UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2000
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Exact name of registrants as I.R.S. Employer
Number specified in their charters, Identification Number
state of incorporation, address
of principal executive offices,
and telephone number
1-14465 IDACORP, Inc. 82-0505802
1-3198 Idaho Power Company 82-0130980
1221 W. Idaho Street
Boise, ID 83702-5627
Telephone: (208) 388-2200
State of Incorporation: Idaho
Web site: www.idacorpinc.com
None
Former name, former address and former fiscal year,
if changed since last report.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
Number of shares of Common Stock outstanding as of
September 30, 2000:
IDACORP,Inc.: 37,414,307
Idaho Power Company: 37,612,351 shares, all of which are held by
IDACORP, Inc.
This combined form 10-Q represents separate filings by
IDACORP, Inc. and Idaho Power Company. Information
contained herein relating to an individual registrant is
filed by that registrant on its own behalf. Idaho Power
Company makes no representations as to the information
relating to IDACORP, Inc.'s other operations.
INDEX
Page
Definitions 2
Part I. Financial Information:
Item 1. Financial Statements
IDACORP, Inc.:
Consolidated Statements of Income 3-4
Consolidated Balance Sheets 5-6
Consolidated Statements of Capitalization 7
Consolidated Statements of Cash Flows 8
Consolidated Statements of Comprehensive Income 9
Notes to Consolidated Financial Statements 10-14
Independent Accountants' Report 15
Idaho Power Company:
Consolidated Statements of Income 16-17
Consolidated Balance Sheets 18-19
Consolidated Statements of Capitalization 20
Consolidated Statements of Cash Flows 21
Consolidated Statements of Comprehensive Income 22
Notes to Consolidated Financial Statements 23-24
Independent Accountants' Report 25
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 26-33
Part II. Other Information:
Item 1. Legal Proceedings 34-35
Item 6. Exhibits and Reports on Form 8-K 36-39
Signatures 40-41
DEFINITIONS
FASB - Financial Accounting Standards Board
FERC - Federal Energy Regulatory Commission
IPUC - Idaho Public Utilities Commission
kWh - kilowatt-hour
MAF - Million Acre-Feet
MMbtu - Million British Thermal Units
MWh - Megawatt-hour
OPUC - Oregon Public Utility Commission
PCA - Power Cost Adjustment
PUCN - Public Utility Commission of Nevada
REA - Rural Electrification Administration
SFAS - Statement of Financial Accounting Standards
FORWARD LOOKING INFORMATION
This Form 10-Q contains "forward-looking statements" intended to
qualify for safe harbor from liability established by the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements should be read with the cautionary statements and
important factors included in this Form 10-Q at Part I, Item 2.
Management's Discussion and Analysis of Financial Condition and
Results of Operations-Forward-Looking Information. Forward-
looking statements are all statements other than statements of
historical fact, including without limitation those that are
identified by the use of the words "anticipates," "estimates,"
"expects," "intends," "plans," "predicts," and similar
expressions.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
IDACORP, Inc.
Consolidated Statements of Income
Three Months Ended
September 30,
2000 1999
(Thousands of Dollars except
for per share amounts)
REVENUES:
General business $ 158,611 $ 137,193
Off system sales 61,179 19,078
Other revenues 11,749 5,707
Total revenues 231,539 161,978
EXPENSES:
Operation:
Purchased power 139,243 41,088
Fuel expense 23,811 23,523
Power cost adjustment (45,612) (14,774)
Other 35,505 36,615
Maintenance 13,676 10,903
Depreciation 19,933 19,511
Taxes other than income taxes 5,024 5,170
Total expenses 191,580 122,036
INCOME FROM OPERATIONS 39,959 39,942
OTHER INCOME:
Allowance for equity funds used
during construction 696 322
Energy marketing activities - Net 42,019 6,802
Other - Net (2,767) 2,098
Total other income 39,948 9,222
INTEREST EXPENSE AND OTHER:
Interest on long-term debt 13,239 13,078
Other interest 2,366 2,339
Allowance for borrowed funds used
during construction (609) (247)
Preferred dividends of Idaho
Power Company 1,511 1,401
Total interest expense and
other 16,507 16,571
INCOME BEFORE INCOME TAXES 63,400 32,593
INCOME TAXES 21,839 10,574
NET INCOME $ 41,561 $ 22,019
AVERAGE COMMON SHARES
OUTSTANDING (000) 37,524 37,612
EARNINGS PER SHARE OF COMMON
STOCK (basic and diluted) $ 1.11 $ 0.59
The accompanying notes are an integral part of these statements.
IDACORP, Inc.
Consolidated Statements of Income
Nine Months Ended
September 30,
2000 1999
(Thousands of Dollars except
for per share amounts)
REVENUES:
General business $ 420,993 $ 396,415
Off-system sales 161,158 86,109
Other revenues 28,803 18,676
Total revenues 610,954 501,200
EXPENSES:
Operation:
Purchased power 253,762 81,503
Fuel expense 68,526 64,398
Power cost adjustment (64,297) 424
Other 108,626 110,579
Maintenance 36,589 30,285
Depreciation 59,769 58,087
Taxes other than income taxes 15,914 16,429
Total expenses 478,889 361,705
INCOME FROM OPERATIONS 132,065 139,495
OTHER INCOME:
Allowance for equity funds
used during construction 1,787 710
Gain on sale of asset 14,000 -
Energy marketing activities -
Net 78,579 14,646
Other - Net 786 6,224
Total other income 95,152 21,580
INTEREST EXPENSE AND OTHER:
Interest on long-term debt 39,654 40,231
Other interest 7,051 6,768
Allowance for borrowed funds
used during construction (1,620) (605)
Preferred dividends of
Idaho Power Company 4,423 4,121
Total interest expense and 49,508 50,515
other
INCOME BEFORE INCOME TAXES 177,709 110,560
INCOME TAXES 61,546 37,799
NET INCOME $ 116,163 $ 72,761
AVERAGE COMMON SHARES OUTSTANDING
(000) 37,581 37,612
EARNINGS PER SHARE OF COMMON STOCK
(basic and diluted) $ 3.09 $ 1.93
The accompanying notes are an integral part of these statements.
IDACORP, Inc.
Consolidated Balance Sheets
Assets
September 30, December 31,
2000 1999
(Thousands of Dollars)
ELECTRIC PLANT:
In service (at original cost) $ 2,772,976 $ 2,726,026
Accumulated provision for
depreciation (1,126,861) (1,073,722)
In service - Net 1,646,115 1,652,304
Construction work in progress 133,021 91,637
Held for future use 2,018 1,742
Electric plant - Net 1,781,154 1,745,683
INVESTMENTS AND OTHER PROPERTY 156,285 146,019
CURRENT ASSETS:
Cash and cash equivalents 18,491 111,338
Receivables:
Customer 191,566 98,923
Allowance for uncollectible
accounts (1,397) (1,397)
Notes 6,923 4,353
Employee notes 4,310 4,105
Other 4,714 7,764
Energy marketing assets 452,036 37,398
Accrued unbilled revenues 34,169 31,994
Materials and supplies (at
average cost) 28,521 29,611
Fuel stock (at average cost) 7,398 9,329
Prepayments 22,133 16,097
Regulatory assets associated
with income taxes 3,232 893
Total current assets 772,096 350,408
DEFERRED DEBITS:
American Falls and Milner water
rights 31,585 31,585
Company-owned life insurance 39,510 40,480
Regulatory assets associated
with income taxes 212,869 214,782
Regulatory assets - PCA 62,509 -
Regulatory assets - other 47,532 56,137
Other 68,398 55,277
Total deferred debits 462,403 398,261
TOTAL $ 3,171,938 $ 2,640,371
The accompanying notes are an integral part of these statements.
IDACORP, Inc.
Consolidated Balance Sheets
Capitalization and Liabilities
September 30, December 31,
2000 1999
(Thousands of Dollars)
CAPITALIZATION:
Common stock equity:
Common stock without par
value (authorized 120
million Shares; 37,612,351
shares issued) $ 452,021 $ 451,343
Retained earnings 363,870 300,093
Accumulated other
comprehensive income 2,526 1,534
Total 818,417 752,970
Treasury stock - (198,044
shares, at cost) (8,014) -
Total common stock equity 810,403 752,970
Preferred stock of Idaho Power
Company 105,443 105,811
Long-term debt 783,478 821,558
Total capitalization 1,699,324 1,680,339
CURRENT LIABILITIES:
Long-term debt due within one
year 39,896 89,101
Notes payable 67,175 19,757
Accounts payable 227,019 145,737
Energy marketing liabilities 436,548 33,814
Taxes accrued 24,024 21,313
Interest accrued 16,978 19,126
Deferred income taxes 3,232 893
Other 19,796 16,696
Total current liabilities 834,668 346,437
DEFERRED CREDITS:
Regulatory liabilities associated
with deferred investment
tax credits 66,396 67,433
Deferred income taxes 459,711 430,468
Regulatory liabilities
associated with income taxes 33,506 33,817
Regulatory liabilities - PCA - 3,378
Regulatory liabilities - other 5,183 3,363
Other 73,150 75,136
Total deferred credits 637,946 613,595
COMMITMENTS AND CONTINGENT
LIABILITIES
TOTAL $ 3,171,938 $ 2,640,371
The accompanying notes are an integral part of these statements.
IDACORP, Inc.
Consolidated Statements of Capitalization
September 30, December 31,
2000 % 1999 %
(Thousands of Dollars)
COMMON STOCK EQUITY:
Common stock $ 452,021 $ 451,343
Retained earnings 363,870 300,093
Accumulated other comprehensive
income 2,526 1,534
Total 818,417 752,970
Treasury stock (8,014) -
Total common stock equity 810,403 48 752,970 45
PREFERRED STOCK OF IDAHO POWER
COMPANY:
4% preferred stock 15,443 15,811
7.68% Series, serial preferred
stock 15,000 15,000
7.07% Series, serial preferred
stock 25,000 25,000
Auction rate preferred stock 50,000 50,000
Total preferred stock 105,443 6 105,811 6
LONG-TERM DEBT:
First mortgage bonds:
8.65 % Series due 2000 - 80,000
6.93 % Series due 2001 30,000 30,000
6.85 % Series due 2002 27,000 27,000
6.40 % Series due 2003 80,000 80,000
8 % Series due 2004 50,000 50,000
5.83 % Series due 2005 60,000 60,000
7.20 % Series due 2009 80,000 80,000
Maturing 2021 through 2031
with rates ranging
from 7.50% to 9.52% 230,000 230,000
Total first mortgage bonds 557,000 637,000
Amount due within one year (30,000) (80,000)
Net first mortgage bonds 527,000 557,000
Pollution control revenue bonds:
7 1/4% Series due 2008 - 4,360
8.30 % Series 1984 due 2014 49,800 49,800
6.05 % Series 1996A due 2026 68,100 68,100
Variable Rate Series 1996B
due 2026 24,200 24,200
Variable Rate Series 1996C
due 2026 24,000 24,000
Variable Rate Series 2000
due 2027 4,360 -
Total pollution control
revenue bonds 170,460 170,460
REA notes 1,358 1,415
Amount due within one year (77) (76)
Net REA notes 1,281 1,339
American Falls Bond guarantee 19,885 19,885
Milner Dam note guarantee 11,700 11,700
Unamortized premium/discount - Net (1,370) (1,441)
Debt related to investments in
affordable housing with
rates ranging from 6.03% -
8.59% due 2000 to 2011 63,005 71,183
Amount due within one year (9,819) (9,025)
Net affordable housing debt 53,186 62,158
Other subsidiary debt 1,336 457
Total long-term debt 783,478 46 821,558 49
TOTAL CAPITALIZATION $ 1,699,324 100 $ 1,680,339 100
The accompanying notes are an integral part of these statements.
