,167,730 Wholesale energy sales 66,519 40,839 33,656 Transmission wheeling-related revenues 80,527 67,997 51,592 Energy efficiency program revenues 33,197 29,920 42,478 Other revenues 88,039 64,319 51,884 Total electric utility operating revenues $ 1,641,040 $ 1,455,410 $ 1,347,340 Energy sales (thousands of Megawatt-hour (MWh)): Residential 6,056 5,645 5,463 Commercial 4,306 4,164 4,009 Industrial 3,510 3,471 3,369 Irrigation 1,950 2,126 1,987 Total retail energy sales 15,822 15,406 14,828 Wholesale energy sales 427 600 1,197 Energy sales bundled with renewable energy credits 892 739 690 Total energy sales 17,141 16,745 16,715 (1) The FCA mechanism is an alternative revenue program in the Idaho jurisdiction and does not represent revenue from contracts with customers as disclosed in Note 4 – “Revenues” to the consolidated financial statements included in this report.
Biggest changeYear Ended December 31, 2023 2022 2021 Retail revenues (thousands of dollars): Residential (includes $37,233, $22,595, and $34,835, respectively, related to the FCA) $ 684,649 $ 645,236 $ 583,061 Commercial (includes $1,338, $922, and $1,407, respectively, related to the FCA) 378,330 347,970 314,745 Industrial 244,538 217,368 195,214 Irrigation 173,929 170,964 168,664 Provision for sharing — — (569) Deferred revenue related to HCC relicensing AFUDC (1) (8,780) (8,780) (8,780) Total retail revenues 1,472,666 1,372,758 1,252,335 Wholesale energy sales 63,421 66,519 40,839 Transmission wheeling-related revenues 80,357 80,527 67,997 Energy efficiency program revenues 31,948 33,197 29,920 Other revenues 114,502 88,039 64,319 Total electric utility operating revenues $ 1,762,894 $ 1,641,040 $ 1,455,410 Energy sales (thousands of MWh): Residential 5,903 6,056 5,645 Commercial 4,269 4,306 4,164 Industrial 3,538 3,510 3,471 Irrigation 1,805 1,950 2,126 Total retail energy sales 15,515 15,822 15,406 Wholesale energy sales 840 427 600 Energy sales bundled with RECs 1,255 892 739 Total energy sales 17,610 17,141 16,745 (1) The IPUC allows Idaho Power to recover a portion of the AFUDC on construction work in progress related to the HCC relicensing process, even though the relicensing process is not yet complete and the costs have not been moved to electric plant in service.
IDACORP’s business strategy emphasizes Idaho Power as its core business, as Idaho Power's regulated utility operations are the primary driver of IDACORP's operating results. IDACORP’s strategy is focused on four areas: growing financial strength, improving Idaho Power's core business, enhancing Idaho Power’s brand, and keeping employees safe and engaged. IDACORP's board of directors has reviewed and affirmed IDACORP’s long-term strategy.
IDACORP’s business strategy emphasizes Idaho Power as its core business, as Idaho Power's regulated utility operations are the primary driver of IDACORP's operating results. IDACORP’s strategy is focused on four areas: keeping employees safe and engaged, growing financial strength, improving Idaho Power's core business, and enhancing Idaho Power’s brand. IDACORP's board of directors has reviewed and affirmed IDACORP’s long-term strategy.
Retail Rates : Idaho Power's rates for retail electric services are generally determined on a “cost of service” basis. Rates are designed to provide, after recovery of allowable operating expenses, including depreciation on capital investments, an opportunity for Idaho Power to earn a reasonable return on investment as authorized by regulators.
Retail Rates : Idaho Power's rates for retail electric services are generally determined on a “cost of service” basis. Rates are designed to provide an opportunity for Idaho Power to earn a reasonable return on investment as authorized by regulators, after recovery of allowable operating expenses, including depreciation on capital investments.
The IPUC and OPUC are charged with ensuring that the prices and terms of service are fair, non-discriminatory, and provide Idaho Power an opportunity to recover its prudently incurred or allowable costs and expenditures and earn a reasonable return on investment.
The IPUC and OPUC are charged with ensuring that the prices and terms of service are fair, are non-discriminatory, and provide Idaho Power an opportunity to recover its prudently incurred or allowable costs and expenditures and earn a reasonable return on investment.
Each committee of the board of directors is delegated and takes on specific roles in this oversight. The compensation and human resources committee is responsible for overseeing employee compensation, benefit plans, general labor issues, diversity, equity, inclusion, and safety issues.
Each committee of the board of directors is delegated and takes on specific roles in this oversight. The compensation and human resources committee is responsible for overseeing employee compensation, benefit plans, general labor issues, diversity, equity, and inclusion, and safety issues.
In May 2020, IDACORP’s and Idaho Power’s boards of directors approved an increased short-term goal to reduce carbon emission intensity by 35 percent for the period from 2021-2025 compared with 2005. In January 2022, Idaho Power posted its emissions reduction report on its website that established short-, medium-, and long-term targets for further CO 2 reductions.
In 2020, IDACORP’s and Idaho Power’s boards of directors approved an increased short-term goal to reduce carbon emission intensity by 35 percent for the period from 2021-2025 compared with 2005. In 2022, Idaho Power posted its emissions reduction report on its website that established short-, medium-, and long-term targets for further CO 2 reductions.
ITEM 1. BUSINESS OVERVIEW Background IDACORP, Inc. (IDACORP) is a holding company incorporated in 1998 under the laws of the state of Idaho. Its principal operating subsidiary is Idaho Power Company (Idaho Power).
ITEM 1. BUSINESS OVERVIEW Background IDACORP is a holding company incorporated in 1998 under the laws of the state of Idaho. Its principal operating subsidiary is Idaho Power.
Idaho Power recognizes such adjustments as regulatory assets or liabilities if it is probable that the amounts will be recovered from or returned to customers in future rates. 9 Table of Contents Business Strategy IDACORP is committed to its focus on competitive total returns and generating long-term value for shareholders.
Idaho Power recognizes such adjustments as regulatory assets or liabilities if it is probable that the amounts will be recovered from or returned to customers in future rates. 8 Table of Contents Business Strategy IDACORP is committed to its focus on competitive total returns and generating long-term value for shareholders.
Idaho Power plans to manage the procurement of additional natural gas for the peaking units primarily on the daily spot market or from storage inventory as necessary to meet system requirements and fueling strategies. Purchased Power : As described below, Idaho Power purchases power in the wholesale market as well as pursuant to long-term power purchase contracts and exchange agreements.
Idaho Power plans to manage the procurement of additional natural gas for the peaking units primarily on the daily spot market or from storage inventory as necessary to meet system requirements and fueling strategies. Purchased Power : Idaho Power purchases power in the wholesale market as well as pursuant to long-term power purchase contracts and exchange agreements.
As of the date of this report, although Idaho Power believes issuance of a new HCC license by the FERC is likely in 2024 or thereafter, Idaho Power is unable to predict the exact timing of issuance by the FERC of any license order or the ultimate capital investment and ongoing operating and maintenance costs Idaho Power will incur in complying with any new license.
As of the date of this report, although Idaho Power believes issuance of a new HCC license by the FERC is likely in 2025 or thereafter, Idaho Power is unable to predict the exact timing of issuance by the FERC of any license order or the ultimate capital investment and ongoing operating and maintenance costs Idaho Power will incur in complying with any new license.
Power Supply Overview: Idaho Power primarily relies on company-owned hydropower, coal-fired, and gas-fired generation facilities and long-term power purchase agreements to supply the energy needed to serve customers, and for power sales into the wholesale markets. Market purchases and sales are used to supplement Idaho Power's generation and balance supply and demand throughout the year.
Power Supply Overview: Idaho Power primarily relies on company-owned hydropower, coal-fired, and gas-fired generation facilities and long-term power purchase agreements to supply the energy needed to serve customers and to make power sales into the wholesale markets. Market purchases and sales are used to supplement Idaho Power's generation and balance supply and demand throughout the year.
Idaho Power’s operations, including information on energy sales, are discussed further in Part II, Item 7 - MD&A - "Results of Operations - Utility Operations.” 10 Table of Contents The table that follows presents Idaho Power’s revenues and sales volumes for the last three years, classified by customer type.
Idaho Power’s operations, including information on energy sales, are discussed further in Part II, Item 7 - MD&A - "Results of Operations - Utility Operations.” 9 Table of Contents The table that follows presents Idaho Power’s revenues and sales volumes for the last three years, classified by customer type.
IDACORP's and Idaho Power's 2021 ESG Report released in April 2022 incorporated elements of the Task Force on Climate-Related Financial Disclosures guidelines and the Sustainability Accounting Standards Board repor ting framework, as well as the Edison Electric Institute (EEI) E SG reporting template.
IDACORP's and Idaho Power's 2022 ESG Report released in April 2023 incorporated elements of the Task Force on Climate-Related Financial Disclosures guidelines and the Sustainability Accounting Standards Board repor ting framework, as well as the Edison Electric Institute (EEI) E SG reporting template.
Additionally, in 2022 Idaho Power responded to the Climate Disclosure Project (CDP) annual questionnaire, providing emissions data and management plans to address risks associated with climate change. The ESG reports, CDP filing, and related website content are not incorporated by reference into this 2022 Annual Report.
Additionally, in 2023 Idaho Power responded to the Climate Disclosure Project (CDP) annual questionnaire, providing emissions data and management plans to address risks associated with climate change. The ESG reports, CDP filing, and related website content are not incorporated by reference into this report.
Additionally, to plan for the potential regulatory impacts of climate change, Idaho Power considers climate-related impacts in planning efforts, plans and advocates for additional transmission capacity to integrate additional renewable energy onto its system, identifies and investigates new technologies, including battery storage, hydrogen generation, and modular nuclear reactor technology, and evaluates modifications to its pricing structure it believes will help ensure fair pricing for all customers.
Additionally, to plan for the potential regulatory impacts of climate change, Idaho Power considers climate-related impacts in planning efforts, plans and advocates for additional transmission capacity to integrate additional renewable energy onto its 17 Table of Contents system, identifies and investigates new technologies, including battery storage, hydrogen generation, and modular nuclear reactor technology, and evaluates modifications to its pricing structure it believes will help ensure fair pricing for all customers.
IDACORP and Idaho Power publicly release annual ESG reports and the most current report is located on Idaho Power’s website, together with other information on ESG issues relevant to Idaho Power, including short-, medium-, and long-term carbon dioxide (CO 2 ) emission reduction targets.
IDACORP and Idaho Power publicly release annual ESG reports and the most current report is located on Idaho Power’s website, together with other information on ESG issues relevant to Idaho Power, including short-, medium-, and long-term CO 2 emission reduction targets.
Environmental, Social, and Governance Initiatives Overview: IDACORP’s and Idaho Power’s corporate governance and nominating committee, with considerable focus from the board of directors, is primarily responsible for the oversight of the companies’ environmental, social, and governance (ESG) initiatives and are regularly informed of the goals, measures, and results of the companies' ESG and sustainability programs.
Environmental, Social, and Governance Initiatives Overview: IDACORP’s and Idaho Power’s corporate governance and nominating committee, with considerable focus from the board of directors, is primarily responsible for the oversight of the companies’ ESG initiatives and both are regularly informed of the goals, measures, and results of the companies' ESG programs.
Wholesale Markets : Idaho Power participates in the wholesale energy markets by purchasing power to help meet load demands and selling power that is in excess of load demands. Idaho Power's market activities are guided by an energy risk management policy and frequently updated operating plans.
Wholesale Markets : Idaho Power participates in the wholesale energy markets by purchasing power to help meet load demands and selling power that is in excess of load demands. Idaho Power's market activities are guided by an energy risk management program and frequently updated operating plans.
ADELMAN, 48 • Vice President of Power Supply of Idaho Power Company, August 2020 - present • Vice President of Transmission & Distribution, Engineering and Construction of Idaho Power Company, October 2019 - August 2020 • Regional Manager for t he Southeast Region of Idaho Power Company, January 2018 - October 2019 BRIAN R.
ADELMAN, 49 • Vice President of Power Supply of Idaho Power Company, August 2020 - present • Vice President of Transmission & Distribution, Engineering and Construction of Idaho Power Company, October 2019 - August 2020 • Regional Manager for t he Southeast Region of Idaho Power Company, January 2018 - October 2019 BRIAN R.
As of the date of this report, no Idaho Power employees are represented by unions. Board and Board Committee Oversight : The companies’ management updates the full board of directors and its committees regularly on safety metrics, total rewards for employees, benefit and pension programs, succession planning and training programs, and diversity, equity, and inclusion initiatives, among other things.
As of the date of this report, no Idaho Power employees are represented by unions. Board and Board Committee Oversight : The companies’ management updates the full board of directors and its committees regularly on safety metrics, compensation for employees, benefit and pension programs, succession planning and training programs, and diversity, equity, and inclusion initiatives, among other things.
Subsequent to the issuance of a new license, Idaho Power expects to incur increased annual capital expenditures and operating and maintenance costs to comply with the requirements of any new license. 19 Table of Contents Human Capital Overview: Idaho Power's purpose is powering lives by safely providing reliable, affordable, clean energy.
Subsequent to the issuance of a new license, Idaho Power expects to incur increased annual capital expenditures and operating and maintenance costs to comply with the requirements of any new license. Human Capital Overview: Idaho Power's purpose is powering lives by safely providing reliable, affordable, clean energy.
GROW, 57 • President and Chief Executive Officer of IDACORP, Inc. and Idaho Power Company, June 2020 - present • President of Idaho Power Company, October 2019 - June 2020 • Senior Vice President and Chief Operating Officer of Idaho Power Company, April 2016 - October 2019 JAMES BO D.
GROW, 58 • President and Chief Executive Officer of IDACORP, Inc. and Idaho Power Company, June 2020 - present • President of Idaho Power Company, October 2019 - June 2020 • Senior Vice President and Chief Operating Officer of Idaho Power Company, April 2016 - October 2019 JAMES BO D.
This report also includes annual power generation levels and associated CO 2 emissions and emissions intensity for the 2021-2040 period. The emissions reduction report is not incorporated in this 2022 Annual Report.
This report also includes target annual power generation levels and associated CO 2 emissions and emissions intensity for the 2021-2040 period. The emissions reduction report is not incorporated in this report.
Idaho Power regularly evaluates the need to request changes in its retail electricity price structure through the use of general rate cases, power cost adjustment mechanisms in Idaho and Oregon, a fixed cost adjustment (FCA) mechanism in Idaho, balancing accounts and tariff riders, and subject-specific filings to recover its costs of providing service and to earn a return on investment.
Idaho Power regularly evaluates the need to request changes in its retail electricity price structure through the use of general rate cases, power cost adjustment mechanisms in Idaho and Oregon, an FCA mechanism in Idaho, balancing accounts, and also uses tariff riders, and subject-specific filings to recover its costs of providing service and to earn a return on investment.
While assumptions are estimates only and subject to change based on actual customer load ramp-rates, the 2023 IRP assumptions include significant large commercial and industrial additions in the 5-year forecasted annual growth rate, including potential load from new facilities recently announced by Meta Platforms, Inc. and Micron Technology, Inc.
While assumptions are estimates only and subject to change based on actual customer load ramp-rates, the 2023 IRP assumptions include significant large commercial and industrial additions in the 5-year forecasted annual growth rate, including potential load from new facilities under development by Meta Platforms, Inc. and Micron Technology, Inc.
Idaho Power has established an internal ESG Steering Committee co-led by an officer and senior manager and composed of a cross-functional team of key employees from multiple departments to oversee ESG activities and inform leadership and the board of directors on ESG-related activities and matters it identifies as material to the company's operations and financial condition.
Idaho Power has established an internal ESG steering committee led by senior management and composed of a cross-functional team of key employees from multiple departments to oversee ESG activities and inform leadership and the board of directors on ESG-related activities and matters it identifies as material to the company's operations and financial condition.
IDACORP is subject to the provisions of the Public Utility Holding Company Act of 2005, which provides the Federal Energy Regulatory Commission (FERC) and state utility regulatory commissions with access to books and records and imposes record retention and reporting requirements on IDACORP.
IDACORP is subject to the provisions of the Public Utility Holding Company Act of 2005, which provides the FERC and state utility regulatory commissions with access to books and records and imposes record retention and reporting requirements on IDACORP.
Idaho Power also plans for the social and economic impacts of climate change by furthering its carbon emissions reduction goals, continuing efforts to achieve its path away from coal generation, increasing the integration of renewable energy, and enhancing customer and stakeholder communication.
Idaho Power also plans for the social and economic impacts of climate change by moving forward toward its carbon emissions reduction goals, continuing efforts to achieve its path away from coal generation, increasing the integration of renewable energy, and enhancing customer and stakeholder communication.
Availability of water and extreme temperatures during the agricultural growing season impact electricity sales to customers who use electricity to operate irrigation pumps. Alternative methods of generation, including customer-owned solar and other forms of distributed generation, have the potential to decrease Idaho Power sales to customers.
Availability of water and variations in temperatures and precipitation during the agricultural growing season impact electricity sales to customers who use electricity to operate irrigation pumps. Alternative methods of generation, including customer-owned solar and other forms of distributed generation, have the potential to decrease Idaho Power sales to customers.
Together, these hydropower facilities provide a total nameplate capacity of 1,799 MW and have averaged total annual generation of approximately 7.7 million MWh over the last 30 years.
Together, these hydropower facilities provide a total nameplate capacity of 1,818 MW and have averaged total annual generation of approximately 7.6 million MWh over the last 30 years.
Idaho Power’s generating facilities are interconnected through its integrated transmission system and are operated on a coordinated basis to achieve maximum capability and reliability. Idaho Power’s transmission system is directly interconnected with the transmission systems of the Bonneville Power Administration, Avista Corporation, PacifiCorp, NorthWestern Energy, and NV Energy.
Idaho Power’s generating facilities are interconnected through its integrated transmission system and are operated on a coordinated basis to achieve maximum capability and reliability. Idaho Power’s transmission system is directly interconnected with the transmission systems of the BPA, Avista Corporation, PacifiCorp, NorthWestern Energy, and NV Energy.
GRIFFIN, 53 • Vice President of Human Resources of Idaho Power Company, October 2019 - present • Director of Human Resources of Idaho Power Company, May 2014 - October 2019 LISA A.
GRIFFIN, 54 • Vice President of Human Resources of Idaho Power Company, October 2019 - present • Director of Human Resources of Idaho Power Company, May 2014 - October 2019 LISA A.
Idaho Power is an electric utility engaged in the generation, transmission, distribution, sale, and purchase of electric energy and capacity and is regulated by the state regulatory commissions of Idaho and Oregon and by the FERC. Idaho Power is the parent of Idaho Energy Resources Co.
Idaho Power is an electric utility engaged in the generation, transmission, distribution, sale, and purchase of electric energy and capacity and is regulated by the state regulatory commissions of Idaho and Oregon and by the FERC.
However, Idaho Power estimates that the annual costs it will incur to obtain a new long-term license for the HCC, including AFUDC, are likely to range from $30 million to $40 million until issuance of the license.
