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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended

June 30, ~~2020~~2021

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Exact name of registrants as specified

I.R.S. Employer

Commission File

in their charters, address of principal

Identification

Number

executive offices, zip code and telephone number

Number

1-14465

IDACORP, Inc.

82-0505802

1-3198

Idaho Power Company

82-0130980



1221 W. Idaho Street
Boise,		Idaho		83702-5627
	(208)		388-2200

State of Incorporation:

Idaho

~~State of Incorporation:~~

~~Idaho~~

None

~~None~~

Former name, former address and former fiscal year, if changed since last report.

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	IDA	New York Stock Exchange

Indicate by check mark whether the registrants (1) have 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 registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.

IDACORP, Inc.: Yes X No __ Idaho Power Company: Yes X No __

Indicate by check mark whether the registrants have submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrants were required to submit such files).

IDACORP, Inc.: Yes X XNo __ Idaho Power Company: Yes X No __

Indicate by check mark whether the registrants are large accelerated filers, accelerated filers, non-accelerated filers, smaller reporting companies, or emerging growth companies. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:

IDACORP, Inc.:

Large accelerated filer X XAccelerated filer __ Non-accelerated filer __

Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange

Act. __

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Idaho Power Company:

Large accelerated filer __ Accelerated filer __ Non-accelerated Filer X

Smaller reporting company ☐

Emerging growth company ☐

Act. __

Indicate by check mark whether the registrants are shell companies (as defined in Rule 12b-2 of the Exchange Act).

IDACORP, Inc.: Yes ☐ No X Idaho Power Company: Yes ☐ No X

Number of shares of common stock outstanding as of July ~~24, 2020:~~23, 2021:

IDACORP, Inc.: ~~50,461,132~~50,516,384

Idaho Power Company: 39,150,812, all 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.

Idaho Power Company meets the conditions set forth in General Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore filing this report on Form 10-Q with the reduced disclosure format.

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TABLE OF CONTENTS
				Page
Commonly Used Terms				4
Cautionary Note Regarding Forward-Looking Statements				5

Part I. Financial Information

	Item 1. Financial Statements (unaudited)
		IDACORP, Inc.:
			Condensed Consolidated Statements of Income	7
			Condensed Consolidated Statements of Comprehensive Income	8
			Condensed Consolidated Balance Sheets	9
			Condensed Consolidated Statements of Cash Flows	11
			Condensed Consolidated Statements of Equity	12
		Idaho Power Company:
			Condensed Consolidated Statements of Income	13
			Condensed Consolidated Statements of Comprehensive Income	14
			Condensed Consolidated Balance Sheets	15
			Condensed Consolidated Statements of Cash Flows	17
		Notes to Condensed Consolidated Financial Statements		18
		Reports of Independent Registered Public Accounting Firm		3332
	Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			3534
	Item 3. Quantitative and Qualitative Disclosures About Market Risk			6058
	Item 4. Controls and Procedures			6159

Part II. Other Information

	Item 1. Legal Proceedings			6260
	Item 1A. Risk Factors			6260
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			6260
	Item 3. Defaults Upon Senior Securities			6360
	Item 4. Mine Safety Disclosures			6360
	Item 5. Other Information			6360
	Item 6. Exhibits			6461

Signatures				6562

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COMMONLY USED TERMS

The following select abbreviations, terms, or acronyms are commonly used or found in multiple locations in this report:

~~2019~~2020 Annual Report	-	IDACORP's and Idaho Power's Annual Report on Form 10-K for the year ended December 31, ~~2019~~ 2020
ADITC	-	Accumulated Deferred Investment Tax Credits
AFUDC	-	Allowance for Funds Used During Construction
AOCI	-	Accumulated Other Comprehensive Income
~~ASU~~	-	~~Accounting Standards Update~~
BCC	-	Bridger Coal Company, a joint venture of IERCo
BLM	-	U.S. Bureau of Land Management
~~CWA~~	-
CWA	-	Clean Water Act
~~FASB~~	-	~~Financial Accounting Standards Board~~
~~FCA~~	-

FCA	-	Fixed Cost Adjustment
FERC	-	Federal Energy Regulatory Commission
~~FPA~~	-	~~Federal Power Act~~
HCC	-	Hells Canyon Complex
IDACORP	-	IDACORP, Inc., an Idaho corporation

Idaho Power	-	Idaho Power Company, an Idaho corporation

Idaho ROE	-	Idaho-jurisdiction return on year-end equity
Ida-West	-	Ida-West Energy, a subsidiary of IDACORP, Inc.
IERCo	-	Idaho Energy Resources Co., a subsidiary of Idaho Power Company
IFS	-	IDACORP Financial Services, a subsidiary of IDACORP, Inc.
IPUC	-	Idaho Public Utilities Commission
IRP	-	Integrated Resource Plan
Jim Bridger plant	-	Jim Bridger generating plant
MD&A	-	Management’s Discussion and Analysis of Financial Condition and Results of Operations
MW	-	Megawatt
MWh	-	Megawatt-hour
O&M	-	Operations and Maintenance
OATT	-	Open Access Transmission Tariff
OPUC	-	Public Utility Commission of Oregon
PCA	-	Idaho-Jurisdiction Power Cost Adjustment
PURPA	-	Public Utility Regulatory Policies Act of 1978
~~SEC~~	-
SEC	-	U.S. Securities and Exchange Commission
SMSP	-	Security Plan for Senior Management Employees


Valmy	-	Idaho Power's jointly-owned coal-fired generating plant in Valmy, Nevada
Western EIM	-	Energy imbalance market implemented in the western United States
~~WPSC~~WMP	-	Wildfire Mitigation Plan
WPSC	-	Wyoming Public Service Commission

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

In addition to the historical information contained in this report, this report contains (and oral communications made by IDACORP, Inc. (IDACORP) and Idaho Power Company (Idaho Power) may contain) statements that relate to future events and expectations, such as statements regarding projected or future financial performance, cash flows, capital expenditures, dividends, capital structure or ratios, strategic goals, challenges, objectives, and plans for future operations. Such statements constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. 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," "continues," "could," "estimates," "expects," "guidance," "intends," "potential," "plans," "predicts," "projects," "may result," "may continue," or similar expressions, are not statements of historical facts and may be forward-looking. Forward-looking statements are not guarantees of future performance and involve estimates, assumptions, risks, and uncertainties. Actual results, performance, or outcomes may differ materially from the results discussed in the statements. In addition to any assumptions and other factors and matters referred to specifically in connection with such forward-looking statements, factors that could cause actual results or outcomes to differ materially from those contained in forward-looking statements include those factors set forth in this report, IDACORP's and Idaho Power's Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, particularly Part I, Item 1A - "Risk Factors" and Part II, Item 7 - "Management’s Discussion and Analysis of Financial Condition and Results of Operations" of that report, subsequent reports filed by IDACORP and Idaho Power with the U.S. Securities and Exchange Commission (SEC), and the following important factors:

•the effect of decisions by the Idaho and Oregon public utilities commissions and the Federal Energy Regulatory Commission that impact Idaho Power's ability to recover costs and earn a return on investment;

•changes to or the elimination of Idaho Power's regulatory cost recovery mechanisms;

•the impacts of the COVID-19 ~~coronavirus outbreak~~pandemic, including COVID-19 variants, on the global and regional economy and on Idaho Power's employees, customers, contractors, and suppliers, including on loads and revenues, uncollectible accounts, transmission revenues, and other aspects of the ~~economy and the~~ companies' business;

•changes in residential, commercial, and industrial growth and demographic patterns within Idaho Power's service area, ~~the loss or change in the business of significant customers, or the addition of new customers,~~ and their associated impacts on loads and load growth, and the availability of regulatory mechanisms that allow for timely cost recovery through customer rates in the event of those changes;

•abnormal or severe weather conditions ~~including~~ (including conditions and events associated with climate ~~change,~~ change), wildfires, ~~drought,~~droughts, earthquakes, and other natural phenomena and natural disasters, which affect customer sales, hydropower generation levels, repair costs, service interruptions, liability for damage caused by utility property, and the availability and cost of fuel for generation plants or purchased power to serve customers;

•advancement of self-generation, energy storage, ~~and~~ energy efficiency, alternative energy sources, and other technologies that may reduce Idaho Power's sale or delivery of electric power or ~~create~~introduction of operational or cyber-security vulnerabilities to the power ~~reliability challenges;~~grid;

•acts or threats of terrorist incidents, ~~other malicious acts, social unrest,~~ acts of war, social unrest, cyber-attacks, the companies' failure to secure data or to comply with privacy laws or regulations, physical security breaches, ~~and~~or the disruption or damage to the companies' business, operations, or reputation resulting from such ~~events and related litigation or penalties;~~events;

•the expense and risks associated with capital expenditures for, and the permitting and construction of, utility infrastructure that Idaho Power may be unable ~~or unwilling~~ to complete or may not be deemed prudent by regulators for cost recovery;

•variable hydrological conditions and over-appropriation of surface and groundwater in the Snake River Basin, which may impact the amount of power generated by Idaho Power's hydropower facilities;

•the ability of Idaho Power to acquire fuel, power, electrical equipment, and transmission capacity ~~under~~on reasonable terms, particularly in the event of unanticipated or abnormally high power demands, price volatility, lack of physical availability, transportation constraints, ~~climate change,~~disruptions or delays in the supply chain, or a ~~credit downgrade;~~lack of credit;

•disruptions or outages of Idaho Power's generation or transmission systems or of any interconnected transmission systems, ~~may constrain resources or cause~~which can result in liability for Idaho Power, ~~to incur repair~~increase power costs, and ~~purchase replacement power at increased costs;~~reduce revenues;

•accidents, terrorist acts, fires (either affecting or caused by Idaho Power facilities or infrastructure), explosions, ~~and~~ mechanical breakdowns, and other unplanned events that may occur while operating and maintaining ~~Idaho Power~~ assets, which can cause unplanned ~~outages,~~outages; reduce generating ~~output,~~output; damage company assets, operations, or ~~reputation,~~reputation; subject Idaho Power to third-party claims for property damage, personal injury, or loss of ~~life,~~life; or result in the imposition of civil, criminal, and regulatory fines and penalties for which Idaho Power may have inadequate insurance coverage;

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•the increased purchased power costs and operational challenges associated with purchasing and integrating intermittent renewable energy sources into Idaho Power's resource portfolio;

•failure to comply with state and federal laws, regulations, and orders, including new interpretations and enforcement initiatives by regulatory and oversight bodies, which may result in penalties and fines and increase the cost of compliance, and the cost of remediation;

•changes in tax laws or related regulations or new interpretations of applicable laws by federal, state, or local taxing jurisdictions, and the availability of tax credits, and the tax rates payable by IDACORP shareholders on common stock dividends;

•adoption of, changes in, and costs of compliance with laws, regulations, and policies relating to the environment, natural resources, and threatened and endangered species, and the ability to recover associated increased costs through rates;

•the inability to obtain or cost of obtaining and complying with required governmental permits and approvals, licenses, rights-of-way, and siting for transmission and generation projects and hydropower facilities;

•failure to comply with mandatory reliability and security requirements, which may result in penalties, reputational harm, and operational changes;

the cost and outcome of litigation, dispute resolution, and regulatory proceedings, and the ability to recover those costs or the costs of resulting operational changes through insurance or rates, or from third parties;

•the impacts of economic conditions, including inflation, interest rates, supply costs, population growth or decline in Idaho Power's service area, changes in customer demand for electricity, revenue from sales of excess power, credit quality of counterparties and suppliers, and the collection of receivables;

•the ability to obtain debt and equity financing or refinance existing debt when necessary and on favorable terms, which can be affected by factors such as credit ratings, volatility or disruptions in the financial markets, interest rate fluctuations, decisions by the Idaho or Oregon public utility commissions, and the companies' past or projected financial performance;

•changes in the method for determining ~~LIBOR~~the London Interbank Offered Rate (LIBOR) and the ~~potential~~ replacement of LIBOR and the impact on interest rates for IDACORP's and Idaho Power's credit facilities;

•the ability to enter into financial and physical commodity hedges with creditworthy counterparties to manage price and commodity risk for fuel, power, and transmission, and the failure of any such risk management and hedging strategies to work as intended;

•changes in actuarial assumptions, changes in interest rates, increasing health care costs, and the actual and projected return on plan assets for pension and other post-retirement plans, which can affect future pension and other postretirement plan funding obligations, costs, and liabilities and the companies' cash flows;

•the assumptions underlying the coal mine reclamation obligations at Bridger Coal Company and related funding and bonding requirements, and the remediation costs associated with planned exits from participation in Idaho Power's co-owned coal plants;

•the ability to continue to pay dividends and achieve target-payout ratios based on financial performance, and in light of credit rating considerations, contractual covenants and restrictions, and regulatory limitations;

•Idaho Power's concentration in one industry and one region and the resulting lack of diversification, and the resulting exposure to regional economic conditions and regional legislation and regulation;

•employee workforce factors, including the operational and financial costs of unionization or the attempt to unionize all or part of the companies' workforce, the impact of an aging workforce and retirements, the cost and ability to attract and retain skilled workers and third-party vendors, and the ability to adjust the labor cost structure when necessary; and

•adoption of or changes in accounting policies and principles, changes in accounting estimates, and new SEC or New York Stock Exchange requirements, or new interpretations of existing requirements.

Any forward-looking statement speaks only as of the date on which such statement is made. 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. IDACORP and Idaho Power disclaim any obligation to update publicly any forward-looking information, whether in response to new information, future events, or otherwise, except as required by applicable law.

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PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

IDACORP, Inc.

Condensed Consolidated Statements of Income

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
	(in thousands, except per share amounts)				(in thousands, except per share amounts)
Operating Revenues:
Electric utility revenues	$	359,058	$	317,666	$	674,625	$	608,154
Other	1,016		1,100		1,502		1,620
Total operating revenues	360,074		318,766		676,127		609,774

Operating Expenses:
Electric utility:
Purchased power	96,116		61,774		164,104		122,975
Fuel expense	31,191		31,414		64,496		61,430
Power cost adjustment	(7,934)		(1,536)		(2,263)		(4,927)
Other operations and maintenance	88,490		83,144		174,148		172,951
Energy efficiency programs	6,658		11,953		15,685		21,428
Depreciation	43,627		42,914		86,942		85,440
Other electric utility operating expenses	9,007		9,151		18,333		18,292
Total electric utility operating expenses	267,155		238,814		521,445		477,589
Other	515		512		1,170		1,176
Total operating expenses	267,670		239,326		522,615		478,765

Operating Income	92,404		79,440		153,512		131,009

Nonoperating (Income) Expense:
Allowance for equity funds used during construction	(7,795)		(7,149)		(15,564)		(14,421)
Earnings of unconsolidated equity-method investments	(2,313)		(2,687)		(4,630)		(5,003)
Interest on long-term debt	21,036		22,056		42,073		41,718
Other interest	3,611		3,557		7,130		7,369
Allowance for borrowed funds used during construction	(3,019)		(2,886)		(6,025)		(5,616)
Other income, net	(460)		(1,043)		(702)		(1,976)
Total nonoperating expense, net	11,060		11,848		22,282		22,071

Income Before Income Taxes	81,344		67,592		131,230		108,938

Income Tax Expense	11,070		6,933		16,156		10,821

Net Income	70,274		60,659		115,074		98,117
Income attributable to noncontrolling interests	(251)		(270)		(220)		(238)
Net Income Attributable to IDACORP, Inc.	$	70,023	$	60,389	$	114,854	$	97,879

Weighted Average Common Shares Outstanding - Basic	50,609		50,551		50,588		50,534
Weighted Average Common Shares Outstanding - Diluted	50,622		50,567		50,601		50,547
Earnings Per Share of Common Stock:
Earnings Attributable to IDACORP, Inc. - Basic	$	1.38	$	1.19	$	2.27	$	1.94
Earnings Attributable to IDACORP, Inc. - Diluted	$	1.38	$	1.19	$	2.27	$	1.94

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
(in thousands, except per share amounts)
Operating Revenues:
Electric utility revenues $ 317,666
$ 315,774
$ 608,154
$ 665,546
Other 1,100
1,121
1,620
1,668
Total operating revenues 318,766
316,895
609,774
667,214

Operating Expenses:
Electric utility:
Purchased power 61,774
58,063
122,975
120,894
Fuel expense 31,414
20,826
61,430
72,696
Power cost adjustment (1,536 ) 16,122
(4,927 ) 42,347
Other operations and maintenance 83,144
87,007
172,951
175,913
Energy efficiency programs 11,953
11,458
21,428
21,570
Depreciation 42,914
41,172
85,440
83,406
Taxes other than income taxes 8,727
9,377
17,410
18,237
Total electric utility expenses 238,390
244,025
476,707
535,063
Other 936
1,090
2,058
2,252
Total operating expenses 239,326
245,115
478,765
537,315

Operating Income 79,440
71,780
131,009
129,899

Allowance for Equity Funds Used During Construction 7,149
6,699
14,421
13,054

Earnings of Unconsolidated Equity-Method Investments 2,687
2,997
5,003
5,379

Other Income, Net 1,043
1,060
1,976
3,173

Interest Expense:
Interest on long-term debt 22,056
21,156
41,718
42,310
Other interest 3,557
3,685
7,369
7,138
Allowance for borrowed funds used during construction (2,886 ) (2,733 ) (5,616 ) (5,324 )
Total interest expense, net 22,727
22,108
43,471
44,124

Income Before Income Taxes 67,592
60,428
108,938
107,381

Income Tax Expense 6,933
7,028
10,821
11,344

Net Income 60,659
53,400
98,117
96,037
Income attributable to noncontrolling interests (270 ) (244 ) (238 ) (195 )
Net Income Attributable to IDACORP, Inc. $ 60,389
$ 53,156
$ 97,879
$ 95,842
Weighted Average Common Shares Outstanding - Basic 50,551
50,499
50,534
50,504
Weighted Average Common Shares Outstanding - Diluted 50,567
50,507
50,547
50,512
Earnings Per Share of Common Stock:
Earnings Attributable to IDACORP, Inc. - Basic $ 1.19
$ 1.05
$ 1.94
$ 1.90
Earnings Attributable to IDACORP, Inc. - Diluted $ 1.19
$ 1.05
$ 1.94
$ 1.90

The accompanying notes are an integral part of these statements.

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IDACORP, Inc.

Condensed Consolidated Statements of Comprehensive Income

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
	(in thousands)				(in thousands)

Net Income	$	70,274	$	60,659	$	115,074	$	98,117
Other Comprehensive Income:

Unfunded pension liability adjustment, net of tax of $290, $259, $579, and $518, respectively	836		747		1,672		1,494
Total Comprehensive Income	71,110		61,406		116,746		99,611
Income attributable to noncontrolling interests	(251)		(270)		(220)		(238)
Comprehensive Income Attributable to IDACORP, Inc.	$	70,859	$	61,136	$	116,526	$	99,373

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
(in thousands) (in thousands)

Net Income $ 60,659
$ 53,400
$ 98,117
$ 96,037
Other Comprehensive Income:
Unfunded pension liability adjustment, net of tax of $259, $169, $518 and $338, respectively 747
488
1,494
976
Total Comprehensive Income 61,406
53,888
99,611
97,013
Income attributable to noncontrolling interests (270 ) (244 ) (238 ) (195 )
Comprehensive Income Attributable to IDACORP, Inc. $ 61,136
$ 53,644
$ 99,373
$ 96,818

The accompanying notes are an integral part of these statements.

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IDACORP, Inc.

Condensed Consolidated Balance Sheets

(unaudited)


	June 30, 2021		December 31, 2020
	(in thousands)
Assets

Current Assets:
Cash and cash equivalents	$	259,965	$	275,116
Short-term investments	0		25,000
Receivables:
Customer (net of allowance of $4,252 and $4,766, respectively)	84,542		72,826
Other (net of allowance of $581 and $497, respectively)	16,659		12,661
Income taxes receivable	0		2,164
Accrued unbilled revenues	108,913		72,461
Materials and supplies (at average cost)	70,248		64,941
Fuel stock (at average cost)	37,600		31,646
Prepayments	20,451		20,184
Current regulatory assets	61,896		63,407
Other	12,705		1,995
Total current assets	672,979		642,401
Investments	129,000		126,948
Property, Plant and Equipment:
Utility plant in service	6,392,964		6,283,790
Accumulated provision for depreciation	(2,236,478)		(2,193,831)
Utility plant in service - net	4,156,486		4,089,959
Construction work in progress	600,800		597,152
Utility plant held for future use	4,035		4,109
Other property, net of accumulated depreciation	16,576		18,290
Property, plant and equipment - net	4,777,897		4,709,510
Other Assets:
Company-owned life insurance	64,533		62,382
Regulatory assets	1,495,961		1,495,488

Other	61,088		58,515
Total other assets	1,621,582		1,616,385
Total	$	7,201,458	$	7,095,244

June 30,
2020 December 31,
2019
(in thousands)
Assets

Current Assets:
Cash and cash equivalents $ 460,365
$ 217,254
Receivables:
Customer (net of allowance of $3,501 and $1,401, respectively) 78,516
72,675
Other (net of allowance of $318 and $343, respectively) 14,604
18,789
Income taxes receivable —
3,106
Accrued unbilled revenues 85,277
64,545
Materials and supplies (at average cost) 62,987
56,660
Fuel stock (at average cost) 50,717
57,448
Prepayments 18,732
17,638
Current regulatory assets 56,683
56,626
Other 160
405
Total current assets 828,041
565,146
Investments 130,941
98,218
Property, Plant and Equipment:
Utility plant in service 6,211,610
6,113,567
Accumulated provision for depreciation (2,213,715 ) (2,155,783 )
Utility plant in service - net 3,997,895
3,957,784
Construction work in progress 575,509
552,499
Utility plant held for future use 3,697
3,872
Other property, net of accumulated depreciation 17,308
17,299
Property, plant and equipment - net 4,594,409
4,531,454
Other Assets:
Company-owned life insurance 60,524
58,922
Regulatory assets 1,345,954
1,326,433
Other 60,663
61,028
Total other assets 1,467,141
1,446,383
Total $ 7,020,532
$ 6,641,201

The accompanying notes are an integral part of these statements.

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IDACORP, Inc.

Condensed Consolidated Balance Sheets

(unaudited)


	June 30, 2021		December 31, 2020
	(in thousands)
Liabilities and Equity

Current Liabilities:


Accounts payable	$	122,834	$	120,576
Taxes accrued	43,073		19,508
Interest accrued	23,944		24,030
Accrued compensation	43,302		52,245
Current regulatory liabilities	26,899		11,104
Advances from customers	41,544		29,341
Other	29,545		30,767
Total current liabilities	331,141		287,571
Other Liabilities:
Deferred income taxes	789,215		800,251
Regulatory liabilities	768,416		757,730
Pension and other postretirement benefits	638,455		634,070
Other	60,597		48,752
Total other liabilities	2,256,683		2,240,803
Long-Term Debt	2,000,527		2,000,414
Commitments and Contingencies	0		0
Equity:
IDACORP, Inc. shareholders’ equity:
Common stock, no par value (120,000 shares authorized; 50,516 and 50,462 shares issued, respectively)	871,111		869,235
Retained earnings	1,776,986		1,734,103
Accumulated other comprehensive loss	(41,686)		(43,358)

Total IDACORP, Inc. shareholders’ equity	2,606,411		2,559,980
Noncontrolling interests	6,696		6,476
Total equity	2,613,107		2,566,456
Total	$	7,201,458	$	7,095,244

The accompanying notes are an integral part of these statements.

June 30,
2020 December 31,
2019
(in thousands)
Liabilities and Equity

Current Liabilities:
Current portion of long-term debt $ 175,000
$ 100,000
Accounts payable 81,906
110,745
Taxes accrued 28,574
11,501
Interest accrued 24,392
20,999
Accrued compensation 50,671
52,550
Current regulatory liabilities 33,001
33,987
Advances from customers 32,475
28,452
Other 21,149
16,625
Total current liabilities 447,168
374,859
Other Liabilities:
Deferred income taxes 739,242
746,231
Regulatory liabilities 759,309
748,198
Pension and other postretirement benefits 522,223
519,570
Other 50,167
45,131
Total other liabilities 2,070,941
2,059,130
Long-Term Debt 2,000,455
1,736,659
Commitments and Contingencies

Equity:
IDACORP, Inc. shareholders’ equity:
Common stock, no par value (120,000 shares authorized; 50,460 and 50,420 shares issued, respectively) 866,127
868,307
Retained earnings 1,664,468
1,634,525
Accumulated other comprehensive loss (34,790 ) (36,284 )
Treasury stock (0 shares and 22 shares, respectively, at cost) —
(1,920 )
Total IDACORP, Inc. shareholders’ equity 2,495,805
2,464,628
Noncontrolling interests 6,163
5,925
Total equity 2,501,968
2,470,553
Total $ 7,020,532
$ 6,641,201

The accompanying notes are an integral part of these statements.