IDACORP, Inc.
Consolidated Statements of Cash Flows
Nine Months Ended
September 30,
2000 1999
(Thousands of Dollars)
OPERATING ACTIVITIES:
Net income $ 116,163 $ 72,761
Adjustments to reconcile net
income to net cash provided
by operating activities:
Unrealized gains from energy
marketing activities (11,904) (3,584)
Gain on sale of asset (14,000) -
Depreciation and amortization 73,996 68,913
Deferred taxes and investment
tax credits 29,741 (1,963)
Accrued PCA costs (65,190) 243
Change in:
Accounts receivable and
prepayments (98,296) (35,122)
Accrued unbilled revenue (2,175) 8,386
Materials and supplies and
fuel stock 3,021 (3,155)
Accounts payable 80,613 44,373
Taxes accrued 2,711 6,290
Other current assets and
liabilities (5,823) 2,326
Other - net (5,166) 9,285
Net cash provided by operating
activities 103,691 168,753
INVESTING ACTIVITIES:
Additions to utility plant (88,944) (73,113)
Investments in affordable
housing projects (15,813) (17,556)
Proceeds from sale of asset 17,500 -
Investments in Company - owned
life insurance - (6,462)
Other - net (8,012) (5,510)
Net cash used in investing
activities (95,269) (102,641)
FINANCING ACTIVITIES:
Proceeds from issuance of:
Pollution control revenue bonds 4,360 -
Long-term debt related to
affordable housing projects 6,995 14,582
Retirement of:
Long-term debt related to
affordable housing projects (15,173) (6,446)
First mortgage bonds (80,000) -
Pollution control revenue bonds (4,360) -
Reacquisition of common shares (8,014) -
Dividends on common stock (52,386) (52,395)
Increase (decrease) in short-
term borrowings 47,418 (26,894)
Other - net (109) (619)
Net cash used in financing
activities (101,269) (71,772)
Net decrease in cash and cash
equivalents (92,847) (5,660)
Cash and cash equivalents at
beginning of period 111,338 22,867
Cash and cash equivalents at end
of period $ 18,491 $ 17,207
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION:
Cash paid during the period for:
Income taxes $ 30,928 $ 34,017
Interest (net of amount
capitalized) $ 45,960 $ 46,836
The accompanying notes are an integral part of these statements.
IDACORP, Inc.
Consolidated Statements of Comprehensive Income
Three Months Ended
September 30,
2000 1999
(Thousands of Dollars)
NET INCOME $ 41,561 $ 22,019
OTHER COMPREHENSIVE INCOME:
Unrealized gains (losses) on
securities-net of tax of
$161 and ($588) 249 (912)
TOTAL COMPREHENSIVE INCOME $ 41,810 $ 21,107
Nine Months Ended
September 30,
2000 1999
(Thousands of Dollars)
NET INCOME $ 116,163 $ 72,761
OTHER COMPREHENSIVE INCOME:
Unrealized gains (losses) on
securities -net of tax of
$67 and ($588) 992 (912)
TOTAL COMPREHENSIVE INCOME $ 117,155 $ 71,849
The accompanying notes are an integral part of these statements.
IDACORP, Inc.
Notes to Consolidated Financial Statements
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Nature of Business
IDACORP, Inc. (IDACORP or the Company), is a holding company
whose principal operating subsidiary is Idaho Power Company
(IPC). IPC is regulated by the FERC and the state
regulatory commissions of Idaho, Oregon, Nevada and Wyoming
and is engaged in the generation, transmission,
distribution, sale and purchase of electric energy.
Financial Statements
In the opinion of the Company, the accompanying unaudited
consolidated financial statements contain all adjustments
necessary to present fairly its consolidated financial
position as of September 30, 2000, and its consolidated
results of operations for the three and nine months ended
September 30, 2000 and 1999 and cash flows for the nine
months ended September 30, 2000 and 1999. These financial
statements do not contain the complete detail or footnote
disclosure concerning accounting policies and other matters
that would be included in full year financial statements and
therefore they should be read in conjunction with the
Company's audited consolidated financial statements included
in the Company's Annual Report on Form 10-K for the year
ended December 31, 1999. The results of operations for the
interim periods are not necessarily indicative of the
results to be expected for the full year.
Principles of Consolidation
The consolidated financial statements include the accounts
of the Company and its wholly-owned or controlled
subsidiaries. All significant intercompany transactions and
balances have been eliminated in consolidation. Investments
in business entities in which the Company and its
subsidiaries do not have control, but have the ability to
exercise significant influence over operating and financial
policies, are accounted for using the equity method.
Derivative Financial Instruments
The Company uses financial instruments such as commodity
futures, forwards, options and swaps to manage exposure to
commodity price risk in the electricity and natural gas
markets. The objective of the Company's risk management
program is to mitigate the risk associated with the purchase
and sale of electricity and natural gas as well as to
optimize its energy marketing portfolio. The accounting for
derivative financial instruments that are used to manage
risk is in accordance with the concepts established in SFAS
No. 80, "Accounting for Futures Contracts," American
Institute of Certified Public Accountants Statement of
Position 86-2, "Accounting for Options," and Emerging Issues
Task Force (EITF) 98-10, "Accounting for Contracts Involved
in Energy Trading Activities." EITF 98-10 was adopted
effective January 1, 1999 resulting in an adjustment to net
income that was not material.
Energy trading contracts as defined by EITF 98-10 are
reported at fair value on the balance sheet with the
resulting gains and losses reported on the income statement.
Cash flows from energy trading contracts are recognized in
the statement of cash flows as an operating activity.
Reclassifications
Certain items previously reported for periods prior to
September 30, 2000 have been reclassified to conform with
the current period's presentation. Net income was not
affected by these reclassifications.
2. INCOME TAXES
The Company's effective tax rate for the first nine months
increased from 34.2 percent in 1999 to 34.6 percent in 2000.
Reconciliations between the statutory income tax rate and
the effective rates are as follows (in thousands of
dollars):
Nine Months Ended September 30,
2000 1999
Amount Rate Amount Rate
Computed income taxes based
on statutory Federal income
tax rate $ 62,198 35.0% $ 38,696 35.0%
Changes in taxes resulting
from:
Investment tax credits (2,313) (1.3) (2,221) (2.0)
Repair allowance (2,100) (1.2) (2,066) (1.9)
Pension expense (1,420) (0.8) 40 0.0
State income taxes 9,110 5.1 5,964 5.4
Depreciation 5,154 2.9 3,952 3.6
Tax credits (10,257) (5.8) (6,958) (6.3)
Preferred dividends of IPC 1,548 0.9 1,442 1.3
Other (374) (0.2) (1,050) (0.9)
Total $ 61,546 34.6% $ 37,799 34.2%
3. PREFERRED STOCK OF IDAHO POWER COMPANY:
The number of shares of IPC preferred stock outstanding were
as follows:
September 30, December 31,
2000 1999
Cumulative, $100 par value:
4% preferred stock (authorized
215,000 shares) 154,432 158,112
Serial preferred stock, 7.68%
Series (authorized
150,000 shares) 150,000 150,000
Serial preferred stock, cumulative,
without par value; total of
3,000,000 shares authorized:
7.07% Series, $100 stated value,
(authorized 250,000 shares) 250,000 250,000
Auction rate preferred stock,
$100,000 stated value,
(authorized 500 shares) 500 500
4. FINANCING:
The Company currently has a $300.0 million shelf
registration statement that can be used for the issuance of
unsecured debt securities and preferred or common stock. At
September 30, 2000, none had been issued.
On March 23, 2000, IPC filed a $200.0 million shelf
registration statement that can be used for first mortgage
bonds (including medium term notes), unsecured debt, or
preferred stock. At September 30, 2000, none had been
issued.
On January 1, 2000, IPC redeemed at maturity, $80.0 million
8.65% First Mortgage Bonds using funds from the issuance of
$80.0 million Secured Medium Term Notes, Series B, 7.20%
issued on November 23, 1999.
On April 26, 2000, at the Company's request, the American
Falls Reservoir District issued its American Falls Refunding
Replacement Dam Bonds, Series 2000, in the aggregate
principal amount of $19.9 million for the purpose of
refunding on April 26, 2000, a like amount of its bonds
dated May 1, 1990. The Company has guaranteed repayment of
these bonds.
On May 17, 2000, tax exempt Pollution Control Revenue
Refunding Bonds Series 2000 in the aggregate principal
amount of $4.4 million were issued by Port of Morrow, Oregon
for the purpose of refunding on August 1, 2000, a like
amount of its Pollution Control Revenue Bonds, Series 1978.
5. COMMITMENTS AND CONTINGENT LIABILITIES:
Commitments under contracts and purchase orders relating to
the Company's program for construction and operation of
facilities amounted to approximately $41.3 million at
September 30, 2000. The commitments are generally revocable
by the Company subject to reimbursement of manufacturers'
expenditures incurred and/or other termination charges.
The Company is party to various legal claims, actions, and
complaints, certain of which involve material amounts.
Although the Company is unable to predict with certainty
whether or not it will ultimately be successful in these
legal proceedings or what the impact might be, based upon
the advice of legal counsel, management presently believes
that disposition of these matters will not have a material
adverse effect on the Company's financial position, results
of operation, or cash flows.
6. REGULATORY ISSUES:
Power Cost Adjustment
IPC has a PCA mechanism that provides for annual adjustments
to the rates charged to its Idaho retail electric customers.
These adjustments, which take effect annually on May 16, are
based on forecasts of net power supply costs, and the true-
up of the prior year's forecast. The difference between the
actual costs incurred and the forecasted costs is deferred,
with interest, and trued-up in the next annual rate
adjustment.
The IPUC approved IPC's May 16, 2000 PCA adjustment, issuing
Order 28358 dated May 9, 2000. This rate adjustment
increased Idaho general business customer rates by 9.5
percent, and results from forecasted below-average
hydroelectric generating conditions (see "Streamflow
Conditions" below). Overall, IPC's annual general business
revenues are expected to increase by $38 million during the
2000-2001 rate period, to partially offset the forecasted
increase in power supply costs.