However, Idaho Power estimates that the annual costs it will incur to obtain a new long-term license for the HCC, including AFUDC, are likely to range from $35 million to $45 million until issuance of the license.
In addition to the discussion below, more information on Idaho Power's regulatory framework and rate regulation can be found in the “Regulatory Matters” section of Part II, Item 7 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (MD&A) and Note 3 – “Regulatory Matters” to the consolidated financial statements included in this report.
In addition to the discussion below, more information on Idaho Power's regulatory framework and rate regulation can be found in the “Regulatory Matters” section of Part II, Item 7 – MD&A and Note 3 – “Regulatory Matters” to the consolidated financial statements included in this report.
Idaho Power's service area is shaded in the illustration on the following page and covers approximately 24,000 square miles with an estimated population of 1.4 million. 8 Table of Contents Idaho Power is under the jurisdiction (as to rates, service, accounting, and other general matters of utility operation) of the Idaho Public Utilities Commission (IPUC), the Public Utility Commission of Oregon (OPUC), and the FERC.
Idaho Power's service area is shaded in the illustration on the following page and covers approximately 24,000 square miles with an estimated population of 1.4 million. 7 Table of Contents Idaho Power is under the jurisdiction (as to rates, service, accounting, and other general matters of utility operation) of the IPUC, the OPUC, and the FERC.
We are a stronger company when we stand together and embrace our differences. As of December 31, 2022, 44 percent of Idaho Power’s senior management were women, 21 percent of its officers were women, and 36 percent of its board of directors were women.
We are a stronger company when we stand together and embrace our differences. As of December 31, 2023, 44 percent of Idaho Power’s senior management were women, 29 percent of its officers were women, and 36 percent of its board of directors were women.
Idaho Power shares the survey results with employees, and senior management incorporates the results of the surveys in their action plans in order to respond to the feedback and improve employee relations. As of December 31, 2022, IDACORP had 2,070 full-time employee s, 2,062 of wh om were employed by Idaho Power and 8 of whom were employed by Ida-West.
Idaho Power shares the survey results with employees, and senior management incorporates the results of the surveys in their action plans in order to respond to the feedback and improve employee relations. As of December 31, 2023, IDACORP had 2,100 full-time employee s, 2,092 of wh om were employed by Idaho Power and 8 of whom were employed by Ida-West.
Each committee of the board of directors is assigned a portion of the oversight of the companies' ESG and sustainability programs.
Each committee of the board of directors is assigned a portion of the oversight of the companies' ESG programs.
Idaho Power also participates in the wholesale energy markets and in the electric transmission markets. Generally, these wholesale markets are regulated by the FERC, which requires electric utilities to transmit power to or for wholesale purchasers and sellers and make available, on a non-discriminatory basis, transmission capacity for the purpose of providing these services.
Generally, these wholesale markets are regulated by the FERC, which requires electric utilities to transmit power to or for wholesale purchasers and sellers and make available transmission capacity, on a non-discriminatory basis, for the purpose of providing these services.
Drought conditions and increased peak load demand cause a greater reliance on potentially more expensive energy sources to meet load requirements. Conversely, favorable hydropower generation conditions increase production at Idaho Power’s hydropower generating facilities and reduce the need for thermal generation and wholesale market purchased power. Weather also affects the generation of PURPA and non-PURPA purchased power.
Drought conditions and increased peak load demand cause a greater reliance on potentially more expensive energy sources to meet load requirements. Conversely, favorable hydropower generation conditions increase production at Idaho Power’s hydropower generating facilities and reduce the need for thermal generation and wholesale market purchased power.
Idaho Power believes it maintains a good relationship with its employees due to a strong safety culture, a respectful and inclusive environment, opportunities for development, and competitive compensation and benefits.
Idaho Power believes it maintains a good relationship with its employees due to a strong safety culture, a respectful and inclusive environment, opportunities for 18 Table of Contents development, and competitive compensation and benefits.
IDACORP had 7 part-time employee s, 4 of whom were employed by Idaho Power. Of IDACORP's full-time employees, 52 percent have worked at the company for over 10 years as of the date of this report. All IDACORP and Idaho Power employees work in the United States.
IDACORP had 12 part-time employee s, 9 of whom were employed by Idaho Power. Of IDACORP's full-time employees, 49 percent have worked at the company for over 10 years as of the date of this report. All IDACORP and Idaho Power employees work in the United States.
IFS has focused on a diversified approach to its investment strategy in order to limit both geographic and operational risk with most of IFS’s investments having been made through syndicated funds. At December 31, 2022, the unamortized amount of IFS’s portfolio was approximately $29 million ($92 million in gross tax credit investments, net of $63 million of accumulated amortization).
IFS has focused on a diversified approach to its investment strategy in order to limit both geographic and operational risk with most of IFS’s investments having been made through syndicated funds. At December 31, 2023, the unamortized amount of IFS’s portfolio was approximately $57 million ($127 million in gross tax credit investments, net of $70 million of accumulated amortization).
IFS generated tax credits of $6.4 million in 2022, $6.2 million in 2021, and $5.3 million in 2020. In 2022 and 2021, IFS received distributions related to fully-amortized real estate tax credit investments that reduced IDACORP's income tax expense by $0.8 million and $1.0 million, respectively. In 2020, IFS received nominal distributions related to fully-amortized real estate tax credit investments.
IFS generated tax credits of $6.9 million in 2023, $6.4 million in 2022, and $6.2 million in 2021. IFS received distributions related to fully-amortized real estate tax credit investments that reduced IDACORP's income tax expense by $0.5 million in 2023, $0.8 million in 2022, and $1.0 million in 2021.
The IPUC and OPUC determine the rates that Idaho Power is authorized to charge to its retail customers. Idaho Power is also under the regulatory jurisdiction of the IPUC, the OPUC, and the Wyoming Public Service Commission as to the issuance of debt and equity securities.
The IPUC and OPUC determine the rates that Idaho Power is authorized to charge to its retail customers. Idaho Power is also under the regulatory jurisdiction of the IPUC, the OPUC, and the WPSC as to the issuance of debt and equity securities.
Participation in Western Energy Imbalance Market : Idaho Power participates in an energy imbalance market in the western United States (Western EIM) under which the participating parties enable their systems to interact for automated intra-hour economic dispatch of generation from committed resources to serve loads.
Participation in Energy Markets : Idaho Power participates in the Western EIM under which the participating parties enable their systems to interact for automated intra-hour economic dispatch of generation from committed resources to serve loads.
The load forecast assumptions Idaho Power currently plans to use in its upcoming 2023 IRP are included in the table below, together with the average annual growth rate assumptions used in the prior two IRPs.
The load forecast assumptions Idaho Power used in its 2023 IRP are included in the table below, together with the average annual growth rate assumptions used in the prior two IRPs.
IDACORP’s and Idaho Power’s ESG initiatives include: • establishing responsible management goals and long-term strategies related to the companies’ impact on the environment; such as 17 Table of Contents ◦ the "Clean Today, Cleaner Tomorrow. ®" goal to provide Idaho Power's customers with 100-percent clean energy by 2045; ◦ the sustainability benefits from the Boardman-to-Hemingway and Gateway West transmission projects, which include integrating renewable energy generation and deferring or eliminating the need for development of additional fossil-fueled resources; ◦ integrating renewable resources into Idaho Power's generation mix and identifying and investigating new generation and storage technologies; as part of this effort, Idaho Power has issued requests for proposals (RFPs) for additional energy resources, including renewables or natural gas resource convertible to hydrogen gas power, and to-date has procured solar power and battery storage as a result of those RFPs; ◦ continuing various environmental stewardship programs along the Snake River, including fish habitat preservation, water temperature reduction, and fish and plant restoration; ◦ wildfire mitigation planning and actions, and ◦ wildlife habitat, archaeological and cultural resource, and raptor protection stewardship; • operational excellence in safely providing reliable, affordable, clean energy, including enhancing grid resiliency and reliability; • engaging and empowering Idaho Power’s workforce (including succession planning at all levels, employee development, leadership education, retirement planning education, and providing competitive compensation and benefits, including post-retirement benefits); • promoting a culture of safety, security, and inclusiveness for all employees; and • building strong community partnerships for healthy, sustainable economic development in Idaho Power’s service area.
Cleaner Tomorrow. ®" goal to provide Idaho Power's customers with 100-percent clean energy by 2045; ◦ the sustainability benefits from the Boardman-to-Hemingway and Gateway West transmission projects, which include integrating renewable energy generation and deferring or eliminating the need for development of additional fossil-fueled resources; ◦ integrating renewable resources into Idaho Power's generation mix and identifying and investigating new generation and storage technologies; as part of this effort, Idaho Power has issued RFPs for additional energy resources, including renewables or natural gas resource convertible to hydrogen gas power, and to-date has procured solar power and battery storage as a result of those RFPs; ◦ continuing various environmental stewardship programs along the Snake River, including fish habitat preservation, water temperature reduction, and fish and plant restoration; ◦ wildfire mitigation planning and actions; ◦ wildlife habitat, archaeological and cultural resource, and raptor protection stewardship; 16 Table of Contents • operational excellence in safely providing reliable, affordable, clean energy, including enhancing grid resiliency and reliability; • engaging and empowering Idaho Power’s workforce (including succession planning at all levels, employee development, leadership education, retirement planning education, and providing competitive compensation and benefits, including post-retirement benefits); • promoting a culture of safety, security, and inclusiveness for all employees; • building strong community partnerships for healthy, sustainable economic development in Idaho Power’s service area; and • publicly releasing Idaho Power's annual EEO-1 statement to report its board and employee demographic workforce data.
In 2022, Idaho Power’s energy efficiency programs reduced energy usage by approximately 141,000 MWh compared with 138,000 MWh in 2021. For 2022, Idaho Power had a demand response available capacity of approximately 320 MW. In 2022, 2021, and 2020, Idaho Power expended approximately $42 million, $38 million, and $51 million, respectively, on both energy efficiency and demand response programs.
In 2023, Idaho Power’s energy efficiency programs reduced energy usage by approximately 140,000 MWh compared with 141,000 MWh in 2022. For 2023, Idaho Power had a demand response available capacity of approximately 312 MW. In both 2023 and 2022, Idaho Power expended approximately $42 million and expended $38 million in 2021 on both energy efficiency and demand response programs.
Idaho Power also ties annual employee incentive compensation to metrics based on the categories 20 Table of Contents of earnings, power system reliability, and customer satisfaction reflective of broad stakeholder interests and each employee's contribution. Idaho Power delivers a variety of training opportunities and provides rotational assignment and continuous learning and development opportunities to all employees.
Idaho Power also ties annual employee incentive compensation to metrics based on the categories of financial performance, power system reliability, and customer satisfaction reflective of broad stakeholder interests and each employee's contribution. Idaho Power delivers a variety of training opportunities and continuous learning and development opportunities to all employees.
The Western EIM is intended to reduce the power supply costs to serve customers through more efficient dispatch of a larger and more diverse pool of resources, to integrate intermittent power from renewable generation sources more effectively, and to enhance reliability. Participation in the Western EIM is voluntary and available to all balancing authorities in the western United States.
The Western EIM is intended to reduce the power supply costs to serve customers through more efficient dispatch of a larger and more diverse pool of resources, to integrate intermittent power from renewable generation sources more effectively, and to enhance reliability.
Idaho Power tracks carbon emissions intensity to measure the impact of its efforts to reduce carbon emissions relative to growing power demand in its service area. Idaho Power has actively engaged in voluntary carbon emissions intensity reduction over the past decade with an original short-term goal to reduce emissions 10-15 percent from the baseline year of 2005 levels.
Idaho Power has actively engaged in voluntary carbon emissions intensity reduction over the past decade with an original short-term goal to reduce emissions 10-15 percent from the baseline year of 2005 levels.
The natural gas is transported through the Williams-Northwest Pipeline under Idaho Power's 55,584 million British thermal units (MMBtu) per day long-term gas transportation service agreements. These transportation agreements vary in contract length but generally contain the right for Idaho Power to extend the term.
The natural gas is transported through Idaho Power's long-term gas transportation service agreements with the Williams-Northwest Pipeline for 55,584 MMBtu per day and Williams-Mt. West Overthrust Pipeline for 89,000 MMBtu per day. These transportation agreements vary in contract length but generally contain the right for Idaho Power to extend the term.
Idaho Power estimates its environmental expenditures, based upon present environmental laws and regulations, will be as follows for the periods indicated, excluding AFUDC (in millions of dollars): 2023 2024-2025 Capital expenditures: License compliance and relicensing efforts at hydropower facilities $ 21 $ 119 Investments in equipment and facilities at thermal plants 10 6 Total capital expenditures $ 31 $ 125 Operating expenses: Operating costs for environmental facilities - hydropower $ 23 $ 46 Operating costs for environmental facilities - thermal 12 18 Total operations and maintenance $ 35 $ 64 Idaho Power anticipates that finalization, implementation, or modification of a number of federal and state rulemakings and other proceedings addressing, among other things, greenhouse gases and endangered species, could result in substantial changes in operating and compliance costs, but Idaho Power is unable to estimate those changes in costs given the uncertainty associated with existing and potential future regulations.
Idaho Power estimates its environmental expenditures, based upon present environmental laws and regulations, will be as follows for the periods indicated, excluding AFUDC (in millions of dollars): 2024 2025-2026 Capital expenditures: License compliance and relicensing efforts at hydropower facilities $ 27 $ 91 Investments in equipment and facilities at thermal plants 2 3 Total capital expenditures $ 29 $ 94 Operating expenses: Operating costs for environmental facilities - hydropower $ 25 $ 49 Operating costs for environmental facilities - thermal 9 21 Total other O&M $ 34 $ 70 Idaho Power anticipates that finalization, implementation, or modification of a number of federal and state rulemakings and other proceedings addressing, among other things, GHGs and endangered species, could result in substantial changes in operating and compliance costs, but Idaho Power is unable to estimate those changes in costs given the uncertainty associated with existing and potential future regulations.
Idaho Power also has programs in place to encourage STEM participation, training to minimize bias and ensure a respectful and inclusive workplace, with a mindset of unity, community outreach to underserved communities, and partnerships with multiple diversity-focused organizations. IDACORP FINANCIAL SERVICES, INC.
Idaho Power also has programs in place to encourage participation in science, technology, engineering, and mathematics education and careers, training to minimize bias and ensure a respectful and inclusive workplace, with a mindset of unity, community outreach across the communities Idaho Power serves, and partnerships with multiple diversity-focused organizations. 19 Table of Contents IDACORP FINANCIAL SERVICES, INC.
BUCKHAM, 43 • Senior Vice President and Chief Financial Officer of IDACORP, Inc. and Idaho Power Company, March 2022 - present • Senior Vice President and General Counsel of IDACORP, Inc. and Idaho Power Company, February 2017 - March 2022 MITCH COLBURN, 39 • Vice President of Planning, Engineering and Construction of Idaho Power Company, August 2020 - present • Director of Engineering and Construction of Idaho Power Company, March 2020 - August 2020 • Director of Resource Planning and Operations of Idaho Power Company, January 2018 - March 2020 • Senior Manager, Transmission & Distribution Strategic Projects of Idaho Power Company, April 2017 - January 2018 SARAH E.
BUCKHAM, 44 • Senior Vice President, Chief Financial Officer, and Treasurer of IDACORP, Inc. and Idaho Power Company, January 2024 - present • Senior Vice President and Chief Financial Officer of IDACORP, Inc. and Idaho Power Company, March 2022 - December 2023 • Senior Vice President and General Counsel of IDACORP, Inc. and Idaho Power Company, February 2017 - March 2022 MITCH COLBURN, 40 • Vice President of Planning, Engineering and Construction of Idaho Power Company, August 2020 - present • Director of Engineering and Construction of Idaho Power Company, March 2020 - August 2020 • Director of Resource Planning and Operations of Idaho Power Company, January 2018 - March 2020 SARAH E.
Each IRP seeks to forecast Idaho Power's loads and resources for a 20-year period, analyzes potential supply-side, demand-side, and transmission resource options, and identifies potential near-term, mid-term, and long-term actions.
Idaho Power filed its most recent 2023 IRP with the IPUC and OPUC in September 2023. Each IRP seeks to forecast Idaho Power's loads and resources for a 20-year period, analyzes potential supply-side, demand-side, and transmission resource options, and identifies potential near-term, mid-term, and long-term actions.
Demand for transmission services can be affected by regional market factors, such as loads and generation of utilities in Idaho Power’s region. 15 Table of Contents Transmission to serve Idaho Power's retail customers is subject to the jurisdiction of the IPUC and OPUC for retail rate making purposes.
Demand for transmission services can be affected by regional market factors, such as loads and generation of utilities in Idaho Power’s region. Transmission to serve Idaho Power's retail customers is subject to the jurisdiction of the IPUC and OPUC for retail rate-making purposes. Idaho Power provides cost-based wholesale access transmission services under the terms of a FERC-approved OATT.
Reduction in Coal-Fired Generation: Idaho Power monitors environmental requirements and assesses whether environmental control measures are or remain economically appropriate. In 2017 and 2018, the IPUC and OPUC approved settlement stipulations allowing accelerated depreciation and cost recovery for the North Valmy plant in connection with Idaho Power's plan to end its participation in the operation of units 1 and 2.
In 2017 and 2018, the IPUC and OPUC approved settlement stipulations allowing accelerated depreciation and cost recovery for the North Valmy plant in connection with Idaho Power's plan to end its participation in the coal-fired operation of units 1 and 2.
(IERCo), a joint venturer in Bridger Coal Company (BCC), which mines and supplies coal to the Jim Bridger power plant (Jim Bridger plant) owned in part by Idaho Power. Idaho Power's utility operations constitute nearly all of IDACORP's current business operations. IDACORP’s other notable subsidiaries include IDACORP Financial Services, Inc.
Idaho Power is the parent of IERCo, a joint-owner of BCC, which mines and supplies coal to the Jim Bridger plant owned in part by Idaho Power. Idaho Power's utility operations constitute nearly all of IDACORP's current business operations.
Idaho Power's 2021 Integrated Resource Plan (2021 IRP) identified a preferred resource portfolio and action plan that includes the conversion from coal to natural gas of two units at the Jim Bridger plant in 2024 and an end to Idaho Power's participation in the remaining two coal-fired units at the Jim Bridger plant by the end of 2028.
Idaho Power's 2023 IRP identified a preferred resource portfolio and action plan that includes the conversion from coal to natural gas of two units at the Jim Bridger plant in 2024, the two units at the North Valmy plant in 2026, and the remaining two units at the Jim Bridger plant in 2030.
During these and other similar heavy load periods, Idaho Power’s system is fully committed to serve load and meet required operating reserves. The table that follows shows Idaho Power’s total power supply for the last three years.
Idaho Power's highest all-time winter peak demand of 2,719 MW occurred on January 16, 2024. During these and other similar heavy load periods, Idaho Power’s system is fully committed to serve load and meet required operating reserves. The table that follows shows Idaho Power’s total power supply for the last three years.