Table of Contents

IDACORP, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)


	Six months ended June 30,
	2021		2020
	(in thousands)
Operating Activities:
Net income	$	115,074	$	98,117
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	88,889		87,764
Deferred income taxes and investment tax credits	(6,169)		(2,121)
Changes in regulatory assets and liabilities	9,311		(11,831)
Pension and postretirement benefit plan expense	14,534		14,478
Contributions to pension and postretirement benefit plans	(11,957)		(13,219)
Earnings of equity-method investments	(4,630)		(5,003)
Distributions from equity-method investments	4,100		0
Allowance for equity funds used during construction	(15,564)		(14,421)
Other non-cash adjustments to net income, net	4,428		5,989
Change in:
Receivables	(15,241)		(8,943)
Accounts payable and other accrued liabilities	2,620		(30,008)
Taxes accrued/receivable	25,728		20,179
Other current assets	(48,206)		(23,889)
Other current liabilities	5,658		13,076
Other assets	(3,285)		(1,420)
Other liabilities	1,905		(135)
Net cash provided by operating activities	167,195		128,613
Investing Activities:
Additions to property, plant and equipment	(128,265)		(145,116)
Payments received from transmission project joint funding partners	2,253		1,728


Investments in affordable housing and other tax credits	(10,164)		(9,394)

Investments in unconsolidated affiliates	0		(2,300)
Purchases of equity securities	(392)		(3,326)
Purchases of short-term investments	(25,000)		0
Maturities of short-term investments	50,000		0
Proceeds from the sale of equity securities	3,197		2,630

Other	1,347		4,941
Net cash used in investing activities	(107,024)		(150,837)
Financing Activities:
Issuance of long-term debt	0		310,000
Premium on issuance of long-term debt	0		31,384

Dividends on common stock	(72,285)		(68,160)


Tax withholdings on net settlements of share-based awards	(3,026)		(4,630)

Debt issuance costs and other	(11)		(3,259)
Net cash (used in) provided by financing activities	(75,322)		265,335
Net (decrease) increase in cash and cash equivalents	(15,151)		243,111
Cash and cash equivalents at beginning of the period	275,116		217,254
Cash and cash equivalents at end of the period	$	259,965	$	460,365
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for:
Income taxes	$	2,880	$	325
Interest (net of amount capitalized)	$	41,626	$	38,303
Non-cash investing activities:
Additions to property, plant and equipment in accounts payable	$	30,984	$	22,072

Six months ended
June 30,
2020 2019
(in thousands)
Operating Activities:
Net income $ 98,117
$ 96,037
Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 87,764
85,655
Deferred income taxes and investment tax credits (2,121 ) (6,177 )
Changes in regulatory assets and liabilities (11,831 ) 31,643
Pension and postretirement benefit plan expense 14,478
13,894
Contributions to pension and postretirement benefit plans (13,219 ) (14,633 )
Earnings of equity-method investments (5,003 ) (5,379 )
Distributions from equity-method investments —
11,800
Allowance for equity funds used during construction (14,421 ) (13,054 )
Other non-cash adjustments to net income, net 5,989
3,923
Change in:

Accounts receivable (8,943 ) (9,333 )
Accounts payable and other accrued liabilities (30,008 ) (44,286 )
Taxes accrued/receivable 20,179
23,530
Other current assets (23,889 ) (16,454 )
Other current liabilities 13,076
9,350
Other assets (1,420 ) (1,482 )
Other liabilities (135 ) 1,039
Net cash provided by operating activities 128,613
166,073
Investing Activities:

Additions to property, plant and equipment (145,116 ) (129,860 )
Payments received from transmission project joint funding partners 1,728
1,016
Investments in affordable housing (9,394 ) (2,687 )
Investments in unconsolidated affiliates (2,300 ) —
Purchases of equity securities (3,326 ) (470 )
Proceeds from the sale of equity securities 2,630
2,546
Other 4,941
3,793
Net cash used in investing activities (150,837 ) (125,662 )
Financing Activities:

Issuance of long-term debt 310,000
—
Premium on issuance of long-term debt 31,384
—
Dividends on common stock (68,160 ) (64,077 )
Tax withholdings on net settlements of share-based awards (4,630 ) (4,107 )
Debt issuance costs and other (3,259 ) (55 )
Net cash provided by (used in) financing activities 265,335
(68,239 )
Net increase (decrease) in cash and cash equivalents 243,111
(27,828 )
Cash and cash equivalents at beginning of the period 217,254
267,492
Cash and cash equivalents at end of the period $ 460,365
$ 239,664
Supplemental Disclosure of Cash Flow Information:

Cash paid during the period for:

Income taxes $ 325
$ —
Interest (net of amount capitalized) 38,303
42,204
Non-cash investing activities:
Additions to property, plant and equipment in accounts payable $ 22,072
$ 26,700

The accompanying notes are an integral part of these statements.

Table of Contents

IDACORP, Inc.

Condensed Consolidated Statements of Equity

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
	(in thousands)				(in thousands)
Common Stock
Balance at beginning of period	$	868,944	$	864,850	$	869,235	$	868,307
Share-based compensation expense	2,140		1,701		4,850		4,325
Tax withholdings on net settlements of share-based awards	0		(447)		(3,026)		(4,630)
Treasury shares issued	0		0		0		(1,920)
Other	27		23		52		45
Balance at end of period	871,111		866,127		871,111		866,127
Retained Earnings
Balance at beginning of period	1,742,994		1,638,065		1,734,103		1,634,525
Net income attributable to IDACORP, Inc.	70,023		60,389		114,854		97,879
Common stock dividends ($0.71, $0.67, $1.42, and $1.34 per share, respectively)	(36,031)		(33,986)		(71,971)		(67,936)
Balance at end of period	1,776,986		1,664,468		1,776,986		1,664,468
Accumulated Other Comprehensive (Loss) Income
Balance at beginning of period	(42,522)		(35,537)		(43,358)		(36,284)
Unfunded pension liability adjustment (net of tax)	836		747		1,672		1,494
Balance at end of period	(41,686)		(34,790)		(41,686)		(34,790)
Treasury Stock
Balance at beginning of period	0		0		0		(1,920)
Issued	0		0		0		1,920

Balance at end of period	0		0		0		0
Total IDACORP, Inc. shareholders’ equity at end of period	2,606,411		2,495,805		2,606,411		2,495,805
Noncontrolling Interests
Balance at beginning of period	6,445		5,893		6,476		5,925
Net income attributable to noncontrolling interests	251		270		220		238
Balance at end of period	6,696		6,163		6,696		6,163
Total equity at end of period	$	2,613,107	$	2,501,968	$	2,613,107	$	2,501,968

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
(in thousands) (in thousands)
Common Stock
Balance at beginning of period $ 864,850
$ 863,425
$ 868,307
$ 863,593
Share-based compensation expense 1,701
1,830
4,325
4,667
Tax withholdings on net settlements of share-based awards (447 ) —
(4,630 ) —
Treasury shares issued —
(1,016 ) (1,920 ) (4,047 )
Other 23
27
45
53
Balance at end of period 866,127
864,266
866,127
864,266
Retained Earnings
Balance at beginning of period 1,638,065
1,542,175
1,634,525
1,531,543
Net income attributable to IDACORP, Inc. 60,389
53,156
97,879
95,842
Common stock dividends ($0.67, $0.63, $1.34, and $1.26 per share, respectively) (33,986 ) (31,932 ) (67,936 ) (63,986 )
Balance at end of period 1,664,468
1,563,399
1,664,468
1,563,399
Accumulated Other Comprehensive (Loss) Income
Balance at beginning of period (35,537 ) (22,356 ) (36,284 ) (22,844 )
Unfunded pension liability adjustment (net of tax) 747
488
1,494
976
Balance at end of period (34,790 ) (21,868 ) (34,790 ) (21,868 )
Treasury Stock
Balance at beginning of period —
(3,008 ) (1,920 ) (1,932 )
Issued —
1,016
1,920
4,047
Acquired for tax withholdings on net settlements of share-based awards —
—
—
(4,107 )
Balance at end of period —
(1,992 ) —
(1,992 )
Total IDACORP, Inc. shareholders’ equity at end of period 2,495,805
2,403,805
2,495,805
2,403,805
Noncontrolling Interests
Balance at beginning of period 5,893
5,402
5,925
5,451
Net income attributable to noncontrolling interests 270
244
238
195
Balance at end of period 6,163
5,646
6,163
5,646
Total equity at end of period $ 2,501,968
$ 2,409,451
$ 2,501,968
$ 2,409,451

The accompanying notes are an integral part of these statements.

Table of Contents

Idaho Power Company

Condensed Consolidated Statements of Income

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
	(in thousands)				(in thousands)

Operating Revenues	$	359,058	$	317,666	$	674,625	$	608,154

Operating Expenses:
Operation:
Purchased power	96,116		61,774		164,104		122,975
Fuel expense	31,191		31,414		64,496		61,430
Power cost adjustment	(7,934)		(1,536)		(2,263)		(4,927)
Other operations and maintenance	88,490		83,144		174,148		172,951
Energy efficiency programs	6,658		11,953		15,685		21,428
Depreciation	43,627		42,914		86,942		85,440
Other operating expenses	9,007		9,151		18,333		18,292
Total operating expenses	267,155		238,814		521,445		477,589

Operating Income	91,903		78,852		153,180		130,565

Nonoperating (Income) Expense:
Allowance for equity funds used during construction	(7,795)		(7,149)		(15,564)		(14,421)
Earnings of unconsolidated equity-method investments	(1,743)		(1,987)		(4,293)		(4,440)
Interest on long-term debt	21,036		22,056		42,073		41,718
Other interest	3,606		3,544		7,120		7,357
Allowance for borrowed funds used during construction	(3,019)		(2,886)		(6,025)		(5,616)
Other income, net	(423)		(841)		(613)		(1,311)
Total nonoperating expense, net	11,662		12,737		22,698		23,287

Income Before Income Taxes	80,241		66,115		130,482		107,278

Income Tax Expense	11,419		7,192		17,291		11,578

Net Income	$	68,822	$	58,923	$	113,191	$	95,700

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
(in thousands) (in thousands)

Operating Revenues $ 317,666
$ 315,774
$ 608,154
$ 665,546

Operating Expenses:
Operation:
Purchased power 61,774
58,063
122,975
120,894
Fuel expense 31,414
20,826
61,430
72,696
Power cost adjustment (1,536 ) 16,122
(4,927 ) 42,347
Other operations and maintenance 83,144
87,007
172,951
175,913
Energy efficiency programs 11,953
11,458
21,428
21,570
Depreciation 42,914
41,172
85,440
83,406
Taxes other than income taxes 8,727
9,377
17,410
18,237
Total operating expenses 238,390
244,025
476,707
535,063

Income from Operations 79,276
71,749
131,447
130,483

Other Income:
Allowance for equity funds used during construction 7,149
6,699
14,421
13,054
Earnings of unconsolidated equity-method investments 1,987
2,034
4,440
4,265
Other income, net 417
165
429
1,087
Total other income 9,553
8,898
19,290
18,406

Interest Charges:
Interest on long-term debt 22,056
21,156
41,718
42,310
Other interest 3,544
3,677
7,357
7,106
Allowance for borrowed funds used during construction (2,886 ) (2,733 ) (5,616 ) (5,324 )
Total interest charges 22,714
22,100
43,459
44,092

Income Before Income Taxes 66,115
58,547
107,278
104,797

Income Tax Expense 7,192
7,371
11,578
12,037

Net Income $ 58,923
$ 51,176
$ 95,700
$ 92,760

The accompanying notes are an integral part of these statements.

Table of Contents

Idaho Power Company

Condensed Consolidated Statements of Comprehensive Income

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
	(in thousands)				(in thousands)

Net Income	$	68,822	$	58,923	$	113,191	$	95,700
Other Comprehensive Income:

Unfunded pension liability adjustment, net of tax of $290, $259, $579, and $518, respectively	836		747		1,672		1,494
Total Comprehensive Income	$	69,658	$	59,670	$	114,863	$	97,194

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
(in thousands) (in thousands)

Net Income $ 58,923
$ 51,176
$ 95,700
$ 92,760
Other Comprehensive Income:
Unfunded pension liability adjustment, net of tax of $259, $169, $518 and $338, respectively 747
488
1,494
976
Total Comprehensive Income $ 59,670
$ 51,664
$ 97,194
$ 93,736

The accompanying notes are an integral part of these statements.

Table of Contents

Idaho Power Company

Condensed Consolidated Balance Sheets

(unaudited)


	June 30, 2021		December 31, 2020
	(in thousands)
Assets

Current Assets:
Cash and cash equivalents	$	127,070	$	165,604
Receivables:
Customer (net of allowance of $4,252 and $4,766, respectively)	84,542		72,826
Other (net of allowance of $581 and $497, respectively)	16,534		12,457
Income taxes receivable	0		4,667
Accrued unbilled revenues	108,913		72,461
Materials and supplies (at average cost)	70,248		64,941
Fuel stock (at average cost)	37,600		31,646
Prepayments	20,321		20,057

Current regulatory assets	61,896		63,407
Other	12,705		1,995
Total current assets	539,829		510,061
Investments	85,060		87,848
Property, Plant and Equipment:
Plant in service	6,392,964		6,283,790
Accumulated provision for depreciation	(2,236,478)		(2,193,831)
Plant in service - net	4,156,486		4,089,959
Construction work in progress	600,800		597,152
Plant held for future use	4,035		4,109
Other property	3,647		5,123
Property, plant and equipment, net	4,764,968		4,696,343
Other Assets:
Company-owned life insurance	64,533		62,382
Regulatory assets	1,495,961		1,495,488
Other	56,640		53,988
Total other assets	1,617,134		1,611,858
Total	$	7,006,991	$	6,906,110

June 30,
2020 December 31,
2019
(in thousands)
Assets

Electric Plant:
In service (at original cost) $ 6,211,610
$ 6,113,567
Accumulated provision for depreciation (2,213,715 ) (2,155,783 )
In service - net 3,997,895
3,957,784
Construction work in progress 575,509
552,499
Held for future use 3,697
3,872
Electric plant - net 4,577,101
4,514,155
Investments and Other Property 94,772
87,104
Current Assets:
Cash and cash equivalents 358,747
98,950
Receivables:
Customer (net of allowance of $3,501 and $1,401, respectively) 78,516
72,675
Other (net of allowance of $318 and $343, respectively) 14,382
17,107
Income taxes receivable —
9,279
Accrued unbilled revenues 85,277
64,545
Materials and supplies (at average cost) 62,987
56,660
Fuel stock (at average cost) 50,717
57,448
Prepayments 18,603
17,520
Current regulatory assets 56,683
56,626
Other 160
405
Total current assets 726,072
451,215
Deferred Debits:
Company-owned life insurance 60,524
58,922
Regulatory assets 1,345,954
1,326,433
Other 56,054
56,330
Total deferred debits 1,462,532
1,441,685
Total $ 6,860,477
$ 6,494,159

The accompanying notes are an integral part of these statements.

Table of Contents

Idaho Power Company

Condensed Consolidated Balance Sheets

(unaudited)


	June 30, 2021		December 31, 2020
	(in thousands)
Liabilities and Equity

Current Liabilities:


Accounts payable	$	122,731	$	120,476
Accounts payable to affiliates	2,507		1,720
Taxes accrued	33,796		19,554
Interest accrued	23,944		24,030

Accrued compensation	43,165		52,036
Current regulatory liabilities	26,899		11,104
Advances from customers	41,544		29,341
Other	17,446		16,717
Total current liabilities	312,032		274,978
Other Liabilities:
Deferred income taxes	821,232		829,146
Regulatory liabilities	768,416		757,730
Pension and other postretirement benefits	638,455		634,070
Other	59,604		45,937
Total other liabilities	2,287,707		2,266,883
Long-Term Debt	2,000,527		2,000,414
Commitments and Contingencies	0		0
Equity:
Common stock, $2.50 par value (50,000 shares authorized; 39,151 shares outstanding)	97,877		97,877
Premium on capital stock	712,257		712,258
Capital stock expense	(2,097)		(2,097)
Retained earnings	1,640,374		1,599,155
Accumulated other comprehensive loss	(41,686)		(43,358)
Total equity	2,406,725		2,363,835
Total	$	7,006,991	$	6,906,110

The accompanying notes are an integral part of these statements.

June 30,
2020 December 31,
2019
(in thousands)
Capitalization and Liabilities

Capitalization:
Common stock equity:
Common stock, $2.50 par value (50,000 shares authorized; 39,151 shares outstanding) $ 97,877
$ 97,877
Premium on capital stock 712,257
712,258
Capital stock expense (2,097 ) (2,097 )
Retained earnings 1,531,566
1,503,805
Accumulated other comprehensive loss (34,790 ) (36,284 )
Total common stock equity 2,304,813
2,275,559
Long-term debt 2,000,455
1,736,659
Total capitalization 4,305,268
4,012,218
Current Liabilities:
Current portion of long-term debt 175,000
100,000
Accounts payable 81,803
110,581
Accounts payable to affiliates 9,604
2,053
Taxes accrued 24,383
11,481
Interest accrued 24,392
20,999
Accrued compensation 39,100
52,267
Current regulatory liabilities 33,001
33,987
Advances from customers 32,475
28,452
Other 20,421
15,629
Total current liabilities 440,179
375,449
Deferred Credits:
Deferred income taxes 789,995
794,402
Regulatory liabilities 759,309
748,198
Pension and other postretirement benefits 522,223
519,570
Other 43,503
44,322
Total deferred credits 2,115,030
2,106,492

Commitments and Contingencies

Total $ 6,860,477
$ 6,494,159

The accompanying notes are an integral part of these statements.

Table of Contents

Idaho Power Company

Condensed Consolidated Statements of Cash Flows

(unaudited)


	Six months ended June 30,
	2021		2020
	(in thousands)
Operating Activities:
Net income	$	113,191	$	95,700
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	88,593		87,454
Deferred income taxes and investment tax credits	(5,393)		(1,734)
Changes in regulatory assets and liabilities	9,311		(11,831)
Pension and postretirement benefit plan expense	14,534		14,478
Contributions to pension and postretirement benefit plans	(11,957)		(13,219)
Earnings of equity-method investments	(4,293)		(4,440)
Distributions from equity-method investments	4,100		0
Allowance for equity funds used during construction	(15,564)		(14,421)
Other non-cash adjustments to net income, net	(422)		1,664
Change in:
Receivables	(14,535)		(10,759)
Accounts payable	2,616		(22,065)
Taxes accrued/receivable	18,908		22,181
Other current assets	(48,203)		(23,877)
Other current liabilities	5,728		13,159
Other assets	(3,307)		(1,442)
Other liabilities	1,999		(42)
Net cash provided by operating activities	155,306		130,806
Investing Activities:
Additions to utility plant	(128,264)		(144,865)

Payments received from transmission project joint funding partners	2,253		1,728

Investments in unconsolidated affiliates	0		(2,300)
Purchases of equity securities	(392)		(3,326)
Proceeds from the sale of equity securities	3,197		2,630

Other	1,347		4,911
Net cash used in investing activities	(121,859)		(141,222)
Financing Activities:
Issuance of long-term debt	0		310,000
Premium on issuance of long-term debt	0		31,384

Dividends on common stock	(71,972)		(67,939)



Other	(9)		(3,232)
Net cash (used in) provided by financing activities	(71,981)		270,213
Net (decrease) increase in cash and cash equivalents	(38,534)		259,797
Cash and cash equivalents at beginning of the period	165,604		98,950
Cash and cash equivalents at end of the period	$	127,070	$	358,747
Supplemental Disclosure of Cash Flow Information:
Cash paid to (received from) IDACORP related to income taxes	$	10,046	$	(9,189)
Cash paid for interest (net of amount capitalized)	41,616		38,291
Non-cash investing activities:
Additions to property, plant and equipment in accounts payable	$	30,984	$	22,072

Six months ended
June 30,
2020 2019
(in thousands)
Operating Activities:
Net income $ 95,700
$ 92,760
Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 87,454
85,355
Deferred income taxes and investment tax credits (1,734 ) (5,919 )
Changes in regulatory assets and liabilities (11,831 ) 31,643
Pension and postretirement benefit plan expense 14,478
13,894
Contributions to pension and postretirement benefit plans (13,219 ) (14,633 )
Earnings of equity-method investments (4,440 ) (4,265 )
Distributions from equity-method investments —
11,800
Allowance for equity funds used during construction (14,421 ) (13,054 )
Other non-cash adjustments to net income, net 1,664
(744 )
Change in:

Accounts receivable (10,759 ) (9,137 )
Accounts payable (22,065 ) (44,180 )
Taxes accrued/receivable 22,181
25,632
Other current assets (23,877 ) (16,447 )
Other current liabilities 13,159
9,432
Other assets (1,442 ) (1,482 )
Other liabilities (42 ) 1,083
Net cash provided by operating activities 130,806
161,738
Investing Activities:

Additions to utility plant (144,865 ) (129,860 )
Payments received from transmission project joint funding partners 1,728
1,016
Investments in unconsolidated affiliates (2,300 ) —
Purchases of equity securities (3,326 ) (470 )
Proceeds from the sale of equity securities 2,630
2,546
Other 4,911
3,700
Net cash used in investing activities (141,222 ) (123,068 )
Financing Activities:

Issuance of long-term debt 310,000
—
Premium on issuance of long-term debt 31,384
—
Dividends on common stock (67,939 ) (63,986 )
Other (3,232 ) (14 )
Net cash provided by (used in) financing activities 270,213
(64,000 )
Net increase (decrease) in cash and cash equivalents 259,797
(25,330 )
Cash and cash equivalents at beginning of the period 98,950
165,460
Cash and cash equivalents at end of the period $ 358,747
$ 140,130
Supplemental Disclosure of Cash Flow Information:

Cash (received from) paid to IDACORP related to income taxes $ (9,189 ) $ 2,244
Cash paid for interest (net of amount capitalized) 38,291
42,172
Non-cash investing activities:
Additions to property, plant and equipment in accounts payable $ 22,072
$ 26,700

The accompanying notes are an integral part of these statements.

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IDACORP, INC. AND IDAHO POWER COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This Quarterly Report on Form 10-Q is a combined report of IDACORP, Inc. (IDACORP) and Idaho Power Company (Idaho Power). Therefore, these Notes to Condensed Consolidated Financial Statements apply to both IDACORP and Idaho Power. However, Idaho Power makes no representation as to the information relating to IDACORP’s other operations.

Nature of Business

IDACORP is a holding company formed in 1998 whose principal operating subsidiary is Idaho Power. Idaho Power is an electric utility engaged in the generation, transmission, distribution, sale, and purchase of electric energy and capacity with a service area covering approximately 24,000 square miles in southern Idaho and eastern Oregon. Idaho Power is regulated primarily by the state utility regulatory commissions of Idaho and Oregon and the Federal Energy Regulatory Commission (FERC). Idaho Power is the parent of Idaho Energy Resources Co. (IERCo), a joint venturer in Bridger Coal Company (BCC), which mines and supplies coal to the Jim Bridger generating plant (Jim Bridger plant) owned in part by Idaho Power.

IDACORP’s significant other wholly-owned subsidiaries include IDACORP Financial Services, Inc. (IFS), an investor in affordable housing and other real estate tax credit investments, and Ida-West Energy Company (Ida-West), an operator of small hydropower generation projects that satisfy the requirements of the Public Utility Regulatory Policies Act of 1978 (PURPA).

Regulation of Utility Operations

As a regulated utility, many of Idaho Power's fundamental business decisions are subject to the approval of governmental agencies, including the prices that Idaho Power is authorized to charge for its electric service. These approvals are a critical factor in determining IDACORP's and Idaho Power's results of operations and financial condition.

IDACORP's and Idaho Power's financial statements reflect the effects of the different ratemaking principles followed by the jurisdictions regulating Idaho Power. The application of accounting principles related to regulated operations sometimes results in Idaho Power recording expenses and revenues in a different period than when an unregulated enterprise would record such expenses and revenues. In these instances, the amounts are deferred or accrued as regulatory assets or regulatory liabilities on the balance sheet. Regulatory assets represent incurred costs that have been deferred because it is probable they will be recovered from customers through future rates. Regulatory liabilities represent obligations to make refunds to customers for previous collections, or represent amounts collected in advance of incurring an expense. The effects of applying these regulatory accounting principles to Idaho Power's operations are discussed in more detail in Note 3 - "Regulatory Matters."

Financial Statements

In the opinion of management of IDACORP and Idaho Power, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly each company's consolidated financial position as of June 30, ~~2020,~~2021, consolidated results of operations for the three and six months ended June 30, ~~2020~~2021 and ~~2019,~~2020, and consolidated cash flows for the six months ended June 30, ~~2020~~2021 and ~~2019.~~2020. These adjustments are of a normal and recurring nature. These financial statements do not contain the complete detail or note disclosures concerning accounting policies and other matters that would be included in full-year financial statements and should be read in conjunction with the audited consolidated financial statements included in IDACORP’s and Idaho Power’s Annual Report on Form 10-K for the year ended December 31, ~~2019 (2019~~2020 (2020 Annual Report). The results of operations for the interim period are not necessarily indicative of the results to be expected for the full year. A change in management's estimates or assumptions could have a material impact on IDACORP's or Idaho Power's respective financial condition and results of operations during the period in which such change occurred.

Management Estimates

Management makes estimates and assumptions when preparing financial statements in conformity with generally accepted accounting principles. These estimates and assumptions include those related to rate regulation, retirement benefits, contingencies, asset impairment, income taxes, unbilled revenues, and bad debt. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates involve judgments

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with respect to, among other things, future economic factors that are difficult to predict and are beyond management's control. Accordingly, actual results could differ from those estimates.

~~New and Recently Adopted Accounting Pronouncements~~

Reclassifications

Idaho Power changed the presentation of its consolidated statements of income from a utility format to a traditional format. The changes revised the order of certain line items and did not result in any material changes in classification of amounts between line items.