So far in the 2000-2001 PCA rate year, actual power supply
costs have been greater than the forecast, due to actual
hydroelectric generation being below the forecast, and
purchased power volumes and prices being above the forecast.
To account for these higher-than-forecasted costs, IPC has
recorded a regulatory asset of $65.3 million as of September
30, 2000.
Regulatory Settlement
IPC had a settlement agreement with the IPUC that expired at
the end of 1999. Under the terms of the settlement, when
earnings in IPC's Idaho jurisdiction exceeded an 11.75
percent return on year-end common equity, IPC set aside 50
percent of the excess for the benefit of Idaho retail
customers.
In March 2000 IPC submitted its 1999 annual earnings sharing
compliance filing to the IPUC. This filing indicated that
there was almost $9.6 million in 1999 earnings and $2.7
million in unused 1998 reserve balances available for the
benefit of our Idaho customers.
In April 2000 the IPUC issued Order 28333, which ordered
that $6.9 million of the revenue sharing balance be refunded
to Idaho customers through rate reductions effective May 16,
2000. The Order also approved IPC's continued participation
in the Northwest Energy Efficiency Alliance (NEEA) for the
years 2000-2004, ordering IPC to set aside the remaining
$5.4 million of revenue sharing dollars to fund that
participation.
DSM (Conservation) Expenses
IPC requested that the IPUC allow for the recovery of post-
1993 DSM expenses and acceleration of the recovery of DSM
expenditures authorized in the last general rate case. In
its Order No. 27660 issued on July 31, 1998, the IPUC set a
new amortization period of 12 years instead of the 24-year
period previously adopted. On April 17, 2000, the Idaho
Supreme Court affirmed the IPUC order, after hearing an
appeal by a group of industrial customers.
7. NEW ACCOUNTING PRONOUNCEMENTS:
In June 1998, the FASB issued "SFAS" No. 133, "Accounting
for Derivative Instruments and Hedging Activities". In June
2000, the FASB issued SFAS No. 138, which amends certain
provisions of SFAS 133 to clarify four areas causing
difficulties in implementation. The amendment included
expanding the normal purchase and sale exemption for supply
contracts, permitting the offsetting of certain intercompany
foreign currency derivatives and thus reducing the number of
third party derivatives, permitting hedge accounting for
foreign-currency denominated assets and liabilities, and
redefining interest rate risk to reduce sources of
ineffectiveness. The Derivatives Implementation Group
(DIG), a task force created by the FASB, is continuing to
identify and resolve implementation questions related to
SFAS 133.
The Company appointed a team to implement SFAS 133. This
team has been identifying and evaluating potential
derivatives, including embedded derivatives, and addressing
various other SFAS 133 related issues. The Company will
adopt SFAS 133 and the corresponding amendments under SFAS
138 on January 1, 2001. The SFAS 133 team is currently
determining the impact of SFAS 133 on the consolidated
results of operations and financial position. This
statement should have no impact on consolidated cash flows.
8. DERIVATIVE FINANCIAL INSTRUMENTS:
The following table shows a summary of the notional amounts
of the Company's forward exposure (including both sales and
purchases) as of September 30, 2000 and December 31, 1999.
The maximum term related to any forward position is ten
years.
September 30, 2000 December 31, 1999
Gas Electricity Gas Electricity
MMbtu's MWh's MMbtu's MWh's
notional volume 214,251 26,632 112,513 10,818
The following table displays the fair values of the
Company's energy marketing assets and liabilities at
September 30, 2000 and December 31, 1999 and the average
values for the nine months ended September 30, 2000 (in
thousands of dollars):
Balance at Nine Months Balance at
September 30, 2000 Average Balance December 31, 1999
Assets Liabilities Assets Liabilities Assets Liabilities
Gas $ 91,315 $ 83,351 $ 59,495 $ 63,613 $ 8,302 $ 8,220
Electricity 360,721 353,197 214,120 207,746 29,096 25,594
Total $452,036 $436,548 $273,615 $271,359 $37,398 $33,814
Notional amounts listed above reflect the volume of energy
related to transactions with counterparties, but do not
measure exposure to market or credit risks. The maximum
term detailed above also is not indicative of likely future
cash flows as positions may be offset in the markets at any
time to meet risk management guidelines.
9. INDUSTRY SEGMENT INFORMATION:
IDACORP's principal operating segment is the regulated
utility operations of IPC. IPC's primary business is the
generation, transmission, distribution, purchase and sale of
electricity. Substantially all of the Company's revenue
comes from the sale of electricity and related services,
predominately in the United States.
The Company's marketing segment includes electricity and
natural gas commodity trading, home security, internet and
satellite television services, and energy-related products
and services.
The Company also is involved in the development and sale of
clean-energy products, including fuel cell and photovoltaic
systems, invests in projects generating tax credits, and
manages and develops independent power projects.
The following table summarizes IDACORP's segment
information:
IPC Total
Utility Marketing Other Enterprise
(Thousands of Dollars)
Three months ended
September 30, 2000:
Revenues $ 231,539 $ - $ - $ 231,539
Net income 14,947 25,585 1,029 41,561
Total assets at
September 30, 2000 $ 2,375,703 $ 600,688 $ 195,547 $ 3,171,938
Three months ended
September 30, 1999:
Revenues $ 161,978 $ - $ - $ 161,978
Net income 14,580 4,009 3,430 22,019
Total assets at
December 31, 1999 $ 2,359,285 $ 129,275 $ 151,811 $ 2,640,371
IPC Total
Utility Marketing Other Enterprise
(Thousands of Dollars)
Nine months ended
September 30, 2000:
Revenues $ 610,954 $ - $ - $ 610,954
Net income 52,599 48,429 15,135 116,163
Nine months ended
September 30, 1999:
Revenues $ 501,200 $ - $ - $ 501,200
Net income 56,815 8,599 7,347 72,761
INDEPENDENT ACCOUNTANTS' REPORT
IDACORP, Inc.
Boise, Idaho
We have reviewed the accompanying consolidated balance sheet
and statement of capitalization of IDACORP, Inc. and
subsidiaries as of September 30, 2000, and the related
consolidated statements of income and comprehensive income
for the three and nine month periods ended September 30,
2000 and 1999 and consolidated statements of cash flows for
the nine month periods ended September 30, 2000 and 1999.
These financial statements are the responsibility of the
Company's management.
We conducted our review in accordance with standards
established by the American Institute of Certified Public
Accountants. A review of interim financial information
consists principally of applying analytical procedures to
financial data and of making inquiries of persons
responsible for financial and accounting matters. It is
substantially less in scope than an audit conducted in
accordance with auditing standards generally accepted in the
United States of America, the objective of which is the
expression of an opinion regarding the financial statements
taken as a whole. Accordingly, we do not express such an
opinion.
Based on our review, we are not aware of any material
modifications that should be made to such consolidated
financial statements for them to be in conformity with
accounting principles generally accepted in the United
States of America.
We have previously audited, in accordance with auditing
standards generally accepted in the United States of
America, the consolidated balance sheet and statement of
capitalization of IDACORP, Inc. and subsidiaries as of
December 31, 1999, and the related consolidated statements
of income, comprehensive income, retained earnings, and cash
flows for the year then ended (not presented herein); and in
our report dated January 31, 2000, we expressed an
unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in
the accompanying consolidated balance sheet and statement of
capitalization as of December 31, 1999 is fairly stated, in
all material respects, in relation to the consolidated
balance sheet and statement of capitalization from which it
has been derived.
DELOITTE & TOUCHE LLP
October 26, 2000
Idaho Power Company
Consolidated Statements of Income
Three Months Ended
September 30,
2000 1999
(Thousands of Dollars)
REVENUES:
General business $ 158,611 $ 137,193
Off system sales 61,179 19,078
Other revenues 11,749 5,707
Total revenues 231,539 161,978
EXPENSES:
Operation:
Purchased power 139,243 41,088
Fuel expense 23,811 23,523
Power cost adjustment (45,612) (14,774)
Other 35,505 36,615
Maintenance 13,676 10,903
Depreciation 19,933 19,511
Taxes other than income taxes 5,024 5,170
Total expenses 191,580 122,036
INCOME FROM OPERATIONS 39,959 39,942
OTHER INCOME:
Allowance for equity funds used
during construction 696 322
Energy marketing activities - Net 41,616 7,266
Other - Net 2,903 1,064
Total other income 45,215 8,652
INTEREST CHARGES:
Interest on long-term debt 13,217 13,041
Other interest 1,042 2,010
Allowance for borrowed funds used
during construction (609) (247)
Total interest charges 13,650 14,804
INCOME BEFORE INCOME TAXES 71,524 33,790
INCOME TAXES 28,429 10,419
NET INCOME 43,095 23,371
Dividends on preferred stock 1,511 1,401
EARNINGS ON COMMON STOCK $ 41,584 $ 21,970
The accompanying notes are an integral part of these statements.
Idaho Power Company
Consolidated Statements of Income
Nine Months Ended
September 30,
2000 1999
(Thousands of Dollars)
REVENUES:
General business $ 420,993 $ 396,415
Off system sales 161,158 86,109
Other revenues 28,803 18,676
Total revenues 610,954 501,200
EXPENSES:
Operation:
Purchased power 253,762 81,503
Fuel expense 68,526 64,398
Power cost adjustment (64,297) 424
Other 108,626 110,579
Maintenance 36,589 30,285
Depreciation 59,769 58,087
Taxes other than income taxes 15,914 16,429
Total expenses 478,889 361,705
INCOME FROM OPERATIONS 132,065 139,495
OTHER INCOME:
Allowance for equity funds used
during construction 1,787 710
Energy marketing activities - Net 75,321 15,852
Other - Net 9,985 3,802
Total other income 87,093 20,364
INTEREST CHARGES:
Interest on long-term debt 39,575 40,120
Other interest 3,433 5,913
Allowance for borrowed funds
used during construction (1,620) (605)
Total interest charges 41,388 45,428
INCOME BEFORE INCOME TAXES 177,770 114,431
INCOME TAXES 68,795 37,480
NET INCOME 108,975 76,951
Dividends on preferred stock 4,423 4,121
EARNINGS ON COMMON STOCK $ 104,552 $ 72,830
The accompanying notes are an integral part of these statements.