To address the physical impacts of climate change, Idaho Power conducts cloud-seeding operations, implements a wildfire mitigation plan, enhances grid resiliency and reliability, and continues to further Snake River shading and in-stream river enhancement projects.
In recent years, Idaho Power has proactively addressed risks associated with climate change through preventative measures. To address the physical impacts of climate change, Idaho Power conducts cloud-seeding operations, implements a WMP, enhances grid resiliency and reliability, and continues to further Snake River shading and in-stream river enhancement projects.
Idaho Power provides cost-based wholesale and retail access transmission services under the terms of a FERC approved OATT. Services under the OATT are offered on a nondiscriminatory basis such that all potential customers, including Idaho Power, have an equal opportunity to access the transmission system.
Services under the OATT are offered on a non-discriminatory basis such that all potential customers, including Idaho Power, have an equal opportunity to access the transmission system.
HANCH EY, 47 • Vice President of Customer Operations and Chief Safety Officer of Idaho Power Company, October 2019 - present • Customer Service Senior Manager of Idaho Power Company, February 2018 - October 2019 • Regional Manager of Southern Region of Idaho Power Company, May 2014 - February 2018 PATRICK A.
HANCH EY, 48 • Vice President of Customer Operations and Chief Safety Officer of Idaho Power Company, October 2019 - present • Customer Service Senior Manager of Idaho Power Company, February 2018 - October 2019 20 Table of Contents JULIA A.
In June 2022, the IPUC approved Idaho Power's amended application requesting, among other things, authorization to allow the Jim Bridger plant to be fully depreciated and recovered by end-of-year 2030.
In October 2020, Idaho Power and co-owner Portland General Electric ceased coal-fired operations at the Boardman plant, as planned. In June 2022, the IPUC approved Idaho Power's amended application requesting, among other things, authorization to allow the Jim Bridger plant to be fully depreciated and recovered by end-of-year 2030.
(IFS), an investor in affordable housing and other real estate tax credit investments, and Ida-West Energy Company (Ida-West), an operator of small hydropower generation projects that satisfy the requirements of the Public Utility Regulatory Policies Act of 1978 (PURPA). IDACORP’s and Idaho Power’s principal executive offices are located at 1221 W.
IDACORP’s other notable subsidiaries include IFS, an investor in affordable housing and other real estate tax credit investments, and Ida-West, an operator of small hydropower generation projects that satisfy the requirements of the PURPA. IDACORP’s and Idaho Power’s principal executive offices are located at 1221 W. Idaho Street, Boise, Idaho 83702, and the telephone number is (208) 388-2200.
Idaho Power's talent development programs, overseen by a talent development team in the Human Resources department, are designed to help employees achieve their career goals, build management skills, and lead their organizations. Idaho Power also encourages and enables its employees to support many charitable causes. This includes volunteer program engagement promoted by the company or employees.
Idaho Power's talent development programs, overseen by a talent development team in the Human Resources department, are designed to help employees achieve their career goals, build management skills, and lead their organizations.
Idaho Street, Boise, Idaho 83702, and the telephone number is (208) 388-2200. Available Information IDACORP and Idaho Power make available free of charge on their websites their Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the U.S.
Available Information IDACORP and Idaho Power make available free of charge on their websites their Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after the reports are electronically filed with or furnished to the SEC.
Power Supply Percent of Total Generation 2022 2021 2020 2022 2021 2020 (thousands of MWh) Hydropower plants 5,347 5,382 6,967 48 % 48 % 54 % Coal-fired plants 3,657 2,981 3,719 32 % 27 % 29 % Natural gas-fired plants 2,319 2,765 2,109 20 % 25 % 17 % Total system generation 11,323 11,128 12,795 Purchased power - cogeneration and small power production 2,756 3,040 3,087 Purchased power - other 4,422 3,783 1,985 Total purchased power 7,178 6,823 5,072 Total power supply 18,501 17,951 17,867 12 Table of Contents Hydropower Generation : Idaho Power operates 17 hydropower projects located on the Snake River and its tributaries.
Power Supply Percent of Total Generation 2023 2022 2021 2023 2022 2021 (thousands of MWh) Hydropower plants 6,548 5,347 5,382 55 % 48 % 48 % Coal-fired plants 2,473 3,657 2,981 21 % 32 % 27 % Natural gas-fired plants 2,917 2,319 2,765 24 % 20 % 25 % Total system generation 11,938 11,323 11,128 Purchased power 7,027 7,178 6,823 Total power supply 18,965 18,501 17,951 Hydropower Generation : Idaho Power operates 17 hydropower projects located on the Snake River and its tributaries.
The contents of these websites are not part of IDACORP's and Idaho Power's Annual Report on Form 10-K for the year ended December 31, 2022 (2022 Annual Report). UTILITY OPERATIONS Background Idaho Power provided electric utility service to approximately 618,000 retail customers in southern Idaho and eastern Oregon as of December 31, 2022. Approximately 518,000 of these customers are residential.
IDACORP's website is www.idacorpinc.com and Idaho Power's website is www.idahopower.com . The contents of these websites are not part of this report. UTILITY OPERATIONS Background Idaho Power provided electric utility service to approximately 633,000 retail customers in southern Idaho and eastern Oregon as of December 31, 2023. Approximately 532,000 of these customers are residential.
These principles sometimes result in Idaho Power recording expenses and revenues in a different period than when an unregulated enterprise would record such expenses and revenues.
Accounting for the economics of rate regulation impacts multiple financial statement line items and disclosures. These principles sometimes result in Idaho Power recording expenses and revenues in a different period than when an unregulated enterprise would record such expenses and revenues.
The energy sales agreements for these qualifying facilities have original contract terms ranging from one to 35 years.
These agreements have contract terms ranging from one to 35 years.
Idaho Power operates the Langley Gulch plant as a baseload unit and the Danskin and Bennett Mountain plants to meet peak supply needs. The plants are also used to take advantage of wholesale market opportunities. Natural gas for all facilities is purchased based on system requirements and dispatch efficiency.
The natural-gas-fired units at the Jim Bridger plant will operate to serve load and meet peak supply needs. The plants are also used to take advantage of wholesale market opportunities. Natural gas for all facilities is purchased based on system requirements and dispatch efficiency.
Compliance factors such as allowable river and reservoir stage elevation changes and flood control requirements also influence these generation dispatch decisions. Idaho Power's wholesale energy sales depend largely on the availability of generation resources above the amount necessary to serve customer loads as well as market power prices at the time when those resources are available.
These operating plans are impacted by factors such as customer demand for power, market prices, generating costs, transmission constraints, and availability of generating resources. Idaho Power's wholesale energy sales depend largely on the availability of generation resources above the amount necessary to serve customer loads as well as market power prices at the time when those resources are available.
As noted in the 2021 IRP, there is uncertainty surrounding the resource sufficiency estimates and project completion dates, including uncertainty around the timing and extent of third-party development of renewable resources, fuel commodity prices, regulatory requirements, the actual completion date of the Boardman-to-Hemingway transmission project, and the economics and logistics of coal-fired 16 Table of Contents plant conversions and retirements.
However, as noted in the 2023 IRP, there is considerable uncertainty surrounding the resource sufficiency estimates and project completion dates, including uncertainty around the timing and extent of third-party development of renewable resources, fuel commodity prices, and the actual completion date and ownership allocations of the transmission projects.
As required by FERC standards of conduct, Idaho Power's transmission function is operated independently from Idaho Power's energy marketing function. Idaho Power is jointly working with various partners on the development of two significant transmission projects. The Boardman-to-Hemingway project is a proposed 300-mile, high-voltage transmission line between a substation near Boardman, Oregon, and the Hemingway substation near Boise, Idaho.
As required by FERC standards of conduct, Idaho Power's transmission function is operated independently from Idaho Power's energy marketing function. 14 Table of Contents Idaho Power is jointly working with various partners on the development of two significant transmission projects.
Idaho Power purchased all of the power generated by Ida-West’s four Idaho hydropower projects at a cost of approximately $8 million in both 2022 and 2021 and $9 million in 2020. 21 Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS The names, ages, and positions of the executive officers of IDACORP and Idaho Power are listed below (in alphabetical order), along with their business experience during at least the past five years.
INFORMATION ABOUT OUR EXECUTIVE OFFICERS The names, ages, and positions of the executive officers of IDACORP and Idaho Power are listed below (in alphabetical order), along with their business experience during at least the past five years.
As a public utility under the Federal Power Act (FPA), Idaho Power has authority to charge market-based rates for wholesale energy sales under its FERC tariff and to provide transmission services under its open access transmission tariff (OATT).
As a public utility under the FPA, Idaho Power has authority to charge market-based rates for wholesale energy sales under its FERC tariff and to provide transmission services under its OATT. Additionally, the FERC has jurisdiction over Idaho Power's sales of transmission capacity and wholesale electricity, hydropower project relicensing, and system reliability and security, among other items.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeCoverage limits within wildfire insurance policies could result in material self-insured costs in the event there are fires that are deemed to be separate occurrences covered by self-insured retention amounts under the terms of Idaho Power’s insurance policies. Idaho Power or its contractors and customers could also experience coverage reductions and increased wildfire insurance costs in future years.
Biggest changeIdaho Power maintains insurance coverage for such risks, but insurance coverage is subject to terms and limitations and may not be sufficient to cover Idaho Power’s ultimate liability. Coverage limits within wildfire insurance policies could result in material self-insured costs due to self-insured retention amounts under the terms of Idaho Power’s insurance policies.
Idaho Power's ability to achieve these targets are subject to a number of risks and uncertainties, including the company's regulatory obligation to serve its customers, the availability and cost of new generation resources, legal and permitting requirements, system operation and energy integration, grid balancing, among others.
Idaho Power's ability to achieve these targets are subject to a number of risks and uncertainties, including the company's regulatory obligation to serve its customers, the availability and cost of new generation resources, legal and permitting requirements, system operation and energy integration, and grid balancing, among others.
Fires alleged to have been caused by Idaho Power's transmission, distribution, or generation infrastructure, or that allegedly result from Idaho Power’s or its contractors’ operating or maintenance practices, could also expose Idaho Power to claims for fire suppression and clean-up costs, evacuation costs, fines and penalties, and liability for economic damages, personal injury, loss of life, property damage, and environmental pollution, whether based on claims of negligence, trespass, or otherwise.
Fires alleged to have been caused by Idaho Power's transmission, distribution, or generation infrastructure, or that allegedly result from Idaho Power’s or its contractors’ operating or maintenance practices, could expose Idaho Power to claims for fire suppression and clean-up costs, evacuation costs, fines and penalties, and liability for economic damages, personal injury, loss of life, property damage, and environmental pollution, whether based on claims of negligence, trespass, or otherwise.
Changes in the number of customers and customers' use of electricity are affected by a number of factors, such as population growth or decline in Idaho Power's service area, expansion or loss of service area, changes in customer needs and expectations, adoption rates of energy efficiency measures, customer-generated power such as from solar panels and gas-fired generators, demand-side management requirements, regulation or deregulation, and adverse economic conditions.
Changes in the number of customers and customers' use of electricity are affected by a number of factors, such as population growth or decline in Idaho Power's service area, expansion or loss of service area, changes in customer needs and expectations, changes to customer rates, adoption rates of energy efficiency measures, customer-generated power such as from solar panels and gas-fired generators, demand-side management requirements, regulation or deregulation, and adverse economic conditions.
If Idaho Power is unable to satisfy the increasing climate-related expectations of certain stakeholders, IDACORP and Idaho Power may suffer reputational harm, which could cause IDACORP’s stock price to decrease or cause certain investors and financial institutions not to purchase the companies’ debt securities or otherwise provide the companies with capital or credit on favorable terms, which may cause IDACORP’s and Idaho Power’s cost of capital to increase.
If Idaho Power is unable to satisfy the increasing climate-related expectations of certain stakeholders, IDACORP and Idaho Power may suffer reputational harm, which could cause IDACORP’s stock price to decrease or cause certain investors and financial institutions not to purchase the companies’ debt or equity securities or otherwise provide the companies with capital or credit on favorable terms, which may cause IDACORP’s and Idaho Power’s cost of capital to increase.
The power cost and FCA mechanisms are generally subject to change at the discretion of applicable state regulators, who could decide to modify or eliminate either mechanism in a manner that adversely impacts IDACORP's and Idaho Power's financial condition, cash flows, and results of operations.
The power cost adjustment and FCA mechanisms are generally subject to change at the discretion of applicable state regulators, who could decide to modify or eliminate either mechanism in a manner that adversely impacts IDACORP's and Idaho Power's financial condition, cash flows, and results of operations.
Idaho Power's ability to issue long-term debt is also subject to a number of conditions included in an indenture, and Idaho Power's ability to issue long-term debt and commercial paper is subject to the availability of purchasers willing to purchase the securities under reasonable terms or at all.
Idaho Power's ability to issue long-term debt is also subject to a number of conditions included in an indenture, and Idaho Power's ability to issue long-term debt, commercial paper, and equity securities is subject to the availability of purchasers willing to purchase the securities under reasonable terms or at all.
Idaho Power may be unable to fully recover costs in excess of insurance through customer rates or regulatory mechanisms and, even if such recovery is possible, it could take several years to collect.
Idaho Power may be unable to recover costs in excess of insurance through customer rates or regulatory mechanisms and, even if such recovery is possible, it could take several years to collect.
For additional information regarding Idaho Power's funding obligations under its benefit plans, see Note 11 - "Benefit Plans" to the consolidated financial statements included in this report. 35 Table of Contents If the assumptions underlying coal mine reclamation at Bridger Coal Company and related forecast trust fund growth are materially inaccurate, Idaho Power’s costs could be greater than anticipated or be incurred sooner than anticipated .
For additional information regarding Idaho Power's funding obligations under its benefit plans, see Note 11 - "Benefit Plans" to the consolidated financial statements included in this report. 34 Table of Contents If the assumptions underlying coal mine reclamation at Bridger Coal Company and related forecast trust fund growth are materially inaccurate, Idaho Power’s costs could be greater than anticipated or be incurred sooner than anticipated .
These risks include, but are not limited to, (1) the failure to timely obtain or construct additional resources to meet forecast needs related to load growth and coal exits, (2) increased renewable energy generation presenting risks of uncertainty and variability that could be further compounded as neighboring systems transition towards increasing levels of renewable resources, and (3) increased potential resource volatility due to changes in the energy market.
These risks include, but are not limited to, (1) the failure to timely obtain or construct additional resources to meet forecast needs related to load growth, (2) increased renewable energy generation presenting risks of uncertainty and variability that could be further compounded as neighboring systems transition towards increasing levels of renewable resources, and (3) increased potential resource volatility due to changes in the energy market.
However, it is possible that federal, state and local authorities could attempt to enforce more stringent standards, stricter regulation, and more expansive application of environmental regulations. 31 Table of Contents Environmental regulations have created the need for Idaho Power to install new pollution control equipment at, and may cause Idaho Power to perform environmental remediation on, its owned and co-owned power generation facilities, often at a substantial cost.
However, it is possible that federal, state and local authorities could attempt to enforce more stringent standards, stricter regulation, and more expansive application of environmental regulations. 30 Table of Contents Environmental regulations have created the need for Idaho Power to install new pollution control equipment at, and may cause Idaho Power to perform environmental remediation on, its owned and co-owned power generation facilities, often at a substantial cost.
Specific legislative and regulatory proposals and recently enacted legislation that could have a 30 Table of Contents material impact on IDACORP and Idaho Power include, but are not limited to, tax reform, utility regulation, carbon-reduction initiatives, infrastructure renewal programs, climate change and environmental regulation, and modifications to accounting and public company reporting requirements.
Specific legislative and regulatory proposals and recently enacted legislation that could have a 29 Table of Contents material impact on IDACORP and Idaho Power include, but are not limited to, tax reform, utility regulation, carbon-reduction initiatives, infrastructure renewal programs, climate change and environmental regulation, and modifications to accounting and public company reporting requirements.
Idaho Power is required to obtain regulatory approval in Idaho, Oregon, and Wyoming in order to borrow money or to issue securities and is therefore dependent on the public utility commissions of those states to issue favorable orders in a timely 33 Table of Contents manner to permit them to finance their operations, capital expenditures, and debt maturities.
Idaho Power is required to obtain regulatory approval in Idaho, Oregon, and Wyoming in order to borrow money or to issue securities and is therefore dependent on the public utility commissions of those states to issue favorable orders in a timely 32 Table of Contents manner to permit them to finance their operations, capital expenditures, and debt maturities.
Because of these limitations, IDACORP and Idaho Power may be unable to issue commercial paper or short-term or long-term debt at reasonable interest rates and terms or at all. Higher interest rates on short-term borrowings with variable interest rates could also have an adverse effect on IDACORP's and Idaho Power's operating results.
Because of these limitations, IDACORP and Idaho Power may be unable to issue commercial paper, short-term or long-term debt, or equity securities on reasonable terms or at all. Higher interest rates on short-term borrowings with variable interest rates could also have an adverse effect on IDACORP's and Idaho Power's operating results.
Proposals have included imposing mandatory reductions in greenhouse gas (GHG) emissions, which could increase Idaho Power’s power supply and compliance costs or require generation facilities to be retired early, resulting in potential stranded costs and write-downs or write-offs if Idaho Power is unable to fully recover investments in such facilities.
Proposals have included imposing mandatory reductions in GHG emissions, which could increase Idaho Power’s power supply and compliance costs or require generation facilities to be retired early, resulting in potential stranded costs and write-downs or write-offs if Idaho Power is unable to fully recover investments in such facilities.
A significant portion of Idaho Power’s facilities were constructed many years ago, and thus require periodic upgrades and frequent maintenance. Also, short-term and long-term anticipated increases in both the number of customers and the demand for energy require expansion and reinforcement of that infrastructure as described in Idaho Power's 2021 IRP.
A significant portion of Idaho Power’s facilities were constructed many years ago, and thus require periodic upgrades and frequent maintenance. Also, short-term and long-term anticipated increases in both the number of customers and the demand for energy require expansion and reinforcement of that infrastructure as described in Idaho Power's 2023 IRP.
Adverse publicity could harm the reputations of IDACORP and Idaho Power; may make state legislatures, utility commissions, and other regulatory authorities less likely to view the 32 Table of Contents companies in a favorable light; and may cause Idaho Power to be subject to less favorable legislative and regulatory outcomes or increased regulatory oversight.
Adverse publicity could harm the reputations of IDACORP and 31 Table of Contents Idaho Power; may make state legislatures, utility commissions, and other regulatory authorities less likely to view the companies in a favorable light; and may cause Idaho Power to be subject to less favorable legislative and regulatory outcomes or increased regulatory oversight.
IDACORP and Idaho Power use credit facilities, commercial paper markets, and long-term debt as significant sources of liquidity and funding for operating and capital requirements and debt maturities not satisfied by operating cash flow. Credit facilities represent commitments by the participating banks to make loans and issue letters of credit.