In ~~June 2016,~~ the ~~Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13,~~ ~~Financial Instruments-Credit Losses (Topic 326): Measurement~~condensed consolidated statements of ~~Credit Losses on Financial Instruments~~income, certain amounts in prior periods' consolidated statements of income have been reclassified to ~~provide financial statement users~~conform with ~~more information about expected credit losses on financial instruments and other commitments. The ASU revises the incurred loss impairment methodology to reflect~~ current ~~expected credit losses and requires consideration of a broader range of information to estimate credit losses. IDACORP~~period presentation. On IDACORP's and Idaho ~~Power adopted ASU 2016-13 on January 1, 2020. The adoption did not have a material impact on their respective financial~~Power's condensed consolidated statements ~~but did result in~~of income for the ~~additional disclosure below.~~

The measurement of expected credit losses on Idaho Power accounts receivable is based upon historical experience, current conditions, and forecasted information that may affect collections on the outstanding balance. Generally, this includes adjustments based upon a combination of historical write-off experience, aging of accounts receivable, an analysis of specific customer accounts, and an evaluation of whether there are current or forecasted economic conditions that might cause variation in collection from the historical experience. In response to the COVID-19 public health crisis, Idaho Power provided certain relief to customers including temporarily suspending disconnections for customers and temporarily waiving late fees. This relief as well as the economic conditions created by the response to the COVID-19 public health crisis have resulted in higher aged accounts receivable and an increase in the number of late payments. Idaho Power expects higher uncollectible account write-offs as a result of the COVID-19 public health crisis and, accordingly, increased its allowance for uncollectible accounts related to customer receivables at June 30, 2020. The allowance for uncollectible accounts increased to 4.3 percent of the total customer receivables balance atthree months ended June 30, 2020, ~~compared with 1.9 percent at December 31, 2019,~~$0.4 million that had previously been reported as "Other" within "Operating Expenses" and ~~1.7 percent at June 30, 2019.~~

~~The following table provides a rollforward~~"Other expense, net" within "Other Income (Expense)" respectively, were reclassified to "Other electric utility operating expenses" and "Other operating expenses" within "Operating Expenses," respectively. On IDACORP's and Idaho Power's condensed consolidated statements of ~~the allowance for uncollectible accounts related to customer receivables~~income for the six months ended June 30, 2020, $0.9 million that had previously been reported as "Other" within "Operating Expenses" and ~~2019 (in thousands):~~"Other expense, net" within "Other Income (Expense)" respectively, were reclassified to "Other electric utility operating expenses" and "Other operating expenses" within "Operating Expenses," respectively.

Six months ended
June 30,
2020 2019
Balance at beginning of period $ 1,401
$ 1,725
Additions to the allowance 2,786
1,011
Write-offs, net of recoveries (686 ) (1,280 )
Balance at end of period $ 3,501
$ 1,456
Allowance for uncollectible accounts as a percentage of customer receivables 4.3 % 1.7 %

New and Recently Adopted Accounting Pronouncements

~~In August 2018, the FASB~~

There have been no recently issued ~~ASU 2018-15,~~ ~~Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract~~,

~~to provide guidance on implementation costs incurred in a cloud computing arrangement~~accounting pronouncements that ~~is a service contract. ASU 2018-15 aligns the recognition of such implementation costs with the accounting for costs incurred~~have had or are expected to implement an internal-use software solution. However, the balance sheet line item for presentation of capitalized implementation costs for a cloud computing arrangement that is a service contract should be the same as that for the prepayment of fees related to the same arrangement, while capitalized implementation costs for internal-use software solutions are often included in property, plant, and equipment as an intangible asset. IDACORP and Idaho Power adopted ASU 2018-15 on January 1, 2020. The adoption did not have a material impact on ~~their respective~~IDACORP's or Idaho Power's consolidated financial statements.

2. INCOME TAXES

In accordance with interim reporting requirements, IDACORP and Idaho Power use an estimated annual effective tax rate for computing their provisions for income taxes. An estimate of annual income tax expense (or benefit) is made each interim period using estimates for annual pre-tax income, income tax adjustments, and tax credits. The estimated annual effective tax rates do not include discrete events such as tax law changes, examination settlements, accounting method changes, or adjustments to tax expense or benefits attributable to prior years. Discrete events are recorded in the interim period in which they occur or become known. The estimated annual effective tax rate is applied to year-to-date pre-tax income to determine income tax expense (or benefit) for the interim period consistent with the annual estimate. In subsequent interim periods, income tax expense (or

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benefit) for the period is computed as the difference between the year-to-date amount reported for the previous interim period and the current period's year-to-date amount.

Income Tax Expense

The following table provides a summary of income tax expense for the six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands):


														IDACORP						Idaho Power
														2021			2020			2021			2020
Income tax at statutory rates (federal and state)													Income tax at statutory rates (federal and state)	$	33,722		$	27,980		$	33,586		$	27,613

Excess deferred income tax reversal													Excess deferred income tax reversal	(3,213)			(2,962)			(3,213)			(2,962)

	IDACORP						Idaho Power
	2020			2019			2020			2019
Income tax at statutory rates (federal and state)	$	27,980		$	27,590		$	27,613		$	26,975
Excess deferred income tax reversal	(2,962		)	(3,262		)	(2,962		)	(3,262		)

Other⁽¹⁾	(14,197		)	(12,984		)	(13,073		)	(11,676		)	Other(1)	(14,353)			(14,197)			(13,082)			(13,073)
Income tax expense	$	10,821		$	11,344		$	11,578		$	12,037		Income tax expense	$	16,156		$	10,821		$	17,291		$	11,578
Effective tax rate	9.9		%	10.6		%	10.8		%	11.5		%	Effective tax rate	12.3		%	9.9		%	13.3		%	10.8		%

(1) "Other" is primarily comprised of the net tax effect of Idaho Power's regulatory flow-through tax adjustments.

~~Income~~The increase in income tax expense for the six months ended June 30, ~~2020, was comparable~~2021, compared with the same period in ~~2019.~~2020, was primarily due to higher pre-tax earnings. On a net basis, Idaho Power’s estimate of its annual ~~2020~~2021 regulatory flow-through tax adjustments is comparable to ~~2019.~~2020.

3. REGULATORY MATTERS

Included below is a summary of Idaho Power's most recent general rate cases and base rate changes, as well as other recent or pending notable regulatory matters and proceedings.

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Idaho and Oregon General Rate Cases

Idaho Power's current base rates result from orders from the Idaho Public Utilities Commission (IPUC) and Public Utility Commission of Oregon (OPUC), as described in Note 3 - "Regulatory Matters" to the consolidated financial statements included in the ~~2019~~2020 Annual Report.

Idaho Settlement Stipulations

In October 2014, the IPUC issued an order approving an extension, with modifications, of the terms of a December 2011 Idaho settlement stipulation for the period from 2015 through 2019, or until otherwise modified or terminated by order of the IPUC (October 2014 Idaho Earnings Support and Sharing Settlement Stipulation). A May 2018 Idaho settlement stipulation related to tax reform (May 2018 Idaho Tax Reform Settlement Stipulation) provides for the extension of the October 2014 Idaho Earnings Support and Sharing Settlement Stipulation beyond the initial termination date of December 31, 2019, with modified terms that became effective beginning January 1, 2020, related to the accumulated deferred investment tax credits (ADITC) and revenue sharing mechanism. The October 2014 Idaho Earnings Support and Sharing Settlement Stipulation and the May 2018 Idaho Tax Reform Settlement Stipulation areis described in Note 3 - "Regulatory Matters" to the consolidated financial statements included in the ~~2019~~2020 Annual Report and ~~include~~includes provisions for the accelerated amortization of ~~ADITC~~accumulated deferred investment tax credits (ADITC) to help achieve a minimum 9.4 percent ~~(9.5 percent prior to 2020)~~ return on year-end equity in the Idaho jurisdiction (Idaho ROE). In addition, under the May 2018 Idaho Tax Reform Settlement Stipulation, minimum Idaho ROE would revert back to 95 percent of the authorized return on equity in the next general rate case. The settlement ~~stipulations~~stipulation also ~~provide~~provides for the potential sharing between Idaho Power and Idaho customers of Idaho-jurisdictional earnings in excess of 10.0 percent of Idaho ROE.

Based on its estimate of full-year ~~2020~~2021 Idaho ROE, in both the second quarter and first six months of ~~2020,~~2021, Idaho Power recorded 0 additional ADITC amortization or provision against current revenues for sharing of earnings with customers for ~~2020~~2021 under the May 2018 Idaho Tax Reform Settlement Stipulation. Accordingly, at June 30, ~~2020,~~2021, the full $45 million of additional ADITC remains available for future use. Idaho Power recorded 0 additional ADITC amortization or provision against revenues for sharing of earnings with customers during the second quarter and first six months of ~~2019,~~2020, based on its then-current estimate of full-year ~~2019~~2020 Idaho ROE.

Idaho Power Cost Adjustment Mechanisms

In both its Idaho and Oregon jurisdictions, Idaho Power's power cost adjustment mechanisms address the volatility of power supply costs and provide for annual adjustments to the rates charged to its retail customers. The power cost adjustment

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mechanisms compare Idaho Power's actual net power supply costs (primarily fuel and purchased power less wholesale energy sales) against net power supply costs being recovered in Idaho Power's retail rates. Under the power cost adjustment mechanisms, certain differences between actual net power supply costs incurred by Idaho Power and costs being recovered in retail rates are recorded as a deferred charge or credit on the balance sheet for future recovery or refund. The power supply costs deferred primarily result from changes in contracted power purchase prices and volumes, changes in wholesale market prices and transaction volumes, fuel prices, and the levels of Idaho Power's own generation.

In May ~~2020,~~2021, the IPUC approved a ~~$58.7~~$39.1 million net increase in Idaho-jurisdiction power cost adjustment (PCA) revenues, effective for the 2021-2022 PCA collection period from June 1, 2021, to May 31, 2022. The net increase in PCA revenues reflects a forecasted reduction in low-cost hydroelectric generation as well as higher costs associated with higher forecasted PURPA power purchases. The net increase in PCA revenues also reflects a smaller credit to customers through the true-up component. Also in May 2021, the IPUC ordered Idaho Power to initiate a case to review the PCA mechanism and propose any modifications it determines are appropriate so the case may be processed before the filing of the 2022 PCA application in April 2022.

Previously, in May 2020, the IPUC issued an order approving a $58.7 million net increase in PCA rates, effective for the 2020-2021 PCA collection period from June 1, 2020, to May 31, 2021. The net increase in PCA revenues ~~reflects~~reflected a return to a more normal level of power supply costs as wholesale market energy prices ~~have come~~came down from unusually high levels reflected in ~~last~~the prior year's PCA. ~~The reduction in market energy prices results in Idaho Power forecasting lower wholesale energy sales, which serve as an offset to power supply costs.~~ The net increase in PCA revenues also ~~reflects~~reflected a forecasted reduction in low-cost hydropower ~~generation. The previous PCA for~~generation and the ~~2019-2020 collection period also included~~removal of a $7.7 million in one-time customer ~~benefits~~benefit associated with revenue sharing and income tax reform benefits, which expired in May 2020.

Previously, in May 2019, the IPUC issued an order approving a $50.1 million net decrease in PCA rates, effective for the 2019-2020 PCA collection period from June 1, 2019, to May 31, 2020. The net decrease in PCA revenues reflected reduced power supply costs due to higher-than-expected wholesale energy sales and positive results from natural gas hedging activities, which combined to reduce actual net power supply costs for the 2018-2019 PCA year (April 2018 through March 2019). The net decrease in PCA revenues for the 2019-2020 PCA collection period also included a $5.0 million credit to customers for sharing of 2018 earnings under the October 2014 Idaho Earnings Support and Sharing Settlement Stipulation and a $2.7 million credit for income tax reform benefits related to Idaho Power's open access transmission tariff (OATT) rate under the May 2018 Idaho Tax Reform Settlement Stipulation.

Idaho Fixed Cost Adjustment Mechanism

The Idaho jurisdiction fixed cost adjustment (FCA) mechanism, applicable to Idaho residential and small general service customers, is designed to remove a portion of Idaho Power’s financial disincentive to invest in energy efficiency programs by separating (or decoupling) the recovery of fixed costs from the variable kilowatt-hour charge and linking it instead to a set amount per customer. Under Idaho Power's current rate design, Idaho Power recovers a portion of fixed costs through the variable kilowatt-hour charge, which may result in over-collection or under-collection of fixed costs. To return over-collection to customers or to collect under-collection from customers, the FCA mechanism allows Idaho Power to accrue, or defer, the difference between the authorized fixed-cost recovery amount per customer and the actual fixed costs per customer recovered

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by Idaho Power during the year. The IPUC has discretion to cap the annual increase in the FCA recovery at 3 percent of base revenue, with any excess deferred for collection in a subsequent year. In ~~June 2020,~~May 2021, the IPUC approved an increase of $2.8 million in recovery from the FCA from $35.5 million to $38.3 million, with new rates effective for the period from June 1, 2021, to May 31, 2022. Also in May 2021, the IPUC ordered Idaho Power to work with interested parties and initiate a case to review the FCA mechanism and propose any modifications it determines are appropriate so the case may be processed before the filing of the 2022 FCA application in March 2022. Previously, in June 2020, the IPUC issued an order approving an increase of $0.7 million in ~~recovery from~~ the FCA from $34.8 million to $35.5 million, with ~~new~~ rates effective for the period from June 1, 2020, to May 31, 2021. ~~Previously,~~

Depreciation Rate Requests

In 2021, Idaho Power conducted a depreciation study of electric plant-in-service, which it conducts approximately every five years. The study provided updates to net salvage percentages and service life estimates for Idaho Power plant assets. Based on the study, in ~~May 2019,~~June 2021, Idaho Power filed applications with the IPUC ~~issued~~and OPUC requesting approval to institute revised depreciation rates for Idaho Power's electric plant-in-service and adjust base rates by an ~~order approving~~aggregate of $3.9 million to reflect the revised depreciation rates applied to electric plant-in-service balances subject to the most recent general rate cases. The proposed adjustments in these applications are an overall rate increase of ~~$19.2 million~~0.31 percent in ~~the FCA from $15.6 million to $34.8 million, with rates effective for the period from June 1, 2019, to May 31, 2020.~~

~~Deferred Costs for COVID-19 Public Health Crisis~~

Idaho and 0.24 percent in Oregon. Idaho Power ~~has incurred, and expects to continue to incur, costs associated with its response to the COVID-19 public health crisis, including information technology expenditures~~requested an effective date of December 1, 2021, for remote work, higher than average levels of bad debt expense related to uncollectible accounts associated in part with its suspension of disconnects, and suspension of late payment fees. Accordingly, in March and April 2020,these adjustments.

Jim Bridger Power Plant Rate Request

In June 2021, Idaho Power ~~submitted applications to~~filed an application with the ~~OPUC and~~ IPUC ~~respectively,~~ requesting authorization to ~~defer~~(a) accelerate depreciation for the Jim Bridger plant, to allow the plant to be fully depreciated and recovered by December 31, 2030, (b) establish a balancing account to track the incremental costs and benefits associated with ~~its response~~ceasing participation in coal-fired operations at the Jim Bridger plant, and (c) adjust customer rates to recover the ~~COVID-19 public health crisis.~~associated incremental annual levelized revenue requirement in the aggregate amount of $30.8 million, which includes Idaho Power's share of all electric plant in service at the Jim Bridger plant. The proposed adjustment in this application is an overall rate increase of 2.53 percent in Idaho. Idaho Power requested ~~authorization~~an effective date of December 1, 2021, for this adjustment.

Wildfire Mitigation Cost Deferral

In June 2021, the IPUC authorized Idaho Power to ~~establish~~defer for future amortization incremental operations and maintenance (O&M) and depreciation expense for certain capital investments necessary to implement Idaho Power's Wildfire Mitigation Plan (WMP). The IPUC also authorized Idaho Power to record these deferred expenses as a ~~new~~ regulatory asset until Idaho Power can request amortization of the deferred costs in a future IPUC proceeding, at which time the IPUC will have the opportunity to ~~record~~review actual costs and determine the amount of prudently incurred costs that Idaho Power can recover through retail rates. Idaho Power projects spending approximately $47 million in wildfire mitigation-related O&M and roughly $35 million in wildfire mitigation system-hardening capital expenditures over the next five years. The IPUC authorized a deferral period of five years, or until rates go into effect from Idaho Power's next general rate case, whichever is first. As of June 30, 2021, Idaho Power had not recorded any deferral related to the WMP, as Idaho Power does not expect to incur significant incremental costs ~~and,~~ in connection with many of the ~~Idaho jurisdiction, unrecovered costs~~projects identified in or associated with the COVID-19 response. Both applications requested only the authority to defer these costs and to determine ratemaking treatment at a later date. Subsequent to Idaho Power's application, the IPUC opened a general docket to address the issue. On July 8, 2020, the IPUC issued an order authorizing Idaho Power and other utilities to account for unanticipated, emergency-related expenses incurred due to the COVID-19 public health crisis by recording the expenses as regulatory assets for possible recovery through future rates. The order also requires utilities to account for the decreases in expenses resulting from the COVID-19 public health crisis, such as reduced employee travel and training, and apply these reductions in expenses to offset the deferral account balance. Additionally, the order addressed potential reductions in revenue due to the COVID-19 public health crisis, allowing utilities to track reduced revenues from customer classes not included in an FCA-type mechanism for possible movement to the regulatory asset account at a later date. Idaho Power plans to resume disconnections and accruing late fees beginning in early August 2020. InWMP until the second ~~quarter~~half of ~~2020, Idaho Power recorded a $0.6 million regulatory asset for its estimate of unanticipated, emergency-related expenses, including higher bad~~2021.

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~~debt expense, net of estimated savings. As of the date of this report, Idaho Power has not received authorization in the Oregon jurisdiction to defer any such costs.~~

4. REVENUES

The following table provides a summary of electric utility operating revenues for IDACORP and Idaho Power for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands):


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Electric utility operating revenues:
Revenue from contracts with customers	$	357,461	$	310,971	$	648,787	$	581,155
Alternative revenue programs and other revenues	1,597		6,695		25,838		26,999
Total electric utility operating revenues	$	359,058	$	317,666	$	674,625	$	608,154

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Electric utility operating revenues:
Revenue from contracts with customers $ 310,971
$ 307,779
$ 581,155
$ 643,180
Alternative revenue programs and other revenues 6,695
7,995
26,999
22,366
Total electric utility operating revenues $ 317,666
$ 315,774
$ 608,154
$ 665,546

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Revenues from Contracts with Customers

The following table presents revenues from contracts with customers disaggregated by revenue source for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands):


	Three months ended June 30,						Six months ended June 30,							Three months ended June 30,				Six months ended June 30,
	2020			2019			2020			2019				2021		2020		2021		2020
Revenues from contracts with customers:													Revenues from contracts with customers:
Retail revenues:													Retail revenues:
Residential (includes $4,135, $7,232, $19,844 and $18,543, respectively, related to the FCA)⁽¹⁾	$	109,471		$	104,797		$	254,357		$	255,016
Commercial(includes $397, $350, $881, and $691, respectively, related to the FCA)⁽¹⁾	67,214			70,973			136,728			144,079
Residential (includes ($715), $4,135, $15,107, and $19,844, respectively, related to the FCA)(1)													Residential (includes ($715), $4,135, $15,107, and $19,844, respectively, related to the FCA)(1)	$	122,633	$	109,471	$	277,418	$	254,357
Commercial (includes $165, $397, $647 and $881, respectively, related to the FCA)(1)													Commercial (includes $165, $397, $647 and $881, respectively, related to the FCA)(1)	77,609		67,214		149,878		136,728
Industrial	43,087			45,602			85,847			91,100			Industrial	48,047		43,087		93,477		85,847
Irrigation	60,149			48,954			61,523			49,953			Irrigation	76,799		60,149		77,885		61,523

Deferred revenue related to HCC relicensing AFUDC⁽²⁾	(1,927		)	(1,927		)	(4,046		)	(4,046		)	Deferred revenue related to HCC relicensing AFUDC(2)	(1,927)		(1,927)		(4,046)		(4,046)

Total retail revenues	277,994			268,399			534,409			536,102			Total retail revenues	323,161		277,994		594,612		534,409
Less: FCA mechanism revenues⁽¹⁾	(4,532		)	(7,582		)	(20,725		)	(19,234		)	Less: FCA mechanism revenues(1)	550		(4,532)		(15,754)		(20,725)
Wholesale energy sales	6,866			16,158			10,775			63,373			Wholesale energy sales	4,308		6,866		10,567		10,775
Transmission wheeling-related revenues	11,491			12,518			21,854			28,246			Transmission wheeling-related revenues	15,420		11,491		29,887		21,854
Energy efficiency program revenues	11,953			11,458			21,428			21,570			Energy efficiency program revenues	6,658		11,953		15,685		21,428
Other revenues from contracts with customers	7,199			6,828			13,414			13,123			Other revenues from contracts with customers	7,364		7,199		13,790		13,414
Total revenues from contracts with customers	$	310,971		$	307,779		$	581,155		$	643,180		Total revenues from contracts with customers	$	357,461	$	310,971	$	648,787	$	581,155

(1) The FCA mechanism is an alternative revenue program in the Idaho jurisdiction and does not represent revenue from contracts with customers.

(2) ~~As part of its January 30, 2009, general rate case order, the~~The IPUC ~~is allowing~~allows Idaho Power to recover a portion of the allowance for funds used during construction (AFUDC) on construction work in progress related to the Hells Canyon Complex (HCC) relicensing process, even though the relicensing process is not yet complete and the costs have not been moved to electric plant in service. Idaho Power is collecting $8.8 million annually in the Idaho jurisdiction but is deferring revenue recognition of the amounts collected until the license is issued and the accumulated license costs approved for recovery are placed in service.

Alternative Revenue Programs and Other Revenues

While revenues from contracts with customers make up most of Idaho Power’s revenues, the IPUC has authorized the use of an additional regulatory mechanism, the Idaho FCA mechanism, which may increase or decrease tariff-based customer rates. The Idaho FCA mechanism is described in Note 3 - "Regulatory Matters." The FCA mechanism revenues include only the initial recognition of FCA revenues when they meet the regulator-specified conditions for recognition. Revenue from contracts with customers excludes the portion of the tariff price representing FCA revenues that Idaho Power initially recorded in prior periods when revenues met regulator-specified conditions. When Idaho Power includes those amounts in the price of utility service billed to customers, Idaho Power records such amounts as recovery of the associated regulatory asset or liability and not as revenues.

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Derivative revenues include gains from settled electricity swaps and sales of electricity under forward sales contracts that are bundled with renewable energy credits. Related to these forward sales, Idaho Power simultaneously enters into forward purchases of electricity for the same quantity at the same location, which are recorded in purchased power on the condensed consolidated statements of income. For more information on settled electricity swaps, see Note 1110 - "Derivative Financial Instruments."

The table below presents the FCA mechanism revenues and other revenues for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands):


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Alternative revenue programs and other revenues:
FCA mechanism revenues	$	(550)	4,532		$	15,754	$	20,725
Derivative revenues	2,147		2,163		10,084		6,274
Total alternative revenue programs and other revenues	$	1,597	$	6,695	$	25,838	$	26,999

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Alternative revenue programs and other revenues:
FCA mechanism revenues $ 4,532
7,582
$ 20,725
$ 19,234
Derivative revenues 2,163
413
6,274
3,132
Total alternative revenue programs and other revenues $ 6,695
$ 7,995
$ 26,999
$ 22,366

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Receivables and Allowance for Uncollectible Accounts

~~5. LONG-TERM DEBT~~

~~On April 3, 2020,~~In response to the COVID-19 pandemic, Idaho Power issued $230 million in principal amount of its 4.20 percent first mortgage bonds, secured medium term notes, Series K, maturing March 1, 2048. The bonds were issued at a reoffer yield of 3.422 percent, whichprovided certain relief to customers, including temporarily suspending disconnections for customers and temporarily waiving late fees. This relief as well as the economic conditions created by the response to COVID-19 have resulted in ~~a net premium~~higher aged accounts receivable and an increase in the number of ~~13.0 percent and net proceeds to~~late payments. Idaho Power ~~of $259.9 million. After this offering the aggregate principal amount~~is experiencing and expects to continue to experience higher uncollectible account write-offs as a result of the ~~4.20 percent first mortgage bonds is $450 million.~~

~~On June 5, 2020, Idaho Power entered into a selling agency agreement with six banks named in the agreement in~~

~~connection with the potential issuance~~COVID-19 pandemic and, ~~sale from time~~accordingly, increased its allowance for uncollectible accounts related to ~~time of up to $500 million aggregate principal amount of first~~

~~mortgage bonds, secured medium term notes, Series L (Series L Notes), under Idaho Power’s Indenture of Mortgage and Deed~~

~~of Trust, dated as of October 1, 1937, as amended and supplemented (Indenture). Also on June 5, 2020, Idaho Power~~

~~entered into the Forty-ninth Supplemental Indenture, dated effective as of June 5, 2020, to the Indenture (Forty-ninth~~

~~Supplemental Indenture). The Forty-ninth Supplemental Indenture provides for, among other items, the issuance of up to~~

~~$500 million in aggregate principal amount of Series L Notes pursuant to the Indenture.~~

On June 22, 2020, Idaho Power issued $80 million in principal amount of its 1.90 percent first mortgage bonds, secured medium term notes, Series L, maturing July 15, 2030. On July 29, 2020, Idaho Power redeemed, prior to maturity, $75 million in principal amount of 2.95 percent first mortgage bonds, medium-term notes, Series H due in April 2022. In accordance with the redemption provisions of the notes, the redemption included Idaho Power's payment of a make-whole premium to the holders of the redeemed notes in the aggregate amount of $3.3 million.

On or around August 3, 2020, Idaho Power plans to use a portion of the net proceeds of the April 2020 sale of first mortgage bonds to redeem $100 million in principal amount of 3.40 percent first mortgage bonds due in November 2020. As a result, the $100 million in principal amount of 3.40 percent first mortgage bonds due in November 2020 and the $75 million in principal amount of 2.95 percent first mortgage bonds due in April 2022 are reported as current portion of long-term debt in the condensed consolidated balance sheetscustomer receivables at June 30, ~~2020.~~2021, as compared with pre-COVID-19 allowance levels.