Idaho Power Company
Consolidated Balance Sheets
Assets
September 30, December 31,
2000 1999
(Thousands of Dollars)
ELECTRIC PLANT:
In service (at original cost) $ 2,772,976 $ 2,726,026
Accumulated provision for
depreciation (1,126,861) (1,073,722)
In service - Net 1,646,115 1,652,304
Construction work in progress 127,917 88,348
Held for future use 2,018 1,742
Electric plant - Net 1,776,050 1,742,394
INVESTMENTS AND OTHER PROPERTY 23,805 117,759
CURRENT ASSETS:
Cash and cash equivalents 6,838 95,038
Receivables:
Customer 175,178 83,412
Allowance for uncollectible
accounts (1,397) (1,397)
Notes 2,914 345
Employee notes 4,310 4,105
Related parties - 195
Other 1,686 7,095
Energy marketing assets 360,721 29,096
Accrued unbilled revenues 34,169 31,994
Materials and supplies (at
average cost) 25,315 28,960
Fuel stock (at average cost) 7,398 9,329
Prepayments 21,590 16,054
Regulatory assets associated 3,232 893
with income taxes
Total current assets 641,954 305,119
DEFERRED DEBITS:
American Falls and Milner water
rights 31,585 31,585
Company-owned life insurance 39,510 40,480
Regulatory assets associated
with income taxes 212,869 214,782
Regulatory assets - PCA 62,509 -
Regulatory assets - other 47,532 56,137
Other 51,470 54,496
Total deferred debits 445,475 397,480
TOTAL $ 2,887,284 $ 2,562,752
The accompanying notes are an integral part of these statements.
Idaho Power Company
Consolidated Balance Sheets
Capitalization and Liabilities
September 30, December 31,
2000 1999
(Thousands of Dollars)
CAPITALIZATION:
Common stock equity:
Common stock, $2.50 par
value (50,000,000 shares
authorized; 37,612,351
shares outstanding) $ 94,031 $ 94,031
Premium on capital stock 362,320 362,203
Capital stock expense (4,015) (3,819)
Retained earnings 304,257 274,181
Accumulated other
comprehensive income 2,526 1,534
Total common stock equity 759,119 728,130
Preferred stock 105,443 105,811
Long-term debt 728,956 821,558
Total capitalization 1,593,518 1,655,499
CURRENT LIABILITIES:
Long-term debt due within one
year 30,077 89,101
Notes payable 28,100 19,757
Accounts payable 197,389 95,125
Notes and accounts payable to
related parties 7,950 10,076
Energy marketing liabilities 353,197 25,594
Taxes accrued 22,597 21,773
Interest accrued 16,149 19,122
Deferred income taxes 3,232 893
Other 16,506 16,069
Total current liabilities 675,197 297,510
DEFERRED CREDITS:
Regulatory liabilities
associated with deferred
investment tax credits 66,396 67,433
Deferred income taxes 452,073 428,923
Regulatory liabilities 33,506 33,817
associated with income taxes
Regulatory liabilities - PCA - 3,378
Regulatory liabilities - other 5,183 3,363
Other 61,411 72,829
Total deferred credits 618,569 609,743
COMMITMENTS AND CONTINGENT
LIABILITIES
TOTAL $2,887,284 $2,562,752
The accompanying notes are an integral part of these statements.
Idaho Power Company
Consolidated Statements of Capitalization
September 30, December 31,
2000 % 1999 %
(Thousands of Dollars)
COMMON STOCK EQUITY:
Common stock $ 94,031 $ 94,031
Premium on capital stock 362,320 362,203
Capital stock expense (4,015) (3,819)
Retained earnings 304,257 274,181
Accumulated other comprehensive 2,526 1,534
income
Total common stock equity 759,119 48 728,130 44
PREFERRED STOCK:
4% preferred stock 15,443 15,811
7.68% Series, serial preferred
stock 15,000 15,000
7.07% Series, serial preferred
stock 25,000 25,000
Auction rate preferred stock 50,000 50,000
Total preferred stock 105,443 6 105,811 6
LONG-TERM DEBT:
First mortgage bonds:
8.65 % Series due 2000 - 80,000
6.93 % Series due 2001 30,000 30,000
6.85 % Series due 2002 27,000 27,000
6.40 % Series due 2003 80,000 80,000
8 % Series due 2004 50,000 50,000
5.83 % Series due 2005 60,000 60,000
7.20 % Series due 2009 80,000 80,000
Maturing 2021 through 2031
with rates ranging
from 7.50% to 9.52% 230,000 230,000
Total first mortgage bonds 557,000 637,000
Amount due within one
year (30,000) (80,000)
Net first mortgage bonds 527,000 557,000
Pollution control revenue
bonds:
7 1/4% Series due 2008 - 4,360
8.30 % Series 1984 due 2014 49,800 49,800
6.05 % Series 1996A due 2026 68,100 68,100
Variable Rate Series 1996B
due 2026 24,200 24,200
Variable Rate Series 1996C
due 2026 24,000 24,000
Variable Rate Series 2000
due 2027 4,360 -
Total pollution control
revenue bonds 170,460 170,460
REA notes 1,358 1,415
Amount due within one year (77) (76)
Net REA notes 1,281 1,339
American Falls bond guarantee 19,885 19,885
Milner Dam note guarantee 11,700 11,700
Debt related to investments in
affordable housing with
rates ranging from 6.03% to - 71,183
8.77% due 2000 to 2010
Amount due within one year - (9,025)
Net affordable housing debt - 62,158
Other subsidiary debt - 457
Unamortized premium/discount - Net (1,370) (1,441)
Total long-term debt 728,956 46 821,558 50
TOTAL CAPITALIZATION $1,593,518 100 $1,655,499 100
The accompanying notes are an integral part of these statements.
Idaho Power Company
Consolidated Statements of Cash Flows
Nine Months Ended
September 30,
2000 1999
(Thousands of Dollars)
OPERATING ACTIVITIES:
Net income $ 108,975 $ 76,951
Adjustments to reconcile net
income to net cash:
Unrealized gains from energy
marketing activities (4,022) (3,502)
Depreciation and amortization 67,750 68,711
Deferred taxes and investment
tax credits 28,355 (1,805)
Accrued PCA costs (65,190) 243
Change in:
Accounts receivable and
prepayments (97,311) 4,209
Accrued unbilled revenue (2,175) 8,386
Materials and supplies and
fuel stock 2,621 (2,758)
Accounts payable 102,452 (3,126)
Taxes accrued 1,288 6,442
Other current assets and
liabilities (7,117) 2,719
Other - net (7,831) 9,376
Net cash provided by
operating activities 127,795 165,846
INVESTING ACTIVITIES:
Additions to utility plant (88,944) (71,713)
Investments in affordable housing
projects - (17,556)
Investments in Company - owned
life insurance - (6,462)
Net cash of affiliates
transferred to parent (4,737) -
Other - net 1,722 (3,842)
Net cash used in investing
activities (91,959) (99,573)
FINANCING ACTIVITIES:
Issuance of:
Long-term debt related to
affordable housing projects - 14,582
Pollution control revenue bonds 4,360 -
Retirement of:
First mortgage bonds (80,000) -
Long-term debt related to
affordable housing projects - (6,446)
Pollution control revenue bonds (4,360) -
Dividends on common stock (52,386) (52,443)
Dividends on preferred stock (4,423) (4,121)
Increase-(decrease) in short-term
borrowings 13,277 (28,343)
Other - net (504) (131)
Net cash used in financing
activities (124,036) (76,902)
Net decrease in cash and cash
equivalents (88,200) (10,629)
Cash and cash equivalents at
beginning of period 95,038 20,029
Cash and cash equivalents at end of
period $ 6,838 $ 9,400
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid during the period for:
Income taxes $ 43,483 $ 34,243
Interest (net of amount
capitalized) $ 41,263 $ 45,837
Net assets of affiliates
transferred to parent $ 22,090 $ -
The accompanying notes are an integral part of these statements.
Idaho Power Company
Consolidated Statements of Comprehensive Income
Three Months Ended
September 30,
2000 1999
(Thousands of Dollars)
NET INCOME $ 43,095 $ 23,371
OTHER COMPREHENSIVE INCOME:
Unrealized gains (losses) on
securities -net of tax of
$161 and ($588) 249 (912)
TOTAL COMPREHENSIVE INCOME $ 43,344 $ 22,459
Nine Months Ended
September 30,
2000 1999
(Thousands of Dollars)
NET INCOME $ 108,975 $ 76,951
OTHER COMPREHENSIVE INCOME:
Unrealized gains (losses) on
securities -net of tax of
$67 and ($588) 992 (912)
TOTAL COMPREHENSIVE INCOME $ 109,967 $ 76,039
The accompanying notes are an integral part of these statements.
Idaho Power Company
Notes to the Consolidated Financial Statements
On October 1, 1998, IDACORP, Inc. (IDACORP) became the
parent of Idaho Power Company and subsidiaries (IPC). On
January 1, 2000 IPC's ownership interests in two
subsidiaries were transferred to IDACORP at book value.
IPC's consolidated balance sheet as of December 31, 1999
included total assets of $108 million and net assets of $22
million, and the consolidated statements of income for the
quarter and nine months ended September 30, 1999 included
net income of $0.9 million and $1.7 million, respectively,
attributable to the transferred subsidiaries.
Except as modified below, the Notes to the Consolidated
Financial Statements of IDACORP also contained in this Form
10-Q are incorporated herein by reference insofar as they
relate to IPC.
Note 1 - Summary of Significant Accounting
Policies
Note 3 - Preferred Stock of Idaho Power
Company
Note 4 - Financing
Note 6 - Regulatory Issues
Note 7 - New Accounting Pronouncements
2. INCOME TAXES:
IPC's effective tax rate for the first nine months increased
from 32.8 percent in 1999 to 38.7 percent in 2000.
Reconciliations between the statutory income tax rate and
the effective rates are as follows (in thousands of
dollars):
Nine Months Ended September 30,
2000 1999
Amount Rate Amount Rate
Computed income taxes based
on statutory
Federal income tax rate $ 62,220 35.0 % $ 40,051 35.0%
Changes in taxes resulting
from:
Investment tax credits (2,3130) (1.3) (2,221) (1.9)
Repair allowance (2,100) (1.2) (2,066) (1.8)
Pension expense (1,420) (0.8) 40 0.0
State income taxes 9,423 5.3 5,964 5.2
Depreciation 5,154 2.9 3,952 3.5
Affordable housing tax
credits - - (6,958) (6.1)
Other (2,169) (1.2) (1,282) (1.1)
Total $ 68,795 38.7% $ 37,480 32.8%
5. COMMITMENTS AND CONTINGENT LIABILITIES:
Commitments under contracts and purchase orders relating to
IPC's program for construction and operation of facilities
amounted to approximately $8.2 million at September 30,
2000. The commitments are generally revocable by IPC
subject to reimbursement of manufacturers' expenditures
incurred and/or other termination charges.
IPC is party to various legal claims, actions, and
complaints, certain of which involve material amounts.
Although IPC is unable to predict with certainty whether or
not it will ultimately be successful in these legal
proceedings or what the impact might be, based upon the
advice of legal counsel, management presently believes that
disposition of these matters will not have a material
adverse effect on IPC's financial position, results of
operation, or cash flows.
8. DERIVATIVE FINANCIAL INSTRUMENTS:
The following table shows a summary of the notional amounts
of IPC's forward exposure (including both sales and
purchases) as of September 30, 2000 and December 31, 1999.
The maximum term related to any forward position is ten
years.