IDACORP and Idaho Power use credit facilities, commercial paper markets, long-term debt, and equity securities as significant sources of liquidity and funding for operating and capital requirements and debt maturities not satisfied by operating cash flow. Credit facilities represent commitments by the participating banks to make loans and issue letters of credit.
Certain of Idaho Power's purchase or sale, hedging, and derivative agreements may result in the receipt of, or posting of, collateral with counterparties. Fluctuations in commodity prices that lead to the posting of collateral with counterparties negatively impact liquidity, and downgrades in Idaho 34 Table of Contents Power's credit ratings may lead to additional collateral posting requirements.
Certain of Idaho Power's purchase or sale, hedging, and derivative agreements may result in the receipt of, or posting of, collateral with counterparties. Fluctuations in 33 Table of Contents commodity prices that lead to the posting of collateral with counterparties negatively impact liquidity, and downgrades in Idaho Power's credit ratings may lead to additional collateral posting requirements.
Legal and Compliance Risks Legal and compliance risk relates to risks arising from government and regulatory action and from legal proceedings and compliance with applicable laws, rules, orders, regulations, policies, and procedures, including those related to financial reporting, environmental, health, and safety, and potential changes in legal requirements.
Legal and Compliance Risks Legal and compliance risk relates to risks arising from government and regulatory action and from legal proceedings and compliance with applicable laws, rules, orders, regulations, policies, and procedures, including those related to financial reporting, environment, health, and safety, and potential changes in legal requirements.
Market prices for coal and natural gas are volatile and influenced by factors impacting supply and demand such as weather conditions, the adequacy and type of generating capacity, fuel transportation availability, economic conditions, regulations related to GHG emissions, changes in technology, moratoriums on federally leased coal, and increases in coal lease costs.
Market prices for coal and natural gas are volatile and influenced by factors 27 Table of Contents impacting supply and demand such as weather conditions, the adequacy and type of generating capacity, fuel transportation availability, economic conditions, regulations related to GHG emissions, changes in technology, moratoriums on federally leased coal, and increases in coal lease costs.
Demand for power could exceed forecasted supply, resulting in deliverability risks and increased costs for purchasing capacity in the market or acquiring or constructing additional generation resources and battery storage facilities .
Demand for power could exceed supply, resulting in deliverability risks and increased costs for, or difficulty in, purchasing capacity in the market or acquiring or constructing additional generation resources and battery storage facilities .
Further, the terms of resolution could require the companies to change their operational practices and procedures, which could also have a negative effect on their financial positions and results of operations. Changes in accounting standards or rules may impact IDACORP's and Idaho Power's financial results and disclosures. The Financial Accounting Standards Board and the U.S.
Further, the terms of resolution could require the companies to change their operational practices and procedures, which could also have a negative effect on their financial positions and results of operations. Changes in accounting standards or rules may impact IDACORP's and Idaho Power's financial results and disclosures.
IDACORP's and Idaho Power's credit facilities consist of revolving lines of credit not to exceed an aggregate principal amount outstanding at any one time of $100 million and $300 million, respectively (Credit Facilities).
IDACORP's and Idaho Power's credit facilities consist of revolving lines of credit not to exceed an aggregate principal amount outstanding at any one time of $100 million and $400 million, respectively (Credit Facilities).
When power costs rise above the level recovered in current retail rates, Idaho Power incurs the costs but recovery of those costs is deferred to a subsequent collection period, which can adversely affect Idaho Power’s operating cash flow and liquidity until those costs are recovered from customers.
When power costs rise above the level recovered in current retail rates, Idaho Power incurs the costs but recovery of those costs is deferred to a subsequent collection period, which can adversely affect operating cash flow and liquidity until those costs are recovered.
Idaho Power’s technology systems are dependent upon connectivity to the internet and third-party vendors to host, maintain, modify, and update its systems, which may experience significant system failures or cyber attacks that could compromise the security of Idaho Power’s assets and information.
Idaho Power’s technology systems are 25 Table of Contents dependent upon connectivity to the internet and third-party vendors to host, maintain, modify, and update its systems, which may experience significant system failures or cyber attacks that could compromise the security of Idaho Power’s assets and information.
Idaho Power actively monitors developments in the area of cybersecurity and is involved in various related government and industry groups, and the company’s board receives security updates at least quarterly.
Idaho Power actively monitors developments in cybersecurity and is involved in various related government and industry groups, and the company’s board receives security updates at least quarterly.
Potential monetary and non-monetary penalties for a violation of FERC regulations may be substantial, and in some circumstances monetary penalties may exceed $1.4 mi llion per day per violation.
Potential monetary and non-monetary penalties for a violation of FERC regulations may be substantial, and in some circumstances monetary penalties may exceed $1.5 mi llion per day per violation.
In addition, new interpretations of existing laws and regulations could be adopted or become applicable to hydropower facilities, which could further increase required expenditures for marine life recovery and endangered species protection and reduce the amount of hydropower generation available to meet Idaho Power’s generation requirements.
In addition, new agency requirements and new interpretations of existing laws and regulations could be adopted or become applicable to hydropower facilities, which could further increase required expenditures for flood control, marine life recovery and endangered species protection and may reduce the amount of hydropower generation available to meet Idaho Power’s generation requirements.
Natural gas transportation to Idaho Power's three natural gas plants is limited to one primary p ipeline, presenting a heightened possibility of supply constraint and disruptions separate from the risk of 28 Table of Contents counterparty default.
Natural gas transportation to Idaho Power's three natural gas plants is limited to one primary p ipeline, presenting a heightened possibility of supply constraint and disruptions separate from the risk of counterparty default.
Idaho Power comprises the bulk of IDACORP's operations, and Idaho Power's business is concentrated solely in the electric power industry. Furthermore, Idaho Power's provision of electric service to retail customers is conducted exclusively in its southern Idaho and eastern Oregon service area.
Idaho Power comprises nearly all of IDACORP's operations, and Idaho Power's business is concentrated solely in the electric power industry. Furthermore, Idaho Power's provision of electric service to retail customers is conducted exclusively in its southern Idaho and eastern Oregon service area.
The risk of wildfires is exacerbated in forested areas where beetle infestations and rising tree mortality rates have caused a significant increase in the quantity of standing dead and dying timber, increasing the risk that such trees may fall from either inside or outside our right-of-way into a powerline igniting a fire and increasing the magnitude of fires.
The risk of wildfires is exacerbated in forested areas where beetle infestations and rising tree mortality rates have caused a significant increase in the quantity of standing dead and dying timber, increasing the risk that such trees may fall from either inside or outside Idaho Power's right-of-way into a powerline igniting a fire and increasing the severity of fires.
Continued inflationary pressures, or a n economic downturn, or a recession could also negatively impact customer use and reduce revenues and cash flows, thus adversely affecting results of operations. Many electric utilities, including Idaho Power, have experienced a decline in usage per customer, in part attributable to energy efficiency activities.
Continued inflationary pressures, or a n economic downturn or recession, could also negatively impact customer use and reduce revenues and cash flows, thus adversely affecting results of operations. Many electric utilities, including Idaho Power, have experienced a long-term decline in usage per customer, in part attributable to 22 Table of Contents energy efficiency activities.
Idaho Power could incur increased costs due to such turnover due to a loss of knowledge, errors due to inexperienced employees or substantial training time, loss of productivity, and increased safety compliance issues.
Idaho Power could incur increased costs as a result of such turnover due to a loss of knowledge, errors due to inexperienced employees, substantial training time, loss of productivity, and increased safety and compliance issues.
The IPUC and OPUC may adopt different methods of calculating the allocation of the total utility costs in their respective jurisdictions, resulting in certain costs excluded in both states.
The IPUC and OPUC may adopt different methods 21 Table of Contents of calculating the allocation of the total utility costs in their respective jurisdictions, resulting in certain costs excluded in both states.
Idaho Power is not only in the permitting process for two high-voltage transmission line projects, but has also entered into contracts to purchase, own, and operate 180 megawatts of battery storage assets as well as issued a request for proposals for new resources, which are intended to help meet increasing customer energy demands.
Idaho Power is not only in the permitting process for two high-voltage transmission line projects, but has also entered into contracts to purchase, own, and operate 304 megawatts of battery storage assets as well as issued RFPs for new resources, which are intended to help meet increasing customer energy demands.
Volatility in power supply costs continues to be significant, in large part due to fluctuations in hydropower generation conditions, fuel cost variability from supply chain disruptions and inflationary pressures, general supply and demand economics for fuel and power, the impact of high costs for the purchase of renewable energy under mandatory long-term contracts, and market price variability for the purchase of power from third parties based on seasonal demands and transmission system constraints.
Volatility in power supply costs continues to be significant, in large part due to fluctuations in hydropower generation conditions, fuel cost variability from factors including supply chain disruptions and inflation, supply and demand economics for fuel and power, the impact of high costs to purchase renewable energy under mandatory long-term contracts, and market price variability for power purchases from third parties based on seasonal demands and transmission system constraints.
The prices that the Idaho Public Utilities Commission (IPUC) and Public Utility Commission of Oregon (OPUC) authorize Idaho Power to charge customers for its retail services, and the tariff rate that the FERC permits Idaho Power to charge for its transmission services, are significant factors influencing IDACORP’s and Idaho Power’s business, results of operations, liquidity, and financial condition.
The prices that the IPUC and OPUC authorize Idaho Power to charge customers for its retail services, and the tariff rate that the FERC permits Idaho Power to charge for its transmission services, are significant factors influencing IDACORP’s and Idaho Power’s business, results of operations, liquidity, and financial condition.
Securities and Exchange Commission have made and may continue to make changes to accounting standards that impact presentation and disclosures of financial condition and results of operations. Further, new accounting orders issued by the FERC could significantly impact IDACORP's and Idaho Power's reported financial condition.
The Financial Accounting Standards Board and the SEC have made and may continue to make changes to accounting standards that impact presentation and disclosures of financial condition and results of operations. Further, new accounting orders issued by the FERC could significantly impact IDACORP's and Idaho Power's reported financial condition.
These risk factors, as well as other information in this report, including without limitation, in the "Cautionary Note Regarding Forward-Looking Statements" and Part II - Item 7 - "Management’s Discussion and Analysis of Financial Condition and Results of Operations" (MD&A), and in other reports the companies file with the SEC, should be considered carefully when making any investment decisions relating to IDACORP or Idaho Power.
These risk factors, as well as other information in this report, including without limitation, in the "Cautionary Note Regarding Forward-Looking Statements" and Part II - Item 7 - MD&A, and in other reports the companies file with the SEC, should be considered carefully when making any investment decisions relating to IDACORP or Idaho Power.
All information technology systems are vulnerable to disability, unauthorized access, unintentional defects, user 26 Table of Contents error, errors in system changes, and cybersecurity incidents. Idaho Power is in the process of pursuing complex business system upgrades, and these significant changes increase the risk of system interruption.
All information technology systems are vulnerable to being disabled, unauthorized access, unintentional defects, user error, errors in system changes, and cybersecurity incidents. Idaho Power is in the process of pursuing complex business system upgrades, and these significant changes increase the risk of system interruption.
Idaho Power is a participant in the energy markets, including the energy imbalance market in the western United States (Western EIM), and engages in direct and indirect power purchase and sale transactions in connection with that participation.
Idaho Power is a participant in the energy markets, including the Western EIM, and engages in direct and indirect power purchase and sale transactions in connection with that participation.
The FCA mechanism is a decoupling mechanism that allows Idaho Power to charge Idaho residential and small commercial customers when it recovers less than the base level of fixed costs per customer that the IPUC authorized for recovery in the most recent general rate case.
The FCA mechanism is a decoupling mechanism that allows Idaho Power to charge Idaho residential and small commercial customers when it recovers less than the base level of fixed costs per customer that the IPUC authorized for recovery.
While Idaho Power has recently experienced a net growth in usage due to an increase in the number of customers, when adjusted for the impacts of weather, the average monthly usage on a per customer basis for Idaho Power's residential customers has declined from 1,032 kilowatt-hour (kWh) in 2012 to 929 kWh in 2022.
While Idaho Power has recently experienced a net growth in usage due to an increase in the number of customers, when adjusted for the impacts of weather, the average monthly usage on a per customer basis for Idaho Power's residential customers has declined from 1,032 kWh in 2012 to 922 kWh in 202 3.
These risks include, as examples: • the ability to timely obtain labor or materials at reasonable costs; • defaults and delays by suppliers and contractors, including delays for specialty equipment that require significant lead times; • increases in price and limitations on availability of commodities, materials, and equipment; • imposition of tariffs on commodities, materials, and equipment sourced by foreign providers; • equipment, engineering, and design failures; • credit quality of counterparties and suppliers and their ability to meet financial and operational commitments; • unexpected environmental and geological problems; • the effects of adverse weather conditions; • catastrophic events, natural disasters, epidemics, pandemics and other public health or disruptive events that could result in supply chain disruptions, as well as permitting and construction delays; • availability of financing; • the ability to obtain approval from local, state, or federal regulatory and governmental bodies and to comply with permits and land use rights, and environmental constraints; and • delays and costs associated with disputes and litigation with third parties. 27 Table of Contents The occurrence of any of these risks could cause Idaho Power to operate at reduced capacity levels, which in turn could reduce revenues and reliability, increase expenses, or cause Idaho Power to incur penalties.
These risks include, as examples: • the ability to timely obtain labor or materials at reasonable costs; • defaults and delays by suppliers and contractors, including delays for specialty equipment that require significant lead times; • increases in price and limitations on availability of commodities, materials, and equipment; • imposition of tariffs on commodities, materials, and equipment sourced by foreign providers; • equipment, engineering, and design failures; • credit quality of counterparties and suppliers and their ability to meet financial and operational commitments; • unexpected environmental and geological problems; • the effects of adverse weather conditions; • catastrophic events, natural disasters, epidemics, pandemics and other public health or disruptive events that could result in supply chain disruptions, as well as permitting and construction delays; • availability of financing; 26 Table of Contents • the ability to obtain approval from local, state, or federal regulatory and governmental bodies and to comply with permits and land use rights, and environmental constraints; and • delays and costs associated with disputes and litigation with third parties.
The Credit Facilities include financial covenants that limit the amount of debt that can be outstanding as a percentage of total capital, and Idaho Power's long-term debt has also been issued under an indenture that contains a number of financial covenants.
Each of the Credit Facilities includes a financial covenant that limits the amount of debt that can be outstanding as a percentage of total capital, and Idaho Power's long-term debt has also been issued under an indenture that contains a number of financial covenants.
For the last several years, Idaho Power has been engaged in an effort to renew its federal license for its largest hydropower generation source, the Hells Canyon Complex (HCC). Relicensing and ongoing permitting requirements include an extensive public review process that involves numerous natural resource issues and environmental conditions.
Since 2003, Idaho Power has been engaged in an effort to renew its federal license for its largest hydropower generation source, the HCC. Relicensing and ongoing permitting requirements include an extensive public review process that involves numerous natural resource issues and environmental conditions.
During peak periods, power demand could exceed Idaho Power’s forecasted available generation capacity, particularly if Idaho Power’s power plants are not performing as anticipated and additional resources and battery storage are not acquired as needed to meet demand.
During peak periods, power demand could exceed, and on occasion has exceeded, Idaho Power’s available generation capacity, particularly if Idaho Power’s power plants are not performing as anticipated and additional resources and battery storage are not available as needed to meet demand.
Bridger Coal Company (BCC), a subsidiary of Idaho Power located in the state of Wyoming, uses surface mining to extract coal to be used for power generation at the Jim Bridger power plant. The federal Surface Mining Control and Reclamation Act and state laws and regulations establish operational, reclamation, bonding, and closure obligations and standards for mining of coal.
BCC, an indirect jointly-owned investment of Idaho Power located in the state of Wyoming, uses surface mining to extract coal to be used for power generation at the Jim Bridger plant. The federal Surface Mining Control and Reclamation Act and state laws and regulations establish operational, reclamation, bonding, and closure obligations and standards for mining of coal.
Idaho Power's 2021 Integrated Resource Plan's (IRP) preferred resource 24 Table of Contents portfolio and action plan included a need to ac quire significant generation and storage resources to meet forecasted increasing energy and capacity needs.
Idaho Power's 2023 IRP preferred resource portfolio and action plan included a need to ac quire significant generation and storage resources to meet forecasted increasing energy and capacity needs.
This increases the likelihood and frequency that Idaho Power will be required to reduce output from its lower-cost hydropower and fossil fuel-fired generation resources, which in turn increases power purchase costs and customer rates and impacts Idaho Power's ability to invest in additional generation and earn a reasonable return on rate base in the future.
Absent a need for this generation, these contracts increase the likelihood and frequency that Idaho Power will be required to reduce output from its lower-cost generation resources, which in turn increases power purchase costs and customer rates and impacts Idaho Power's ability to invest in 28 Table of Contents additional generation and earn a reasonable return on rate base in the future.
The costs of repairing and replacing infrastructure or any costs related to Idaho Power liability for personal injury, loss of life, and property damage from utility equipment that fails, including as a result of significant weather and weather-related events and the increasing threat of fires, may not be covered in full by insurance.
This could limit Idaho Power's ability to meet customer demand for those periods. 23 Table of Contents The costs of repairing and replacing infrastructure or any costs related to Idaho Power liability for personal injury, loss of life, and property damage from utility equipment that fails, including as a result of significant weather and weather-related events and the increasing threat of fires, may not be covered by insurance.
Also, changing customer needs and expectations and increased competition from customer-owned generation could lead to lower customer satisfaction, reduced loyalty, difficulty in obtaining rate increases, legislation to deregulate electric service, and customers seeking alternative sources of energy and electric service.
Also, changing customer needs and expectations, increased customer rates as a result of the 2023 Idaho general rate case and any future rate cases, and increased competition from customer-owned generation could lead to lower customer satisfaction, reduced loyalty, difficulty in obtaining rate increases, legislation to deregulate electric service, and customers seeking alternative sources of energy and electric service.
Factors contributing to lower hydropower generation can increase costs and negatively impact IDACORP's and Idaho Power's financial condition and results of operations . Idaho Power derives a significant portion of its power supply from its hydropower facilities. During both 2022 and 2021, 48 percent o f Idaho Power's electric power from Idaho Power-owned generation was from hydropower facilities.
Factors contributing to lower hydropower generation can increase costs and negatively impact IDACORP's and Idaho Power's financial condition and results of operations . Idaho Power derives a significant portion of its power supply from its hydropower facilities.
As Idah o Power implements the IRP's action plan, which also advances its goal to provide 100 percent clean energy by 2045, it remains obligated to provide reliable and affordable energy to its customers, but there are certain potential deliverability and cost risks associated with this transition.
As Idah o Power implements the IRP's action plan, it remains obligated to provide reliable and affordable energy to its customers, but there are certain potential deliverability and cost risks associated with implementation.
In the past, Idaho Power has been denied recovery, or required to defer recovery pending the next general rate case, including denials or deferrals related to capital expenditures for long-term project expenses.