AsThe following table provides a rollforward of the ~~date of this report, Idaho Power has $420 million in principal amount of first mortgage bonds available~~allowance for ~~issuance, including Series L Notes under~~uncollectible accounts related to customer receivables for the ~~selling agency agreement, but only $190 million in principal amount of long-term debt securities remained available for issuance pursuant to state regulatory authority.~~six months ended June 30, 2021 and 2020 (in thousands):


	Six months ended June 30,
	2021			2020
Balance at beginning of period	$	4,766		$	1,401
Additions to the allowance	369			2,786
Write-offs, net of recoveries	(883)			(686)
Balance at end of period	$	4,252		$	3,501
Allowance for uncollectible accounts as a percentage of customer receivables	4.8		%	4.3		%

5. COMMON STOCK

IDACORP Common Stock

During the six months ended June 30, ~~2020,~~2021, IDACORP granted ~~75,030~~76,147 restricted stock unit awards to employees and issued ~~40,381~~54,499 shares of common stock using ~~market purchases~~original issuances of shares pursuant to the IDACORP, Inc. 2000 Long-Term Incentive and Compensation Plan, including ~~7,746~~12,784 shares of common stock issued to members of the board of directors. As directed by IDACORP, plan administrators of the IDACORP, Inc. Dividend Reinvestment and Stock Purchase Plan and Idaho Power Company Employee Savings Plan used market purchases of IDACORP common stock to acquire shares of IDACORP common stock for the plans.

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Restrictions on Dividends

Idaho Power’s ability to pay dividends on its common stock held by IDACORP and IDACORP’s ability to pay dividends on its common stock are limited to the extent payment of such dividends would violate the covenants in their respective credit facilities or Idaho Power’s Revised Code of Conduct. A covenant under IDACORP’s credit facility and Idaho Power’s credit facility requires IDACORP and Idaho Power to maintain leverage ratios of consolidated indebtedness to consolidated total capitalization, as defined therein, of no more than 65 percent at the end of each fiscal quarter. At June 30, ~~2020,~~2021, the leverage ratios for IDACORP and Idaho Power were 4743 percent and 4946 percent, respectively. Based on these restrictions, IDACORP’s and Idaho Power’s dividends were limited to ~~$1.3~~$1.5 billion and ~~$1.1~~$1.3 billion, respectively, at June 30, ~~2020.~~2021. There are additional facility covenants, subject to exceptions, that prohibit or restrict the sale or disposition of property without consent and any agreements restricting dividend payments to IDACORP and Idaho Power from any material subsidiary. At June 30, ~~2020,~~2021, IDACORP and Idaho Power were in compliance with those financial covenants.

Idaho Power’s Revised Code of Conduct relating to transactions between and among Idaho Power, IDACORP, and other affiliates, which was approved by the IPUC in April 2008, provides that Idaho Power will not pay any dividends to IDACORP that will reduce Idaho Power’s common equity capital below 35 percent of its total adjusted capital without IPUC approval. At June 30, ~~2020,~~2021, Idaho Power's common equity capital was 5155 percent of its total adjusted capital. Further, Idaho Power must obtain approval from the OPUC before it can directly or indirectly loan funds or issue notes or give credit on its books to IDACORP.

Idaho Power’s articles of incorporation contain restrictions on the payment of dividends on its common stock if preferred stock dividends are in arrears. As of the date of this report, Idaho Power has 0 preferred stock outstanding.

In addition to contractual restrictions on the amount and payment of dividends, the Federal Power Act ~~(FPA)~~ prohibits the payment of dividends from "capital accounts." The term "capital account" is undefined in the ~~FPA~~Federal Power Act or its regulations, but

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Idaho Power does not believe the restriction would limit Idaho Power's ability to pay dividends out of current year earnings or retained earnings.

7.6. EARNINGS PER SHARE

The table below presents the computation of IDACORP’s basic and diluted earnings per share for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands, except for per share amounts).


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Numerator:
Net income attributable to IDACORP, Inc.	$	70,023	$	60,389	$	114,854	$	97,879
Denominator:
Weighted-average common shares outstanding - basic	50,609		50,551		50,588		50,534
Effect of dilutive securities	13		16		13		13
Weighted-average common shares outstanding - diluted	50,622		50,567		50,601		50,547
Basic earnings per share	$	1.38	$	1.19	$	2.27	$	1.94
Diluted earnings per share	$	1.38	$	1.19	$	2.27	$	1.94

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Numerator:

Net income attributable to IDACORP, Inc. $ 60,389
$ 53,156
$ 97,879
$ 95,842
Denominator:

Weighted-average common shares outstanding - basic 50,551
50,499
50,534
50,504
Effect of dilutive securities 16
8
13
8
Weighted-average common shares outstanding - diluted 50,567
50,507
50,547
50,512
Basic earnings per share $ 1.19
$ 1.05
$ 1.94
$ 1.90
Diluted earnings per share $ 1.19
$ 1.05
$ 1.94
$ 1.90

8.7. COMMITMENTS

Purchase Obligations

During the six months ended June 30, ~~2020,~~2021, IDACORP's and Idaho Power's contractual obligations, outside the ordinary course of business, did not change materially from the amounts disclosed in the notes to the consolidated financial statements in the ~~2019~~2020 Annual Report, except that Idaho Power entered into ~~one~~two new ~~contract with a hydropower PURPA-qualifying facility~~long-term transmission purchase agreements, which increased Idaho Power's contractual purchase obligations by approximately $16 million over the 5-year terms of the contracts, and ~~nine~~five new replacement contracts for expiring power purchase agreements with PURPA-qualifying hydropower ~~and cogeneration PURPA-qualifying~~ facilities, which increased Idaho Power's contractual purchase obligations by approximately ~~$28~~$29 million over the 20-year terms of the contracts.

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Guarantees

~~Through a self-bonding mechanism,~~ Idaho Power guarantees its portion of reclamation activities and obligations at BCC, of which IERCo owns a one-third interest. This guarantee, which is renewed annually with the Wyoming Department of Environmental Quality, was ~~$58.3~~$51.7 million at June 30, ~~2020,~~2021, representing IERCo's one-third share of BCC's total reclamation obligation of ~~$175.0~~$155.2 million. BCC has a reclamation trust fund set aside specifically for the purpose of paying these reclamation costs. At June 30, ~~2020,~~2021, the value of BCC's reclamation trust fund was ~~$144.4~~$198.3 million. During the six months ended June 30, ~~2020,~~2021, the reclamation trust fund made ~~$1.1~~$16.4 million of distributions for reclamation activity costs associated with the BCC surface mine. BCC periodically assesses the adequacy of the reclamation trust fund and its estimate of future reclamation costs. To ensure that the reclamation trust fund maintains adequate reserves, BCC has the ability to, and does, add a per-ton surcharge to coal sales, all of which are made to the Jim Bridger plant. Because of the existence of the fund and the ability to apply a per-ton surcharge, the estimated fair value of this guarantee is minimal.

In May 2019, the state of Wyoming enacted legislation that limits a mine operator's maximum amount of self-bonding. Idaho Power and the co-owners of BCC have until December 2020 to comply with the new regulations, which would reduce the portion of Idaho Power's guarantee of reclamation activities and obligations at BCC that Idaho Power is allowed to self-bond. As of the date of this report, Idaho Power believes the cost of any insurance, third-party assurance, or additional collateral that might be required for this guarantee due to the new law would be immaterial to the companies' consolidated financial statements.

IDACORP and Idaho Power enter into financial agreements and power purchase and sale agreements that include indemnification provisions relating to various forms of claims or liabilities that may arise from the transactions contemplated by these agreements. Generally, a maximum obligation is not explicitly stated in the indemnification provisions and, therefore, the overall maximum amount of the obligation under such indemnification provisions cannot be reasonably estimated. IDACORP and Idaho Power periodically evaluate the likelihood of incurring costs under such indemnities based on their historical experience and the evaluation of the specific indemnities. As of June 30, ~~2020,~~2021, the companies believe the likelihood is remote that IDACORP or Idaho Power would be required to perform under such indemnification provisions or otherwise incur any significant losses with respect to such indemnification obligations. Neither IDACORP nor Idaho Power has recorded any liability on their respective condensed consolidated balance sheets with respect to these indemnification obligations.

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8. CONTINGENCIES

IDACORP and Idaho Power have in the past and expect in the future to become involved in various claims, controversies, disputes, and other contingent matters, some of which involve litigation and regulatory or other contested proceedings. The ultimate resolution and outcome of litigation and regulatory proceedings is inherently difficult to determine, particularly where (a) the remedies or penalties sought are indeterminate, (b) the proceedings are in the early stages or the substantive issues have not been well developed, or (c) the matters involve complex or novel legal theories or a large number of parties. In accordance with applicable accounting guidance, IDACORP and Idaho Power, as applicable, establish an accrual for legal proceedings when those matters proceed to a stage where they present loss contingencies that are both probable and reasonably estimable. If the loss contingency at issue is not both probable and reasonably estimable, IDACORP and Idaho Power do not establish an accrual and the matter will continue to be monitored for any developments that would make the loss contingency both probable and reasonably estimable. As of the date of this report, IDACORP's and Idaho Power's accruals for loss contingencies are not material to their financial statements as a whole; however, future accruals could be material in a given period. IDACORP's and Idaho Power's determination is based on currently available information, and estimates presented in financial statements and other financial disclosures involve significant judgment and may be subject to significant uncertainty.

IDACORP and Idaho Power are parties to legal claims and legal, tax, and regulatory actions and proceedings in the ordinary course of business and, as noted above, record an accrual for associated loss contingencies when they are probable and reasonably estimable. In connection with its utility operations, Idaho Power is subject to claims by individuals, entities, and governmental agencies for ~~damages for~~ alleged personal injury, property damage, trespass, and economic losses relating to Idaho Power’s provision of electric service and the operation of its generation, transmission, and distribution facilities. Some of those claims relate to ~~electrical contacts,~~personal injury, service quality and business interruption, property damage, and wildfires. In recent years, utilities in the western United States have been subject to significant liability for personal injury, loss of life, property damage, trespass, and economic losses, and in some cases, punitive damages and criminal charges and fines and penalties, associated with wildfires that originated from utility property, most commonly transmission and distribution lines. In recent years, Idaho Power has regularly received claims by both governmental agencies and private landowners for damages for fires allegedly originating from Idaho Power’s transmission and distribution system. As of the date of this report, the companies believe that resolution of existing claims will not have a material adverse effect on their respective consolidated financial statements. Idaho Power is also actively monitoring various pending environmental regulations and executive orders related to environmental matters that may have a significant

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impact on its future ~~operations.~~operations and compliance costs. Given uncertainties regarding the outcome, timing, and compliance plans for these environmental matters, Idaho Power is unable to estimate the financial or operational impact of many of these regulations.

~~10.~~9. BENEFIT PLANS

Idaho Power has a noncontributory defined benefit pension plan (pension plan) and two nonqualified defined benefit plans for certain senior management employees called the Security Plan for Senior Management Employees I and Security Plan for Senior Management Employees II (together, SMSP). Idaho Power also has a nonqualified defined benefit pension plan for directors that was frozen in 2002. Remaining vested benefits from that plan are included with the SMSP in the disclosures below. The benefits under the pension plan are based on years of service and the employee’s final average earnings. Idaho Power also maintains a defined benefit postretirement benefit plan (consisting of health care and death benefits) that covers all employees who were enrolled in the active-employee group plan at the time of retirement as well as their spouses and

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qualifying dependents. The table below shows the components of net periodic benefit costs for the pension, SMSP, and postretirement benefits plans for the three months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands).


	Pension Plan						SMSP					Postretirement Benefits						Total							Pension Plan				SMSP				Postretirement Benefits				Total
	2020			2019			2020		2019			2020			2019			2020			2019				2021		2020		2021		2020		2021		2020		2021		2020
Service cost	$	10,578		$	8,316		$	53	$	(45	)	$	240		$	196		$	10,871		$	8,467		Service cost	$	13,693	$	10,578	$	203	$	53	$	179	$	240	$	14,075	$	10,871
Interest cost	9,988			10,560			1,087		1,145			633			762			11,708			12,467			Interest cost	9,456		9,988		889		1,087		502		633		10,847		11,708
Expected return on plan assets	(14,089		)	(12,187		)	—		—			(597		)	(557		)	(14,686		)	(12,744		)	Expected return on plan assets	(16,024)		(14,089)		0		0		(597)		(597)		(16,621)		(14,686)
Amortization of prior service cost	1			2			73		24			12			12			86			38			Amortization of prior service cost	1		1		74		73		12		12		87		86
Amortization of net loss	4,296			3,302			933		633			—			—			5,229			3,935			Amortization of net loss	6,225		4,296		1,052		933		0		0		7,277		5,229
Net periodic benefit cost	10,774			9,993			2,146		1,757			288			413			13,208			12,163			Net periodic benefit cost	13,351		10,774		2,218		2,146		96		288		15,665		13,208
Regulatory deferral of net periodic benefit cost⁽¹⁾	(10,279		)	(9,523		)	—		—			—			—			(10,279		)	(9,523		)	Regulatory deferral of net periodic benefit cost(1)	(12,787)		(10,279)		—		—		—		—		(12,787)		(10,279)
Previously deferred pension costs recognized⁽¹⁾	4,289			4,289			—		—			—			—			4,289			4,289			Previously deferred pension costs recognized(1)	4,289		4,289		—		—		—		—		4,289		4,289
Net periodic benefit cost recognized for financial reporting⁽¹⁾⁽²⁾	$	4,784		$	4,759		$	2,146	$	1,757		$	288		$	413		$	7,218		$	6,929		Net periodic benefit cost recognized for financial reporting(1)(2)	$	4,853	$	4,784	$	2,218	$	2,146	$	96	$	288	$	7,167	$	7,218

(1) Net periodic benefit costs for the pension plan are recognized for financial reporting based upon the authorization of each regulatory jurisdiction in which Idaho Power operates. Under IPUC order, the Idaho portion of net periodic benefit cost is recorded as a regulatory asset and is recognized in the income statement as those costs are recovered through rates.

(2) Of total net periodic benefit cost recognized for financial reporting, ~~$4.3~~$4.5 million and ~~$4.2~~$4.3 million, respectively, were recognized in "Other operations and maintenance" and ~~$3.0~~$2.6 million and ~~$2.7~~$3.0 million, respectively, were recognized in "Other ~~expense,~~income, net" on the condensed consolidated statements of income of the companies for the three months ended June 30, ~~2020~~2021 and ~~2019.~~2020.

The table below shows the components of net periodic benefit costs for the pension, SMSP, and postretirement benefits plans for the six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands).


	Pension Plan						SMSP					Postretirement Benefits						Total							Pension Plan				SMSP				Postretirement Benefits				Total
	2020			2019			2020		2019			2020			2019			2020			2019				2021		2020		2021		2020		2021		2020		2021		2020
Service cost	$	21,493		$	17,030		$	106	$	(90	)	$	514		$	427		$	22,113		$	17,367		Service cost	$	27,101	$	21,493	$	406	$	106	$	532	$	514	$	28,039	$	22,113
Interest cost	20,006			21,156			2,175		2,288			1,247			1,494			23,428			24,938			Interest cost	18,659		20,006		1,778		2,175		1,030		1,247		21,467		23,428
Expected return on plan assets	(28,119		)	(24,311		)	—		—			(1,202		)	(1,110		)	(29,321		)	(25,421		)	Expected return on plan assets	(32,045)		(28,119)		0		0		(1,198)		(1,202)		(33,243)		(29,321)
Amortization of prior service cost	3			3			145		48			24			24			172			75			Amortization of prior service cost	3		3		148		145		24		24		175		172
Amortization of net loss	8,663			6,782			1,867		1,266			—			—			10,530			8,048			Amortization of net loss	11,898		8,663		2,103		1,867		0		0		14,001		10,530
Net periodic benefit cost	22,046			20,660			4,293		3,512			583			835			26,922			25,007			Net periodic benefit cost	25,616		22,046		4,435		4,293		388		583		30,439		26,922
Regulatory deferral of net periodic benefit cost⁽¹⁾	(21,021		)	(19,690		)	—		—			—			—			(21,021		)	(19,690		)	Regulatory deferral of net periodic benefit cost(1)	(24,482)		(21,021)		—		—		—		—		(24,482)		(21,021)
Previously deferred pension costs recognized⁽¹⁾	8,577			8,577			—		—			—			—			8,577			8,577			Previously deferred pension costs recognized(1)	8,577		8,577		—		—		—		—		8,577		8,577
Net periodic benefit cost recognized for financial reporting⁽¹⁾⁽²⁾	$	9,602		$	9,547		$	4,293	$	3,512		$	583		$	835		$	14,478		$	13,894		Net periodic benefit cost recognized for financial reporting(1)(2)	$	9,711	$	9,602	$	4,435	$	4,293	$	388	$	583	$	14,534	$	14,478

(2) Of total net periodic benefit cost recognized for financial reporting, ~~$8.5~~$9.3 million and ~~$8.4~~$8.5 million, respectively, were recognized in "Other operations and maintenance" and ~~$5.9~~$5.2 million and ~~$5.5~~$5.9 million, respectively, were recognized in "Other ~~expense,~~income, net" on the condensed consolidated statements of income of the companies for the six months ended June 30, ~~2020~~2021 and ~~2019.~~2020.

During the six months ended June 30, ~~2020,~~2021, Idaho Power made a $10 million ~~of contributions~~contribution to its defined benefit pension plan. In July ~~2020,~~2021, Idaho Power ~~contributed~~made an additional $10 million contribution to the defined benefit pension plan in a continued effort to balance the regulatory

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collection of these expenditures with the amount and timing of contributions and to mitigate the cost of being in an underfunded position. Idaho Power has no further minimum ~~contribution requirement~~required contributions to be made to its defined benefit pension plan ~~in 2020.~~during 2021, but depending on market conditions and cash flows, Idaho Power expects it will contribute up to a total of $40 million to the pension plan for the full year of 2021. The primary impact of pension contributions is on the timing of cash flows, as the timing of cost recovery lags behind contributions.

In March 2021, the American Rescue Plan Act of 2021 (American Rescue Plan) was signed into law, which included changes to the funding rules for single employer pension plans. The American Rescue Plan lowered the minimum funding requirements by revising liability discount rates and by lengthening the period over which unfunded liabilities must be amortized. This did not have a material effect on Idaho Power's near-term pension contribution plans.

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Idaho Power also has an Employee Savings Plan that complies with Section 401(k) of the Internal Revenue Code and covers substantially all employees. Idaho Power matches specified percentages of employee contributions to the Employee Savings Plan.

~~11.~~10. DERIVATIVE FINANCIAL INSTRUMENTS

Commodity Price Risk

Idaho Power is exposed to market risk relating to electricity, natural gas, and other fuel commodity prices, all of which are heavily influenced by supply and demand. Market risk may be influenced by market participants’ nonperformance of their contractual obligations and commitments, which affects the supply of or demand for the commodity. Idaho Power uses derivative instruments, such as physical and financial forward contracts, for both electricity and fuel to manage the risks relating to these commodity price exposures. The primary objectives of Idaho Power’s energy purchase and sale activity are to meet the demand of retail electric customers, maintain appropriate physical reserves to ensure reliability, and make economic use of temporary surpluses that may develop.

All of Idaho Power's derivative instruments have been entered into for the purpose of economically hedging forecasted purchases and sales, though none of these instruments have been designated as cash flow hedges. Idaho Power offsets fair value amounts recognized on its balance sheet and applies collateral related to derivative instruments executed with the same counterparty under the same master netting agreement. Idaho Power does not offset a counterparty's current derivative contracts with the counterparty's long-term derivative contracts, although Idaho Power's master netting arrangements would allow current and long-term positions to be offset in the event of default. Also, in the event of default, Idaho Power's master netting arrangements would allow for the offsetting of all transactions executed under the master netting arrangement. These types of transactions may include non-derivative instruments, derivatives qualifying for scope exceptions, receivables and payables arising from settled positions, and other forms of non-cash collateral (such as letters of credit). These types of transactions are excluded from the offsetting presented in the derivative fair value and offsetting table that follows.

The table below presents the gains and losses on derivatives not designated as hedging instruments for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands).

Gain/(Loss) on Derivatives Recognized in Income⁽¹⁾
Location of Realized Gain/(Loss) on Derivatives Recognized in Income Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Financial swaps Operating revenues $ 308
$ 414
$ 1,134
$ (2,789 )
Financial swaps Purchased power (1,125 ) (56 ) (1,315 ) 687
Financial swaps Fuel expense (69 ) 7
(2,917 ) 12,402
Forward contracts Operating revenues 41
—
120
64
Forward contracts Purchased power (39 ) —
(115 ) (64 )
Forward contracts Fuel expense (1 ) —
(20 ) 416


		Gain/(Loss) on Derivatives Recognized in Income(1)
	Location of Realized Gain/(Loss) on Derivatives Recognized in Income	Three months ended June 30,				Six months ended June 30,
		2021		2020		2021		2020
Financial swaps	Operating revenues	$	0	$	308	$	0	$	1,134
Financial swaps	Purchased power	0		(1,125)		249		(1,315)
Financial swaps	Fuel expense	903		(69)		1,636		(2,917)

Forward contracts	Operating revenues	26		41		73		120
Forward contracts	Purchased power	(26)		(39)		(73)		(115)
Forward contracts	Fuel expense	2		(1)		1		(20)

(1)Excludes unrealized gains or losses on derivatives, which are recorded on the balance sheet as regulatory assets or regulatory liabilities.

Settlement gains and losses on electricity swap contracts are recorded on the income statement in operating revenues or purchased power depending on the forecasted position being economically hedged by the derivative contract. Settlement gains and losses on contracts for natural gas are reflected in fuel expense. Settlement gains and losses on diesel derivatives are recorded in other operations and maintenance expense. See Note 1211 - "Fair Value Measurements" for additional information concerning the determination of fair value for Idaho Power’s assets and liabilities from price risk management activities.

Credit Risk

At June 30, ~~2020,~~2021, Idaho Power did not have material credit risk exposure from financial instruments, including derivatives. Idaho Power monitors credit risk exposure through reviews of counterparty credit quality, corporate-wide counterparty credit exposure, and corporate-wide counterparty concentration levels. Idaho Power manages these risks by establishing credit and

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concentration limits on transactions with counterparties and requiring contractual guarantees, cash deposits, or letters of credit from counterparties or their affiliates, as deemed necessary. Idaho Power’s physical power, physical gas, and financial transactions are generally under standardized industry contracts. These contracts contain adequate assurance clauses requiring collateralization if a counterparty has debt that is downgraded below investment grade by at least one rating agency.

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Credit-Contingent Features

Certain Idaho Power derivative instruments contain provisions that require Idaho Power's unsecured debt to maintain an investment grade credit rating from Moody's Investors Service and Standard & Poor's Ratings Services. If Idaho Power's unsecured debt were to fall below investment grade, it would be in violation of these provisions, and the counterparties to the derivative instruments could request immediate payment or demand immediate and ongoing full overnight collateralization on derivative instruments in net liability positions. The aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a liability position at June 30, ~~2020,~~2021, was ~~$6.7~~$1.0 million. Idaho Power posted ~~$3.6~~$0.4 million of cash collateral related to this amount. If the credit-risk-related contingent features underlying these agreements were triggered on June 30, ~~2020,~~2021, Idaho Power would have been required to pay or post collateral to its counterparties up to an additional ~~$3.3~~$9.7 million to cover the open liability positions as well as completed transactions that have not yet been paid.

Derivative Instrument Summary

The table below presents the fair values and locations of derivative instruments not designated as hedging instruments recorded on the balance sheets and reconciles the gross amounts of derivatives recognized as assets and as liabilities to the net amounts presented in the balance sheets at June 30, ~~2020,~~2021, and December 31, ~~2019~~2020 (in thousands).

Asset Derivatives Liability Derivatives
Balance Sheet Location Gross Fair Value Amounts Offset Net Assets Gross Fair Value Amounts Offset Net Liabilities

June 30, 2020
Current:

Financial swaps Other current assets $ 160
$ —
$ 160
$ —
$ —
$ —
Financial swaps Other current liabilities 1,531
(1,531 ) —
6,658
(4,546 )
⁽¹⁾
2,112
Forward contracts Other current liabilities —
—
—
3
—
3
Long-term:

Financial swaps Other assets 870
—
870
—
—
—
Financial swaps Other liabilities 10
(10 ) —
47
(47 )
⁽²⁾
—
Total $ 2,571
$ (1,541 ) $ 1,030
$ 6,708
$ (4,593 ) $ 2,115

December 31, 2019

Current:

Financial swaps Other current assets $ 2,426
$ (2,034 ) $ 392
$ 2,034
$ (2,034 ) $ —
Financial swaps Other current liabilities 134
(134 ) —
924
(134 ) 790
Forward contracts Other current assets 13
—
13
—
—
—
Forward contracts Other current liabilities —
—
—
32
—
32
Long-term:

Financial swaps Other assets 3
(3 ) —
27
(3 ) 24
Total $ 2,576
$ (2,171 ) $ 405
$ 3,017
$ (2,171 ) $ 846


		Asset Derivatives						Liability Derivatives
	Balance Sheet Location	Gross Fair Value		Amounts Offset		Net Assets		Gross Fair Value		Amounts Offset			Net Liabilities

June 30, 2021
Current:
Financial swaps	Other current assets	$	13,390	$	(685)	$	12,705	$	685	$	(685)		$	0


Forward contracts	Other current liabilities	0		0		0		104		0			104
Long-term:
Financial swaps	Other assets	2,547		(236)		2,311		236		(236)			0


Total		$	15,937	$	(921)	$	15,016	$	1,025	$	(921)		$	104

December 31, 2020
Current:
Financial swaps	Other current assets	$	2,028	$	(36)	$	1,992	$	36	$	(36)		$	0
Financial swaps	Other current liabilities	187		(187)		0		786		(652)		(1)	134
Forward contracts	Other current assets	5		(2)		3		2		(2)			0
Forward contracts	Other current liabilities	3		(3)		0		13		(3)			10
Long-term:

Financial swaps	Other liabilities	40		(40)		0		56		(56)		(1)	0

Total		$	2,263	$	(268)	$	1,995	$	893	$	(749)		$	144

(1) Current and long-term liability derivative amounts offset include ~~$3.0~~$0.5 million~~of collateral receivable for the period ended June 30, 2020.~~

~~(2) Long-term liability derivative amounts offset include $37~~ and $16 thousand of collateral receivable ~~for the period ended June 30, 2020.~~at December 31, 2020, respectively.

