IDACORP INC Q1 FY2025 earnings call

• Customer growth: Idaho Power's customer base has grown 2.6% since last year's first quarter, including 2.9% for residential customers, with significant new customer investments in food processing and warehousing. - Project progress: 80-megawatt 2025 battery project on track, Boise Bench battery storage project permitted, Jackalope wind project agreements pending approval, solar PPA project online. - Regulatory matters: Submitted notice of intent to file a general rate case in Idaho, expecting process to take ~7 months with rates effective no earlier than Jan 2026; submitted Wildfire Standard of Care Act, not expecting changes to mitigation plans immediately but will evaluate modifications; monitoring tariffs, especially on battery storage assets. - Financial and CapEx: Future 5-year CapEx forecast $5.6 billion, 2024 CapEx exceeded $1 billion, 2025 CapEx expected $1-$1.1 billion, targeting 50-50 debt-equity capital ratio, slightly debt-heavy on March 31 due to $400 million debt issuance, with $90 million stock issuance proceeds held at IDACORP.

IDACORP's diluted earnings per share in the first quarter was $1.10 compared to $0.95 in the same period last year. Idaho Power's customer base grew 2.6% since last year's first quarter, with a 2.9% increase in residential customers. The first quarter saw significant new customer investments in the food processing and warehousing sectors. The 5-year forecast for retail sales growth is 8.3% annually. Idaho Power's 80-megawatt 2025 battery project is on track to be operational later this spring, along with a 150-megawatt storage agreement. The Boise Bench battery storage project was recently permitted. The Jackalope wind project agreements are pending Idaho Commission approval. A solar PPA project associated with the Clean Energy Way program came online. Transmission projects like Boardman to Hemingway, Swift North, and Gateway West are in various stages of planning and development.

• Full year IDACORP diluted earnings per share guidance range $5.65 to $5.85, including Idaho Power using $60 million to $77 million of additional tax credit amortization. - Full-year O&M expense expected in range $465 million to $475 million. - 2025 CapEx expected $1 billion to $1.1 billion. - Expected good hydropower generation in 2025, ranging from 7 million to 8.5 million megawatt hours.

• Tariff impacts, especially on battery storage assets affecting ongoing projects. - Regulatory lag risk impacting earned ROEs. - Wildfire litigation risk with potential Noneconomic damages, though Idaho has favorable damage caps.

Q: On the wildfire legislation, do you expect any changes to your wildfire mitigation plans?

A: We don't anticipate any changes in the program. We are taking a look at the plan as it's written today and may make some modifications, but it would not necessarily be changing any of the actual activities.

Q: Thoughts on what kind of mechanisms or trackers you might be contemplating filing for in the rate case to improve earned ROEs?

A: We're right in the middle of preparing our case right now. We're considering a number of different options. We will take some action in the case to request that the commission help us to reduce regulatory lag going forward with the negative effects of regulatory lag.

Q: Any other legislation you were hoping to push for regarding wildfire after SB 1183?

A: I don't know that we have anything imminent that we would be pursuing. But we do feel like this has been a good step to define what a standard of care plan looks like.

Q: If there are new large load customers, would they be captured in the 28 and 29 RFPs?

A: When new loads would come on, it would depend on what year they would start for sure. But it's possible that if we have a number of projects that would meet the need as the need changes, we could certainly contract with those as well.

Q: Thoughts on wildfire funds?

A: It was certainly something that we discussed. The hard part is that Idaho is very small. And so, the amount of money that would be needed to create a fund would fall on a few people, so when you have the state of California that can put billions of dollars into a fund is not really something that Idaho could do. And then it was, well, if you look at a multi-seat sort of arrangement. But then that's always the sort of, well, who pays and who gets the benefit. And so, it wasn't 1 that really, we thought was something we could do now, but it's something we could certainly think about, but it's also important to remember we do have insurance. And there might be other strategies like a captive insurance product or something along those lines.