September 30, December 31,
2000 1999
Electricity Electricity
MWh's MWh's
Total gross notional volume 26,632 10,818
The following table displays the fair value of IPC's energy
marketing assets and liabilities (all electricity) at
September 30, 2000 and December 31, 1999 and the average
values for the nine months ended September 30, 2000 (in
thousands of dollars):
Balance at Nine Months Balance at
September 30, 2000 Average Balance December 31, 1999
Assets Liabilities Assets Liabilities Assets Liabilities
$360,721 $353,197 $214,120 $207,746 $ 29,096 $ 25,594
9. INDUSTRY SEGMENT INFORMATION:
IPC's principal operating segment is its regulated electric
operations, including the generation, transmission,
distribution, purchase and sale of electricity.
Substantially all of IPC's revenue comes from the sale of
electricity and related services, predominately in the
United States
The Company's marketing segment represents its electricity
commodity trading.
The following table summarizes IPC's segment information:
Regulated
Electric Total
Operations Marketing Other Enterprise
(Thousands of Dollars)
Three months ended
September 30, 2000:
Revenues $ 231,539 $ - $ - $ 231,539
Net income 16,458 24,995 1,642 43,095
Total assets at
September 30, 2000 $ 2,375,703 $ 486,275 $ 25,306 $ 2,887,284
Three months ended
September 30, 1999:
Revenues $ 161,978 $ - $ - $ 161,978
Net income 15,981 4,427 2,963 23,371
Total assets at
December 31, 1999 $ 2,359,285 $ 72,023 $ 131,444 $ 2,562,752
Regulated
Electric Total
Operations Marketing Other Enterprise
(Thousands of Dollars)
Nine months ended
September 30, 2000:
Revenues $ 610,954 $ - $ - $ 610,954
Net income 57,022 46,015 5,938 108,975
Nine months ended
September 30, 1999:
Revenues $ 501,200 $ - $ - $ 501,200
Net income 60,936 9,729 6,286 76,951
INDEPENDENT ACCOUNTANTS' REPORT
Idaho Power Company
Boise, Idaho
We have reviewed the accompanying consolidated balance sheet
and statement of capitalization of Idaho Power Company and
subsidiaries as of September 30, 2000, and the related
consolidated statements of income and comprehensive income
for the three and nine month periods ended September 30,
2000 and 1999 and consolidated statements of cash flows for
the nine month periods ended September 30, 2000 and 1999.
These financial statements are the responsibility of the
Company's management.
We conducted our review in accordance with standards
established by the American Institute of Certified Public
Accountants. A review of interim financial information
consists principally of applying analytical procedures to
financial data and of making inquiries of persons
responsible for financial and accounting matters. It is
substantially less in scope than an audit conducted in
accordance with auditing standards generally accepted in the
United States of America, the objective of which is the
expression of an opinion regarding the financial statements
taken as a whole. Accordingly, we do not express such an
opinion.
Based on our review, we are not aware of any material
modifications that should be made to such consolidated
financial statements for them to be in conformity with
accounting principles generally accepted in the United
States of America.
We have previously audited, in accordance with auditing
standards generally accepted in the United States of
America, the consolidated balance sheet and statement of
capitalization of Idaho Power Company and subsidiaries as of
December 31, 1999, and the related consolidated statements
of income, comprehensive income, retained earnings, and cash
flows for the year then ended (not presented herein); and in
our report dated January 31, 2000, we expressed an
unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in
the accompanying consolidated balance sheet and statement of
capitalization as of December 31, 1999 is fairly stated, in
all material respects, in relation to the consolidated
balance sheet and statement of capitalization from which it
has been derived.
DELOITTE & TOUCHE LLP
October 26, 2000
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERTIONS
In Management's Discussion and Analysis we explain the
general financial condition and results of operations for
IDACORP, Inc. and subsidiaries (IDACORP or the Company) and
for Idaho Power Company and subsidiaries (IPC). IPC, an
electric utility, is IDACORP's principal operating
subsidiary. Except where we indicate otherwise, this
discussion explains the material changes in results of
operations and the financial condition of both IDACORP and
IPC. This discussion should be read in conjunction with the
accompanying consolidated financial statements of both
IDACORP and IPC.
This discussion updates the discussion that we included in
our Annual Report on Form 10-K for the year ended December
31, 1999. This discussion should be read in conjunction
with the discussion in the annual report.
FORWARD-LOOKING INFORMATION:
In connection with the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 (Reform Act), we
are hereby filing cautionary statements identifying
important factors that could cause our actual results to
differ materially from those projected in forward-looking
statements (as such term is defined in the Reform Act) made
by or on behalf of the Company and IPC in this quarterly
report on Form 10-Q, in presentations, in response to
questions or otherwise. Any statements that express, or
involve discussions as to expectations, beliefs, plans,
objectives, assumptions or future events or performance
(often, but not always, through the use of words or phrases
such as "anticipates", "believes", "estimates", "expects",
"intends", "plans", "predicts", projects", "will likely
result", "will continue", or similar expressions) are not
statements of historical facts and may be forward-looking.
Forward-looking statements involve estimates, assumptions,
and uncertainties and are qualified in their entirety by
reference to, and are accompanied by, the following
important factors, which are difficult to predict, contain
uncertainties, are beyond our control and may cause actual
results to differ materially from those contained in forward-
looking statements:
prevailing governmental policies and regulatory
actions, including those of the FERC, the IPUC, the OPUC,
and the PUCN, with respect to allowed rates of return,
industry and rate structure, acquisition and disposal of
assets and facilities, operations and construction of plant
facilities, recovery of purchased power and other capital
investments, and present or prospective wholesale and retail
competition (including but not limited to retail wheeling
and transmission costs);
economic and geographic factors including political and
economic risks;
changes in and compliance with environmental and safety
laws and policies;
weather conditions;
population growth rates and demographic patterns;
competition for retail and wholesale customers;
pricing and transportation of commodities;
market demand, including structural market changes;
changes in tax rates or policies or in rates of
inflation;
changes in project costs;
unanticipated changes in operating expenses and capital
expenditures;
capital market conditions;
competition for new energy development opportunities;
and
legal and administrative proceedings (whether civil or
criminal) and settlements that influence the business and
profitability of the Company.
Any forward-looking statement speaks only as of the date on
which such statement is made, and we undertake no obligation
to update any forward-looking statement to reflect events or
circumstances after the date on which such statement is made
or to reflect the occurrence of unanticipated events. New
factors emerge from time to time and it is not possible for
management to predict all such factors, nor can it assess
the impact of any such factor on the business, or the extent
to which any factor, or combination of factors, may cause
results to differ materially from those contained in any
forward-looking statement.
RESULTS OF OPERATIONS:
Quarter ended September 30, 2000 vs. Quarter ended September
30, 1999:
Earnings per share of IDACORP Common Stock:
Earnings per share (EPS) of IDACORP common stock (basic and
diluted) was $1.11 for the quarter ended September 30, 2000,
an increase of $0.52 over the same quarter last year. The
increase in EPS was due primarily to improved results from
energy marketing activities, which increased EPS
approximately $0.57. Energy marketing is discussed below in
"Other Income."
General Business Revenue
Our general business revenue is dependent on many factors,
including the number of customers we serve, the rates we
charge, and economic and weather conditions (temperature and
precipitation) in our service territory. The following
changes affected our general business revenue:
Our revenue per MWh increased 10.4 percent. Changes in
revenue per MWh result principally from the annual rate
adjustments authorized by regulatory authorities. These
rate adjustments are discussed below in "PCA" and
"Regulatory Settlement."
Cooling degree-days, a common measure used in the
utility industry to analyze demand, were above 1999 levels
by 11.4 percent.
The average number of general business customers we
served increased 2.7 percent. This increase was due
primarily to economic growth in our service territory.
Precipitation, which affects sales to irrigators,
decreased 55.2 percent in July and August, the heavier
irrigation sales months in the quarter. MWh sales to
irrigation customers increased 9.5 percent.
The combination of these factors resulted in an increase in
general business revenue of $21 million.
Power Supply
Power supply components of income from operations include
off-system sales, purchased power and fuel expenses and the
PCA.
Off-system sales, consisting primarily of long-term sales
contracts and opportunity sales of surplus system energy
increased $42 million from last year, while purchased power
expenses increased $98 million. These changes were due to a
number of factors:
Market prices were significantly above 1999 levels,
resulting in a 118 percent increase in average price per MWh
purchased and a 316 percent increase in average price per
MWh sold.
Hydro generation was down 12.5 percent from last year,
necessitating more purchases in the open market.
Warmer, drier summer weather increased demand from our
general business customers by 4.7 percent
The PCA decreased $31 million. The PCA is a regulatory
mechanism that increases expense when actual power supply
costs are below the costs forecasted in the annual PCA
filing, and decreases expense when actual power supply costs
are above the forecast. The PCA is an IPUC mechanism and
only mitigates approximately 75 percent of the variance in
forecasted power supply costs. In 2000, actual power supply
costs were significantly above the forecast, due to the
factors previously described, and resulted in a PCA credit.
In 1999, actual power supply costs were also above that
year's forecast, but not to the same extent. IPC's share of
the variance in power costs was $15.2 million in 2000
compared to $1.6 million in 1999. We discuss the PCA in
more detail below in "PCA."
The impact of these changes in net power supply costs is an
increase in net expense in 2000 of $26 million.
Other expenses
Other maintenance expenses increased $3 million, due
primarily to increased maintenance on power lines of our
electricity distribution system.
Other income
Other income increased for the quarter, due to improved
results from energy marketing activities, which increased
IDACORP's other income by $35 million and IPC's other income
by $34 million. The energy marketing results improved due
to a combination of increasing volumes over a larger
geographical area and greater price volatility. While
managing within strict risk limits, our trading strategy was
able to take advantage of several key market factors such as
price differential between regions, the run-up in power and
natural gas prices and the increase in volatility.
Income taxes
The increase in income taxes is predominately due to the
increases in net income before taxes. IPC's effective tax
rate increased because of a transfer of its IDACORP
Financial Services (IFS) subsidiary to IDACORP on January 1,
2000. IFS invests in projects which generate income tax
credits. These credits reduced IPC's income tax expense for
periods prior to January 1, 2000.
Nine months ended September 30, 2000 vs. Nine months ended
September 30, 1999:
Earnings per share of IDACORP Common Stock
Earnings per share of IDACORP common stock (basic and
diluted) was $3.09 for the nine months ended September 30,
2000, an increase of $1.16 over last year. The increase in
EPS was due to two principal factors, improved results from
energy marketing activities, which increased EPS
approximately $1.03, and the sale of the Hermiston Power
Project, which increased EPS approximately $0.22. These
factors are discussed below in "Other Income."
General Business Revenue
The following factors affected our general business revenue:
Precipitation during the growing season, which affects
sales to irrigators, decreased 40.9 percent, from 1999 to
2000. MWh sales to irrigation customers have increased 22.0
percent year-to-date.