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The table below presents the ~~volumes~~volume of derivative commodity forward contracts and swaps outstanding at June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands of units).


		June 30,
Commodity	Units	2021	2020
Electricity purchases	MWh	254	115
Electricity sales	MWh	10	40
Natural gas purchases	MMBtu	14,455	12,930
Natural gas sales	MMBtu	75	388

June 30,
Commodity Units 2020 2019
Electricity purchases MWh 115
216
Electricity sales MWh 40
106
Natural gas purchases MMBtu 12,930
13,980
Natural gas sales MMBtu 388
308

~~12.~~11. FAIR VALUE MEASUREMENTS

IDACORP and Idaho Power have categorized their financial instruments into a three-level fair value hierarchy, based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active

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markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

Financial assets and liabilities recorded on the condensed consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:

• Level 1: Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that IDACORP and Idaho Power have the ability to access.

• Level 2: Financial assets and liabilities whose values are based on the following:

a) quoted prices for similar assets or liabilities in active markets;

b) quoted prices for identical or similar assets or liabilities in non-active markets;

c) pricing models whose inputs are observable for substantially the full term of the asset or liability; and

d) pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the asset or liability.

IDACORP and Idaho Power Level 2 inputs are based on quoted market prices adjusted for location using corroborated, observable market data.

• Level 3: Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability.

IDACORP’s and Idaho Power’s assessment of a particular input's significance to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy. An item recorded at fair value is reclassified among levels when changes in the nature of valuation inputs cause the item to no longer meet the criteria for the level in which it was previously categorized. There were 0 transfers between levels or material changes in valuation techniques or inputs during the six months ended June 30, ~~2020.~~2021.

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The table below presents information about IDACORP’s and Idaho Power’s assets and liabilities measured at fair value on a recurring basis as of June 30, ~~2020,~~2021, and December 31, ~~2019~~2020 (in thousands).

June 30, 2020 December 31, 2019
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Assets:

Money market funds
IDACORP⁽¹⁾
$ 67,980
$ —
$ —
$ 67,980
$ 64,173
$ —
$ —
$ 64,173
Idaho Power 156,064
—
—
156,064
26,510
—
—
26,510
Derivatives 1,030
—
—
1,030
392
13
—
405
Equity securities 43,666
—
—
43,666
42,738
—
—
42,738
Liabilities:
Derivatives 2,112
3
—
2,115
814
32
—
846


	June 30, 2021								December 31, 2020
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Money market funds
IDACORP(1)	$	69,177	$	0	$	0	$	69,177	$	56,048	$	0	$	0	$	56,048
Idaho Power	11,616		0		0		11,616		40,038		0		0		40,038
Derivatives	15,016		0		0		15,016		1,995		0		0		1,995
Equity securities	47,752		0		0		47,752		50,733		0		0		50,733
Liabilities:
Derivatives	0		104		0		104		134		10		0		144

(1) Holding company only. Does not include amounts held by Idaho Power.

Idaho Power’s derivatives are contracts entered into as part of its management of loads and resources. Electricity derivatives are valued on the Intercontinental Exchange (ICE) with quoted prices in an active market. Natural gas and diesel derivatives are valued using New York Mercantile Exchange (NYMEX) and ICE pricing, adjusted for location basis, which are also quoted under NYMEX and ICE pricing. Equity securities consist of employee-directed investments related to an executive deferred compensation plan and actively traded money market and exchange traded funds related to the SMSP. The investments are measured using quoted prices in active markets and are held in a Rabbi trust.

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The table below presents the carrying value and estimated fair value of financial instruments that are not reported at fair value, as of June 30, ~~2020,~~2021, and December 31, ~~2019,~~2020, using available market information and appropriate valuation methodologies (in thousands).

June 30, 2020 December 31, 2019
Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value
IDACORP

Assets:

Notes receivable⁽¹⁾
$ 3,804
$ 3,804
$ 3,804
$ 3,804
Liabilities:

Long-term debt, including current portion⁽¹⁾
2,175,455
2,553,338
1,836,659
2,083,931
Idaho Power

Liabilities:

Long-term debt, including current portion⁽¹⁾
2,175,455
2,553,338
1,836,659
2,083,931


	June 30, 2021				December 31, 2020
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
IDACORP
Assets:
Notes receivable(1)	$	3,804	$	3,804	$	3,804	$	3,804
Liabilities:
Long-term debt, including current portion(1)	2,000,527		2,352,122		2,000,414		2,466,967
Idaho Power
Liabilities:
Long-term debt, including current portion(1)	2,000,527		2,352,122		2,000,414		2,466,967

(1) Notes receivable and long-term debt are categorized as Level 3 and Level 2, respectively, of the fair value hierarchy, as defined earlier in this Note 1211 - "Fair Value Measurements."

Notes receivable are related to Ida-West and are valued based on unobservable inputs, including ~~discounted~~forecasted cash flows, which are partially based on ~~forecasted~~expected hydropower conditions. Long-term debt is not traded on an exchange and is valued using quoted rates for similar debt in active markets. Carrying values for cash and cash equivalents, deposits, customer and other receivables, notes payable, accounts payable, interest accrued, and taxes accrued approximate fair value.

~~13.~~12. SEGMENT INFORMATION

IDACORP’s only reportable segment is utility operations. The utility operations segment’s primary source of revenue is the regulated operations of Idaho Power. Idaho Power’s regulated operations include the generation, transmission, distribution, purchase, and sale of electricity. This segment also includes income from IERCo, a wholly-owned subsidiary of Idaho Power that is also subject to regulation and is a one-third owner of BCC, an unconsolidated joint venture.

IDACORP’s other operating segments are below the quantitative and qualitative thresholds for reportable segments and are included in the "All Other" category in the table below. This category is comprised of IFS’s investments in affordable housing ~~developments~~ and ~~historic rehabilitation~~other real estate tax credit projects, Ida-West’s joint venture investments in small hydropower generation projects, and IDACORP’s holding company expenses.

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The table below summarizes the segment information for IDACORP’s utility operations and the total of all other segments, and reconciles this information to total enterprise amounts (in thousands).


	Utility Operations		All Other		Eliminations		Consolidated Total
Three months ended June 30, 2021:
Revenues	$	359,058	1,016		$	0	$	360,074
Net income attributable to IDACORP, Inc.	68,822		1,201		0		70,023
Total assets as of June 30, 2021	7,006,991		250,549		(56,082)		7,201,458
Three months ended June 30, 2020:
Revenues	$	317,666	$	1,100	$	0	$	318,766
Net income attributable to IDACORP, Inc.	58,923		1,466		0		60,389
Six months ended June 30, 2021:
Revenues	$	674,625	$	1,502	$	0	$	676,127
Net income attributable to IDACORP, Inc.	113,191		1,663		0		114,854
Six months ended June 30, 2020:
Revenues	$	608,154	$	1,620	$	0	$	609,774
Net income attributable to IDACORP, Inc.	95,700		2,179		0		97,879

Utility
Operations

All
Other
Eliminations
Consolidated
Total
Three months ended June 30, 2020:
Revenues $ 317,666
$ 1,100
$ —
$ 318,766
Net income attributable to IDACORP, Inc. 58,923
1,466
—
60,389
Total assets as of June 30, 2020 6,860,477
234,378
(74,323 ) 7,020,532
Three months ended June 30, 2019:
Revenues $ 315,774
$ 1,121
$ —
$ 316,895
Net income attributable to IDACORP, Inc. 51,176
1,980
—
53,156
Six months ended June 30, 2020:
Revenues $ 608,154
$ 1,620
$ —
$ 609,774
Net income attributable to IDACORP, Inc. 95,700
2,179
—
97,879
Six months ended June 30, 2019:
Revenues $ 665,546
$ 1,668
$ —
$ 667,214
Net income attributable to IDACORP, Inc. 92,760
3,082
—
95,842

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~~14.~~13. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME

The table below presents changes in components of accumulated other comprehensive income (AOCI), net of tax, during the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands). Items in parentheses indicate charges to AOCI.


	Defined Benefit Pension Items				Defined Benefit Pension Items
	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Balance at beginning of period	$	(42,522)	$	(35,537)	$	(43,358)	$	(36,284)
Amounts reclassified out of AOCI	836		747		1,672		1,494
Balance at end of period	$	(41,686)	$	(34,790)	$	(41,686)	$	(34,790)

Defined Benefit Pension Items Defined Benefit Pension Items
Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Balance at beginning of period $ (35,537 ) $ (22,356 ) $ (36,284 ) $ (22,844 )
Amounts reclassified out of AOCI 747
488
1,494
976
Balance at end of period $ (34,790 ) $ (21,868 ) $ (34,790 ) $ (21,868 )

The table below presents amounts reclassified out of components of AOCI and the income statement location of those amounts reclassified during the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands). Items in parentheses indicate increases to net income.


	Amount Reclassified from AOCI													Amount Reclassified from AOCI
Details About AOCI	Three months ended June 30,						Six months ended June 30,						Details About AOCI	Three months ended June 30,				Six months ended June 30,
	2020			2019			2020			2019				2021		2020		2021		2020
Amortization of defined benefit pension items⁽¹⁾													Amortization of defined benefit pension items(1)
Prior service cost	$	73		$	24		$	145		$	48		Prior service cost	$	74	$	73	$	148	$	145
Net loss	933			633			1,867			1,266			Net loss	1,052		933		2,103		1,867
Total before tax	1,006			657			2,012			1,314			Total before tax	1,126		1,006		2,251		2,012
Tax benefit⁽²⁾	(259		)	(169		)	(518		)	(338		)	Tax benefit(2)	(290)		(259)		(579)		(518)

Total reclassification for the period, net of tax	$	747		$	488		$	1,494		$	976		Total reclassification for the period, net of tax	$	836	$	747	$	1,672	$	1,494

(1) Amortization of these items is included in IDACORP's condensed consolidated income statements in other operating expenses and in Idaho Power's condensed consolidated statements of income in other expense, net.

(2) The tax benefit is included in income tax expense in the condensed consolidated statements of income of both IDACORP and Idaho Power.

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~~15.~~14. CHANGES IN IDAHO POWER RETAINED EARNINGS

The table below presents changes in Idaho Power retained earnings during the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands).


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Balance at beginning of period	$	1,607,583	$	1,506,629��	$	1,599,155	$	1,503,805
Net income	68,822		58,923		113,191		95,700
Dividends to parent	(36,031)		(33,986)		(71,972)		(67,939)
Balance at end of period	$	1,640,374	$	1,531,566	$	1,640,374	$	1,531,566

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Balance at beginning of period $ 1,506,629
$ 1,418,775
$ 1,503,805
$ 1,409,245
Net income 58,923
51,176
95,700
92,760
Dividends to parent (33,986 ) (31,932 ) (67,939 ) (63,986 )
Balance at end of period $ 1,531,566
$ 1,438,019
$ 1,531,566
$ 1,438,019

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of IDACORP, Inc.

Results of Review of Interim Financial Information

We have reviewed the accompanying condensed consolidated balance sheet of IDACORP, Inc. and subsidiaries (the “Company”) as of June 30, ~~2020~~,2021, the related condensed consolidated statements of income, comprehensive income, and equity for the three-month and six-month periods ended June 30, ~~2020~~2021 and ~~2019,~~2020, and of cash flows for the six-month periods ended June 30, ~~2020~~2021 and ~~2019~~2020, and the related notes (collectively referred to as the "interim financial information"). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, ~~2019~~,2020, and the related consolidated statements of income, comprehensive income, equity, and cash flows for the year then ended (not presented herein); and in our report dated February ~~20, 2020,~~18, 2021, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, ~~2019~~,2020, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

This interim financial information is the responsibility of the Company’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our reviews in accordance with standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, 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.

/s/ DELOITTE & TOUCHE LLP

Boise, Idaho

July ~~30, 2020~~29, 2021

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholder and the Board of Directors of Idaho Power Company

Results of Review of Interim Financial Information

We have reviewed the accompanying condensed consolidated balance sheet of Idaho Power Company and subsidiary (the “Company”) as of June 30, ~~2020,~~2021, the related condensed consolidated statements of income and comprehensive income for the three-month and six-month periods ended June 30, ~~2020~~2021 and ~~2019,~~2020, and of cash flows for the six-month periods ended June 30, ~~2020~~2021 and ~~2019~~2020, and the related notes (collectively referred to as the "interim financial information"). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, ~~2019,~~2020, 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 February ~~20, 2020,~~18, 2021, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, ~~2019,~~2020, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

/s/ DELOITTE & TOUCHE LLP

Boise, Idaho

July ~~30, 2020~~29, 2021

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

In Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) in this report, the general financial condition and results of operations for IDACORP, Inc. and its subsidiaries (collectively, IDACORP) and Idaho Power Company and its subsidiary (collectively, Idaho Power) are discussed. While reading the MD&A, please refer to the accompanying condensed consolidated financial statements of IDACORP and Idaho Power. Also refer to "Cautionary Note Regarding Forward-Looking Statements" in this report for important information regarding forward-looking statements made in this MD&A and elsewhere in this report. This discussion updates the MD&A included in IDACORP's and Idaho Power's Annual Report on Form 10-K for the year ended December 31, ~~2019 (2019~~2020 (2020 Annual Report), and should also be read in conjunction with the information in that report. The results of operations for an interim period generally will not be indicative of results for the full year, particularly in light of the seasonality of Idaho Power's sales volumes, as discussed below.

INTRODUCTION

IDACORP is a holding company formed in 1998 whose principal operating subsidiary is Idaho Power. IDACORP’s common stock is listed and trades on the New York Stock Exchange under the trading symbol "IDA". Idaho Power is an electric utility whose rates and other matters are regulated by the Idaho Public Utilities Commission (IPUC), Public Utility Commission of Oregon (OPUC), and Federal Energy Regulatory Commission (FERC). Idaho Power generates revenues and cash flows primarily from the sale and distribution of electricity to customers in its Idaho and Oregon service areas, as well as from the wholesale sale and transmission of electricity. Idaho Power experiences its highest retail energy sales during the summer irrigation and cooling season, with a lower peak in the winter that generally results from heating demand.

Idaho Power is the parent of Idaho Energy Resources Co. (IERCo), a joint venturer in Bridger Coal Company (BCC), which mines and supplies coal to the Jim Bridger generating plant (Jim Bridger plant) owned in part by Idaho Power. IDACORP’s other significant subsidiaries include IDACORP Financial Services, Inc., an investor in affordable housing and other real estate tax credit investments, and Ida-West Energy Company, an operator of small hydropower generation projects that satisfy the requirements of the Public Utility Regulatory Policies Act of 1978 (PURPA).

EXECUTIVE OVERVIEW

Management's Outlook and Company Initiatives

In the ~~2019~~2020 Annual Report, IDACORP's and Idaho Power's management included a brief overview of their business strategies for the companies for ~~2020~~2021 and beyond, under the heading "Executive Overview" in the MD&A. As of the date of this report, management's outlook and strategy remain consistent with that discussion. Most notably:

Idaho Power continues to expect positive customer growth in its service area and continues to participate in and support state and local economic development initiatives aimed at responsible and sustainable growth. During the first six months of 2020, Idaho Power's customer count grew by nearly 7,200 customers, and for the twelve months ended June 30, 2020, the customer growth rate was 2.6 percent.

Idaho Power anticipates substantial capital investments, with expected total capital expenditures of approximately $1.6 billion over the five-year period from 2020 (including the expenditures incurred so far in 2020) through 2024.

•Idaho Power continues to execute on its four strategic ~~areas:~~areas and initiatives: growing financial strength, improving Idaho Power's core business, enhancing Idaho Power's brand, and focusing on safety and employee engagement.

•Idaho Power continues to expect positive customer growth in its service area. During the first six months of 2021, Idaho Power's customer count grew by over 8,500 customers, and for the twelve months ended June 30, 2021, the customer growth rate was 2.9 percent. On June 30, 2021, a new all-time system peak demand of 3,751 MW was set, exceeding the previous high of 3,422 MW set on July 7, 2017. The previous high from July 2017 was exceeded multiple times during the heat wave in Idaho Power's service area in June and July of 2021.

•Idaho Power anticipates substantial capital investments, with expected total capital expenditures of approximately $2.0 billion over the five-year period from 2021 (including the expenditures incurred so far in 2021) through 2025.

•Idaho Power continues to focus on timely recovery of costs and earning a reasonable return on investment, including working to evaluate and ensure that its rate design and regulatory mechanisms more closely reflect the cost to provide electric service.

~~In April and June 2020, respectively,~~ •Idaho Power ~~issued $230 million in principal amount of 4.20 percent first mortgage bonds due in 2048,~~is committed to continuing to provide reliable, affordable, safe service to its customers while furthering its environmental, social, and ~~$80 million in principal amount of 1.90 percent first mortgage bonds due in 2030.~~governance initiatives, including the "Clean Today. Cleaner Tomorrow.®" goal to provide Idaho ~~Power intends to use a portion of~~Power's customers with 100-percent clean energy by 2045, as well as water stewardship and environmental projects, and the ~~bond proceeds to redeem outstanding debt. Idaho Power believes the issuances help maintain its strong liquidity position enabling it to fund its ongoing operations, capital expenditures,~~company’s diversity, equity, and ~~dividend payments.~~inclusion initiatives.

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Coronavirus (COVID-19) Response and Impacts

In response to the COVID-19 ~~public health crisis,~~pandemic, in ~~March~~ 2020 Idaho Power implemented its emergency management, business continuity, and enterprise pandemic plans. Idaho Power's internal emergency management team responded in accordance with the plans in an effort to ensure Idaho Power continues to provide reliable service to its customers during the pandemic. Idaho Power's

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provision of electricity to customers through its power supply, transmission, and distribution operations, as of the date of this report, continues largely uninterrupted.

~~Idaho Power has taken proactive steps during the crisis to protect employees, customers, the general public, and~~ For more information about Idaho Power's electrical system. In March 2020, Idaho Power closed all of its operating facilities to the public, closed most Idaho Power recreation sites, upgraded information technology capabilities to facilitate remote working for over half of its workforce, eliminated substantially all in-person meetings and non-essential work travel, reviewed its supply chain for critical items, continued monitoring of cyber and physical security threats, tested critical information technology systems for business continuity purposes, enhanced cleaning procedures at all facilities, and encouraged employees to practice responsible social distancing and other effective prevention and safety measures. Idaho Power has a small number of highly specialized employees who are trained to operate the power grid and critical generation facilities. Idaho Power has taken actions to help ensure the health and availability of those essential employees, including performing health screenings, alternating schedules, segregating employees into separate facilities, and limiting interaction. If the COVID-19 pandemic were to worsen, Idaho Power is prepared for the potential sequestration of those employees as a further measure for ensuring their health and safety and ability to perform their specialized functions. As of the date of this report, most of Idaho Power's office workforce continues to work remotely.

In March 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) that provides numerous economic assistance and stimulus measures for individuals and businesses. Idaho Power does not expect the CARES Act to have a material effect on its financial results or liquidity.

Also in March 2020, in consideration of the COVID-19 public health crisis, Idaho Power temporarily suspended disconnections and late fees for late payment or non-payment. As approved by the IPUC in July 2020, Idaho Power plans to resume disconnections and accruing late fees for customers in its Idaho service area beginning in early August 2020. Commercial customers have been particularly affected by the economic impacts of the COVID-19 public health crisis, as the response disrupted operations of many of those customers. As many of Idaho Power's larger commercial and industrial customers are in the agriculture and food-processing industry, COVID-19 has had a smaller impact on those customers given the importance of the food that they produce, and thus mitigated in part the overall energy usage decline from those customers. Irrigation customers have also been impacted to a lesser extent. While the COVID-19 crisis does not appear to have significantly affected wheeling revenues to date, to the extent economies of other states continue to be negatively affected by the COVID-19 crisis, transmission wheeling revenues could decrease due to overall decreases in energy loads in the western region of the U.S., impacting energy prices and overall market activity regionally. Overall, Idaho Power anticipates that the disruption of economic activities in its service area and global economic conditions created by the response to the COVID-19 ~~public health crisis will continue to negatively affect energy usage~~pandemic and ~~associated revenues from commercial and industrial customers, and will continue to increase late payments and uncollectible account write-offs. In recognition~~the effects of ~~the economic impact,~~COVID-19 on Idaho Power, ~~increased its allowance for uncollectible receivables from $1.4 million at December 31, 2019, to $3.5 million at June 30, 2020, based on Idaho Power's estimate of the impact of the crisis.~~

In July 2020, the IPUC issued an order granting Idaho Power the authority to defer unanticipated, emergency-related expenses due to the COVID-19 public health crisis, net of any cost savings, for possible recovery through future rates. In the second quarter of 2020, Idaho Power recorded a $0.6 million regulatory asset for its estimate of unanticipated, emergency-related expenses, including higher bad debt expense, net of estimated savings. For additional information, see ~~Note 3~~Part II - ~~"Regulatory Matters" to the condensed consolidated financial statements included in this report.~~

As noted above, in April 2020 Idaho Power issued $230 million in principal amount of 4.20 percent first mortgage bonds due in 2048. The bonds were issued at a reoffer yield of 3.422 percent, which resulted in a net premium of 13.0 percent and net proceeds to Idaho Power of approximately $260 million. In June 2020, Idaho Power issued $80 million in principal amount of first mortgage bonds due in 2030. While Idaho Power expected to issue debt securities during 2020 unrelated and prior to the COVID-19 public health crisis, and has used or will use some of the proceeds of the issuances for early retirement of debt, the net proceeds from the issuances provide Idaho Power with additional liquidity should the financial impacts of the COVID-19 public health crisis worsenItem 7 - "Executive Overview" in the ~~coming months or be prolonged.~~

~~As of~~MD&A in the date of this report, Idaho Power is uncertain how long the COVID-19 public health crisis will last and how significantly it will ultimately impact its business operations, results of operations, cash flows, financial condition, or capital

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~~resources.~~2020 Annual Report. For a discussion of certain risks to IDACORP and Idaho Power ~~are confronting~~ as a result of the ~~public health crisis,~~pandemic, see Part II - Item 1A - "Risk Factors" in ~~this report.~~the 2020 Annual Report.

Summary of Financial Results

The following is a summary of Idaho Power's net income, net income attributable to IDACORP, and IDACORP's earnings per diluted share for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands, except earnings per share amounts):


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Idaho Power net income	$	68,822	$	58,923	$	113,191	$	95,700
Net income attributable to IDACORP, Inc.	$	70,023	$	60,389	$	114,854	$	97,879
Weighted average outstanding shares – diluted	50,622		50,567		50,601		50,547
IDACORP, Inc. earnings per diluted share	$	1.38	$	1.19	$	2.27	$	1.94

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Idaho Power net income $ 58,923
$ 51,176
$ 95,700
$ 92,760
Net income attributable to IDACORP, Inc. $ 60,389
$ 53,156
$ 97,879
$ 95,842
Average outstanding shares – diluted 50,567
50,507
50,547
50,512
IDACORP, Inc. earnings per diluted share $ 1.19
$ 1.05
$ 1.94
$ 1.90

The table below provides a reconciliation of net income attributable to IDACORP for the three and six months ended June 30, ~~2020,~~2021, from the same period in ~~2019~~2020 (items are in millions and are before related income tax impact unless otherwise noted).


	Three months ended			Six months ended
Net income attributable to IDACORP, Inc. - June 30, 2020		$	60.4		$	97.9
Increase (decrease) in Idaho Power net income:
Customer growth, net of associated power supply costs and power cost adjustment mechanisms	3.9			7.6
Usage per retail customer, net of associated power supply costs and power cost adjustment mechanisms	22.9			20.5
Idaho fixed cost adjustment (FCA) revenues	(5.1)			(5.0)
Retail revenues per megawatt-hour (MWh), net of associated power supply costs and power cost adjustment mechanisms	(6.8)			(6.1)
Transmission wheeling-related revenues	3.9			8.0

Other operations and maintenance (O&M) expenses	(5.3)			(1.2)

Other changes in operating revenues and expenses, net	(0.4)			(1.2)

Increase in Idaho Power operating income	13.1			22.6

Non-operating income and expenses	1.0			0.6

Income tax expense	(4.2)			(5.7)
Total increase in Idaho Power net income		9.9			17.5
Other IDACORP changes (net of tax)		(0.3)			(0.5)
Net income attributable to IDACORP, Inc. - June 30, 2021		$	70.0		$	114.9

Three months ended Six months ended
Net income attributable to IDACORP, Inc. - June 30, 2019 $ 53.2
$ 95.8
Increase (decrease) in Idaho Power net income:

Customer growth, net of associated power supply costs and power cost adjustment mechanisms 3.4

7.0

Usage per retail customer, net of associated power supply costs and power cost adjustment mechanisms 6.6
(0.1 )
Idaho fixed cost adjustment (FCA) revenues (3.1 ) 1.5

Retail revenues per megawatt-hour (MWh), net of associated power supply costs and power cost adjustment mechanisms
(1.5 ) (3.0 )
Transmission wheeling-related revenues (1.0 ) (6.4 )
Other operations and maintenance (O&M) expenses 3.9
3.0

Other changes in operating revenues and expenses, net (0.8 ) (1.0 )
Increase in Idaho Power operating income 7.5
1.0

Non-operating income and expenses —
1.4

Income tax expense 0.2
0.5

Total increase in Idaho Power net income
7.7
2.9
Other IDACORP changes (net of tax)
(0.5 ) (0.8 )
Net income attributable to IDACORP, Inc. - June 30, 2020 $ 60.4
$ 97.9

Net Income - Second Quarter ~~2020~~2021

IDACORP's net income increased ~~$7.2~~$9.6 million for the second quarter of ~~2020~~2021 compared with the second quarter of ~~2019,~~2020, primarily due to higher net income at Idaho Power. Customer growth increased operating income by ~~$3.4~~$3.9 million in the second quarter of ~~2020~~2021 compared with the second quarter of ~~2019,~~2020, as the number of Idaho Power customers grew by ~~approximately 14,500,~~over 16,900, or ~~2.6~~2.9 percent, during the twelve months ended June 30, ~~2020.~~2021. Higher sales volumes on a per-customer basis in all customer classes increased operating income by ~~$6.6~~$22.9 million as warmer and drier weather caused customers to use more energy for cooling or irrigation in the second quarter of ~~2020~~2021 compared with the second quarter of ~~2019, as higher usage per irrigation and residential customer was partially offset by decreased~~2020. Increases in usage per commercial and industrial ~~customer. Less precipitation in April and May 2020 compared with the same months in 2019 led~~customers were partially due to a ~~24 percent increase~~return to more normal economic activity in ~~usage per irrigation customer during~~ the second quarter of ~~2020~~2021 compared with the second quarter of ~~2019. Also, residential customers used more energy for heating and cooling due to weather variations and residential customers spending more time at home due to the COVID-19 public health crisis,~~2020, which ~~increased usage per residential customer~~was affected by 6 percent in the second quarter of 2020 compared with the second quarter of 2019. Decreases of 7 percent and 4 percent in usage per commercial and industrial customer, respectively, were largely due to the economic impacts of COVID-19.negative COVID-19-related business conditions. The increase in sales volumes per ~~residential~~ customer was partially offset by the FCA mechanism (applicable to residential and small general service customers), which decreased revenues in the second quarter of ~~2020~~2021 by ~~$3.1 million as compared with the second quarter of 2019.~~

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~~During the second quarter of 2020, transmission wheeling-related revenues decreased $1.0~~$5.1 million compared with the second quarter of ~~2019.~~2020.