There can be no assurance that any rate case filed by Idaho Power will result in an outcome that is satisfactory for Idaho Power. In the past, Idaho Power has been denied recovery, or required to defer recovery pending the next general rate case, including denials or deferrals related to capital expenditures for long-term project expenses.
If the amount of insurance is insufficient or otherwise unavailable, and if Idaho Power is unable to fully recover in rates the costs of uninsured losses, IDACORP’s and Idaho Power’s financial condition, results of operations, or cash flows could be materially affected. 29 Table of Contents Purchases of power from renewable energy projects, and integration of power generated from those projects into Idaho Power's system, may increase costs and decrease system reliability, and adversely affect Idaho Power's and IDACORP's results of operations and financial condition.
If the amount of insurance is insufficient or otherwise unavailable, and if Idaho Power is unable to fully recover in rates the costs of uninsured losses, IDACORP’s and Idaho Power’s financial condition, results of operations, or cash flows could be materially affected.
For additional information relating to Idaho Power's state and federal regulatory framework and regulatory matters, see Part I - Item 1 - "Business - Utility Operations," Part II - Item 7 - MD&A - "Regulatory Matters," and Note 3 - "Regulatory Matters" to the consolidated financial statements of Part II - Item 8 in this report. 23 Table of Contents Idaho Power's regulatory cost recovery mechanisms may not function as intended and are subject to change or elimination, which may adversely affect IDACORP's and Idaho Power's financial condition and results of operations.
For additional information relating to Idaho Power's state and federal regulatory framework and regulatory matters, see Part I - Item 1 - "Business - Utility Operations," Part II - Item 7 - MD&A - "Regulatory Matters," and Note 3 - "Regulatory Matters" to the consolidated financial statements of Part II - Item 8 in this report.
Recently, Idaho Power has seen a rise in certain stakeholders, such as investors, customers, employees, and lenders, placing increasing importance on the impact and social cost associated with climate change.
Recently, Idaho Power has seen a rise in certain stakeholders, such as investors, customers, suppliers, employees, and lenders, placing increasing importance on the impact and social cost associated with climate change. Customers, suppliers, or other stakeholders could pursue, and in some cases have pursued, alternatives to Idaho Power's services or business as a result of their ESG-related expectations.
Idaho Power has power cost adjustment mechanisms in its Idaho and Oregon jurisdictions and a fixed cost adjustment (FCA) mechanism in Idaho. The power cost adjustment mechanisms track Idaho Power’s actual net power supply costs (primarily fuel and purchased power less wholesale energy sales) and compare these amounts to net power supply costs being recovered in retail rates.
The power cost adjustment mechanisms track Idaho Power’s actual net power supply costs (primarily fuel and purchased power less wholesale energy sales) and compare these amounts to net power supply costs being recovered in retail rates. A majority of the differences between these two amounts is deferred for future recovery from, or refund to, customers through rates.
Idaho Power's 2021 IRP identified a low-cost preferred resource portfolio and action plan for the next 20-year period that includes adding substantial renewable resources and ending participation in the remaining coal-fired units by the end of 2028.
Idaho Power's 2023 IRP identified a low-cost preferred resource portfolio and action plan for the next 20-year period that includes adding substantial renewable resources and the conversion from coal to natural gas of two units at the Jim Bridger plant in 2024, the two units at the North Valmy plant in 2026, and the remaining two units at the Jim Bridger plant in 2030.
Further, there has been an increasing trend in the degree of annual destruction from wildfires in the western United States. Idaho Power maintains insurance coverage for such operating and event risks, but insurance coverage is subject to the terms and limitations of the available policies and may not be sufficient in amount to cover Idaho Power’s ultimate liability.
Idaho Power maintains insurance coverage for such operating and event risks, but insurance coverage is subject to terms and limitations and may not be sufficient to cover Idaho Power’s ultimate liability.
For additional information relating to legislation, regulations, and legal proceedings related to environmental matters, see Part II - Item 7 - MD&A - "Environmental Matters” in this report. 25 Table of Contents New advances in power generation, energy efficiency, alternative energy sources, or other technologies that impact the power utility industry could decrease customer energy demand and revenues, which could have implications for generation and system planning .
New advances in power generation, energy efficiency, alternative energy sources, or other technologies that impact the power utility industry could decrease customer energy demand and revenues, which could have implications for generation and system planning .
Diminished availability or performance of those facilities could result in reduced customer satisfaction, reputational harm, liability to third parties (including tort liability), and regulatory inquiries and fines.
Idaho Power maintains business continuity and disaster recovery plans, but such plans may be inadequate or not function as anticipated, which could result in delayed recovery after any such events. Diminished availability or performance of those facilities could result in reduced customer satisfaction, reputational harm, liability to third parties (including tort liability), and regulatory inquiries and fines.
Idaho Power is generally obligated under federal law to purchase power from certain renewable energy projects, regardless of the then-current load demand, availability of lower cost generation resources, or wholesale energy market prices. As of December 31, 2022, Idaho Power had federally-mandated contracts to purchase energy from 129 on-line projects with third parties.
Purchases of power mandated by PURPA from renewable energy projects may increase costs and adversely affect Idaho Power's and IDACORP's results of operations and financial condition. Under PURPA, Idaho Power is generally obligated to purchase power from certain renewable energy projects, regardless of the then-current load demand, availability of lower cost generation resources, or wholesale energy market prices.
In 2022, Idaho Power recorded gains on economic hedges of $68.5 million, compared with $12.1 million of gains in 2021. The change in the magnitude of the gain is reflective of an increased volume of transactions, as well as high volatility in prices.
In 2023, Idaho Power recorded losses on economic hedges of $16.2 million, compared with $68.5 million of gains in 2022.
Removed
A majority of the differences between these two amounts is deferred for future recovery from, or refund to, customers through rates.
Added
While Idaho Power reached a settlement stipulation for its 2023 general rate case in Idaho that was approved by the IPUC, with the large amount of ongoing investments and the associated regulatory lag in cost recovery, Idaho Power has filed a general rate case in Oregon and on February 14, 2024, Idaho Power provided notice to the IPUC of its intent to file a general rate case or limited issue rate proceeding in Idaho on or after June 1, 2024.
Removed
An abundance of intermittent, non-dispatchable generation from renewable energy projects interconnected with Idaho Power's system has had an impact on the operation of Idaho Power's generation plants, system reliability, power supply costs, and the wholesale power markets.
Added
Idaho Power's regulatory cost recovery mechanisms may not function as intended and are subject to change or elimination, which may adversely affect IDACORP's and Idaho Power's financial condition and results of operations. Idaho Power has power cost adjustment mechanisms in its Idaho and Oregon jurisdictions and a FCA mechanism in Idaho.
Removed
Further, balancing load and generation from Idaho Power's power generation portfolio is challenging, and Idaho Power expects that its operational and infrastructure costs will continue to increase as a result of its efforts to integrate intermittent, non-dispatchable generation from a large number of renewable energy projects.
Added
Changes in market dynamics due to the emergence of day ahead or other energy and transmission markets in the West could also increase the volatility of power supply costs.
Removed
In recent years, state regulatory mechanisms with income tax-related provisions (such as Idaho Power's May 2018 Idaho tax reform settlement stipulation approved by the IPUC), have significantly impacted IDACORP's and Idaho Power's results of operations.
Added
There is also no guarantee that Idaho Power will continue to experience an increase in the number of customers at the current rate of growth or at all.
Added
Prolonged periods of unfavorable wind or solar conditions will temporarily reduce or eliminate the availability of power from wind and solar facilities, respectively.
Added
For additional information relating to legislation, regulations, and legal proceedings related to environmental matters, see Part II - Item 7 - MD&A - "Environmental Matters” in this report. Liability from fires could adversely impact IDACORP's and Idaho Power's business, financial condition, and results of operations, and Idaho Power's WMP and other protocols may not prevent such liability.
Added
Further, there has been an increasing trend in the degree of annual destruction from wildfires in the western United States, as well as utility companies facing claims for significant damages resulting from wildfires.
Added
Idaho Power or its contractors and customers could also experience coverage reductions and increased wildfire insurance costs in future years. Idaho Power may be unable to recover costs in excess of insurance through customer rates or regulatory mechanisms and, even if such recovery is possible, it could take several years to collect.
Added
If the amount of insurance is insufficient or otherwise unavailable, and if Idaho Power is unable to fully recover in rates the costs of uninsured losses, IDACORP’s and Idaho Power’s business, financial condition, and results of operations could be materially affected.
Added
Idaho Power spends significant resources on initiatives designed to mitigate wildfire risks, including through its WMP, but there is no assurance that the WMP and protocols such as the PSPS will be successful or effective in reducing wildfire-related losses. Idaho Power will face a higher likelihood of wildfires in its service area if it cannot effectively implement its WMP.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIdaho Power considers its properties to be well-maintained and in good operating condition. 36 Table of Contents Through Idaho Energy Resources Co., Idaho Power owns a one-third interest in Bridger Coal Company and coal leases near the Jim Bridger power plant in Wyoming from which coal is mined and supplied to the plant.
Biggest changeThrough Idaho Energy Resources Co., Idaho Power owns a one-third interest in Bridger Coal Company and coal leases near the Jim Bridger plant in Wyoming from which coal is mined and supplied to the plant. Ida-West Energy Company holds 50-percent interests in nine hydropower plants that have a total nameplate capacity of 44 MW.
IDACORP's and Idaho Power's headquarters are located in Boise, Idaho. The corporate headquarters campus consists of approximately 305,741 square feet of owned office space. Excluding Idaho Power's power generation facilities and substations, Idaho Power owns an additional 1,168,813 square feet of office, warehouse, and industrial space to support its operations in Idaho and Oregon.
IDACORP's and Idaho Power's headquarters are located in Boise, Idaho. The corporate headquarters campus consists of approximately 305,741 square feet of owned office space. Excluding Idaho Power's power generation facilities and substations, Idaho Power owns an additional 1,218,813 square feet of office, warehouse, and industrial space to support its operations in Idaho and Oregon.
ITEM 2. PROPERTIES Idaho Power's properties consist of the physical assets necessary to support its utility operations, which include generation, transmission, and distribution facilities. In addition to these physical assets, Idaho Power has rights-of-way and water rights that enable it to use its facilities.
ITEM 2. PROPERTIES Idaho Power's properties consist of the physical assets necessary to support its utility operations, which include generation and battery storage, transmission, and distribution facilities. In addition to these physical assets, Idaho Power has rights-of-way and water rights that enable it to use its facilities.
(2) Licensed on an annual basis while the application for a new multi-year license is pending. (3) Idaho Power’s ownership interests are one-third for Jim Bridger and 50 percent for North Valmy. Amounts shown represent Idaho Power’s share.
(3) Licensed on an annual basis while the application for a new multi-year license is pending. (4) Idaho Power’s ownership interests are one-third for Jim Bridger and 50 percent for North Valmy. Amounts shown represent Idaho Power’s share.
(4) Pursuant to an agreement with NV Energy, Idaho Power's participation in coal-fired operations of North Valmy ended in December 2019 at unit 1 and is planned to end no later than the end of 2025 at unit 2.
(6) Pursuant to an agreement with NV Energy, Idaho Power's participation in coal-fired operations of North Valmy ended in December 2019 at unit 1 and is planned to end no later than the end of 2025 at unit 2.
Idaho Power owns all of its interests in principal plants and other important units of real property, except for portions of certain projects licensed under the Federal Power Act and reservoirs and other easements. Substantially all of Idaho Power’s property is subject to the lien of its Mortgage and Deed of Trust and the provisions of its project licenses.
Idaho Power owns all of its interests in principal plants and other important units of real property, except for portions of certain projects licensed under the FPA and reservoirs and other easements. Substantially all of Idaho Power’s property is subject to the lien of its Mortgage and Deed of Trust and the provisions of its project licenses.
Idaho Power’s system is composed of 17 hydropower generating plants located in southern Idaho and eastern Oregon, three natural gas-fired plants in southern Idaho, and interests in two coal-fired steam electric generating plants located in Wyoming and Nevada.
Idaho Power’s system is composed of 17 hydropower generating plants located in 36 Table of Contents southern Idaho and eastern Oregon, three natural gas-fired plants in southern Idaho, and interests in two coal-fired steam electric generating plants located in Wyoming and Nevada.
Project Nameplate Capacity (Kilowatt) (1) License Expiration Hydropower Projects: Properties Subject to Federal Licenses: Lower Salmon 60,000 2034 Bliss 75,038 2034 Upper Salmon 34,500 2034 Shoshone Falls 14,729 2040 CJ Strike 82,800 2034 Upper Malad - Lower Malad 21,770 2035 Brownlee - Oxbow - Hells Canyon (Hells Canyon Complex) 1,256,501 2005 (2) Swan Falls 27,170 2042 American Falls 92,340 2025 Cascade 12,420 2031 Milner 59,448 2038 Twin Falls 52,898 2040 Other Hydropower: Clear Lake - Thousand Springs 9,300 Total Hydropower 1,798,914 Steam and Other Generating Plants: Jim Bridger (coal-fired) (3) 775,286 North Valmy Unit 2 (coal-fired) (3)(4) 144,900 Danskin (gas-fired) 270,900 Langley Gulch (gas-fired) 318,453 Bennett Mountain (gas-fired) 172,800 Salmon (diesel-internal combustion) 5,000 Total Steam and Other 1,687,339 Total Generation 3,486,253 (1) Actual generation capacity from a facility may be greater or less than the rated nameplate generation capacity.
Project Nameplate Capacity (Kilowatt (kW)) (1) License Expiration Hydropower Projects: Properties Subject to Federal Licenses: (2) Lower Salmon 60,000 2034 Bliss 75,038 2034 Upper Salmon 34,500 2034 Shoshone Falls 14,729 2040 CJ Strike 82,800 2034 Upper Malad - Lower Malad 21,770 2035 HCC: Brownlee, Oxbow, and Hells Canyon 1,276,076 2005 (3) Swan Falls 27,170 2042 American Falls 92,340 2025 Cascade 12,420 2031 Milner 59,448 2038 Twin Falls 52,898 2040 Other Hydropower: Clear Lake - Thousand Springs 9,300 Total Hydropower 1,818,489 Steam and Other Generating Plants: Jim Bridger (coal-fired) (4)(5) 775,286 North Valmy Unit 2 (coal-fired) (4)(6) 144,900 Danskin (gas-fired) 270,900 Langley Gulch (gas-fired) 318,453 Bennett Mountain (gas-fired) 172,800 Salmon (diesel-internal combustion) 5,000 Total Steam and Other 1,687,339 Total Generation 3,505,828 (1) Actual generation capacity from a facility may be greater or less than the rated nameplate generation capacity.
Idaho Power’s property is subject to minor defects common to properties of such size and character that it believes do not materially impair the value to, or the use by, Idaho Power of such properties.
Idaho Power’s property is subject to minor defects common to properties of such size and character that it believes do not materially impair the value to, or the use by, Idaho Power of such properties. Idaho Power considers its properties to be well-maintained and in good operating condition.
As of December 31, 2022, the system also includes approximately 4,832 pole-miles of high-voltage transmission lines, 23 step-up transmission substations located at power plants, 21 transmission substations, 11 switching stations, 30 mixed-use transmission and distribution substations, 189 energized distribution substations (excluding mobile substations and dispatch centers), and approximately 29,384 pole-miles of distribution lines.
As of December 31, 2023, the system also includes approximately 4,762 linear miles of high-voltage transmission lines, 23 step-up transmission substations located at power plants, 21 transmission substations, 11 switching stations, 30 mixed-use transmission and distribution substations, 186 energized distribution substations (excluding mobile substations and dispatch centers), approximately 29,714 linear miles of distribution lines, and 131 MW of battery storage.
Idaho Power holds Federal Energy Regulatory Commission licenses for all of its hydropower projects that are subject to federal licensing. Relicensing of Idaho Power’s hydropower projects is discussed in Part II - Item 7 - "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Regulatory Matters – Relicensing of Hydropower Projects" in this report.
(2) Idaho Power holds FERC licenses for all of its hydropower projects that are subject to federal licensing. Relicensing of Idaho Power’s hydropower projects is discussed in Part II - Item 7 - MD&A - "Regulatory Matters – Relicensing of Hydropower Projects" in this report.
Ida-West Energy Company holds 50-percent interests in nine hydropower plants that have a total nameplate capacity of 44 MW. These plants are located in Idaho and California. Idaho Power's hydropower projects and other owned and co-owned generating facilities and their nameplate capacities, as of the date of this report, are included in the table below.
These plants are located in Idaho and California. 37 Table of Contents Idaho Power's hydropower projects and other owned and co-owned generating facilities and their nameplate capacities, as of the date of this report, are included in the table below.
Added
(5) Idaho Power's 2023 IRP identified a preferred resource portfolio and action plan that includes the conversion from coal generation to natural gas generation of two units at the Jim Bridger plant in 2024 and the remaining two units at the Jim Bridger plant in 2030.
Added
Idaho Power's 2023 IRP identified a preferred resource portfolio and action plan that includes the conversion of the two units at the North Valmy plant from coal generation to natural gas generation in 2026.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeITEM 4. MINE SAFETY DISCLOSURES Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95.1 of this report. 37 Table of Contents PART II
Biggest changeITEM 4. MINE SAFETY DISCLOSURES Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95.1 of this report, which is incorporated herein by reference. 38 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeFor information regarding IDACORP's dividend policy, see Part II - Item 7 - "Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Dividends" in this report. For information relating to restrictions on dividends see, Note 6 - "Common Stock" to the consolidated financial statements in this report.
Biggest changeFor information relating to restrictions on dividends, see Note 6 - "Common Stock" to the consolidated financial statements in this report. IDACORP did not repurchase any shares of its common stock during the fourth quarter of 2023.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES IDACORP’s common stock, without par value, is traded on the New York Stock Exchange under the trading symbol "IDA". On February 10, 2023, there were 7,447 holders of record of IDACORP common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES IDACORP’s common stock, without par value, is traded on the New York Stock Exchange under the trading symbol "IDA". On February 9, 2024, there were 7,127 holders of record of IDACORP common stock.
The outstanding shares of Idaho Power’s common stock, $2.50 par value, are held by IDACORP and are not traded. IDACORP became the holding company of Idaho Power on October 1, 1998.
The outstanding shares of Idaho Power’s common stock, $2.50 par value, are held by IDACORP and are not traded. IDACORP became the holding company of Idaho Power on October 1, 1998. For information regarding IDACORP's dividend policy, see Part II - Item 7 - MD&A - "Liquidity and Capital Resources - Dividends" in this report.