The average number of general business customers we
served increased 2.7 percent, due primarily to economic
growth in our service territory.
Our revenue per MWh is up slightly compared to 1999.
Changes in revenue per MWh result primarily from the annual
rate adjustments authorized by regulatory authorities.
These adjustments are discussed below in "PCA" and
"Regulatory Settlement."
Heating degree-days, a common measure used in the
utility industry to analyze demand, were 13.0 percent below
1999 levels. Cooling degree-days were up 9.8 percent.
Sales (in MWhs) to commercial and industrial customers
increased 3.2 percent, due primarily to positive economic
conditions in our service territory.
The combination of these factors resulted in an increase in
general business revenue of $25 million over 1999.
Power Supply
Off-system sales, consisting primarily of long-term sales
contracts and opportunity sales of surplus system energy,
increased $75 million from last year while purchased power
expenses increased $172 million. Our purchased power costs
increase is due to a number of factors:
Market prices were significantly above 1999 levels,
resulting in 98 percent and 123 percent increases in the
average price of MWh purchased and sold, respectively.
Hydro generation was down 19.0 percent from last year,
necessitating more purchases in the open market.
In late June 2000 a unit of the Bridger steam plant
suffered a forced outage, requiring us to buy more market-
priced power.
The $4 million (6.4 percent) increase in fuel expenses is
due predominantly to a 4.2 percent increase in total MWhs
generated at our coal-fired plants.
The PCA decreased $65 million. The PCA is a regulatory
mechanism that increases expense when actual power supply
costs are below the costs forecasted in the annual PCA
filing, and decreases expense when actual power supply costs
are above the forecast. The PCA is an IPUC mechanism and
only mitigates approximately 75 percent of the variance from
forecasted power supply costs. In 2000, actual power supply
costs were significantly above the forecast, due to the
power supply variations described above, and resulted in a
PCA credit. In 1999, actual power supply costs were very
near that year's forecast. IPC's share of the variance in
power supply costs was $17.9 million in 2000, compared to a
$3.2 million benefit in 1999. We discuss the PCA in more
detail below in "PCA."
The impact of these changes in net power supply costs is an
increase in net expense in 2000 of $37 million.
Other expenses
Maintenance expenses increased $6 million. The increase is
due primarily to increased maintenance on power lines of our
electricity distribution system, and to maintenance of the
Bridger generation plant.
Other income
Other income increased due to improved results from energy
marketing activities, which increased IDACORP's other income
by $64 million and IPC's other income by $59 million. The
energy marketing results improved due to a combination of
increasing trading volumes over a larger geographical area
and greater price volatility. While managing within strict
risk limits, our trading strategy was able to take advantage
of several key market factors such as price differential
between regions, the run-up in power and natural gas prices
and the increase in volatility.
IDACORP's other income also increased due to the sale of our
interest in the Hermiston Power Project, a 536 MW, gas-fired
cogeneration project to be located near Hermiston, Oregon.
We recorded a pre-tax gain of $14 million on this
transaction. This item does not affect IPC's financial
statements because Ida-West, the developer of the Hermiston
project, is a subsidiary of IDACORP, and not IPC.
Income taxes
The increase in income taxes is predominantly due to the
increases in net income before taxes. IPC's effective tax
rate increased because of a transfer of its IDACORP
Financial Services (IFS) subsidiary to IDACORP on January 1,
2000. IFS invests in projects which generate income tax
credits. These credits reduced IPC's income tax expense for
periods prior to January 1, 2000.
LIQUIDITY AND CAPITAL RESOURCES:
Cash Flow
For the nine months ended September 30, 2000, IDACORP
generated $103.7 million in net cash from operations. After
deducting for common stock dividends, net cash generation
from operations provided approximately $51.3 million for our
construction program and other capital requirements.
Cash Expenditures
We estimate that our total cash construction expenditures
for 2000 will be approximately $121 million. This estimate
is subject to revision in light of changing economic,
regulatory, and environmental factors. During the first
nine months of 2000, we spent approximately $88.9 million
for construction. Our primary financial commitments and
obligations are related to contracts and purchase orders
associated with ongoing construction programs. To the
extent required, we expect to finance these commitments and
obligations by using both internally generated funds and
externally financed capital. At September 30, 2000, our
short-term borrowings totaled $67.2 million.
Financing Program
IDACORP has a $300.0 million shelf registration statement
that can be used for the issuance of unsecured debt
securities and preferred or common stock. At September 30,
2000, none had been issued.
On March 23, 2000, IPC filed a $200.0 million shelf
registration statement that can be used for both First
Mortgage Bonds (including Medium Term Notes), Preferred
Stock, and unsecured debt. At September 30, 2000, none had
been issued.
On January 1, 2000, IPC redeemed at maturity, $80.0 million
8.65% First Mortgage Bonds using funds from the issuance of
$80.0 million Secured Medium Term Notes, Series B, 7.20%
issued on November 23, 1999.
On April 26, 2000, at the Company's request, the American
Falls Reservoir District issued its American Falls Refunding
Replacement Dam Bonds, Series 2000, in the aggregate
principal amount of $19.9 million for the purpose of
refunding on April 26, 2000, a like amount of its bonds
dated May 1, 1990. IPC has guaranteed repayment of these
bonds.
On May 17, 2000, tax exempt Pollution Control Revenue
Refunding Bonds Series 2000 in the aggregate principal
amount of $4.4 million were issued by Port of Morrow, Oregon
for the purpose of refunding on August 1, 2000, a like
amount of its Pollution Control Revenue Bonds, Series 1978.
REGULATORY ISSUES:
Power Cost Adjustment
IPC has a PCA mechanism that provides for annual adjustments
to the rates charged to its Idaho retail electric customers.
These adjustments, which take effect annually on May 16, are
based on forecasts of net power supply costs, and the true-
up of the prior year's forecast. The difference between the
actual costs incurred and the forecasted costs is deferred,
with interest, and trued-up in the next annual rate
adjustment.
The IPUC approved IPC's May 16, 2000 PCA adjustment, issuing
Order 28358 dated May 9, 2000. This rate adjustment
increased Idaho general business customer rates by 9.5
percent, and results from forecasted below-average
hydroelectric generating conditions (see "Streamflow
Conditions" below). Overall, IPC's annual general business
revenues are expected to increase by $38 million during the
2000-2001 rate period, to partially offset the forecasted
increase in power supply costs.
So far in the 2000-2001 PCA rate year, actual power supply
costs have been greater than the forecast, due to actual
hydroelectric generation being below the forecast, and
purchased power volumes and prices being above the forecast.
To account for these higher-than-forecasted costs, IPC has
recorded a regulatory asset of $65 million as of September
30, 2000.
Regulatory Settlement
IPC had a settlement agreement with the IPUC that expired at
the end of 1999. Under the terms of the settlement, when
earnings in IPC's Idaho jurisdiction exceeded an 11.75
percent return on year-end common equity, IPC set aside 50
percent of the excess for the benefit of Idaho retail
customers.
In March 2000 IPC submitted its 1999 annual earnings sharing
compliance filing to the IPUC. This filing indicated that
there was almost $9.6 million in 1999 earnings and $2.7
million in unused 1998 reserve balances available for the
benefit of our Idaho customers.
In April 2000 the IPUC issued Order 28333, which ordered
that $6.9 million of the revenue sharing balance be refunded
to Idaho customers through rate reductions effective May 16,
2000. The Order also approved IPC's continued participation
in the Northwest Energy Efficiency Alliance (NEEA) for the
years 2000-2004, ordering IPC to set aside the remaining
$5.4 million of revenue sharing dollars to fund that
participation.
DSM (Conservation) Expenses
IPC requested that the IPUC allow for the recovery of post-
1993 DSM expenses and acceleration of the recovery of DSM
expenditures authorized in the last general rate case. In
its Order No. 27660 issued on July 31, 1998, the IPUC set a
new amortization period of 12 years instead of the 24-year
period previously adopted. On April 17, 2000, the Idaho
Supreme Court affirmed the IPUC order, after hearing an
appeal by a group of industrial customers.
OTHER MATTERS:
Energy Marketing
To compete as an energy provider of choice, we have built a
trading operation that participates in the electricity,
natural gas and other related markets from our offices in
Boise, Idaho and Houston, Texas. Our energy marketing and
trading strategy has produced increasingly positive results
over the last four years. Our natural gas marketing
capability continues to expand as the electricity and natural
gas markets move toward
convergence, and our electricity marketing efforts have
resulted in volume and income increases each year since
inception of the strategy.
When buying and selling energy, the high volatility of
energy prices can have significant negative impact on
profitability if not appropriately managed. Also,
counterparty creditworthiness is key to ensuring that
transactions entered into withstand dramatic market
fluctuations. To manage the risks inherent in the energy
commodity industry while implementing our business strategy,
the Company's Risk Management Committee, comprised of
Company officers, oversees the risk management program as
defined in our risk management policy. The program is
intended to manage the impact to earnings caused by the
volatility of energy prices by mitigating commodity price
risk, credit risk, and other risks related to the energy
commodity business.
The aggregate potential daily loss in earnings from our
energy trading activity as of September 30, 2000 is
estimated to be $1.7 million at a 95 percent confidence
interval and for a holding period of one business day
(common industry parameters). This potential loss in
earnings was estimated using an analytic value-at-risk
methodology. This methodology computes value-at-risk based
upon market prices for futures and option-implied
volatilities as of September 30, 2000. The value-at-risk is
understood to be a statistical calculation of potential loss
and not a forecast of expected loss and as such, is not
guaranteed to occur. The confidence level and holding
period imply that there is a five percent chance that the
daily loss could exceed $1.7 million.
The primary factors causing the increase in our value-at-
risk since December 31, 1999 are increases in electricity
and natural gas prices and volatility since the beginning of
the year. The daily value-at-risk estimate is managed
within acceptable limits and is reported daily to the Risk
Management Committee.
In August 2000 IPC submitted an application to the IPUC to
move our non-operating electricity marketing activity to
another IDACORP subsidiary, IDACORP Energy. These non-
operating transactions do not involve sales from IPC's
resources and are not related to system reliability.
Acquisitions
In August 2000, IDACORP acquired a controlling interest in
Rocky Mountain Communications, Inc. (RMCI), a Boise, Idaho
based Internet service provider. RMCI currently serves more
than 25,000 subscribers primarily in the western United
States and offers a variety of traditional and high-speed
internet access services to both residential and business
customers.
As part of the acquisition of RMCI, IDACORP's board of
directors approved the repurchase of up to 350,000 shares of
outstanding common stock. These shares will be distributed
to RMCI shareholders, representing partial payment for the
acquisition. The amount and timing of the repurchase depend
on market conditions. As of September 30, 2000, IDACORP has
repurchased 156,300 shares for this purpose.