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The net decrease in retail revenues per MWh, net of associated power supply costs and power cost adjustment mechanisms, decreased operating income by $6.8 million during the second quarter of 2021 compared with the second quarter of 2020. In the second quarter of 2021, higher wholesale energy market prices due to a heat wave in the western United States and higher energy usage by Idaho Power customers increased Idaho Power's net power supply expenses. The increase in the amount of net power supply expenses that were not deferred through Idaho Power's power cost adjustment mechanisms was the primary cause of the negative variance in net retail revenues per MWh between the comparison periods.

Transmission wheeling-related revenues increased $3.9 million during the second quarter of 2021 compared with the second quarter of 2020 as the warmer, drier weather in the western United States increased wheeling volumes. Also, Idaho Power's open access transmission tariff (OATT) rates ~~decreased~~were approximately 1310 percent ~~in October 2019.~~

~~Other O&M expenses were $3.9 million lower~~higher in the second quarter of ~~2020~~2021 compared with the second quarter of ~~2019,~~2020.

Other O&M expenses were $5.3 million higher in the second quarter of 2021 compared with the second quarter of 2020, primarily due to the ~~temporary deferral~~timing of performing certain maintenance projects at Idaho Power's jointly-owned thermal generation ~~plants. The timing~~plants in 2021 instead of ~~these projects is discretionary and Idaho Power expects these projects to be completed later~~ in ~~2020 or~~2020. Also, other O&M expenses increased in ~~2021. As noted above, in July 2020,~~ the ~~IPUC issued an order granting Idaho Power the authority to defer unanticipated, emergency-related expenses due to the COVID-19 public health crisis, net~~second quarter of ~~any cost savings, for possible recovery through future rates. In~~2021 compared with the second quarter of 2020, ~~Idaho Power recorded~~as a ~~$0.6 million regulatory asset~~result of an increase in labor-related costs from higher performance-based variable compensation accruals.

The increase in income tax expense for ~~its estimate~~the second quarter of ~~such costs, including higher bad debt expense, net~~2021 compared with the second quarter of ~~estimated savings in vehicle fuel, employee travel, and training. For additional information, see Note 3 - "Regulatory Matters"~~2020 was primarily due to ~~the condensed consolidated financial statements included in this report.~~greater 2021 pre-tax income.

Net Income - Year-to-Date ~~2020~~2021

IDACORP's net income increased ~~$2.1~~$17.0 million for the first half of ~~2020~~2021 compared with the first half of ~~2019,~~2020, primarily due to higher net income at Idaho Power. Customer growth increased operating income by ~~$7.0~~$7.6 million in the first half of ~~2020~~2021 compared with the first half of ~~2019. Sales~~2020. An increase in sales volumes on a per-customer basis ~~were relatively flat during those periods as higher usage per~~increased operating income by $20.5 million due primarily to warmer and drier weather that caused customers to use more energy for cooling or irrigation ~~customer was offset by lower usage per~~in the first half of 2021 compared with 2020. To a lesser extent, a return to more normal economic conditions for commercial and industrial ~~customer largely due to COVID-19. Less precipitation~~customers in ~~April and May 2020~~the first half of 2021 compared with ~~the same months in 2019 led to~~2020, also increased sales volumes on a ~~24 percent increase in usage per irrigation customer during~~per-customer basis, as the first half of 2020 ~~compared with the first half of 2019. Usage per residential customer decreased~~was affected by ~~1 percent during the first half of 2020 compared with the first half of 2019, as the~~negative COVID-19-related business conditions. The increase caused by weather and COVID-19 in the second quarter of 2020 described above did not fully offset the lower usage from the first quarter of 2020 caused by more moderate weather, which resulted in residential customers using less energy for heating. The decrease in sales volumes per ~~residential~~ customer was partially offset by the FCA mechanism (applicable to residential and small general service customers), which ~~increased~~decreased revenues by ~~$1.5~~$5.0 million.

The net decrease in retail revenues per MWh ~~decreased operating income by $3.0 million~~ in the first half of ~~2020~~2021 compared ~~with~~to the first half of ~~2019~~.2020, decreased operating income by $6.1 million primarily due to higher power supply costs. In the second quarter of 2021, higher wholesale energy market prices due to a heat wave in the western United States and higher energy usage by Idaho Power customers increased Idaho Power's net power supply expenses. The ~~Idaho-jurisdiction PCA mechanism includes a cost or benefit ratio that allocates~~increase in the ~~deviations in certain~~amount of net power supply expenses that were not deferred through Idaho Power's power cost adjustment mechanisms was the primary cause of the negative variance in net retail revenues per MWh between ~~customers (95 percent) and Idaho Power (5 percent). In~~ the first half of 2019, net power supply expenses were reduced due to significant amount of wholesale energy sales resulting from regional wholesale energy market conditions. Regional wholesale energy prices were elevated due to below normal regional temperatures, lack of energy imports to the region due to equipment maintenance, and natural gas pipeline disruptions. The higher wholesale energy prices during the first half of 2019 led to greater wholesale energy sales by Idaho Power, of which 5 percent benefited Idaho Power.

comparison periods.

During the first half of ~~2020,~~2021, transmission wheeling-related revenues ~~decreased $6.4~~increased $8.0 million compared with the first half of ~~2019, due~~2020, as the warmer and drier weather in the western United States caused customers in the region to use more energy for cooling or irrigation, as applicable, which increased wheeling volumes. Colder winter weather in the southwest United States during the first quarter of 2021 also contributed to increased wheeling volumes in the first six months of 2021 compared with the first six months of 2020. In addition, Idaho Power's ~~open access transmission tariff~~OATT rates ~~decreasing~~were approximately 1310 percent higher in ~~October 2019 and less regional wholesale market activity~~the first six months of 2021 compared with the first six months of 2020.

The increase in income tax expense for the first half of ~~2020~~2021 compared with the first half of ~~2019, resulting from the market conditions noted above.~~

~~Other O&M expenses were $3.0 million lower in the first half of~~ 2020 ~~compared with the first half of 2019,~~was primarily due to ~~lower thermal operating and maintenance expenses as explained above.~~greater 2021 pre-tax income.

Based on its estimate of full-year ~~2020~~2021 return on year-end equity in the Idaho jurisdiction (Idaho ROE), in the first half of ~~2020~~2021 Idaho Power recorded no additional accumulated deferred investment tax credits (ADITC) amortization or any provision against revenues for sharing of earnings with customers under the Idaho regulatory settlement stipulation approved in May 2018.

Overview of General Factors and Trends Affecting Results of Operations and Financial Condition

IDACORP's and Idaho Power's results of operations and financial condition are affected by a number of factors, and the impact of those factors is discussed in more detail below in this MD&A. To provide context for the discussion elsewhere in this report, some of the more notable factors are as follows:

•

~~Regulation of Rates and Cost Recovery:~~ The prices that Idaho Power is authorized to charge for its electric and transmission service is a critical factor in determining IDACORP's and Idaho Power's results of operations and financial condition. Those rates are established by state regulatory commissions and the FERC and are intended to allow Idaho Power an opportunity to recover its expenses and earn a reasonable return on investment. Idaho Power

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•Regulation of Rates and Cost Recovery: The prices that Idaho Power is authorized to charge for its electric and transmission service is a critical factor in determining IDACORP's and Idaho Power's results of operations and financial condition. Those rates are established by state regulatory commissions and the FERC and are intended to allow Idaho Power an opportunity to recover its expenses and earn a reasonable return on investment. Idaho Power focuses on timely recovery of its costs through filings with its regulators, working to put in place innovative regulatory mechanisms, and on the prudent management of expenses and investments. Idaho Power has a regulatory settlement stipulation in Idaho that includes provisions for the accelerated amortization of certain tax credits to help achieve a minimum 9.4 percent Idaho ROE. The settlement stipulation also provides for the potential sharing between Idaho Power and its Idaho customers of Idaho-jurisdictional earnings in excess of 10.0 percent of Idaho ROE. The settlement stipulation has no expiration date but the minimum Idaho ROE would revert back to 95 percent of the allowed return on equity in the next rate case. The specific terms of the settlement stipulation are described in Note 3 - "Regulatory Matters" to the consolidated financial statements included in the ~~2019~~2020 Annual Report. Idaho Power will continue to assess the need to file a general rate case to reset base rates but does not anticipate filing a rate case in the next twelve months.

•

•Economic Conditions and Loads: Economic conditions impact consumer demand for energy, revenues, collectability of accounts, the volume of wholesale energy sales, and the need to construct and improve infrastructure, purchase power, and implement programs to meet customer load demands. In recent years, Idaho Power has seen growth in the number of customers in its service area. Over the twelve months ended June 30, 2020, Idaho Power's customer count grew by 2.6 percent. Idaho Power expects its number of customers to continue to increase in the foreseeable future. As noted above, Idaho Power's provision of electricity to customers through its power supply, transmission, and distribution operations continues largely uninterrupted despite the COVID-19 crisis, other than lower usage by commercial and industrial customers during the first half of 2020.

~~In June 2019,~~ Idaho Power ~~released~~has seen growth in the number of customers in its ~~2019~~service area. Over the twelve months ended June 30, 2021, Idaho Power's customer count grew by 2.9 percent. For Idaho Power, a new all-time system peak demand of 3,751 MW was set on June 30, 2021, exceeding the previous high of 3,422 MW set on July 7, 2017. The previous peak demand from July 2017 was exceeded multiple times during the heat wave in Idaho Power's service area in June and July of 2021. Idaho Power expects its number of customers to continue to increase in the foreseeable future. Idaho Power expects that existing and sustained future customer growth and an increasing peak demand for electricity will require Idaho Power to continue to enhance its distribution and transmission system infrastructure, including the Boardman-to-Hemingway project. That growth and peak demand may also result in the need for Idaho Power to procure other new sources of energy and capacity to serve growing demand and to maintain system reliability. Further, recent changes in the regional transmission markets have constrained the transmission system external to Idaho Power's service area and impacted Idaho Power's ability to import energy from energy markets in the western United States. Idaho Power expects to need approximately 80 MW of additional capacity as early as the summer of 2023. On June 30, 2021, Idaho Power issued a formal request for proposals for up to 80MW of new resources to help meet peak electric energy needs in 2023. Idaho Power is analyzing options for potential energy and capacity resource procurement, while at the same time working on its 2021 Integrated ~~Resource Plan (IRP),~~Resources Plan.

•Weather Conditions: Weather and agricultural growing conditions have a significant impact on Idaho Power's energy sales. Relatively low and high temperatures result in greater energy use for heating and cooling, respectively. During the agricultural growing season, which ~~was amended~~ in ~~January 2020,~~large part occurs during the second and asthird quarters, irrigation customers use electricity to operate irrigation pumps, and weather conditions can impact the timing and extent of use of those pumps. Idaho Power also has tiered rates and seasonal rates, which contribute to increased revenues during higher-load periods, most notably during the third quarter of each year when overall customer demand is highest. Much of the ~~date~~adverse or favorable impact of ~~this report, remains subject~~weather on sales of energy to ~~further amendment as~~residential and small commercial customers is mitigated through the Idaho FCA mechanism, which is described in Note 3 - "Regulatory Matters" to the condensed consolidated financial statements included in this MD&A. The load forecast assumptions Idaho Power used in the 2019 IRP are included in the table below. For comparison purposes, the analogous average annual growth rates used in the prior two IRPs are included.report.

5-Year Forecasted Annual Growth Rate 20-Year Forecasted Annual Growth Rate

Retail Sales
(Billed MWh)

Annual Peak
(Peak Demand)

Retail Sales
(Billed MWh)

Annual Peak
(Peak Demand)
2019 IRP 1.3% 1.4% 1.0% 1.2%
2017 IRP 1.1% 1.6% 0.9% 1.4%
2015 IRP 1.5% 1.8% 1.2% 1.5%

•

~~Weather Conditions:~~ Weather and agricultural growing conditions have a significant impact on Idaho Power's energy sales. Relatively low and high temperatures result in greater energy use for heating and cooling, respectively. During the agricultural growing season, which in large part occurs during the second and third quarters, irrigation customers use electricity to operate irrigation pumps, and weather conditions can impact the timing and extent of use of those pumps. Idaho Power also has tiered rates and seasonal rates, which contribute to increased revenues during higher-load periods, most notably during the third quarter of each year when overall customer demand is highest. Much of the adverse or favorable impact of weather on sales of energy to residential and small commercial customers is mitigated through the Idaho FCA mechanism, which is described in Note 3 - "Regulatory Matters" to the condensed consolidated financial statements included in this report.

Further, as Idaho Power's hydropower facilities comprise ~~nearly~~over one-half of Idaho Power's nameplate generation capacity, precipitation levels impact the mix of Idaho Power's generation resources. When hydropower generation ~~is reduced,~~decreases, Idaho Power must rely on more expensive generation sources and purchased power. When favorable hydropower generating conditions exist for Idaho Power, they also may exist for other Pacific Northwest hydropower facility operators, lowering regional wholesale market prices and impacting the revenue Idaho Power receives from wholesale energy sales. Much of the adverse or favorable impact of this volatility is addressed through the Idaho and Oregon power cost adjustment mechanisms. For ~~2020,~~2021, Idaho Power expects generation from its hydropower resources to be in the range of ~~6.5~~5.0 to ~~7.5~~6.0 million MWh, compared with ~~20-year~~ average total annual ~~hydropower~~ generation of ~~7.3~~approximately 7.7 million ~~MWh.~~MWh over the last 30 years.

•

•Rate Base Growth and Infrastructure Investment: As noted above, the rates established by the IPUC and OPUC are determined with the intent to provide an opportunity for Idaho Power to recover authorized operating expenses and depreciation and earn a reasonable return on “rate base.” Rate base is generally determined by reference to the original cost (net of accumulated depreciation) of utility plant in service and certain other assets, subject to various adjustments for deferred taxes and other items. Over time, rate base is increased by additions to utility plant in service and reduced by depreciation and retirement of utility plant and write-offs as authorized by the IPUC and OPUC. In recent years,

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for deferred taxes and other items. Over time, rate base is increased by additions to utility plant in service and reduced by depreciation and retirement of utility plant and write-offs as authorized by the IPUC and OPUC. Idaho Power ~~has been~~is pursuing significant enhancements to its utility infrastructure in an effort to maintain system reliability, ensure an adequate supply of electricity, and to provide service to new customers, including major ongoing transmission projects such as the Boardman-to-Hemingway and Gateway West projects. Idaho Power's existing hydropower and thermal generation facilities also require continuing upgrades and equipment replacement, and the company is undertaking a significant relicensing effort for the Hells Canyon Complex (HCC), its largest hydropower generation resource. Idaho Power intends to pursue timely inclusion of any significant completed capital projects into rate base as part of a future general rate case or other appropriate regulatory proceeding.

•

•Mitigation of Impact of Fuel and Purchased Power Expense: In addition to hydropower generation, Idaho Power relies significantly on natural gas and coal to fuel its generation facilities and on power purchases in the wholesale markets. Fuel costs are impacted by electricity sales volumes, the terms and conditions of contracts for fuel, Idaho Power's generation capacity, the availability of hydropower generation resources, transmission capacity, energy market prices, and Idaho Power's hedging program for managing fuel costs. Purchased power costs are impacted by the terms and conditions of contracts for purchased power, the rate of expansion of alternative energy generation sources such as wind or solar energy, and wholesale energy market prices. The Idaho and Oregon power cost adjustment mechanisms mitigate in large part the potential adverse impacts to Idaho Power of fluctuations in power supply costs.

•Regulatory and Environmental Compliance Costs: Idaho Power is subject to extensive federal and state laws, policies, and regulations, as well as regulatory actions and audits by agencies and quasi-governmental agencies, including the FERC, the North American Electric Reliability Corporation, and the Western Electricity Coordinating Council. Compliance with these requirements directly influences Idaho Power's operating environment and affects Idaho Power's operating costs. Recently, energy industry regulators have issued substantial penalties for utilities alleged to have violated reliability and critical infrastructure protection requirements. Moreover, environmental laws and regulations, in particular, may increase the cost of constructing new facilities and transmission projects, may increase the cost of operating generation plants, including Idaho Power's jointly-owned coal-fired generating plants, may require that Idaho Power install additional pollution control devices at existing generating plants, or may require that Idaho Power cease operating certain generation plants. Idaho Power expects to spend significant amounts on environmental compliance and controls in the next decade. Due to economic factors in part associated with the costs of compliance with environmental regulation, Idaho Power accelerated the retirement date of its jointly-owned coal-fired generating plant in Valmy, Nevada (Valmy), ceasing operations at one unit in 2019. In April 2021, Idaho Power filed an application with the IPUC requesting an acknowledgment that its year-end 2025 exit date from Valmy unit 2 is appropriate based on economics and reliability needs. In June 2021, Idaho Power filed an application with the IPUC requesting, among other things, authorization to accelerate depreciation for the Jim Bridger plant by end-of-year 2030. In addition, Idaho Power's jointly-owned coal plant in Boardman, Oregon, ceased operations as planned in October 2020.

•

~~Regulatory and Environmental Compliance Costs:~~ Idaho Power is subject to extensive federal and state laws, policies, and regulations, as well as regulatory actions and audits by agencies and quasi-governmental agencies, including the FERC, the North American Electric Reliability Corporation, and the Western Electricity Coordinating Council. Compliance with these requirements directly influences Idaho Power's operating environment and affects Idaho Power's operating costs. Recently, energy industry regulators have issued substantial penalties for utilities alleged to have violated reliability and critical infrastructure protection requirements. Moreover, environmental laws and regulations, in particular, may increase the cost of constructing new facilities, may increase the cost of operating generation plants, including Idaho Power's jointly-owned coal-fired generating plants, may require that Idaho Power install additional pollution control devices at existing generating plants, or may require that Idaho Power cease operating certain generation plants. Idaho Power expects to spend significant amounts on environmental compliance and controls in the next decade, and due to economic factors in part associated with the costs of compliance with environmental regulation, has accelerated the retirement dates of two of its jointly-owned coal-fired generating plants.

•

•Water Management and Relicensing of Hydropower Projects: Because of Idaho Power's reliance on stream flow in the Snake River and its tributaries, Idaho Power participates in numerous proceedings and venues that may affect its water rights, seeking to preserve the long-term availability of its rights for its hydropower projects. Also, Idaho Power is involved in renewing its long-term federal licenses for the HCC, its largest hydropower generation source, and for American Falls, its second largest hydropower generation source. Given the number of parties involved, Idaho Power's relicensing costs have been and are expected to continue to be substantial. Idaho Power cannot currently determine the ultimate terms of, and costs associated with, any resulting long-term licenses.

•

~~Wildfire Mitigation Plan:~~ In recent years, the Western United States, particularly California, has experienced an increased frequency of destructive wildland fires (wildfires). A variety of factors have contributed in varying degrees to this trend including such things as climate change, increased human encroachment in wildland-urban interfaces, historical land management practices, and overall wildland and forest health. While Idaho Power has not experienced the type of catastrophic wildfires within its service area that have occurred in California, Idaho Power is taking a proactive approach to wildfire threat relative to its service area. Idaho Power has drafted a Wildfire Mitigation Plan (WMP) that outlines actions Idaho Power is taking or is working to implement in the future to reduce wildfire risk and to strengthen the resiliency of its transmission and distribution system to wildfires. Idaho Power's approach to achieve these objectives includes identifying areas subject to elevated risk, creating specific targeted actions in O&M practices, system hardening programs, vegetation management, and field personnel practices to mitigate wildfire risk, incorporating current and forecasted weather and field conditions into operational practices, evaluating whether public safety shutoffs are currently a reasonable mitigation approach, and evaluating the performance and effectiveness of the strategies identified in the WMP through metrics and monitoring.

•Wildfire Mitigation Efforts: In recent years, in the western United States there has been an increasing trend in the degree of annual destruction from wildfires. A variety of factors have contributed in varying degrees to this trend including climate change, increased wildland-urban interfaces, historical land management practices, and overall wildland and forest health. While Idaho Power has not experienced the extent of catastrophic wildfires within its service area that have occurred in California, Oregon, and elsewhere in the western United States, Idaho Power is taking a proactive approach to wildfire threat relative to its service area. Idaho Power has drafted a Wildfire Mitigation Plan (WMP) that outlines actions Idaho Power is taking or is working to implement in the future to reduce wildfire risk and to strengthen the resiliency of its transmission and distribution system to wildfires. Idaho Power's approach to achieve these objectives includes identifying areas subject to elevated risk; system hardening programs, vegetation management, and field personnel practices to mitigate wildfire risk; incorporating current and forecasted weather and field conditions into operational practices; evaluating a public safety power shutoff approach; and evaluating the performance and effectiveness of the strategies identified in the WMP through metrics and monitoring. In June 2021, the IPUC authorized Idaho Power to defer, for future amortization, the Idaho jurisdictional share of actual incremental

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O&M expenses and depreciation expense of certain capital investments necessary to implement the WMP, including incremental insurance costs, among other things. The WMP case with the IPUC is described in more detail in Note 3 - "Regulatory Matters" to the condensed consolidated financial statements included in this report.

RESULTS OF OPERATIONS

This section of MD&A takes a closer look at the significant factors that affected IDACORP’s and Idaho Power’s earnings during the three and six months ended June 30, ~~2020.~~2021. In this analysis, the results for the three and six months ended June 30, ~~2020,~~2021, are compared with the same period in ~~2019.~~2020.

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The table below presents Idaho Power’s energy sales and supply (in thousands of MWh) for the three and six months ended June 30, ~~2020~~2021 and ~~2019.~~2020.


	Three months ended June 30,		Six months ended June 30,
	2021	2020	2021	2020
Retail energy sales	4,098	3,594	7,467	6,913
Wholesale energy sales	67	489	188	671
Bundled energy sales	34	110	245	272
Total energy sales	4,199	4,193	7,900	7,856
Hydropower generation	1,449	2,275	2,875	3,881
Coal generation	372	810	908	1,272
Natural gas and other generation	666	89	1,307	727
Total system generation	2,487	3,174	5,090	5,880
Purchased power	1,949	1,305	3,346	2,526
Line losses	(237)	(286)	(536)	(550)
Total energy supply	4,199	4,193	7,900	7,856

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Retail energy sales 3,594
3,409
6,913
6,780
Wholesale energy sales 489
1,042
671
1,902
Bundled energy sales 110
—
272
146
Total energy sales 4,193
4,451
7,856
8,828
Hydropower generation 2,275
3,032
3,881
5,132
Coal generation 810
422
1,272
1,554
Natural gas and other generation 89
137
727
564
Total system generation 3,174
3,591
5,880
7,250
Purchased power 1,305
1,195
2,526
2,256
Line losses (286 ) (335 ) (550 ) (678 )
Total energy supply 4,193
4,451
7,856
8,828

Weather-related information for Boise, Idaho, for the three and six months ended June 30, ~~2020~~2021 and ~~2019,~~2020, is presented in the table below. While Boise, Idaho weather conditions are not necessarily representative of weather conditions throughout Idaho Power's service area, the greater Boise area has the majority of Idaho Power's customers and is included for illustrative purposes.


	Three months ended June 30,			Six months ended June 30,				Three months ended June 30,			Six months ended June 30,
	2020	2019	Normal ⁽²⁾	2020	2019	Normal ⁽²⁾		2021	2020	Normal (2)	2021	2020	Normal (2)
Heating degree-days⁽¹⁾	664	583	719	2,902	3,020	3,199	Heating degree-days(1)	594	664	719	2,921	2,902	3,199
Cooling degree-days⁽¹⁾	195	159	183	195	159	183	Cooling degree-days(1)	383	195	183	383	195	183
Precipitation (inches)	6.4	6.0	3.3	11.6	12.1	6.9	Precipitation (inches)	2.4	6.4	2.4	7.5	11.6	6.0

(1) Heating and cooling degree-days are common measures used in the utility industry to analyze the demand for electricity and indicate when a customer would use electricity for heating and cooling. A degree-day measures how much the average daily temperature varies from 65 degrees. Each degree of temperature above 65 degrees is counted as one cooling degree-day, and each degree of temperature below 65 degrees is counted as one heating degree-day.