Source: Bloomberg and EEI 2017 2018 2019 2020 2021 2022 IDACORP $ 100.00 $ 104.56 $ 123.06 $ 113.86 $ 138.29 $ 135.44 S&P 500 100.00 95.61 125.71 148.83 191.51 156.79 EEI Electric Utilities Index 100.00 103.67 130.41 128.89 150.96 152.70 The foregoing performance graph and data shall not be deemed “filed” as part of this Form 10-K for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section and shall not be deemed incorporated by reference into any other filing of IDACORP or Idaho Power under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent IDACORP or Idaho Power specifically incorporates it by reference into such filing. 38 Table of Contents
Source: Bloomberg and EEI 2018 2019 2020 2021 2022 2023 IDACORP $ 100.00 $ 117.69 $ 108.90 $ 132.26 $ 129.53 $ 121.81 S&P 500 100.00 131.48 155.66 200.30 163.99 207.05 EEI Electric Utilities Index 100.00 125.79 124.33 145.62 147.29 134.48 The foregoing performance graph and data shall not be deemed “filed” as part of this Form 10-K for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section and shall not be deemed incorporated by reference into any other filing of IDACORP or Idaho Power under the Securities Act of 1933 or the Exchange Act, except to the extent IDACORP or Idaho Power specifically incorporates it by reference into such filing. 39 Table of Contents
The data assumes that $100 was invested on December 31, 2017, with beginning-of-period weighting of the peer group indices (based on market capitalization) and monthly compounding of returns.
Performance Graph The graph below shows a comparison of the five-year cumulative total shareholder return for IDACORP common stock, the S&P 500 Index, and the EEI Electric Utilities Index. The data assumes that $100 was invested on December 31, 2018, with beginning-of-period weighting of the peer group indices (based on market capitalization) and monthly compounding of returns.
Removed
IDACORP did not repurchase any shares of its common stock during the fourth quarter of 2022. Performance Graph The graph below shows a comparison of the five-year cumulative total shareholder return for IDACORP common stock, the S&P 500 Index, and the Edison Electric Institute (EEI) Electric Utilities Index.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

253 edited+98 added−186 removed126 unchanged
Biggest changeSignificant items and transactions that affected investing cash flows in 2022 and 2021 were as follows: • IDACORP’s and Idaho Power’s investing cash outflows for 2022 and 2021 included $433 million and $300 million, respectively, of additions to utility plant; • IDACORP's and Idaho Power's investing cash inflows for 2022 and 2021 included $18 million and $6 million, respectively, from Boardman-to-Hemingway project joint permitting participants relating to a portion of the permitting expenditures; • IDACORP's investing cash outflows for 2022 and 2021 included $10 million and $15 million, respectively, of tax credit investments in affordable housing and other real estate, which provide a return principally by reducing federal and state income taxes through tax credits and accelerated tax depreciation benefits; • IDACORP's investing cash outflows and inflows for 2022 and 2021 included $25 million in purchases of short-term investments and $25 million and $50 million, respectively, in sales of short-term investments; • IDACORP's and Idaho Power's investing cash inflows for 2022 and 2021 included an $8 million and $14 million, respectively, return of investment from IERCo, a wholly-owned subsidiary of Idaho Power; and • IDACORP's and Idaho Power's investing cash outflows and inflows for 2022 included $44 million and $31 million in purchases of equity and held-to-maturity securities, respectively, and $64 million in sales of equity securities, held in a rabbi trust, which is designated to provide funding for obligations related to Idaho Power's security plan for senior management employees.
Biggest changeSignificant items and transactions that affected investing cash flows in 2023 and 2022 included: • $611 million and $433 million, respectively, of additions to property, plant and equipment, including $112 million spent on battery storage projects, and at December 31, 2023, $31 million was accrued in accounts payable on their consolidated balance sheets related to battery payments; • $27 million and $18 million, respectively, from Boardman-to-Hemingway project joint permitting participants relating to a portion of the permitting expenditures; • $3 million and $10 million, respectively, of tax credit investments in affordable housing and other real estate, which provide a return principally by reducing federal and state income taxes through tax credits and accelerated tax depreciation benefits at IDACORP; 51 Table of Contents • $8 million in 2022 related to return of investment from IERCo, a wholly-owned subsidiary of Idaho Power; • $11 million and $44 million in purchases of equity securities, respectively, $2 million and $31 million in purchases of held-to-maturity securities, respectively, and $9 million and $64 million in sales of equity securities, respectively, held in a rabbi trust, which is designated to provide funding for obligations related to Idaho Power's SMSP; and • $25 million in 2022 of both purchases and sales of short-term investments at IDACORP.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS In Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) in this report, the general financial condition and results of operations for IDACORP and its subsidiaries and Idaho Power and its subsidiary are discussed.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS In MD&A in this report, the general financial condition and results of operations for IDACORP and its subsidiaries and Idaho Power and its subsidiary are discussed.
Idaho Power has been engaged in the process of obtaining from the FERC a new long-term license for the HCC. The past and anticipated future costs associated with obtaining a new long-term license for the HCC are significant.
Idaho Power has been engaged in the process of obtaining a new long-term license for the HCC from the FERC. The past and anticipated future costs associated with obtaining a new long-term license for the HCC are significant.
Federal and state regulations pertaining to GHG emissions under the CAA have raised uncertainty about the future viability of fossil fuels, most notably coal, as an economical energy source for new and existing electric generation facilities because many new technologies for reducing carbon dioxide (CO 2 ) emissions from coal, including carbon capture and storage, are still in the development stage and are not yet proven .
Federal and state regulations pertaining to GHG emissions under the CAA have raised uncertainty about the future viability of fossil fuels, most notably coal, as an economical energy source for new and existing electric generation facilities because many new technologies for reducing CO 2 emissions from coal, including carbon capture and storage, are still in the development stage and are not yet proven .
Effective March 1, 2012, Idaho Power implemented new Oregon base rates resulting from its receipt of an order from the OPUC approving a settlement stipulation in its general rate case proceedings that provided for a $1.8 million base rate revenue increase, a rate of return on equity of 9.9 percent, and an overall rate of return of 7.757 percent in the Oregon jurisdiction.
Previously, effective March 1, 2012, Idaho Power implemented new Oregon base rates resulting from its receipt of an order from the OPUC approving a settlement stipulation in its general rate case proceedings that provided for a $1.8 million base rate revenue increase, a rate of return on equity of 9.9 percent, and an overall rate of return of 7.757 percent in the Oregon jurisdiction.
Due to economic factors in part associated with the costs of compliance with environmental regulation, Idaho Power accelerated the retirement date of its jointly-owned coal-fired generating plant in Valmy, Nevada (Valmy plant), ceasing coal-fired operations at one unit in 2019 and planning to cease its participation in coal-fired operations at the remaining unit by year-end 2025.
Due to economic factors in part associated with the costs of compliance with environmental regulation, Idaho Power accelerated the retirement date of its jointly-owned coal-fired generating plant in North Valmy, Nevada (North Valmy plant), ceasing coal-fired operations at one unit in 2019 and planning to cease its participation in coal-fired operations at the remaining unit by year-end 2025.
Idaho Power's jointly-owned coal plant in Boardman, Oregon, ceased operations as planned in October 2020. In June 2022, the IPUC approved Idaho Power's request to allow the coal-related assets at the Jim Bridger plant to be fully depreciated and recovered by end-of-year 2030.
Idaho Power's jointly-owned coal plant in Boardman, Oregon, ceased operations as planned in October 2020. In 2022, the IPUC approved Idaho Power's request to allow the coal-related assets at the Jim Bridger plant to be fully depreciated and recovered by end-of-year 2030.
Deferred Net Power Supply Costs Deferred (accrued) power supply costs represent certain differences between Idaho Power's actual net power supply costs and the costs included in its retail rates, the latter being based on annual forecasts of power supply costs. Deferred (accrued) power supply costs are recorded on the balance sheets for future recovery (refund) through customer rates.
Deferred Net Power Supply Costs Deferred (accrued) power supply costs represent certain differences between Idaho Power's actual net power supply costs and the costs included in its retail rates, the latter being based on annual forecasts of power supply costs. Deferred (accrued) power supply costs are recorded on the balance sheets for future recovery or refund through customer rates.
Further, as Idaho Power's hydropower facilities comprise over one-half of Idaho Power's nameplate generation capacity, precipitation levels impact the mix of Idaho Power's generation resources. When hydropower generation decreases, Idaho Power must rely on more expensive generation sources and purchased power.
Further, as Idaho Power's hydropower facilities comprise over one-half of Idaho Power's nameplate generation capacity, precipitation levels impact the mix of Idaho Power's generation resources. When hydropower generation decreases, Idaho Power must rely on more expensive generation resources and purchased power.
Idaho Power has in the past, and expects in the future, to incur costs and expenses associated with those permitting and compliance obligations, but as of the date of this report, Idaho Power is unable to estimate with any reasonable certainty those costs and expenses.
Idaho Power has in the past, and expects in the future, to incur costs associated with those permitting and compliance obligations, but as of the date of this report, Idaho Power is unable to estimate with any reasonable certainty those costs.
Fixed Cost Adjustment: The FCA mechanism, applicable to Idaho residential and small commercial customers, is designed to remove a portion of Idaho Power’s financial disincentive to invest in energy efficiency programs by separating (or decoupling) the recovery of fixed costs from the variable kilowatt-hour (kWh) charge and linking it instead to a set amount per customer.
Fixed Cost Adjustment: The FCA mechanism, applicable to Idaho residential and small commercial customers, is designed to remove a portion of Idaho Power’s financial disincentive to invest in energy efficiency programs by separating (or decoupling) the recovery of fixed costs from the variable kWh charge and linking it instead to a set amount per customer.
The discussion of IDACORP's and Idaho Power's general financial condition and results of operations for 2021 compared with 2020 can be found in their Annual Report on Form 10-K for the year ended December 31, 2021. See Part II - Item 7 - MD&A in that report for further information on the companies' prior period results of operations.
The discussion of IDACORP's and Idaho Power's general financial condition and results of operations for 2022 compared with 2021 can be found in their Annual Report on Form 10-K for the year ended December 31, 2022. See Part II - Item 7 - MD&A in that report for further information on the companies' prior period results of operations.
Long-Term Resource Planning: The IPUC and OPUC require that Idaho Power prepare biennially an IRP. The IRP seeks to forecast Idaho Power's loads and resources for a 20-year period, analyzes potential supply-side, demand-side, and transmission options, and identifies potential near-term, mid-term, and long-term actions. Idaho Power filed its most recent IRP with the IPUC and OPUC in 2021.
Long-Term Resource Planning: The IPUC and OPUC require that Idaho Power prepare biennially an IRP. The IRP seeks to forecast Idaho Power's loads and resources for a 20-year period, analyzes potential supply-side, demand-side, and transmission options, and identifies potential near-term, mid-term, and long-term actions. Idaho Power filed its most recent IRP with the IPUC and OPUC in 2023.
ENVIRONMENTAL MATTERS Overview Idaho Power is subject to a broad range of federal, state, regional, and local laws and regulations designed to protect, restore, and enhance the environment, including the Clean Air Act (CAA), the CWA, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, the Comprehensive Environmental Response, Compensation and Liability Act, and the ESA, among other laws.
ENVIRONMENTAL MATTERS Overview Idaho Power is subject to a broad range of federal, state, regional, and local laws and regulations designed to protect, restore, and enhance the environment, including the CAA, the CWA, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, the Comprehensive Environmental Response, Compensation and Liability Act, and the ESA, among other laws.
Idaho Power is also under the regulatory jurisdiction of the IPUC, the OPUC, and the WPSC as to the issuance of debt and equity securities. As a public utility under the Federal Power Act (FPA), Idaho Power has authority to charge market-based rates for wholesale energy sales under its FERC tariff and to provide transmission services under its OATT.
Idaho Power is also under the regulatory jurisdiction of the IPUC, the OPUC, and the WPSC as to the issuance of debt and equity securities. As a public utility under the FPA, Idaho Power has authority to charge market-based rates for wholesale energy sales under its FERC tariff and to provide transmission services under its OATT.
The events of default under the Credit Facilities include, without limitation, non-payment of principal, interest, or fees; materially false representations or warranties; breach of covenants; bankruptcy or insolvency events; condemnation of property; cross-default to certain other indebtedness; failure to pay certain judgments; change of control; failure of IDACORP to own free and clear of liens the voting stock of Idaho Power; the occurrence of specified events or the incurring of specified liabilities relating to benefit plans; and the incurring of certain environmental liabilities, subject, in certain instances, to cure periods.
The events of default under the Credit Facilities include, without limitation, non-payment of principal, interest, or fees; materially false representations or warranties; breach of covenants; bankruptcy or insolvency events; condemnation of property; cross-default to certain other indebtedness; failure to pay certain judgments; change of control; failure of IDACORP to own free and clear of liens the voting stock of Idaho Power; the occurrence of specified events or the incurring of specified liabilities relating to benefit plans; and the occurrence of certain events related to the environment, subject, in certain instances, to cure periods.
Contractual Obligations IDACORP’s and Idaho Power’s contractual cash obligations as of December 31, 2022, include long-term debt, interest payments, purchase obligations, pension and post-retirement benefit plans, and other long-term liabilities specific to IDACORP, most of which are discussed throughout this MD&A.
Contractual Obligations IDACORP’s and Idaho Power’s contractual cash obligations as of December 31, 2023, include long-term debt, interest payments, purchase obligations, pension and post-retirement benefit plans, and other long-term liabilities specific to IDACORP, most of which are discussed throughout this MD&A.
At December 31, 2022, IDACORP and Idaho Power believe they were in compliance with all of their respective Credit Facility covenants and, as of the date of this report, do not believe they will be in violation or breach of such covenants during 2023.
At December 31, 2023, IDACORP and Idaho Power believe they were in compliance with all of their respective Credit Facility covenants and, as of the date of this report, do not believe they will be in violation or breach of such covenants during 2024.
Additional analysis is performed to measure the expected range of returns, as well as worst-case and best-case scenarios. The long-term rate of return used to calculate the 2023 pension expense will be 7.4 percent, the same assumption as used in 2022.
Additional analysis is performed to measure the expected range of returns, as well as worst-case and best-case scenarios. The long-term rate of return used to calculate the 2024 pension expense will be 7.4 percent, the same assumption as used in 2023.
In August 2015, the EPA promulgated the Clean Power Plan (CPP) under Section 111(d) of the CAA, which required states to adopt plans to collectively reduce 2005 levels of power sector CO 2 emissions by 32 percent by the year 2030.
In August 2015, the EPA issued the Clean Power Plan (CPP) under Section 111(d) of the CAA, which required states to adopt plans to collectively reduce 2005 levels of power sector CO 2 emissions by 32 percent by the year 2030.
Specifically, IDACORP and Idaho Power determined the discount rate for each plan through the construction of hypothetical portfolios of bonds selected from high-quality corporate bonds available as of December 31, 2022, with maturities matching the projected cash outflows of the plans.
Specifically, IDACORP and Idaho Power determined the discount rate for each plan through the construction of hypothetical portfolios of bonds selected from high-quality corporate bonds available as of December 31, 2023, with maturities matching the projected cash outflows of the plans.
Given the uncertainty of future environmental regulations and technological advances, there is uncertainty around near-term estimates, and Idaho Power is also unable to predict its environmental-related expenditures beyond 2025, though they could be substantial.
Given the uncertainty of future environmental regulations and technological advances, there is uncertainty around near-term estimates, and Idaho Power is also unable to predict its environmental-related expenditures beyond 2026, though they could be substantial.
Depending on factors such as RFP results, the timing of project in-service dates, estimated load and resource balances and customer growth, the nature and quantity of resources owned versus acquired under power purchase agreements or similar agreements, and the 56 Table of Contents outcome of regulatory proceedings, actual expenditures and their timing could deviate substantially from Idaho Power's expected expenditures.
Depending on factors such as RFP results, the timing of project in-service dates, estimated load and resource balances and customer growth, the nature and quantity of resources owned versus acquired under power purchase agreements or similar agreements, and the outcome of regulatory proceedings, actual expenditures and their timing could deviate substantially from Idaho Power's expected expenditures.
Idaho Power has adopted a Wildfire Mitigation Plan (WMP) that outlines actions Idaho Power is taking or is working to implement in the future to reduce wildfire risk and to strengthen the resiliency of its transmission and distribution system to wildfires.
Idaho Power has adopted a WMP that outlines actions Idaho Power is taking or is working to implement in the future to reduce wildfire risk and to strengthen the resiliency of its transmission and distribution system to wildfires.
IDACORP and Idaho Power have the right to request an increase in the aggregate principal amount of the facilities to $150 million and $450 million, respectively, in each case subject to certain conditions. The IDACORP and Idaho Power Credit Facilities have similar terms and conditi ons.
IDACORP and Idaho Power have the right to request an increase in the aggregate principal amount of the facilities to $150 million and $600 million, respectively, in each case subject to certain conditions. The IDACORP and Idaho Power Credit Facilities have similar terms and conditi ons.
Idaho Power cannot currently determine the ultimate terms of, and costs associated with, any resulting long-term licenses for the HCC or American Falls hydroelectric facilities. • Wildfire Mitigation Efforts: In recent years, the western United States has experienced an increasing trend in the degree of annual destruction from wildfires.
Idaho Power cannot currently determine the 44 Table of Contents ultimate terms of, and costs associated with, any resulting long-term licenses for the HCC or American Falls hydroelectric facilities. • Wildfire Mitigation Efforts: In recent years, the western United States has experienced an increasing trend in the degree of annual destruction from wildfires.
In April 2018, the IPUC issued an order approving a settlement stipulation signed by Idaho Power, the IPUC staff, and a third-party intervenor recognizing that a total of $216.5 million in expenditures were reasonably incurred, and therefore should be eligible for inclusion in customer rates at a later date.
In April 2018, the IPUC issued an order approving a settlement stipulation signed by Idaho Power, the IPUC staff, and a third-party intervenor 57 Table of Contents recognizing that a total of $216.5 million in expenditures were reasonably incurred, and therefore should be eligible for inclusion in customer rates at a later date.
Idaho Power expects the listing of the slickspot peppergrass and its existence within or near the proposed route for the Gateway West transmission line project and other transmission and distribution lines 70 Table of Contents to increase the cost and timing of permitting and construction of the projects, as it requires an ESA Section 7 consultation and potential mitigation.
Idaho Power expects the listing of the slickspot peppergrass and its existence within or near the proposed route for the Gateway West transmission line project and other transmission and distribution lines to increase the cost and timing of permitting and construction of the projects, as it requires an ESA Section 7 consultation and potential mitigation.
IDACORP has a dividend policy that provides for a target long-term dividend payout ratio of between 60 percent and 70 percent of sustainable IDACORP earnings, with the flexibility to achieve that payout ratio over time and to adjust the payout ratio or to deviate from the target payout ratio from time to time based on the various factors that drive IDACORP's board of directors' dividend decisions.
IDACORP has a dividend policy that provides for a target long-term dividend payout ratio of between 60 percent and 70 percent of sustainable IDACORP earnings, with the flexibility to achieve that payout ratio over time and to adjust the payout ratio or to deviate from the target payout ratio from time to time based on the various factors that drive IDACORP's board of 58 Table of Contents directors' dividend decisions.
However, the 69 Table of Contents ongoing relicensing of the HCC presents endangered species and fisheries issues that may require operational adjustments and could adversely impact the amount of output from hydropower dams, potentially causing Idaho Power to rely on more expensive sources for power generation or market purchases.