Subsidiary Activities
IDACORP Financial, a wholly owned subsidiary of IDACORP, is
expanding its investment portfolio to include projects that
provide historical tax credits. IDACORP Financial recently
closed on a historical tax credit project in San Diego,
California, the El Cortez project, which began to contribute
to earnings in the third quarter of 2000.
In June 2000, IdaTech (formerly Northwest Power Systems), a
majority-owned subsidiary of IDACORP, delivered the first of
110 fuel cell systems to Bonneville Power Administration
(BPA). Since then, five additional units have been
delivered with the final four "alpha" units scheduled to go
out by the first quarter of 2001. After three months of
field testing, Ida-Tech also received notice from the BPA to
proceed with the design and production of the first block of
50 "beta" fuel cell systems for testing in 2001.
IdaTech also received Notice of Allowance from the U.S.
Patent Office of all claims in an additional patent on its
fuel processor. This patent covers the process that will
help reduce the cost of the materials used in the hydrogen
purification module. IdaTech demonstrated a natural gas
fuel cell system this summer and continues to work on key
alliances to meet the goal of commercializing fuel cell
systems for home applications by 2003, and small-scale
consumer and commercial applications by late 2002.
Streamflow Conditions
We monitor the effect of streamflow conditions on Brownlee
Reservoir, the water source for our three Hells Canyon
hydroelectric projects. In a typical year, these three
projects combine to produce about half of our generated
electricity.
Inflows into Brownlee result from a combination of
precipitation, storage, and ground water conditions.
Inflows into Brownlee were 4.4 MAF for April - July 2000
runoff period, compared to the 70-year median of 4.9 MAF and
1999's 7.9 MAF.
Integrated Resource Plan
Every two years, IPC is required to file with the IPUC and
OPUC an IRP, a comprehensive look at IPC's present and
future demands for electricity and plan for meeting that
demand. The 2000 IRP identifies a potential electricity
shortfall within our utility service territory by mid-2004.
The plan projects a 250 MW resource need in 2004 to satisfy
energy demand during IPC's peak periods. Prior to 2004, the
IRP calls for IPC to increase purchases from the Northwest
energy markets to meet short-term energy needs. IPC
anticipates that after 2004, transmission constraints will
not allow it to continue to cover increasing demand by
increasing purchases. IPC issued a request for proposals
(RFP), seeking bids for 250 MW of additional generation to
support the growing demand in IPC's utility service
territory. The final decision on the acquisition of
additional energy supplies will be made in consultation with
the IPUC and OPUC.
Ida-West Energy Company, IDACORP's unregulated subsidiary,
has responded to the IRP. If selected, Ida-West intends to
construct a 250-MW combined-cycle natural gas turbine
facility within IPC's service territory. In June 2000, Ida-
West filed an application with the Idaho Division of
Environmental Quality seeking the necessary air quality
permits to construct and operate the gas turbine generator.
On July 19, 2000, the DEQ deemed the application complete.
Regional Transmission Organization
In December 1999 the Federal Energy Regulatory Commission, in
its landmark Order 2000, said that all companies with
transmission assets must file to form regional transmission
organizations (RTOs) or explain why they cannot. Order 2000 is
a follow up to orders 888 and 889 issued in 1996, which
required transmission owners to provide non-discriminatory
transmission service to third parties. By encouraging the
formation of RTOs, FERC seeks to further facilitate the
formation of liquid wholesale electricity markets.
In response to FERC Order 2000, IPC and other regional
transmission owners filed in October 2000 a plan to form RTO
West, an independent entity that will operate the transmission
grid in eight western states. RTO West will have its own
independent governing board. The participating transmission
owners will retain ownership of the lines, but will not have a
role in operating the grid.
The FERC filing represents a major portion of the filing
necessary to form RTO West. However, substantial additional
filings will be necessary to include the tariff and
integration agreements associated with the new entity and
filings for state approvals. We expect the FERC filings to be
completed by the first quarter of 2001 and state filings to be
initiated in November.
New Accounting Pronouncements
In June 1998, the FASB issued SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities". In June
2000, the FASB issued SFAS No. 138, which amends certain
provisions of SFAS 133 to clarify four areas causing
difficulties in implementation. The amendment included
expanding the normal purchase and sale exemption for supply
contracts, permitting the offsetting of certain intercompany
foreign currency derivatives and thus reducing the number of
third party derivatives, permitting hedge accounting for
foreign-currency denominated assets and liabilities, and
redefining interest rate risk to reduce sources of
ineffectiveness. The Derivatives Implementation Group
(DIG), a task force created by the FASB, is continuing to
identify and resolve implementation questions related to
SFAS 133.
We have appointed a team to implement SFAS 133. This team
has been inventorying and evaluating our derivatives,
including embedded derivatives, and addressing various other
SFAS 133 related issues. We will adopt SFAS 133 and the
corresponding amendments under SFAS 138 on January 1, 2001.
Our SFAS 133 team is currently determining the impact of
SFAS 133 on our consolidated results of operations and
financial position. This statement should have no impact on
consolidated cash flows.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK
The information required by this item is included in Item 2
"Management's Discussion and Analysis of Financial Condition
and Results of Operations" under "Energy Marketing".
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
On November 30, 1995, a complaint entitled Idaho Power
Company vs. Cogeneration, Inc., Case No. 98467, was filed by
the Company in the District Court of the Fourth Judicial District
of the State of Idaho. The proceeding involves an effort by the
Company to terminate a firm energy sales agreement (FESA) for a
small hydroelectric generating plant.
As required by PURPA and the orders of the Idaho Public
Utilities Commission (IPUC), on January 7, 1992, the Company
entered into a 35-year FESA with Cogeneration, Inc., to
purchase the output of a 43-megawatt hydroelectric generating
project known as the Auger Falls Project. The FESA for the Auger
Falls Project was approved by the IPUC on January 27, 1992. The FESA
required that on or before January 1, 1994, Cogeneration,
Inc., post cash or cash equivalent security in the amount of
approximately $1.9 million to assure performance of the
FESA. Cogeneration, Inc., failed to provide the security
amount. Consistent with the FESA, the Company filed a
petition for declaratory order with the IPUC requesting that
the FESA be terminated as a result of Cogeneration, Inc.'s
breach. Cogeneration, Inc., cross petitioned claiming that
its failure to perform was excused by the occurrence of an
event of force majeure. On April 17, 1995, the IPUC issued
its order finding that Cogeneration, Inc.'s failure to post
the cash security on January 1, 1994, was a default under
the FESA and further finding that the posting of the liquid
security was required by the public interest. Based upon
those findings, the IPUC ordered Cogeneration, Inc., to post
the cash security prior to May 1, 1995. Cogeneration, Inc.,
failed to comply with the Commission's order and has never
posted the $1.9 million amount required by the FESA.
After the IPUC's order became final and non-appealable, the
Company filed a complaint for declaratory relief in the
District Court of the Fourth Judicial District. The
Complaint sought a determination by the district court that
Cogeneration, Inc.'s failure to provide the cash security
and its violation of the IPUC's orders requiring that it
expeditiously provide the cash security constituted material
breaches of the FESA. The Company asked the district court
to find that as a matter of law Idaho Power was entitled to
either terminate or rescind the FESA.
In response to the Company's complaint, Cogeneration, Inc.,
filed counterclaims alleging that the Company, by seeking to
terminate the FESA, had breached the FESA and was attempting
to monopolize the electric generation market and drive
Cogeneration, Inc., out of business. Cogeneration, Inc.,
alleged damages for breach in excess of $50 million and
requested that any damages be trebled under the anti-trust
laws.
On November 30, 1995, the district judge, by memorandum
decision found that Cogeneration, Inc., had materially
breached the FESA and the Company was entitled to either
rescind or terminate the FESA.
On February 16, 1996, Cogeneration, Inc., dismissed its anti-
trust claims against the Company with prejudice, and on
February 23, 1996, the Idaho Supreme Court granted
Cogeneration, Inc.'s request for an expedited appeal of the
district court's decision establishing an accelerated
briefing schedule and scheduling oral argument for May 10,
1996.
On August 12, 1996, the Idaho Supreme Court determined that
the District Court's decision that Cogeneration, Inc., had
breached the FESA was premature.
On February 10, 1997, Cogeneration, Inc. filed an amended
Complaint restating its previous claims, requesting a jury
trial rather than the court trial it had previously
requested and raising several new allegations and claims.
Following a court trial, on June 24, 1998 the District Court
issued a memorandum decision finding that Cogeneration, Inc.
had materially breached the FESA and as a result the Company
had properly terminated the FESA.
On July 27, 1998, Cogeneration, Inc. filed a Notice of
Appeal with the Idaho Supreme Court.
The case was fully briefed in 1999 and argued on January 5,
2000. With an opinion issued on July 13, 2000, the Supreme
Court upheld the district court's decision in favor of the
Company. The decision became final when the Idaho Supreme
Court issued an order dated September 26, 2000, denying the
Petition for Rehearing filed by Cogeneration, Inc.
This matter has been previously reported in Form 10-K dated
March 11, 1999, and other IPC reports filed with the
Commission.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit File Number As Exhibit
*2 333-48031 2 Agreement and Plan of Exchange
between IDACORP, Inc., and IPC
dated as of February 2, 1998.
*3(a) 33-00440 4(a)(xiii) Restated Articles of Incorporation
of IPC as filed with the Secretary
of State of Idaho on June 30, 1989.
*3(a)(i) 33-65720 4(a)(ii) Statement of Resolution
Establishing Terms of Flexible
Auction Series A, Serial Preferred
Stock, Without Par Value
(cumulative stated value of
$100,000 per share) of IPC, as
filed with the Secretary of State
of Idaho on November 5, 1991.
*3(a)(ii) 33-65720 4(a)(iii) Statement of Resolution
Establishing Terms of 7.07% Serial
Preferred Stock, Without Par Value
(cumulative stated value of $100
per share) of IPC, as filed with
the Secretary of State of Idaho on
June 30, 1993.
*3(a)(iii) 1-3198 3(a)(iii) Articles of Amendment to Restated
Form 10-Q Articles of Incorporation of IPC as
for 6/30/00 filed with the Secretary of State
of Idaho on June 15, 2000.
*3(b) 33-41166 4(b) Waiver resolution to Restated
Articles of Incorporation of IPC
adopted by Shareholders on May 1,
1991.
*3(c) 1-3198 3(c) By-laws of IPC amended on September
Form 10-Q 9, 1999, and presently in effect.
for 9/30/99
*3(d) 33-56071 3(d) Articles of Share Exchange, as
filed with the Secretary of State
of Idaho on September 29, 1998.
*3(e) 333-64737 3.1 Articles of Incorporation of
IDACORP, Inc.
*3(f) 333-64737 3.2 Articles of Amendment to Articles
of Incorporation of IDACORP, Inc.
as filed with the Secretary of
State of Idaho on March 9, 1998.
*3(g) 333-00139 3(b) Articles of Amendment to Articles
of Incorporation of IDACORP, Inc.
creating A Series Preferred Stock,
without par value, as filed with
the Secretary of State of Idaho on
September 17, 1998.