(2) Normal heating degree-days and cooling degree-days elements are, by convention, the arithmetic mean of the elements computed over 30 consecutive years. The normal amounts are the sum of the monthly normal amounts. These normal amounts are computed by the National Oceanic and Atmospheric Administration.

Sales Volume and Generation: Retail sales volumes increased 514 percent and 28 percent in the second quarter and first six months of ~~2020,~~2021, respectively, compared with the same periods in 2020, primarily due to warmer and drier weather that caused customers to use more energy for cooling or irrigation. Cooling degree-days in Boise, Idaho were 96 percent higher during the three months ended June 30, 2021, compared with the three months ended June 30, 2020, and 109 percent above normal. Also, precipitation in Idaho Power's service area decreased significantly during the three months ended June 30, 2021, compared with the same period of ~~2019.~~2020, which increased usage by irrigation customers. During the second quarter and first six months of ~~2020,~~2021, usage per irrigation customer was approximately 25 percent and 24 percent higher, respectively, compared with the same periods in ~~2019.~~2020. During the second quarter and first six months of ~~2020,~~2021, usage per residential customer was approximately 610 percent and 5 percent higher, ~~than~~respectively, compared with the ~~second quarter~~same periods in 2020. Customer growth increased sales volumes

Table of 2019, primarily due to residential customers spending more time at home due to the COVID-19 public health crisis combined with weather variations that caused residential customers to use more energy at home for heating and cooling. Cooling degree-days in Boise, Idaho were 23 percent higher Contents

during the three and six months ended June 30, ~~2020,~~2021, compared with the ~~three months ended June 30, 2019, and 7 percent above normal. Also, heating degree-days were 14 percent higher during the three months ended June 30~~same period in 2020, ~~compared~~ with the ~~three months ended June 30, 2019. For~~number of Idaho Power's customers growing by 2.9 percent over the ~~second quarter of 2020, the increases in sales volumes per irrigation and residential customer were only partially offset by decreases of 7 percent and 4 percent~~prior twelve months. Increases in usage per commercial and industrial ~~customer, respectively,~~customers were partially due to a return to more normal economic activity in the second quarter of 2021 compared with the second quarter of ~~2019. For~~2020, which was affected by negative COVID-19-related business conditions. During the second quarter and first six months of ~~2020, the increase in sales volumes per irrigation customer was entirely offset by decreases of 5 percent and 3 percent in~~2021, usage per commercial customer was approximately 12 percent and 5 percent higher, respectively, compared with the same periods in 2020. Usage per industrial customer ~~respectively. The decreases in usage per commercial~~was approximately 8 percent and ~~industrial customer~~4 percent higher during the second quarter and first six months of ~~2020 were largely due to the economic impacts of COVID-19. Customer growth increased sales volumes during the three and six months ended June 30, 2020,~~2021 compared with the same ~~period~~periods in ~~2019, with the number of Idaho Power's customers growing by 2.6 percent over the prior twelve months.~~2020, respectively.

Total system generation decreased 1222 percent and 1913 percent in the second quarter and first six months of ~~2020,~~2021, respectively, compared with the second quarter and first six months of ~~2019. Hydropower~~2020, due primarily to lower hydropower and coal-fired generation, partially offset by increased natural gas ~~generation~~generation. Generation from hydropower during the second quarter and first six months of ~~2020~~2021 decreased 2536 percent and 3526 percent, respectively, compared with the same periods of 2020, due mostly to less snowpack and precipitation in the Snake River basin. Coal-fired generation also decreased 54 percent and 29 percent during the second quarter and first six months of ~~2019,~~2021 compared with the same periods of 2020, respectively, due ~~primarily~~ to

~~Table of Contents~~

~~decreased wholesale energy sales, higher purchased power, and~~ economic-, operations-, and reliability-based ~~decisions to use more coal generation.~~decisions. During the second quarter and first six months of ~~2020, coal~~2021, natural gas generation increased ~~92 percent~~ compared with the ~~second quarter~~same periods of ~~2019.~~ 2020, due to the decreases in hydropower and coal-fired generation.

Purchased power volumes increased 949 percent and 1232 percent in the second quarter and first six months of ~~2020,~~2021, respectively, ~~compared with the same periods of 2019,~~mostly due to an increase in purchases from the ~~lower regional wholesale~~ energy imbalance market ~~prices. During the first half of 2019, regional wholesale energy prices were elevated due to below-normal temperatures~~implemented in the ~~northwest region, lack of energy imports due~~western United States (Western EIM) and additional purchases to equipment maintenance, limited production from the federal hydropower system due to freezing temperatures and low water flow, and reduced capacity of Pacific Northwest and Western Canada region natural gas pipelines due to a natural gas pipeline that ruptured in British Columbia, Canada, during the fourth quarter of 2018. The higher regional wholesale energy prices during the first six months of 2019 led to higher Idaho Power opportunistic wholesale energy sales during those periods.

meet load requirements. The financial impacts of fluctuations in wholesale energy sales, purchased power, fuel expense, and other power supply-related expenses are addressed in Idaho Power's Idaho and Oregon power cost adjustment mechanisms, which are described ~~later~~below in ~~this MD&A.~~"Power Cost Adjustment Mechanisms."

Operating Revenues

Retail Revenues: The table below presents Idaho Power’s retail revenues (in thousands) and MWh sales volumes (in thousands) for the three and six months ended June 30, ~~2020~~2021 and ~~2019,~~2020, and the number of customers as of June 30, ~~2020~~2021 and ~~2019.~~2020.


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Retail revenues:
Residential (includes ($715), $4,135, $15,107, and $19,844, respectively, related to the FCA)(1)	$	122,633	$	109,471	$	277,418	$	254,357
Commercial (includes $165, $397, $647, and $881, respectively, related to the FCA)(1)	77,609		67,214		149,878		136,728
Industrial	48,047		43,087		93,477		85,847
Irrigation	76,799		60,149		77,885		61,523

Deferred revenue related to HCC relicensing AFUDC(2)	(1,927)		(1,927)		(4,046)		(4,046)

Total retail revenues	$	323,161	$	277,994	$	594,612	$	534,409
Volume of retail sales (MWh)
Residential	1,262		1,127		2,764		2,575
Commercial	1,013		894		2,015		1,899
Industrial	856		801		1,708		1,653
Irrigation	967		772		980		786
Total retail MWh sales	4,098		3,594		7,467		6,913
Number of retail customers at period end
Residential	498,747		483,609
Commercial	75,187		73,620
Industrial	126		127
Irrigation	21,811		21,583
Total customers	595,871		578,939

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Retail revenues:

Residential (includes $4,135, $7,232, $19,844 and $18,543, respectively, related to the FCA)⁽¹⁾
$ 109,471
$ 104,797
$ 254,357
$ 255,016
Commercial(includes $397, $350, $881, and $691, respectively, related to the FCA)⁽¹⁾
67,214
70,973
136,728
144,079
Industrial 43,087
45,602
85,847
91,100
Irrigation 60,149
48,954
61,523
49,953
Deferred revenue related to HCC relicensing AFUDC⁽²⁾
(1,927 ) (1,927 ) (4,046 ) (4,046 )
Total retail revenues $ 277,994
$ 268,399
$ 534,409
$ 536,102
Volume of retail sales (MWh)

Residential 1,127
1,032
2,575
2,522
Commercial 894
945
1,899
1,964
Industrial 801
830
1,653
1,682
Irrigation 772
602
786
612
Total retail MWh sales 3,594
3,409
6,913
6,780
Number of retail customers at period end

Residential 483,609
470,609

Commercial 73,620
72,318

Industrial 127
128

Irrigation 21,583
21,370

Total customers 578,939
564,425

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(1) The FCA mechanism is an alternative revenue program and does not represent revenue from contracts with customers.

(2) As part of its January 30, 2009 general rate case order, the IPUC is allowing Idaho Power to recover a portion of the allowance for funds used during construction (AFUDC) on construction work in progress related to the HCC relicensing process, even though the relicensing process is not yet complete and the costs have not been moved to electric plant in service. Idaho Power is collecting approximately $8.8 million annually in the Idaho jurisdiction but is deferring revenue recognition of the amounts collected until the license is issued and the accumulated license costs approved for recovery are placed in service.

Changes in rates, changes in customer ~~demand,~~usage, and changes in FCA mechanism revenues are the primary reasons for fluctuations in retail revenues from period to period. The primary influences on customer ~~demand~~usage for electricity are weather, economic conditions, and energy efficiency. Extreme temperatures increase sales to customers who use electricity for cooling and heating, while moderate temperatures decrease sales. Precipitation levels and the timing of precipitation during the

~~Table of Contents~~

agricultural growing season also affect sales to customers who use electricity to operate irrigation pumps. Rates are also seasonally adjusted, providing for higher rates during peak load periods, and residential customer rates are tiered, providing for higher rates based on higher levels of usage. The seasonal and tiered rate structures contribute to seasonal fluctuations in revenues and earnings.

Retail revenues increased ~~$9.6~~$45.2 million and $60.2 million during the second quarter ~~of 2020,~~ and ~~decreased $1.7 million during~~ first six months of ~~2020,~~2021, respectively, compared with the same periods in ~~2019.~~2020. The factors affecting retail revenues during the period are discussed below.

•

•Customers: Customer growth of 2.9 percent during the twelve months ended June 30, 2021, increased retail revenues by $5.1 million and $10.2 million in the second quarter and first six months of 2021, respectively, compared with the same periods of 2020.

•Usage: Higher usage (on a per customer basis) by irrigation, residential, commercial, and industrial customers increased retail revenues by $37.1 million and $36.9 million in the second quarter and first six months of 2021, respectively, compared with the same periods of 2020. Increased usage was primarily the result of warmer summer temperatures and drier weather in Idaho Power's service area, which increased usage by residential and irrigation customers. To a lesser extent, a return to more normal economic conditions for commercial and industrial customers also increased sales volumes on a per-customer basis, as the first half of 2020 was negatively affected by COVID-19-related business conditions.

•Idaho FCA Revenue: The FCA mechanism, applicable to Idaho residential and small commercial customers, adjusts revenue each year to accrue, or defer, the difference between the authorized fixed-cost recovery amount per customer and the actual fixed costs per customer recovered by Idaho Power through volume-based rates during the year. Higher usage (on a per customer basis) by residential and small general service customers during the second quarter and first six months of 2021 decreased the amount of FCA revenue accrued by $5.1 million and $5.0 million, respectively, compared with the same periods in 2020.

•Rates: Average customer rates, excluding amounts related to the power cost adjustment mechanisms, decreased retail revenues by $3.1 million and $4.1 million for the three and six months ended June 30, 2021, compared with the same periods in 2020. Customer rates also include the collection from customers of amounts related to the power cost adjustment mechanisms, which increased revenues by $11.1 million and $22.2 million in the second quarter and first six months of 2021, respectively, compared with the same periods of 2020. The amount collected from customers in rates under the power cost adjustment mechanisms has relatively little effect on operating income as a corresponding amount is recorded as expense in the same period it is collected through rates.

: Customer rates, excluding collections of amounts related to the power cost adjustment mechanism, decreased revenues by approximately $0.6 million for both the three and six months ended June 30, 2020, compared with the same periods in 2019. Customer rates also include the return to customers of amounts related to the power cost adjustment mechanism, which decreased revenues by $2.2 million and $13.3 in the second quarter and first six months of 2020, respectively, compared with the same periods of 2019. The amount returned to customers in rates under the power cost adjustment mechanism has relatively little effect on operating income as a corresponding amount is recorded as a reduction of expense in the same period it is returned through rates.


•	~~Customers~~: Customer growth of 2.6 percent during the twelve months ended June 30, 2020, increased retail revenues by $4.4 million and $9.5 million in the second quarter and first six months of 2020, respectively, compared with the same periods of 2019.

•

~~Usage~~: Higher usage (on a per customer basis), primarily by irrigation customers, increased retail revenues by $11.1 million and $1.3 million in the second quarter and first six months of 2020, respectively, compared with the same periods of 2019. During the second quarter of 2020, usage per residential customer was approximately 6 percent higher than the second quarter of 2019, primarily due to residential customers spending more time at home due to the COVID-19 public health crisis, combined with weather variations that caused residential customers to use more energy at home for heating and cooling. Cooling degree-days in Boise, Idaho were 23 percent higher during the three months ended June 30, 2020, compared with the three months ended June 30, 2019 and 7 percent above normal. Also, heating degree-days were 14 percent higher during the three months ended June 30 2020, compared with the three months ended June 30, 2019. For the second quarter of 2020, the increases in sales volumes per irrigation and residential customer were only partially offset by decreases of 7 percent and 4 percent in usage per commercial and industrial customer, respectively, compared with the second quarter of 2019. For the first six months of 2020, the increase in sales volumes per irrigation customer was entirely offset by decreases of 5 percent and 3 percent in usage per commercial and industrial customer, respectively. The decreases in usage per commercial and industrial customer during the second quarter and first six months of 2020 were largely due to the economic impacts of COVID-19.

•

~~Idaho FCA Revenue~~: The FCA mechanism, applicable to Idaho residential and small commercial customers, adjusts revenue each year to accrue, or defer, the difference between the authorized fixed-cost recovery amount per customer and the actual fixed costs per customer recovered by Idaho Power through volume-based rates during the year. Higher usage (on a per customer basis) by residential and small general service customers during the second quarter of 2020 decreased the amount of FCA accrued by $3.1 million compared with the second quarter of 2019. Lower usage (on a per customer basis) by residential and small general service customers during the first six months of 2020 increased the amount of FCA revenue accrued by $1.5 million compared with the same period in 2019.

Wholesale Energy Sales: Wholesale energy sales consist primarily of opportunistic sales of surplus system energy and sales into the ~~energy imbalance market implemented in the western United States (Western EIM),~~Western EIM, and do not include derivative transactions. The table below presents Idaho Power’s wholesale energy sales for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands, except for per MWh amounts).


	Three months ended June 30,				Six months ended June 30,					Three months ended June 30,				Six months ended June 30,
	2020		2019		2020		2019			2021		2020		2021		2020
Wholesale energy revenues	$	6,866	$	16,158	$	10,775	$	63,373	Wholesale energy revenues	$	4,308	$	6,866	$	10,567	$	10,775
Wholesale MWh sold	489		1,042		671		1,902
Wholesale volume in MWh sold									Wholesale volume in MWh sold	67		489		188		671
Average wholesale energy revenues per MWh	$	14.04	$	15.51	$	16.06	$	33.32	Average wholesale energy revenues per MWh	$	64.30	$	14.04	$	56.21	$	16.06

In the second quarter and during the first six months of ~~2020,~~2021, wholesale energy revenues decreased ~~$9.3~~$2.6 million and ~~$52.6~~$0.2 million, respectively, compared with the same periods of ~~2019.~~2020, primarily due to a heat wave in Idaho Power's service area which increased energy usage by Idaho Power customers and resulted in less energy available for opportunistic market sales. Wholesale energy sales volumes decreased 5386 percent and 6572 percent in the second quarter and first six months of ~~2020,~~2021, respectively, compared with the ~~same~~sames periods of ~~2019.~~2020. The decreases in wholesale energy revenues related to lower volumes sold were partially offset by increases in average wholesale energy revenues per MWh ~~for~~due mostly to higher wholesale energy

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prices in the ~~second quarter and first six months of 2020~~region. Wholesale energy prices were ~~9 percent and 52 percent lower compared with the same periods in 2019. The~~ higher ~~prices and sales volumes~~ in the second quarter and first six months of ~~2019 were due~~

~~Table~~2021 compared with the same periods in 2020 as extreme weather resulted in higher demand and lower supply of ~~Contents~~

energy to ~~below-normal temperatures~~the wholesale markets in the Northwest, lack of energy imports due to equipment maintenance, limited production from the federal hydropower system due to freezing temperatures and low water flow, and reduced capacity of Pacific Northwest and Western Canada region natural gas pipelines due to a natural gas pipeline rupture in British Columbia, Canada, during the fourth quarter of 2018. The higher regional wholesale energy prices during the first half of 2019 led to higher Idaho Power opportunity wholesale energy sales volumes.region.

Transmission Wheeling-Related Revenues: Transmission wheeling-related revenues ~~decreased $1.0~~increased $3.9 million, or 834 percent, and ~~$6.4~~$8.0 million, or 2337 percent, during the second quarter and during the first six months of 2021, respectively, compared with the same periods in 2020, as warmer, drier spring and summer weather in the western United States increased wheeling volumes. Colder winter weather in the southwest United States in early 2021 also contributed to increased wheeling volumes in the first six months of 2021 compared with the first six months of 2020. In addition, Idaho Power's open access transmission tariff (OATT) rates were approximately 10 percent higher in the second quarter and first six months of ~~2020~~2021 compared with the same periods of 2019, primarily due to a decrease in Idaho Power's OATT rates that became effective in October 2019. Idaho Power's OATT rates decreased approximately 13 percent in October 2019 and there was less regional wholesale market activity due to the regional market conditions described above in this MD&A in the first six months of 2020 compared with the same period of 2019. In June 2020, Idaho Power publicly posted its 2020 draft transmission rate, reflecting approximately a 10 percent increase for the period from October 1, 2020 to September 30, 2021, as described below in "Regulatory Matters" in this MD&A.2020.

Energy Efficiency Program Revenues: In both Idaho and Oregon, energy efficiency riders fund energy efficiency program expenditures. Expenditures funded through the riders are reported as an operating expense with an equal amount recorded in revenues, resulting in no net impact on earnings. The cumulative variance between expenditures and amounts collected through the rider is recorded as a regulatory asset or liability. A liability balance indicates that Idaho Power has collected more than it has spent and an asset balance indicates that Idaho Power has spent more than it has collected. At June 30, ~~2020,~~2021, Idaho Power's energy efficiency rider balances were ~~a $8.2~~regulatory assets of $12.1 million ~~regulatory asset~~ in the Idaho jurisdiction and ~~a $1.0~~$0.8 million ~~regulatory asset~~ in the Oregon jurisdiction.

Operating Expenses

Purchased Power: The table below presents Idaho Power’s purchased power expenses and volumes for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands, except for per MWh amounts).


	Three months ended June 30,				Six months ended June 30,					Three months ended June 30,				Six months ended June 30,
	2020		2019		2020		2019			2021		2020		2021		2020
Expense									Expense
PURPA contracts	$	47,388	$	45,906	$	89,677	$	86,989	PURPA contracts	$	53,163	$	47,388	$	96,220	$	89,677
Other purchased power (including wheeling)	14,386		12,157		33,298		33,905		Other purchased power (including wheeling)	42,953		14,386		67,884		33,298
Total purchased power expense	$	61,774	$	58,063	$	122,975	$	120,894	Total purchased power expense	$	96,116	$	61,774	$	164,104	$	122,975
MWh purchased									MWh purchased
PURPA contracts	915		881		1,621		1,559		PURPA contracts	979		915		1,675		1,621
Other purchased power	390		314		905		697		Other purchased power	970		390		1,671		905
Total MWh purchased	1,305		1,195		2,526		2,256		Total MWh purchased	1,949		1,305		3,346		2,526
Average cost per MWh from PURPA contracts	$	51.79	$	52.11	$	55.32	$	55.80	Average cost per MWh from PURPA contracts	$	54.30	$	51.79	$	57.44	$	55.32
Average cost per MWh from other sources	$	36.89	$	38.72	$	36.79	$	48.64	Average cost per MWh from other sources	$	44.28	$	36.89	$	40.62	$	36.79
Weighted average - all sources	$	47.34	$	48.59	$	48.68	$	53.59	Weighted average - all sources	$	49.32	$	47.34	$	49.04	$	48.68

Purchased power expense increased ~~$3.7~~$34.3 million, or 656 percent, and ~~$2.1~~$41.1 million, or 233 percent, during the second quarter and first six months of ~~2020~~2021 compared with the same periods of ~~2019. Lower regional wholesale energy market prices led~~2020, primarily due to ~~higher~~148 percent and 84 percent increases, respectively, in MWh purchased from sources other than PURPA contracts mostly due to increases in purchases from the ~~wholesale market during the second quarter~~Western EIM and ~~first six months of 2020 compared with the same periods of 2019.~~additional purchases to meet load requirements.

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Fuel Expense: The table below presents Idaho Power’s fuel expenses and thermal generation for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands, except for per MWh amounts).


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Expense
Coal	$	11,672	$	27,414	$	28,607	$	43,188
Natural gas	19,519		4,000		35,889		18,242
Total fuel expense	$	31,191	$	31,414	$	64,496	$	61,430
MWh generated
Coal	372		810		908		1,272
Natural gas	666		89		1,307		727
Total MWh generated	1,038		899		2,215		1,999
Average cost per MWh - Coal	$	31.38	$	33.84	$	31.51	$	33.95
Average cost per MWh - Natural gas	$	29.31	$	44.94	$	27.46	$	25.09
Weighted average, all sources	$	30.05	$	34.94	$	29.12	$	30.73

Three months ended
June 30, Six months ended
June 30,
2020 2019 2020 2019
Expense

Coal $ 27,414
$ 16,687
$ 43,188
$ 55,310
Natural gas 4,001
4,139
18,242
17,386
Total fuel expense $ 31,415
$ 20,826
$ 61,430
$ 72,696
MWh generated

Coal 810
422
1,272
1,554
Natural gas 89
137
727
564
Total MWh generated 899
559
1,999
2,118
Average cost per MWh - Coal $ 33.84
$ 39.54
$ 33.95
$ 35.59
Average cost per MWh - Natural gas $ 44.96
$ 30.21
$ 25.09
$ 30.83
Weighted average, all sources $ 34.94
$ 37.26
$ 30.73
$ 34.32

The majority of the fuel for Idaho Power’s jointly-owned coal-fired plants is purchased through long-term contracts, including purchases from BCC, a one-third owned joint venture of IERCo. The price of coal from BCC is subject to fluctuations in mine operating expenses, geologic conditions, and production levels. BCC supplies ~~up to~~approximately two-thirds of the coal used by the Jim Bridger plant. Natural gas is mainly purchased on the regional wholesale spot market at published index prices. In addition to commodity (variable) costs, both natural gas and coal expenses include costs that are more fixed in nature for items such as capacity charges, transportation, and fuel handling. Period to period variances in fuel expense per MWh are noticeably impacted by these fixed charges when generation output is substantially different between the periods.

Fuel expense ~~increased $10.6~~decreased $0.2 million, or 511 percent in the second quarter of ~~2020,~~2021, but ~~decreased $11.3~~increased $3.1 million, or 155 percent, in the first six months of ~~2020~~2021 compared with the same periods of ~~2019.~~2020. The ~~increase~~slight decrease in fuel expense in the second quarter of ~~2020~~2021 compared with the ~~second quarter of 2019~~same period in 2020 was ~~primarily~~ due to ~~economic-, operations-, and reliability-based decisions~~a 14 percent decrease in the average cost per MWh generated at the thermal plants, mostly offset by an increase in thermal generation to ~~utilize more coal generation. Included~~meet load requirements. The increase in fuel expense are losses and gains on settled financial gas hedges entered into in accordance with Idaho Power's energy risk management policies. In the first six months of 2020, losses on financial gas hedges of $2.9 million increased natural gas fuel expense, while in the first six months of ~~2019, gains on financial gas hedges of $12.4 million reduced natural gas fuel expense. Most of these realized hedging gains and losses are passed on~~2021 compared with the same period in 2020 was due to ~~customers through~~an increase in thermal generation to meet higher load requirements, partially offset by a 5 percent decrease in the ~~power~~average cost ~~adjustment mechanisms described below.~~per MWh generated at the thermal plants.

Power Cost Adjustment Mechanisms: Idaho Power's power supply costs (primarily purchased power and fuel expense, less wholesale energy sales) can vary significantly from year to year. Volatility of power supply costs arises from factors such as weather conditions, wholesale market prices, volumes of power purchased and sold in the wholesale markets, Idaho Power's hydropower and thermal generation volumes and fuel costs, generation plant availability, and retail loads. To address the volatility of power supply costs, Idaho Power's power cost adjustment mechanisms in the Idaho and Oregon jurisdictions allow Idaho Power to recover from customers, or refund to customers, most of the fluctuations in power supply costs. In the Idaho jurisdiction, the PCA includes a cost or benefit sharing ratio that allocates the deviations in net power supply expenses between customers (95 percent) and Idaho Power (5 percent), with the exception of PURPA power purchases and demand response program incentives, which are allocated 100 percent to customers. The Idaho deferral period, or PCA year, runs from April 1 through March 31. Amounts deferred or accrued during the PCA year are primarily recovered or refunded during the subsequent June 1 through May 31 period. Because of the power cost adjustment mechanisms, one of the primary financial impacts of power supply cost variations is that cash is paid out but recovery from customers does not occur until a future period, or cash that is collected is refunded to customers in a future period, resulting in fluctuations in operating cash flows from year to year.

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The table that follows presents the components of the Idaho and Oregon power cost adjustment mechanisms for the three and six months ended June 30, ~~2020~~2021 and ~~2019~~2020 (in thousands).