However, the ongoing relicensing of the HCC presents endangered species and fisheries issues that may require operational adjustments and could adversely impact the amount of output from hydropower dams, potentially causing Idaho Power to rely on more expensive sources for power generation or market purchases.
To a greater extent, the net increase in retail revenues per MWh was due to the June 1, 2022 rate increase for Idaho Power’s Idaho retail customers related to an order from the IPUC that authorized Idaho Power to accelerate the depreciation on and recover through 2030 the net book value of coal-related assets at Idaho Power's jointly-owned Jim Bridger plant as of December 31, 2020, plus forecasted plant investments (Bridger Order).
The net increase in retail revenues per MWh was primarily due to the June 1, 2022, rate increase for Idaho Power’s Idaho retail customers related to an order from the IPUC that authorized Idaho Power to accelerate the depreciation on and recover through 2030 the net book value of coal-related assets at Idaho Power's jointly-owned Jim Bridger plant, as of December 31, 2020, plus forecasted plant investments (Bridger Order).
Investing cash outflows for 2022 and 2021 were primarily for construction of utility infrastructure needed to address Idaho Power’s aging plant and equipment, customer growth, and environmental and regulatory compliance requirements.
Investing cash outflows for 2023 and 2022 were primarily for construction of utility infrastructure needed to address Idaho Power’s customer growth, aging plant and equipment, and environmental and regulatory compliance requirements.
As of the date of this report, the IPUC authorizes Idaho Power to include in its Idaho jurisdiction rates approximately $8.8 million annually of AFUDC relating to the HCC relicensing project. Collecting these amounts currently will reduce future collections when the HCC relicensing costs are approved for recovery in base rates.
As of the date of this report, the IPUC has authorized Idaho Power to include in its Idaho jurisdiction rates approximately $8.8 million annually of AFUDC relating to the HCC relicensing project. Collecting these amounts currently will reduce future collections when the HCC relicensing costs are approved for recovery in base rates.
Large Customer Rate Proceedings Speculative High-Density Load : In June 2022, the IPUC approved Idaho Power's application to create a new customer class that would be applicable to commercial and industrial cryptocurrency mining operations, or any other speculative high-density load customers of less than 20 MW.
Speculative High-Density Load : In June 2022, the IPUC approved Idaho Power's application to create a new customer class that would be applicable to commercial and industrial cryptocurrency mining operations, or any other speculative high-density load customers of less than 20 MW.
The following table outlines the ratings of Idaho Power’s and IDACORP’s securities, and the ratings outlook, by Moody’s Investors Service (Moody's) and Standard & Poor’s Ratings Services as of the date of this report: IDACORP Idaho Power Moody's Investors Service: Rating Outlook Stable Stable Long-Term Issuer Rating Baa2 Baa1 First Mortgage Bonds None A2 Senior Secured Debt None A2 Commercial Paper P-2 P-2 Standard & Poor's Rating Services: Corporate Credit Rating BBB BBB Rating Outlook Stable Stable Short-Term Rating A-2 A-2 Senior Secured Debt None A- These security ratings reflect the views of the ratings agencies.
The following table outlines the ratings of Idaho Power’s and IDACORP’s securities, and the ratings outlook, by Moody's and Standard & Poor’s Ratings Services as of the date of this report: Moody's Standard & Poor's IDACORP Idaho Power IDACORP Idaho Power Rating Outlook Stable Stable Stable Stable Issuer Rating/Corporate Baa2 Baa1 BBB BBB First Mortgage Bonds None A2 Senior Secured Debt None A2 None A- Commercial Paper/Short-Term P-2 P-2 A-2 A-2 These security ratings reflect the views of the ratings agencies.
Refer to Note 3 - “Regulatory Matters” to the consolidated financial statements included in this report for additional information relating to regulatory matters. 74 Table of Contents Income Taxes IDACORP and Idaho Power use judgment and estimation in developing the provision for income taxes and the reporting of tax-related assets and liabilities.
Refer to Note 3 - “Regulatory Matters” to the consolidated financial statements included in this report for additional information relating to regulatory matters. Income Taxes IDACORP and Idaho Power use judgment and estimation in developing the provision for income taxes and the reporting of tax-related assets and liabilities.
In recent years, Idaho Power has seen significant growth in the number of customers in its service area. In 2022, Idaho Power's customer count grew by 2.4 percent.
In recent years, Idaho Power has seen significant growth in the number of customers in its service area. In 2023, Idaho Power's customer count grew by 2.4 percent.
Refer to Note 11 – “Benefit Plans” to the consolidated financial statements included in this report for information relating to those obligations. Idaho Power defers its Idaho-jurisdiction pension expense as a regulatory asset until recovered from Idaho customers. At December 31, 2022 and 2021, Idaho Power's deferral balance associated with the Idaho jurisdiction was $250 million and $234 million, respectively.
Refer to Note 11 – “Benefit Plans” to the consolidated financial statements included in this report for information relating to those obligations. Idaho Power defers its Idaho-jurisdiction pension expense as a regulatory asset until recovered from Idaho customers. At December 31, 2023 and 2022, Idaho Power's deferral balance associated with the Idaho jurisdiction was $255 million and $250 million, respectively.
IDACORP and Idaho Power monitor capital markets with a view toward opportunistic debt and equity transactions, taking into account current and potential future long-term needs.
IDACORP and Idaho Power monitor capital markets with a view toward favorable debt and equity transactions, taking into account current and potential future long-term needs.
These six pollutants are carbon monoxide, lead, ozone, particulate matter, nitrogen dioxide, and sulfur dioxide (SO 2 ). States are then required to develop emissions reduction strategies through State Implementation Plans (SIPs), based on attainment of these ambient air quality standards. Recent developments and pending actions related to certain of those items relevant to Idaho Power.
These six pollutants are carbon monoxide, lead, ozone, particulate matter, nitrogen dioxide, and SO 2 . States are then required to develop emissions reduction strategies through SIPs, based on attainment of these ambient air quality standards. Recent developments and pending actions related to certain of those items are relevant to Idaho Power.
As of the date of this report, Idaho Power estimates that the annual costs it will incur to obtain a new long-term license for the HCC, including AFUDC but excluding costs expected to be incurred for complying with the license after issuance, are likely to range from $30 million to $40 million until issuance of t he license.
As of the date of this report, Idaho Power estimates that the annual costs it will incur to obtain a new long-term license for the HCC, including AFUDC but excluding costs expected to be incurred for complying with the license after issuance, are likely to range from $35 million to $45 million until issuance of t he license.
Idaho Power has determined that it meets these conditions, and its financial statements reflect the effects of the different rate-making principles followed by the jurisdictions regulating Idaho Power. The primary effect of this policy is that Idaho Power had recorded approximately $1.5 billion of regulatory assets and $0.9 billion of regulatory liabilities at December 31, 2022.
Idaho Power has determined that it meets these conditions, and its financial statements reflect the effects of the different rate-making principles followed by the jurisdictions regulating Idaho Power. The primary effect of this policy is that Idaho Power had recorded approximately $1.7 billion of regulatory assets and $0.9 billion of regulatory liabilities at December 31, 2023.
Given the uncertainty associated with the timing of infrastructure projects and associated expenditures, actual expenditures and the timing of such expenditures could deviate substantially from those set forth in the table.
Given the uncertainty associated with the timing of infrastructure projects and associated expenditures, actual expenditures and their timing could deviate substantially from those set forth in the table.
State GHG Initiatives and Idaho Power’s Voluntary GHG Reduction Initiative: In August 2007, the Oregon legislature enacted legislation setting goals of reducing GHG levels to 10 percent below 1990 levels by 2020 and at least 75 percent below 1990 levels by 2050.
State GHG Initiatives and Idaho Power’s Voluntary GHG Reduction Initiative: In 2007, Oregon enacted legislation setting goals of reducing GHG levels to 10 percent below 1990 levels by 2020 and at least 75 percent below 1990 levels by 2050.
IDACORP's board of directors has reviewed and affirmed IDACORP’s long-term strategy. In executing on these four strategic cornerstones, IDACORP seeks to balance the interests of shareowners, Idaho Power customers, employees, and other stakeholders.
IDACORP's directors have reviewed and affirmed IDACORP’s long-term strategy. In executing on these four strategic cornerstones, IDACORP seeks to balance the interests of shareowners, Idaho Power customers, employees, and other stakeholders.
Based on planned capital expenditures and other O&M expenses, the companies believe they will be able to meet capital and debt service requirements and fund corporate expenses during at least the next twelve months with a combination of existing cash, operating cash flows generated by Idaho Power's utility business, availability under existing credit facilities, and access to commercial paper and short-term and long-term debt markets.
Based on planned capital expenditures and other O&M expenses, the companies believe they will be able to meet capital and debt service requirements and fund corporate expenses during at least the next twelve months and thereafter for the foreseeable future with a combination of existing cash, operating cash flows generated by Idaho Power's utility business, availability under existing credit facilities, access to commercial paper, short-term, and long-term debt markets, and equity issuances.
Stringent emissions standards could result in significant increases in capital 71 Table of Contents expenditures and operating costs, which may accelerate the retirement of coal-fired units and create power system reliability issues.
Stringent emissions standards could result in significant increases in capital expenditures and operating costs, which may accelerate the retirement of coal-fired units and create power system reliability issues.
The decision to cease operation of the Boardman power plant in October 2020 was based in part on the significant cost of compliance with environmental laws and regulations. The decision to pursue an end to participation in coal-fired operations at the North Valmy plant was also based primarily on the economics of continuing coal-fired generation at the plant.
The decision to cease operation of the Boardman power plant in 2020 was based in part on the significant cost of compliance with environmental laws and regulations. The decision to end participation in coal-fired operations at the North Valmy plant was also based in part on the economics of continuing coal-fired generation at the plant.
Gateway West and Boardman-to-Hemingway Transmission Projects and Other Infrastructure - Slickspot Peppergrass and Washington Ground Squirrel Designations : In August 2016, the USFWS re-instated the threatened species status of slickspot peppergrass under the ESA. In July 2020, the USFWS published a revised proposed rule designating critical habitat for the species, most of which are located on federal land.
Gateway West and Boardman-to-Hemingway Transmission Projects and Other Infrastructure - Slickspot Peppergrass Designation : In August 2016, the USFWS re-instated the threatened species status of slickspot peppergrass under the ESA. In July 2020, the USFWS published a revised proposed rule designating critical habitat for the species, most of which are located on federal land.
In June 2022, Idaho Power and the IDEQ entered into a consent judgment in the district courts for the third, fourth, fifth, and sixth judicial districts of the State of Idaho to resolve a National Pollutant Discharge Elimination System permitting issue related to 15 of Idaho Power’s hydropower projects that required Idaho Power to pay a $1.1 million fine, implement interim measures for compliance, and ultimately submit applications for new permits at each of the dams subject to the consent judgment.
In June 2022, Idaho Power and the IDEQ entered into a consent judgment in the Idaho state district courts to resolve a National Pollutant Discharge Elimination System permitting issue related to 15 of Idaho Power’s hydropower projects that required Idaho Power to pay a $1.1 million fine, implement interim measures for compliance, and ultimately submit applications for new permits at each of the dams subject to the consent judgment.
Idaho Power funds liquidity needs for capital investment, working capital, managing commodity price risk, dividends, and other financial commitments through cash flows from operations, debt offerings, commercial paper markets, credit facilities, a term loan facility, and capital contributions from IDACORP.
Idaho Power funds liquidity needs for capital investment, working capital, managing commodity price risk, dividends, and other financial commitments through cash flows from operations, debt offerings, commercial paper markets, credit facilities, and capital contributions from IDACORP.
In July 2003, Idaho Power filed an application with the FERC for a new license in anticipation of the July 2005 expiration of the then-existing license. Since the expiration of that license, Idaho Power has been operating the project under annual licenses issued by the FERC.
Hells Canyon Complex Relicensing: In July 2003, Idaho Power filed an application with the FERC for a new license in anticipation of the July 2005 expiration of the then-existing license. Since the expiration of that license, Idaho Power has been operating the project under annual licenses issued by the FERC.
Part I, Item 1 - “Business - Utility Operations - Environmental Regulation and Costs” in this report includes a summary of Idaho Power's expected capital and operating expenditures for environmental matters during the period from 2023 to 2025.
Part I, Item 1 - “Business - Utility Operations - Environmental Regulation and Costs” in this report includes a summary of Idaho Power's expected capital and operating expenditures for environmental matters during the period from 2024 to 2026.
When favorable hydropower generating conditions exist for Idaho Power, they also may exist for other Pacific Northwest hydropower facility operators, lowering regional wholesale market prices and impacting the revenue Idaho Power receives from 43 Table of Contents wholesale energy sales.
When favorable hydropower generating conditions exist for Idaho Power, they also may exist for other Pacific Northwest hydropower facility operators, lowering regional wholesale market prices and impacting the revenue Idaho Power receives from wholesale energy sales.
Idaho Power's contributions are made in a continued effort to balance the regulatory collection of these expenditures with the amount and timing of contributions to 58 Table of Contents mitigate the cost of being in an underfunded position. Beyond 2023, Idaho Power expects continuing contributions under the pension plan could be significant.
Idaho Power's contributions are made in a continued effort to balance the regulatory collection of these expenditures with the amount and timing of contributions to mitigate the cost of being in an underfunded position. Beyond 2024, Idaho Power expects continuing contributions under the pension plan could be significant.
Idaho Power estimates that it has no minimum required contribution to be made during 2023. Depending on market conditions and cash flow considerations, Idaho Power could contribute up to $40 million to the pension plan during 2023.
Idaho Power estimates that it has no minimum required contribution to be made during 2024. Depending on market conditions and cash flow considerations, Idaho Power could contribute up to $30 million to the pension plan during 2024.
The primary factors affecting retail revenues during the period were the following: • Rates : Customer rates, excluding collections of amounts related to the power cost adjustment mechanisms, increased retail revenues by $24.4 million in 2022 compared with 2021, due primarily to the June 1, 2022 rate increase for Idaho Power’s Idaho retail customers related to the Bridger Order.
The primary factors affecting retail revenues during the period were the following: • Rates : Customer rates, excluding collections of amounts related to the power cost adjustment mechanisms, increased retail revenues by $11.0 million in 2023 compared with 2022, due primarily to the June 1, 2022 rate increase for Idaho Power’s Idaho retail customers related to the Bridger Order.
Specifically, Idaho Power is seeking authority to: (1) rename its existing green power program; (2) maintain and expand procurement options for the renewable energy credits (REC); (3) establish a regulatory framework for a future voluntary subscription green power service program; (4) offer a tailored renewable option for Idaho Power's largest customers; and (5) procure the associated additional resources outside of the IPUC's current competitive procurement requirements.
Specifically, Idaho Power received authority to: (1) rename its existing green power program; (2) maintain and expand procurement options for the RECs; (3) establish a regulatory framework for a future voluntary subscription green power service program; (4) offer a tailored renewable option for Idaho Power's largest customers; and (5) procure the associated additional resources outside of the IPUC's current competitive procurement requirements.
As of the date of this report, Idaho Power anticipates that the final biological opinions will likely be issued in 2024 after the FERC issues a final supplemental EIS, which is scheduled for December 2023 according to the FERC's notice of intent.
As of the date of this report, Idaho Power anticipates that the final biological opinions will likely be issued after the FERC issues a final supplemental EIS, which is scheduled for November 2024 according to the FERC's revised notice of intent.
Those rates are established by state regulatory commissions and the FERC and are intended to allow Idaho Power an opportunity to recover its expenses and earn a reasonable return on investment. Idaho Power focuses on timely recovery of its costs through filings with its regulators, working to put in place innovative regulatory mechanisms, and prudent management of expenses and investments.
Those rates are established by state regulatory commissions and the FERC and are intended to allow Idaho Power an opportunity to recover its expenses and earn a reasonable return on investment. Idaho Power focuses on the prudent management of expenses and investments and on the timely recovery of its costs through filings with its regulators.
Also, cooling degree-days in Boise, Idaho, were 1 percent higher during 2022 compared with 2021 and 34 percent above normal. • Idaho FCA Revenues: The FCA mechanism, applicable to Idaho residential and small commercial customers, adjusts revenue each year to accrue, or defer, the difference between the authorized fixed-cost recovery amount per customer and the actual fixed costs per customer recovered by Idaho Power through volume-based rates during the year.
Also, cooling degree-days in Boise, Idaho, were 4 percent lower during 2023 compared with 2022 and 28 percent above normal. • Idaho FCA Revenues: The FCA mechanism, applicable to Idaho residential and small commercial customers, adjusts revenue each year to accrue, or defer, the difference between the authorized fixed-cost recovery amount per customer and the actual fixed costs per customer recovered by Idaho Power through volume-based rates during the year.
The following table reflects the sensitivities associated with changes in the discount rate and rate-of-return on plan assets actuarial assumptions on historical and future net periodic pension costs and other postretirement benefit costs: Discount rate Rate of return 2023 2022 2023 2022 (millions of dollars) Effect of 0.5% rate increase on total net periodic pension costs and other postretirement benefit costs $ (2.4) $ (10.9) $ (4.3) $ (5.0) Effect of 0.5% rate decrease on total net periodic pension costs and other postretirement benefit costs 6.1 12.1 4.3 5.1 Additionally, a 0.5 percent increase in the plans' discount rates would have resulted in a $68.6 million decrease in the combined benefit obligations of the plans as of December 31, 2022.
The following table reflects the sensitivities associated with changes in the discount rate and rate-of-return on plan assets actuarial assumptions on historical and future net periodic pension costs and other postretirement benefit costs: Discount rate Rate of return 2024 2023 2024 2023 (millions of dollars) Effect of 0.5% rate increase on total net periodic pension costs and other postretirement benefit costs $ (3.0) $ (2.4) $ (4.7) $ (4.3) Effect of 0.5% rate decrease on total net periodic pension costs and other postretirement benefit costs 8.1 6.1 4.7 4.3 Additionally, a 0.5 percent increase in the plans' discount rates would have resulted in a $76.2 million decrease in the combined benefit obligations of the plans as of December 31, 2023.
Idaho Power's approach to achieve these objectives includes identifying areas subject to elevated risk; system hardening programs, vegetation management, and field personnel practices to mitigate wildfire risk; incorporating current and forecasted weather and field conditions into operational practices; public safety power shutoff protocols adopted in 2022; and evaluating the performance and effectiveness of the strategies identified in the WMP through metrics and monitoring.
Idaho Power's approach to achieve these objectives includes identifying areas subject to elevated risk; system hardening programs, vegetation management, and field personnel practices to mitigate wildfire risk; incorporating current and forecasted weather and field conditions into operational practices; PSPS protocols; and evaluating the performance and effectiveness of the strategies identified in the WMP through metrics and monitoring.
A 0.5 percent decrease in the plans' discount rates would have resulted in an $76.4 million increase in the combined benefit obligations of the plans as of December 31, 2022.
A 0.5 percent decrease in the plans' discount rates would have resulted in an $85.4 million increase in the combined benefit obligations of the plans as of December 31, 2023.