*3(h) 1-14465 3(c) Amended Bylaws of IDACORP, Inc. as
Form 10-Q of July 8, 1999.
for 6/30/99
*4(a)(i) 2-3413 B-2 Mortgage and Deed of Trust, dated
as of October 1, 1937, between IPC
and Bankers Trust Company and
R. G. Page, as Trustees.
*4(a)(ii) IPC Supplemental Indentures to
Mortgage and Deed of Trust:
Number Dated
1-MD B-2-a First July 1, 1939
2-5395 7-a-3 Second November 15, 1943
2-7237 7-a-4 Third February 1, 1947
2-7502 7-a-5 Fourth May 1, 1948
2-8398 7-a-6 Fifth November 1, 1949
2-8973 7-a-7 Sixth October 1, 1951
2-12941 2-C-8 Seventh January 1, 1957
2-13688 4-J Eighth July 15, 1957
2-13689 4-K Ninth November 15, 1957
2-14245 4-L Tenth April 1, 1958
2-14366 2-L Eleventh October 15, 1958
2-14935 4-N Twelfth May 15, 1959
2-18976 4-O Thirteenth November 15, 1960
2-18977 4-Q Fourteenth November 1, 1961
2-22988 4-B-16 Fifteenth September 15, 1964
2-24578 4-B-17 Sixteenth April 1, 1966
2-25479 4-B-18 Seventeenth October 1, 1966
2-45260 2(c) Eighteenth September 1, 1972
2-49854 2(c) Nineteenth January 15, 1974
2-51722 2(c)(i) Twentieth August 1, 1974
2-51722 2(c)(ii) Twenty-first October 15, 1974
2-57374 2(c) Twenty-second November 15, 1976
2-62035 2(c) Twenty-third August 15, 1978
33-34222 4(d)(iii) Twenty-fourth September 1, 1979
33-34222 4(d)(iv) Twenty-fifth November 1, 1981
33-34222 4(d)(v) Twenty-sixth May 1, 1982
33-34222 4(d)(vi) Twenty-seventh May 1, 1986
33-00440 4(c)(iv) Twenty-eighth June 30, 1989
33-34222 4(d)(vii) Twenty-ninth January 1, 1990
33-65720 4(d)(iii) Thirtieth January 1, 1991
33-65720 4(d)(iv) Thirty-first August 15, 1991
33-65720 4(d)(v) Thirty-second March 15, 1992
33-65720 4(d)(vi) Thirty-third April 1, 1993
1-3198 4 Thirty-fourth December 1, 1993
Form 8-K
Dated
12/17/93
*4(b) 1-3198 4(b) Instruments relating to IPC
Form 10-Q American Falls bond guarantee (see
for 6/30/00 Exhibit 10(c)).
*4(c) 33-65720 4(f) Agreement of IPC to furnish certain
debt instruments.
*4(d) 33-00440 2(a)(iii) Agreement and Plan of Merger dated
March 10, 1989, between Idaho Power
Company, a Maine Corporation, and
Idaho Power Migrating Corporation.
*4(e) 1-14465 4 Rights Agreement, dated as of
Form 8-K September 10, 1998, between
dated IDACORP, Inc. and the Bank of New
September York as Rights Agent.
15, 1998
*10(a) 2-49584 5(b) Agreements, dated September 22,
1969, between IPC and Pacific
Power & Light Company relating to
the operation, construction and
ownership of the Jim Bridger
Project.
*10(a)(i) 2-51762 5(c) Amendment, dated February 1, 1974,
relating to operation agreement
filed as Exhibit 10(a).
*10(b) 2-49584 5(c) Agreement, dated as of October 11,
1973, between IPC and Pacific
Power & Light Company.
*10(c) 1-3198 10(c) Guaranty Agreement, dated April
Form 10-Q 11, 2000, between IPC and Bank One
for 6/30/00 Trust Company, N.A., as Trustee,
relating to $19,885,000 American
Falls Replacement Dam Refinancing
Bonds of the American Falls
Reservoir District, Idaho.
*10(d) 2-62034 5(r) Guaranty Agreement, dated as of
August 30, 1974, between IPC and
Pacific Power & Light Company.
*10(e) 2-56513 5(i) Letter Agreement, dated January 23,
1976, between IPC and Portland
General Electric Company.
*10(e)(i) 2-62034 5(s) Agreement for Construction,
Ownership and Operation of the
Number One Boardman Station on
Carty Reservoir, dated as of
October 15, 1976, between Portland
General Electric Company and IPC.
*10(e)(ii) 2-62034 5(t) Amendment, dated September 30,
1977, relating to agreement filed
as Exhibit 10(e).
*10(e)(iii) 2-62034 5(u) Amendment, dated October 31, 1977,
relating to agreement filed as
Exhibit 10(e).
*10(e)(iv) 2-62034 5(v) Amendment, dated January 23, 1978,
relating to agreement filed as
Exhibit 10(e).
*10(e)(v) 2-62034 5(w) Amendment, dated February 15, 1978,
relating to agreement filed as
Exhibit 10(e).
*10(e)(vi) 2-68574 5(x) Amendment, dated September 1, 1979,
relating to agreement filed as
Exhibit 10(e).
*10(f) 2-68574 5(z) Participation Agreement, dated
September 1, 1979, relating to the
sale and leaseback of coal handling
facilities at the Number One
Boardman Station on Carty
Reservoir.
*10(g) 2-64910 5(y) Agreements for the Operation,
Construction and Ownership of the
North Valmy Power Plant Project,
dated December 12, 1978, between
Sierra Pacific Power Company and
IPC.
*10(h)(i)1 1-3198 10(n)(i) The Revised Security Plan for
Form 10-K Senior Management Employees - a non-
for 1994 qualified, deferred compensation
plan effective August 1, 1996.
*10(h)(ii)1 1-3198 10(n)(ii) The Executive Annual Incentive Plan
Form 10-K for senior management employees of
for 1994 IPC effective January 1, 1995.
*10(h)(iii)1 1-3198 10(n)(iii) The 1994 Restricted Stock Plan for
Form 10-K officers and key executives of
for 1994 IDACORP, Inc. and IPC effective
July 1, 1994.
*10(h)(iv)1 1-14465 10(h)(iv) The Revised Security Plan for Board
1-3198 of Directors - a non-qualified,
Form 10-K deferred compensation plan
for 1998 effective August 1, 1996, revised
March 2, 1999.
*10(h)(v)1 14465 10(e) IDACORP, Inc. Non-Employee
Form 10-Q Directors Stock Compensation Plan
for 6/30/99 as of May 17, 1999.
*10(h)(vi) 1-3198 10(y) Executive Employment Agreement
Form 10-K dated November 20, 1996 between IPC
for 1997 and Richard R. Riazzi.
*10(h)(vii) 1-3198 10(g) Executive Employment Agreement
Form 10-Q dated April 12, 1999 between IPC
for 6/30/99 and Marlene Williams.
*10(h)(viii) 1-14465 10(h) Agreement between IDACORP, Inc. and
Form 10-Q Jan B. Packwood, J. LaMont Keen,
for 9/30/99 James C. Miller, Richard Riazzi,
Darrel T. Anderson, Bryan Kearney,
Cliff N. Olson, Robert W. Stahman
and Marlene K. Williams.
*10(h)(ix)1 1-14465 10(h)(ix) IDACORP, Inc. 2000 Long-Term
Form 10-K Incentive and Compensation Plan.
for 1999
*10(i) 33-65720 10(h) Framework Agreement, dated October
1, 1984, between the State of Idaho
and IPC relating to IPC's Swan
Falls and Snake River water rights.
*10(i)(i) 33-65720 10(h)(i) Agreement, dated October 25, 1984,
between the State of Idaho and IPC
relating to the agreement filed as
Exhibit 10(i).
*10(i)(ii) 33-65720 10(h)(ii) Contract to Implement, dated
October 25, 1984, between the State
of Idaho and IPC relating to the
agreement filed as Exhibit 10(i).
*10(j) 33-65720 10(m) Agreement Regarding the Ownership,
Construction, Operation and
Maintenance of the Milner
Hydroelectric Project (FERC No.
2899), dated January 22, 1990,
between IPC and the Twin Falls
Canal Company and the Northside
Canal Company Limited.
*10(j)(i) 33-65720 10(m)(i) Guaranty Agreement, dated February
10, 1992, between IPC and New York
Life Insurance Company, as Note
Purchaser, relating to $11,700,000
Guaranteed Notes due 2017 of Milner
Dam Inc.
12 Statement Re: Computation of Ratio
of Earnings to Fixed Charges.
(IDACORP, Inc.)
12(a) Statement Re: Computation of
Supplemental Ratio of Earnings to
Fixed Charges. (IDACORP, Inc.)
12(b) Statement Re: Computation of Ratio
of Earnings to Combined Fixed
Charges and Preferred Dividend
Requirements. (IDACORP, Inc.)
12(c) Statement Re: Computation of
Supplemental Ratio of Earnings to
Combined Fixed Charges and
Preferred Dividend Requirements.
(IDACORP, Inc.)
12(d) Statement Re: Computation of Ratio
of Earnings to Fixed Charges. (IPC)
12(e) Statement Re: Computation of
Supplemental Ratio of Earnings to
Fixed Charges. (IPC)
12(f) Statement Re: Computation of Ratio
of Earnings to Combined Fixed
Charges and Preferred Dividend
Requirements. (IPC)
12(g) Statement Re: Computation of
Supplemental Ratio of Earnings to
Combined Fixed Charges and
Preferred Dividend Requirements.
(IPC)
15 Letter re: Unaudited Interim
Financial Information
27(a) Financial Data Schedule for
IDACORP, Inc.
27(b) Financial Data Schedule for IPC.
(b) Reports on Form 8-K. The following report on Form 8-K was
filed for the quarter ended September 30, 2000.
1. Item 5. Other Events - IDACORP filed a Current Report on
Form 8-K dated August 9, 2000 , and a Form 8-K/A, also
dated August 9, 2000.
* Previously filed and Incorporated herein by Reference.
________________________
1 Compensatory plan
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
IDACORP, Inc.
(Registrant)
Date November 3, 2000 By: /s/ J LaMont Keen
J LaMont Keen
Senior Vice President
Administration
and Chief Financial Officer
(Principal Financial Officer)
Date November 3, 2000 By: /s/ Darrel T Anderson
Darrel T Anderson
Vice President Finance
and Treasurer
(Principal Accounting Officer)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
IDAHO POWER COMPANY
(Registrant)
Date November 3, 2000 By: /s/ J LaMont Keen
J LaMont Keen
Senior Vice President
Administration
and Chief Financial Officer
(Principal Financial Officer)
Date November 3, 2000 By: /s/ Darrel T Anderson
Darrel T Anderson
Vice President Finance
and Treasurer
(Principal Accounting Officer)