Total net periodic pension and other postretirement benefit cost for these plans totaled $42.3 million and $65.6 million for the years ended December 31, 2022 and 2021, respectively, including amounts deferred as regulatory assets (see discussion below) and amounts allocated to capitalized labor.
Total net periodic pension and other postretirement benefit cost for these plans totaled $28.5 million and $42.3 million for the years ended December 31, 2023 and 2022, respectively, including amounts deferred as regulatory assets (see discussion below) and amounts allocated to capitalized labor.
For 2023, Idaho Power expects generation from its hydropower resources to be in the range of 5.5 million to 7.5 million MWh, compared with average total annual hydropower generation of approximately 7.7 million MWh over the last 30 years. • Mitigation of Impact of Fuel and Purchased Power Expense: In addition to hydropower generation, Idaho Power relies significantly on natural gas and coal to fuel its generation facilities and on power purchases in the wholesale markets.
For 2024, Idaho Power expects generation from its hydropower resources to be in the range of 5.5 million to 7.5 million MWh, compared with 6.5 million MWh in 2023 and average total annual hydropower generation of approximately 7.6 million MWh over the last 30 years. • Mitigation of Impact of Fuel and Purchased Power Expense: In addition to hydropower generation, Idaho Power relies significantly on natural gas and coal to fuel its generation facilities, long-term power purchase agreements (including PURPA agreements), and power purchases in the wholesale markets.
The timing and amount of actual constructed projects and capital expenditures could be affected by Idaho Power’s ability to timely obtain labor or materials at reasonable costs, supply chain disruptions and delays, regulatory determinations, inflationary pressures, macroeconomic conditions, or other issues, including those described below. 2023 2024 2025-2027 Expected capital expenditures (excluding AFUDC) $ 650-700 $ 800-850 $ 1,500-1,700 Infrastructure Projects: A significant portion of expected capital expenditures included in the five-year forecast above relate to a large number of relatively small projects as Idaho Power continues to add to its system to accommodate growth and maintain reliability and operational effectiveness.
The timing and amount of actual constructed projects and capital expenditures could be affected by Idaho Power’s ability to timely obtain labor or materials at reasonable costs, supply chain disruptions and delays, regulatory determinations, inflationary pressures, macroeconomic conditions, or other issues, including those described below. 2024 2025 2026-2028 Expected capital expenditures (excluding AFUDC) $ 925-975 $ 850-950 $ 2,000-2,500 Infrastructure Projects: A significant portion of expected capital expenditures included in the five-year forecast above relate to a large number of relatively small projects as Idaho Power continues to add to its system to accommodate growth and maintain reliability and operational effectiveness.
“Consolidated total capitalization” is calculated as the sum of all consolidated indebtedness, consolidated stockholders' equity of the borrower and its subsidiaries, and the aggregate value of outstanding hybrid securities. At December 31, 2022, the leverage ratios for IDACORP and Idaho Power were 45 percent and 46 percent, respectively.
“Consolidated total capitalization” is calculated as the sum of all consolidated indebtedness, consolidated stockholders' equity of the borrower and its subsidiaries, and the aggregate value of outstanding hybrid securities. At December 31, 2023, the leverage ratios for IDACORP and Idaho Power were 50 percent and 51 percent, respectively.
Other Major Infrastructure Projects: Idaho Power has recently completed or is engaged in the development of a number of significant projects and has entered into arrangements with third parties for joint development of infrastructure projects. The most notable projects are described below.
Other Major Infrastructure Projects: Idaho Power has recently completed or is engaged in the development of a number of significant projects and has entered into arrangements with third parties for joint development of infrastructure projects.
IDACORP and Idaho Power Credit Facilities (Credit Facilities) : The IDACORP Credit Facility, which may be used for general corporate purposes and commercial paper backup, consists of a revolving line of credit not to exceed the aggregate principal amount at any one time outstanding of $100 million, including swingline loans in an aggregate principal amount at any time outstanding not to exceed $10 million, and letters of credit in an aggregate principle amount at any time outstanding not to exceed $50 million.
The IDACORP Credit Facility, which may be used for general corporate purposes, consists of a revolving line of credit not to exceed the aggregate principal amount at any one time outstanding of $100 million, including swingline loans in an aggregate principal amount at any time outstanding not to exceed $10 million, and letters of credit in an aggregate principal amount at any time outstanding not to exceed $50 million.
Examples of anticipated system enhancements planned for 2023 through 2027 and estimated costs include the following: • $50-$150 million per year for construction and replacement of transmission lines and stations other than the Boardman-to-Hemingway and Gateway West projects; • $125-$170 million per year for construction and replacement of distribution lines and stations, including replacement of underground distribution cables; • $10-$50 million per year for ongoing improvements and replacements at thermal plants; • $80-$130 million per year for hydropower plant improvement programs, including relicensing costs; and • $50-$80 million per year for general plant improvements, such as land and buildings, vehicles, information technology, and communication equipment.
Examples of anticipated system enhancements planned for 2024 through 2028 and estimated costs include the following: • $140-$250 million per year for construction and replacement of transmission lines and stations other than the Boardman-to-Hemingway and Gateway West projects; • $130-$175 million per year for construction and replacement of distribution lines and stations, including replacement of underground distribution cables; • $10-$50 million per year for ongoing improvements and replacements at thermal plants; • $80-$150 million per year for hydropower plant improvement programs, including relicensing costs; and • $60-$75 million per year for general plant improvements, such as land and buildings, vehicles, information technology, and communication equipment.
Description Effective Date Estimated Annualized Rate Impact (millions) (1) 2022 Idaho PCA 6/1/2022 $ 95 2022 Idaho FCA 6/1/2022 (3) Idaho Bridger rate base adjustment and recovery 6/1/2022 19 2021 Idaho PCA 6/1/2021 39 2021 Idaho FCA 6/1/2021 3 Idaho Boardman plant closure 1/1/2021 (4) (1) The annual amount collected or refunded in rates is typically not recovered or refunded on a linear basis (i.e., 1/12th per month), and is instead recovered or refunded in proportion to retail sales volumes.
Description Effective Date Estimated Annualized Rate Impact (millions) (1) 2023 Idaho PCA 6/1/2023 $ 105 2023 Idaho FCA 6/1/2023 (10) 2022 Idaho PCA 6/1/2022 95 2022 Idaho FCA 6/1/2022 (3) Idaho Bridger rate base adjustment and recovery 6/1/2022 19 (1) The annual amount collected or refunded in rates is typically not recovered or refunded on a linear basis (i.e., 1/12th per month), and is instead recovered or refunded in proportion to retail sales volumes.
In August 2022, Idaho Power filed its 2022 final transmission rate with the FERC, reflecting a transmission rate of $31.42 per "kW-year," to be effective for the period from October 1, 2022, to September 30, 2023. A "kW-year" is a unit of electrical capacity equivalent to 1 kilowatt of power used for 8,760 hours.
In October 2023, Idaho Power filed its 2023 final transmission rate with the FERC, reflecting a transmission rate of $30.74 per "kW-year," to be effective for the period from October 1, 2023, to September 30, 2024. A "kW-year" is a unit of electrical capacity equivalent to 1 kW of power used for 8,760 hours.
Idaho Power's existing hydropower and thermal generation facilities also require continuing upgrades and equipment replacement, and the company is undertaking a significant relicensing effort for the Hells Canyon Complex (HCC), its largest hydropower generation resource.
Idaho Power's existing hydropower and thermal generation facilities also require continuing upgrades and equipment replacement, and Idaho Power is undertaking a significant relicensing effort for the HCC, its largest hydropower generation resource.
Additional information on Idaho Power's 2021 IRP is included in Part I, Item 1 - "Business - Resource Planning" in this report. Defined Benefit Pension Plan Contributions and Recovery Idaho Power contributed $40 million to its defined benefit pension plan in each of 2022 and 2021.
Information on Idaho Power's 2023 IRP is included in Part I, Item 1 - "Business - Resource Planning" in this report. Defined Benefit Pension Plan Contributions and Recovery Idaho Power contributed $48 million in 2023 and $40 million in 2022 to its defined benefit pension plan.
Idaho Power generates revenues and cash flows primarily from the sale and distribution of electricity to customers in its Idaho and Oregon service areas, as well as from the wholesale sale and transmission of electricity. Idaho Power is the parent of Idaho Energy Resources Co.
Idaho Power generates revenues and cash flows primarily from the sale and distribution of electricity to customers in its Idaho and Oregon service areas, as well as from the wholesale sale and transmission of electricity.
Idaho Power First Mortgage Bonds : Idaho Power's issuance of long-term indebtedness is subject to the approval of the IPUC, OPUC, and Wyoming Public Service Commission (WPSC).
Idaho Power First Mortgage Bonds : Idaho Power's issuance of long-term indebtedness is subject to the approval of the IPUC, OPUC, and WPSC.
Idaho Power also expects to incur additional expenses associated with the relicensing of its hydroelectric facilities, as discussed elsewhere in this report.
Idaho Power also expects to incur additional costs associated with the relicensing of its hydropower facilities, as discussed elsewhere in this report.
Based on the results of this analysis, the discount rate used to calculate the 2023 defined benefit plan pension expense increased to 5.45 percent from the 3.05 percent rate used in 2022. Rate-of-return projections for plan assets are based on historical risk/return relationships among asset classes.
Based on the results of this analysis, the discount rate used to calculate the 2024 defined benefit plan pension expense decreased to 5.10 percent from the 5.45 percent rate used in 2023. Rate-of-return projections for plan assets are based on historical risk/return relationships among asset classes.
The following table summarizes the change in deferred (accrued) net power supply costs over last year (in millions): Idaho Oregon Total Balance at December 31, 2021 $ 33.8 $ (0.3) $ 33.5 Current period net power supply costs deferred 117.0 1.0 118.0 Prior amounts refunded through rates (17.6) 0.2 (17.4) SO 2 allowance and REC sales (7.0) (0.3) (7.3) Interest and other 2.5 — 2.5 Balance at December 31, 2022 $ 128.7 $ 0.6 $ 129.3 Open Access Transmission Tariff Rate Idaho Power uses a formula rate for transmission service provided under its OATT, which allows transmission rates to be updated annually based primarily on financial and operational data Idaho Power files with the FERC.
The following table summarizes the change in deferred (accrued) net power supply costs over last year (in millions): Idaho Oregon Total Balance at December 31, 2022 $ 128.7 $ 0.6 $ 129.3 Current period net power supply costs deferred/(accrued) 66.7 (1.2) 65.5 Prior amounts collected through rates (72.2) (0.2) (72.4) REC sales (13.2) (0.6) (13.8) Interest and other 5.6 0.1 5.7 Balance at December 31, 2023 $ 115.6 $ (1.3) $ 114.3 Open Access Transmission Tariff Rate Idaho Power uses a formula rate for transmission service provided under its OATT, which allows transmission rates to be updated annually based primarily on financial and operational data Idaho Power files with the FERC.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

15 edited+1 added−4 removed17 unchanged
Biggest changeCommodity Price Risk IDACORP's exposure to changes in commodity prices is related to Idaho Power's ongoing utility operations that produce electricity to meet the demand of its retail electric customers. To supplement its power supply resources and balance its supply of power with the demand of its retail customers, Idaho Power participates in the wholesale marketplace.
Biggest changeTo supplement its power supply resources and balance its supply of power with the demand of its retail customers, Idaho Power participates in the wholesale marketplace. Purchased power arrangements allow Idaho Power to respond to fluctuations in the demand for electricity and variability in generating plant operations.
Idaho Power has established asset allocation targets for the pension plan holdings, which are described in Note 11 - "Benefit Plans" to the consolidated financial statements included in this report. 78 Table of Contents
Idaho Power has established asset allocation targets for the pension plan holdings, which are described in Note 11 - "Benefit Plans" to the consolidated financial statements included in this report. 73 Table of Contents
The primary tools for risk mitigation are physical and financial forward power transactions and fueling alternatives for utility-owned generation resources. Idaho Power only engages in a nominal amount of trading activity for non-retail purposes.
The primary tools for risk mitigation are physical and financial forward power transactions and fueling alternatives 72 Table of Contents for utility-owned generation resources. Idaho Power only engages in a nominal amount of trading activity for non-retail purposes.
The following discussion summarizes these risks and the financial instruments, derivative instruments, and derivative commodity instruments sensitive to changes in interest rates, commodity prices, and equity prices that were held at December 31, 2022. Neither IDACORP nor Idaho Power have entered into any of these market-risk-sensitive instruments for trading purposes.
The following discussion summarizes these risks and the financial instruments, derivative instruments, and derivative commodity instruments sensitive to changes in interest rates, commodity prices, and equity prices that were held at December 31, 2023. Neither IDACORP nor Idaho Power have entered into any of these market-risk-sensitive instruments for speculative purposes.
Fixed Rate Debt : As of December 31, 2022, both IDACORP and Idaho Power had $2.0 billion in fixed rate debt, with a fair market value of approximately $1.8 billion. These instruments are fixed rate and, therefore, do not expose the companies to a loss in earnings due to changes in market interest rates.
Fixed Rate Debt : As of December 31, 2023, both IDACORP and Idaho Power had $2.8 billion in fixed rate debt, with a fair value of approximately $2.7 billion. These instruments are fixed rate and, therefore, do not expose the companies to a loss in earnings due to changes in market interest rates.
The power supply business unit produces and evaluates projections of the operating plan based on factors such as forecasted resource availability, stream flows, and load, and orders risk mitigating actions, including resource optimization and hedging strategies, dictated by the limits stated in the Energy Risk Management Policy and associated standards to bring exposures within pre-established risk guidelines.
The power supply business unit produces and evaluates projections of the operating plan based on factors such as forecasted resource availability, stream flows, and load, and orders risk mitigating actions, including resource optimization and hedging strategies, dictated by the limits stated in the ERMP to bring exposures within pre-established risk guidelines.
As of December 31, 2022, Idaho Power had no 77 Table of Contents performance assurance collateral posted related to these contracts. Should Idaho Power experience a reduction in its credit rating on Idaho Power’s unsecured debt to below investment grade, Idaho Power could be subject to requests by its wholesale counterparties to post additional performance assurance collateral.
As of December 31, 2023, Idaho Power posted $53 million of performance assurance collateral related to these contracts. Should Idaho Power experience a reduction in its credit rating on Idaho Power’s unsecured debt to below investment grade, Idaho Power could be subject to requests by its wholesale counterparties to post additional performance assurance collateral.
The Energy Risk Management Policy and associated standards require monitoring monthly volumetric electricity position and total monthly dollar (net power supply cost) exposure on a rolling 18-month forward view.
The ERMP require monitoring monthly volumetric electricity position and total monthly dollar (net power supply cost) exposure on a rolling 18-month forward view.
Credit Risk IDACORP is subject to credit risk based on Idaho Power's activity with market counterparties. Idaho Power is exposed to this risk to the extent that a counterparty may fail to fulfill a contractual obligation to provide energy, purchase energy, or complete financial settlement for market activities.
Idaho Power is exposed to this risk to the extent that a counterparty may fail to fulfill a contractual obligation to provide energy, purchase energy, or complete financial settlement for market activities.
Based upon Idaho Power’s energy and fuel portfolio and market conditions as of December 31, 2022, the amount of collateral that could be requested upon a downgrade to below investment grade was approximately $113.3 million.
Based upon Idaho Power’s energy and fuel portfolio and then existing market conditions as of December 31, 2023, the amount of additional collateral that could have been requested upon a downgrade to below investment grade was approximately $23 million.
Purchased power arrangements allow Idaho Power to respond to fluctuations in the demand for electricity and variability in generating plant operations. Idaho Power also enters into arrangements for the purchase of fuel for natural gas and coal-fired generating plants. These contracts for the purchase of power and fuel expose Idaho Power to commodity price risk.
Idaho Power also enters into arrangements for the purchase of fuel for natural gas and coal-fired generating plants. These contracts for the purchase of power and fuel expose Idaho Power to commodity price risk.
Idaho Power has adopted an energy risk management program, which has been reviewed and accepted by the Idaho Public Utilities Commission (IPUC), designed to reduce exposure to power supply cost-related uncertainty, further mitigating commodity price risk.
Idaho Power has adopted an energy risk management program, overseen by the risk management committee (RMC), and described in Idaho Power’s Energy Risk Management Policy and associated standards (ERMP). The ERMP has been reviewed and accepted by the IPUC, designed to reduce exposure to power supply cost-related uncertainty, further mitigating commodity price risk.
The RMC is also responsible for conducting an ongoing general assessment of the appropriateness of Idaho Power’s strategies for energy risk management activities. In its energy risk management process, Idaho Power considers both demand-side and supply-side options consistent with its Integrated Resource Plan.
The RMC, composed of Idaho Power officers and senior managers, oversees the risk management program. The RMC is responsible for communicating the status of risk management activities to Idaho Power's board of directors. In its energy risk management process, Idaho Power considers both demand-side and supply-side options consistent with its IRP.
However, the fair value of these instruments would increase by 76 Table of Contents approximately $196 million if market interest rates were to decline by one percentage point from their December 31, 2022 levels.
However, the fair value of these instruments would increase by approximately $343 million if market interest rates were to decline by one percentage point from their December 31, 2023 levels. Commodity Price Risk IDACORP's exposure to changes in commodity prices is related to Idaho Power's ongoing utility operations that produce electricity to meet the demand of its retail electric customers.
Variable Rate Debt : As of December 31, 2022, IDACORP and Idaho Power had $118.9 million and $135.4 million, respectively, in net floating rate debt, which approximated fair value.
Variable Rate Debt : As of December 31, 2023, IDACORP and Idaho Power had no net variable rate debt, as the carrying value of short-term investments exceeded the carrying value of outstanding variable rate debt.
Removed
Assuming no change in financial structure, if variable interest rates were to average one percentage point higher than the average rate on December 31, 2022, IDACORP and Idaho Power's annual interest expense would increase and pre-tax earnings would decrease by approximately $1.2 million and $1.4 million, respectively.
Added
The RMC evaluates the actions initiated by the power supply unit for consistency and compliance with the ERMP. Credit Risk IDACORP is subject to credit risk based on Idaho Power's activity with market counterparties.
Removed
Idaho Power’s Energy Risk Management Policy and associated standards implementing the Energy Risk Management Policy describe a collaborative process with customers and regulators via a committee called the Customer Advisory Group (CAG). The Risk Management Committee (RMC), composed of Idaho Power officers and senior managers, oversees the risk management program.
Removed
The RMC is responsible for communicating the status of risk management activities to Idaho Power's Board of Directors and to the CAG, and Idaho Power’s Audit Committee is responsible for approving the Energy Risk Management Policy and associated standards.
Removed
The RMC evaluates the actions initiated by the power supply unit for consistency and compliance with the Risk Management Policy and associated standards. Idaho Power representatives meet with the CAG at least annually to assess effectiveness of the limits. Changes to the limits can be endorsed by the CAG and referred to the board of directors for approval.

Other IDA 10-K year-over-year comparisons