	Three months ended June 30,						Six months ended June 30,							Three months ended June 30,				Six months ended June 30,
	2020			2019			2020			2019				2021		2020		2021		2020
Power supply cost accrual	$	11,991		$	24,811		$	22,948		$	55,752		Power supply cost accrual	$	866	$	11,991	$	16,126	$	22,948

Amortization of prior year authorized balances	(13,527		)	(8,689		)	(27,875		)	(13,405		)	Amortization of prior year authorized balances	(8,800)		(13,527)		(18,389)		(27,875)
Total power cost adjustment expense	$	(1,536	)	$	16,122		$	(4,927	)	$	42,347		Total power cost adjustment expense	$	(7,934)	$	(1,536)	$	(2,263)	$	(4,927)

The power supply accruals represent the portion of the power supply cost fluctuations accrued under the power cost adjustment mechanisms. When actual power supply costs are lower than the amount forecasted in power cost adjustment rates, which was the case for all periods presented, most of the difference is ~~accrued.~~accrued as an increase to a regulatory liability or decrease to a regulatory asset. When actual power supply costs are higher than the amount forecasted in power cost adjustment rates, most of the difference is ~~deferred.~~deferred as an increase to a regulatory asset or decrease to a regulatory liability. The amortization of the prior year’s balances represents the offset to the amounts being collected or refunded in the current power cost adjustment year that were deferred or accrued in the prior ~~power cost adjustment~~PCA year (the true-up component of the power cost adjustment mechanism).

Other O&M Expenses: Other O&M expenses ~~decreased $3.9~~increased $5.3 million, or 46 percent, and ~~$3.0~~$1.2 million, or 21 percent, ~~respectively, in~~for the second quarter and first six months of ~~2020~~2021 compared with the ~~same periods~~first quarter of ~~2019. The decreases in other O&M expenses in both periods were~~2020, respectively, primarily due to the ~~temporary deferral~~timing of completing certain maintenance projects at ~~Idaho Power's~~its jointly-owned thermal generation ~~plants. The timing~~plants in 2021 instead of ~~these projects is discretionary and Idaho Power expects these projects to be completed later~~2020. Also, other O&M expenses increased in ~~2020 or in 2021. In July 2020,~~ the ~~IPUC issued an order granting Idaho Power the authority to defer unanticipated, emergency-related expenses due to the COVID-19 public health crisis, net~~second quarter of ~~any cost savings, for possible recovery through future rates. In~~2021 compared with the second quarter of 2020, ~~Idaho Power recorded~~as a ~~$0.6 million regulatory asset for its estimate~~result of ~~such~~an increase in labor-related costs ~~including~~from higher bad debt expense, net of estimated savings in vehicle fuel, employee travel, and training. For additional information, see Note 3 - "Regulatory Matters" to the condensed consolidated financial statements included in this report.performance-based variable compensation accruals.

Income Taxes

IDACORP's and Idaho Power's income tax expense ~~were relatively flat~~increased $5.3 million and $5.7 million for the six months ended June 30, ~~2020,~~2021, when compared with the same period in ~~2019.~~2020, respectively, primarily due to greater pre-tax income. For information relating to IDACORP's and Idaho Power's computation of income tax expense and effective income tax rates, see Note 2 - "Income Taxes" to the condensed consolidated financial statements included in this report.

LIQUIDITY AND CAPITAL RESOURCES

Overview

Idaho Power has been pursuing significant enhancements to its utility infrastructure in an effort to ensure an adequate supply of electricity, to provide service to new customers, and to maintain system reliability. Idaho Power's existing hydropower and thermal generation facilities also require continuing upgrades and component replacement. Idaho Power anticipates these substantial capital expenditures will continue, with expected total capital expenditures of approximately ~~$1.6~~$2.0 billion over the five-year period from ~~2020~~2021 (including expenditures incurred to-date in ~~2020)~~2021) through ~~2024.~~2025.

Idaho Power funds its liquidity needs for capital expenditures through cash flows from operations, debt offerings, commercial paper markets, credit facilities, and capital contributions from IDACORP. Idaho Power periodically files for rate adjustments for recovery of operating costs and capital investments to provide the opportunity to align Idaho Power's earned returns with those allowed by regulators. Idaho Power uses operating and capital budgets to control operating costs and capital expenditures. During the first six months of ~~2020,~~2021, Idaho Power continued its efforts to optimize operations, control costs, and generate operating cash inflows to meet operating expenditures, contribute to capital expenditure requirements, and pay dividends to shareholders.

As of July ~~24, 2020,~~23, 2021, IDACORP's and Idaho Power's access to debt, equity, and credit arrangements included:

•their respective $100 million and $300 million revolving credit facilities;

•IDACORP's shelf registration statement filed with the U.S. Securities and Exchange Commission (SEC) on May 17, 2019, which may be used for the issuance of debt securities and common stock;

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Idaho Power's shelf registration statement filed with the SEC on May 17, 2019, which may be used for the issuance of first mortgage bonds and debt securities; $190 million remains available for issuance pursuant to state regulatory authority; and

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•IDACORP's and Idaho Power's commercial paper, which may be issued up to an amount equal to the available credit capacity under their respective credit facilities.

IDACORP and Idaho Power monitor capital markets with a view toward opportunistic debt and equity transactions, taking into account current and potential future long-term needs. As a result, IDACORP may issue debt securities or common stock, and Idaho Power may issue debt securities or first mortgage bonds, if the companies believe terms available in the capital markets are favorable and that issuances would be financially prudent.

In April 2020, Idaho Power issued $230 million in principal amount of its 4.20 percent first mortgage bonds, secured medium term notes, Series K, maturing March 1, 2048. The bonds were issued at a reoffer yield of 3.422 percent, which resulted in a net premium of 13.0 percent and net proceeds to Idaho Power of $259.9 million. After this offering, the aggregate principal amount of the 4.20 percent first mortgage bonds is $450 million.

In June 2020, Idaho Power issued $80 million in principal amount of its 1.90 percent first mortgage bonds, secured medium term notes, Series L, maturing July 15, 2030. On July 29, 2020, Idaho Power redeemed, prior to maturity, $75 million in principal amount of 2.95 percent first mortgage bonds, medium-term notes, Series H due in April 2022. In accordance with the redemption provisions of the notes, the redemption included Idaho Power's payment of a make-whole premium to the holders of the redeemed notes in the aggregate amount of $3.3 million.

On August 3, 2020, Idaho Power plans to use a portion of the net proceeds of the April 2020 issuance of first mortgage bonds to redeem $100 million in principal amount of 3.40 percent first mortgage bonds due in November 2020, but callable at par on or after August 1, 2020.

As of the date of this report, Idaho Power is uncertain how significantly the COVID-19 public health crisis will ultimately impact Idaho Power's operations, results of operations, cash flows, financial condition, or capital resources. The net proceeds from the debt issuances, noted above, provided Idaho Power with additional liquidity should the financial impacts of the COVID-19 public health crisis worsen in the coming months or be prolonged. Based on planned capital expenditures and other O&M expenses, the companies believe they will be able to meet capital and debt service requirements and fund corporate expenses during at least the next twelve months with a combination of existing cash, operating cash flows generated by Idaho Power's utility business, availability under existing credit facilities, and access to commercial paper and long-term debt markets.

IDACORP and Idaho Power generally seek to maintain capital structures of approximately 50 percent debt and 50 percent equity, and maintaining this ratio influences IDACORP's and Idaho Power's debt and equity issuance decisions. As of June 30, ~~2020,~~2021, IDACORP's and Idaho Power's capital structures, as calculated for purposes of applicable debt covenants, were as follows:


	IDACORP	Idaho Power
Debt	43%	46%
Equity	57%	54%

IDACORP Idaho Power
Debt 47% 49%
Equity 53% 51%

IDACORP and Idaho Power ~~generally~~typically maintain their cash and cash equivalents in highly liquid investments, such as U.S. Treasury Bills, money market funds, and bank deposits.

Operating Cash Flows

IDACORP’s and Idaho Power’s operating cash inflows for the six months ended June 30, ~~2020,~~2021, were ~~$129~~$167 million and ~~$131~~$155 million, respectively, ~~a decrease~~an increase of ~~$37~~$39 million for IDACORP and ~~$31~~an increase of $25 million for Idaho Power, compared with the same period in ~~2019.~~2020. With the exception of cash flows related to income taxes, IDACORP's operating cash flows are principally derived from the operating cash flow of Idaho Power. Significant items that affected the comparability of the companies' operating cash flows in the first six months of ~~2020~~2021 compared with the same period in ~~2019~~2020 were as follows:

•increased net income;

•changes in regulatory assets and liabilities, mostly related to the relative amounts of costs deferred and collected under the Idaho PCA mechanism, increased operating cash flows by $21 million; and

•changes in working capital balances due primarily to timing, including fluctuations in accounts receivable, accounts payable, other current assets, and ~~demand-side management program,~~other current liabilities as follows:

◦timing of collections of accounts receivable balances decreased operating cash flows by ~~$43 million;~~$6 million for IDACORP and $4 million for Idaho Power;

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Idaho Power contributed $2 million to IERCo's investment in BCC for 2020 and received $12 million of distributions from IERCo's investment in BCC for 2019; changes in distributions from year to year are primarily driven by changes in the timing of cash needs associated with BCC; and

~~changes in working capital balances as the~~ timing of accounts payable payments increased operating cash flows by ~~$14~~$33 million for IDACORP and ~~$22~~$25 million for Idaho Power, of which $8 million of the difference between IDACORP and Idaho Power related to intercompany ~~estimated~~ tax ~~payments.~~payments in the first six months of 2020;

◦the changes in other current assets decreased operating cash flows by $24 million for IDACORP and Idaho Power, which was primarily due to fluctuations in accrued unbilled revenues and the timing of purchases and consumption of coal at Idaho Power's jointly-owned coal-fired generating plants; and

◦the changes in other current liabilities, which includes compensation, customer deposits, accrued interest, and other miscellaneous liabilities, decreased operating cash flows by $7 million for IDACORP and Idaho Power.

Investing Cash Flows

Investing activities consist primarily of capital expenditures related to new construction and improvements to Idaho Power’s generation, transmission, and distribution facilities. IDACORP’s and Idaho Power’s net investing cash outflows for the six months ended June 30, ~~2020,~~2021, were ~~$151~~$107 million and ~~$141~~$122 million, respectively. Investing cash outflows for ~~2020~~2021 and ~~2019~~2020 were primarily for construction of utility infrastructure needed to address Idaho Power’s aging plant and equipment, customer growth, and environmental and regulatory compliance requirements. During the first six months of 2021, IDACORP's investing cash inflows and outflows also included $50 million of proceeds from maturities of short-term investments and $25 million of

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purchases of short-term investments, respectively. In addition, IDACORP's investing cash outflows also included ~~$9.4~~$10 million and $9 million of investments in affordable housing and other tax credits during the six months ended June 30, ~~2020.~~2021 and 2020, respectively.

Financing Cash Flows

Financing activities provide supplemental cash for both day-to-day operations and capital requirements, as needed. Idaho Power funds liquidity needs for capital investment, working capital, managing commodity price risk, and other financial commitments through cash flows from operations, debt offerings, commercial paper markets, credit facilities, and capital contributions from IDACORP. IDACORP funds its cash requirements, such as payment of taxes, capital contributions to Idaho Power, and non-utility expenses allocated to IDACORP, through cash flows from operations, commercial paper markets, sales of common stock, and credit facilities.

IDACORP's and Idaho Power's net financing cash ~~inflows~~outflows for the six months ended June 30, ~~2020,~~2021, were ~~$265~~$75 million and ~~$270~~$72 million, respectively. In April 2020, Idaho Power issued $230 million in principal amount of its 4.20 percent first mortgage bonds, secured medium term notes, Series K, maturing March 1, 2048. The bonds were issued at a reoffer yield of 3.422 percent, which resulted in a net premium of 13.0 percent and net proceeds to Idaho Power of $260 million. In June 2020, Idaho Power issued $80 million in principal amount of its 1.90 percent first mortgage bonds, secured medium term notes, Series L, maturing July 15, 2030. Financing cash flows also included the payment of $68 million of dividends on common stock during the first six months of ~~2020.~~2021, IDACORP and Idaho Power paid dividends of approximately $72 million.

Financing Programs and Available Liquidity

IDACORP Equity Programs: In recent years, IDACORP has entered into sales agency agreements under which it could offer and sell shares of its common stock from time to time through a third-party agent. The most recent sales agency agreement terminated in May 2016. IDACORP has no current plans to issue equity securities other than under its equity compensation plans during ~~2020, and as of the date of this report, IDACORP has not pursued the execution of a new sales agency agreement.~~2021.

Idaho Power First Mortgage Bonds: Idaho Power's issuance of long-term indebtedness is subject to the approval of the IPUC, OPUC, and Wyoming Public Service Commission (WPSC). In April and May 2019, Idaho Power received orders from the IPUC, OPUC, and WPSC authorizing the company to issue and sell from time to time of up to $500 million in aggregate principal amount of debt securities and first mortgage bonds, subject to conditions specified in the orders. Following the April 2020 issuance of Series K medium-term notes and the June 2020 issuance of Series L medium-term notes described in the 2020 Annual Report, in Part II, Item 7 - "MD&A - Liquidity and ~~the April 2020 issuance of Series K medium-term notes described above,~~Capital Resources," $190 million of debt securities remains available for issuance under the orders. Authority from the IPUC is effective through May 31, 2022, subject to extension upon request to the IPUC. The OPUC’s and WPSC’s orders do not impose a time limitation for issuances, but the OPUC order does impose a number of other conditions, including a requirement that the interest rates for the debt securities or first mortgage bonds fall within either (a) designated spreads over comparable U.S. Treasury rates or (b) a maximum all-in interest rate limit of seven percent.

In May 2019, Idaho Power filed a shelf registration statement with the SEC, which became effective upon filing, for the offer and sale of an unspecified principal amount of its first mortgage bonds. The issuance of first mortgage bonds requires that Idaho Power meet interest coverage and security provisions set forth in Idaho Power's Indenture of Mortgage and Deed of Trust, dated as of October 1, 1937, as amended and supplemented from time to time (Indenture). Future issuances of first mortgage bonds are subject to satisfaction of covenants and security provisions set forth in the Indenture, market conditions, regulatory authorizations, and covenants contained in other financing agreements.

OnIn June 5, 2020, Idaho Power entered into a selling agency agreement with six banks named in the agreement in

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connection with the potential issuance and sale from time to time of up to $500 million aggregate principal amount of first

mortgage bonds, secured medium term notes, Series L (Series L Notes), under Idaho Power’s Indenture of Mortgage and Deed

of Trust, dated as of October 1, 1937, as amended and supplemented (Indenture). Also onin June 5, 2020, Idaho Power

entered into the Forty-ninth Supplemental Indenture, dated effective as of June 5, 2020, to the Indenture (Forty-ninth

Supplemental Indenture). The Forty-ninth Supplemental Indenture provides for, among other items the issuance of up to

$500 million in aggregate principal amount of Series L Notes pursuant to the Indenture.

The Indenture limits the amount of first mortgage bonds at any one time outstanding to $2.5 billion, and as a result, the maximum amount of additional first mortgage bonds Idaho Power could issue as of June 30, ~~2020~~2021, was limited to approximately ~~$359~~$534 million. Idaho Power may increase the $2.5 billion limit on the maximum amount of first mortgage bonds outstanding by filing a supplemental indenture with the trustee as provided in the Indenture of Mortgage and Deed of Trust. Separately, the Indenture also limits the amount of additional first mortgage bonds that Idaho Power may issue to the sum of (a) the principal amount of retired first mortgage bonds and (b) 60 percent of total unfunded property additions, as defined in the Indenture. As of June 30, ~~2020,~~2021, Idaho Power could issue approximately ~~$1.7~~$1.8 billion of additional first mortgage bonds based on retired first mortgage bonds and total unfunded property additions.

IDACORP and Idaho Power Credit Facilities: In December 2019, IDACORP and Idaho Power entered into ~~Credit Agreements~~amendments to credit agreements for $100 million and $300 million credit facilities, respectively, replacing ~~prior credit~~prior-credit agreements. Each of the credit facilities may be used for general corporate purposes and commercial paper back-up. IDACORP's facility permits

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borrowings under a revolving line of credit of up to $100 million at any one time outstanding, including swingline loans not to exceed $10 million at any one time and letters of credit not to exceed $50 million at any one time. IDACORP's facility may be increased, subject to specified conditions, to $150 million. Idaho Power's facility permits borrowings through the issuance of loans and standby letters of credit of up to $300 million at any one time outstanding, including swingline loans not to exceed $30 million at any one time and letters of credit not to exceed $50 million at any one time outstanding. Idaho Power's facility may be increased, subject to specified conditions, to $450 million. The credit facilities currently provide for a maturity date of December 6, 2024, though IDACORP and Idaho Power may request up to two-one-year extensions of the credit agreements, subject to certain conditions. Other terms and conditions of the credit facilities are described in the ~~2019~~2020 Annual Report, in Part II, Item 7 - "MD&A - Liquidity and Capital Resources."

Each facility contains a covenant requiring each company to maintain a leverage ratio of consolidated indebtedness to consolidated total capitalization equal to or less than 65 percent as of the end of each fiscal quarter. In determining the leverage ratio, "consolidated indebtedness" broadly includes all indebtedness of the respective borrower and its subsidiaries, including, in some instances, indebtedness evidenced by certain hybrid securities (as defined in the credit agreement). "Consolidated total capitalization" is calculated as the sum of all consolidated indebtedness, consolidated stockholders' equity of the borrower and its subsidiaries, and the aggregate value of outstanding hybrid securities. At June 30, ~~2020,~~2021, the leverage ratios for IDACORP and Idaho Power were 4743 percent and 4946 percent, respectively. IDACORP's and Idaho Power's ability to utilize the credit facilities is conditioned upon their continued compliance with the leverage ratio covenants included in the credit facilities. There are additional covenants, subject to exceptions, that prohibit certain mergers, acquisitions, and investments, restrict the creation of certain liens, and prohibit entering into any agreements restricting dividend payments from any material subsidiary.

At June 30, ~~2020,~~2021, IDACORP and Idaho Power believed they were in compliance with all facility covenants. Further, IDACORP and Idaho Power do not anticipate they will be in violation or breach of their respective debt covenants during ~~2020.~~2021.

Without additional approval from the IPUC, the OPUC, and the WPSC, the aggregate amount of short-term borrowings by Idaho Power at any one time outstanding may not exceed $450 million. Idaho Power has obtained approval of the IPUC, the OPUC, and the WPSC for the issuance of short-term borrowings through December 2026.

IDACORP and Idaho Power Commercial Paper: IDACORP and Idaho Power have commercial paper programs under which they issue unsecured commercial paper notes up to a maximum aggregate amount outstanding at any time not to exceed the available capacity under their respective credit facilities, described above. IDACORP's and Idaho Power's credit facilities are available to the companies to support borrowings under their commercial paper programs. The commercial paper issuances are used to provide an additional financing source for the companies' short-term liquidity needs. The maturities of the commercial paper issuances will vary but may not exceed 270 days from the date of issue. Individual instruments carry a fixed rate during their respective terms, although the interest rates are reflective of current market conditions, subjecting the companies to fluctuations in interest rates.

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Available Short-Term Borrowing Liquidity

The table below outlines available short-term borrowing liquidity as of the dates specified (in thousands).


	June 30, 2020					December 31, 2019						June 30, 2021				December 31, 2020
	IDACORP⁽²⁾		Idaho Power			IDACORP⁽²⁾		Idaho Power				IDACORP(2)		Idaho Power		IDACORP(2)		Idaho Power
Revolving credit facility	$	100,000	$	300,000		$	100,000	$	300,000		Revolving credit facility	$	100,000	$	300,000	$	100,000	$	300,000
Commercial paper outstanding	—		—			—		—			Commercial paper outstanding	—		—		—		—
Identified for other use⁽¹⁾	—		(24,245		)	—		(24,245		)	Identified for other use(1)	—		(24,245)		—		(24,245)
Net balance available	$	100,000	$	275,755		$	100,000	$	275,755		Net balance available	$	100,000	$	275,755	$	100,000	$	275,755

⁽¹⁾ Port of Morrow and American Falls bonds that Idaho Power could be required to purchase prior to maturity under the optional or mandatory purchase provisions of the bonds, if the remarketing agent for the bonds is unable to sell the bonds to third parties.

⁽²⁾ Holding company only.

AtOn July ~~24, 2020,~~23, 2021, IDACORP had no loans outstanding under its credit facilities and had no commercial paper outstanding. Idaho Power also had no loans outstanding under its credit facilities and no commercial paper ~~outstanding.~~outstanding at that date. During the three and six months ended June 30, ~~2020,~~2021, IDACORP and Idaho Power ~~borrowed~~issued no short-term commercial paper.

Impact of Credit Ratings on Liquidity and Collateral Obligations

IDACORP’s and Idaho Power’s access to capital markets, including the commercial paper market, and their respective financing costs in those markets, depend in part on their respective credit ratings. There have been no changes to IDACORP's or

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Idaho Power's ratings ~~or ratings outlook~~ by Standard & Poor’s Ratings Services (S&P) or Moody’s Investors Service (Moody's) from those included in the ~~2019~~2020 Annual Report. However, any rating can be revised upward or downward or withdrawn at any time by a rating agency if it decides that the circumstances warrant the change. In June 2021, Moody's rating outlook for IDACORP and Idaho Power were modified to negative, from stable, due to Moody's perception of the companies' financial profile relative to its A-rated peers. Moody's rating outlook indicated that it expects that IDACORP and Idaho Power will not take any material actions to improve their cash flows over the next 12-18 months. As disclosed in the 2020 Annual Report, Moody's credit ratings of IDACORP and Idaho Power are currently higher than the similar ratings of S&P. Were IDACORP’s and Idaho Power’s credit ratings at Moody’s to decrease to a similar level as S&P, the companies’ credit ratings would nonetheless remain investment grade and the companies do not believe it would have a material impact on their liquidity or access to debt capital. Moody’s credit ratings of Baa3 and above are considered to be investment grade, or prime, ratings.

Idaho Power maintains margin agreements relating to its wholesale commodity contracts that allow performance assurance collateral to be requested of and/or posted with certain counterparties. As of June 30, ~~2020,~~2021, Idaho Power had posted ~~$3.6~~$0.4 million ofcash performance assurance collateral related to these contracts. Should Idaho Power experience a reduction in its credit rating on its unsecured debt to below investment grade, Idaho Power could be subject to requests by its wholesale counterparties to post additional performance assurance collateral, and counterparties to derivative instruments and other forward contracts could request immediate payment or demand immediate ongoing full daily collateralization on derivative instruments and contracts in net liability positions. Based upon Idaho Power’s current energy and fuel portfolio and market conditions as of June 30, ~~2020,~~2021, the amount of additional collateral that could be requested upon a downgrade to below investment grade is approximately ~~$5.1~~$27.6 million. To minimize capital requirements, Idaho Power actively monitors its portfolio exposure and the potential exposure to additional requests for performance assurance collateral through sensitivity analysis.

Capital Requirements

Idaho Power's construction expenditures, excluding AFUDC,were ~~$139~~$122 million during the six months ended June 30, ~~2020.~~2021. The cash expenditure amount excludes net costs of removing assets from service. The table below presents Idaho Power's estimated accrual-basis additions to electric plant for ~~2020~~2021 (including amounts incurred to-date) through ~~2024~~2025 (in millions of dollars). The amounts in the table exclude AFUDC but include net costs of removing assets from service that Idaho Power expects would be eligible to include in rate base in future rate case proceedings. However, given the uncertainty associated with the timing of infrastructure projects and associated expenditures, actual expenditures and their timing could deviate substantially from those set forth in the table.


	2021	2022	2023-2025
Expected capital expenditures (excluding AFUDC)	$320-$330	$340-$350	$1,250-$1,350

2020 2021 2022-2024
Expected capital expenditures (excluding AFUDC) $300-$310 $305-$315 $1,000-$1,050

Major Infrastructure Projects:Idaho Power is engaged in the development of a number of significant projects and has entered into arrangements with third parties concerning joint infrastructure development. The discussion below provides a summary of developments in certain of those projects since the discussion of these matters included in Part II, Item 7 - "MD&A - Capital Requirements" in the ~~2019~~2020 Annual Report. The discussion below should be read in conjunction with that report.

Boardman-to-Hemingway Transmission Line: The Boardman-to-Hemingway line, a proposed 300-mile, high-voltage transmission project between a substation near Boardman, Oregon, and the Hemingway substation near Boise, Idaho, would provide transmission service to meet future resource needs. In January 2012, Idaho Power entered into a joint funding

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agreement with PacifiCorp and the Bonneville Power Administration (BPA) to pursue permitting of the project. The joint funding agreement provides that Idaho Power's interest in the permitting phase of the project would be approximately 21 percent. Total cost estimates for the project are between $1.0 billion and $1.2 billion, including Idaho Power's AFUDC. This cost estimate is preliminary and excludes the impacts of inflation and price changes of materials and labor resources that may occur following the date of the estimate.

Approximately ~~$110~~$118 million, including AFUDC, has been expended on the Boardman-to-Hemingway project through June 30, ~~2020.~~2021. Pursuant to the terms of the joint funding arrangements, Idaho Power has received ~~$74~~$78 million in reimbursement as of June 30, ~~2020,~~2021, from project co-participants for their share of costs. As of the date of this report, no material co-participant reimbursements are outstanding. Joint permitting participants are obligated to reimburse Idaho Power for their share of any future project permitting expenditures or agreed upon early construction expenditures incurred by Idaho Power under the terms of the joint funding agreement.

Idaho Power's share of the remaining permitting phase of the project (excluding AFUDC) is included in the capital requirements table above, which includes approximately $160 million of Idaho Power's share of estimated costs related to

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permitting, design, material procurement, and construction. The preliminary estimates of Idaho Power’s share of construction costs, which are primarily included in the table in the period 2023-2025, could significantly change as the construction timeline nears and as the project participants further align on future activities, allocation of ownership interests, and cost estimates. In addition to the estimated costs included in the table above, costs will continue to be incurred until the transmission line is placed into service.

The permitting phase of the Boardman-to-Hemingway project is subject to federal review and approval by the U.S. Bureau of Land Management (BLM), the U.S. Forest Service, the Department of the Navy, and certain other federal agencies. The BLM issued its record of decision for the project in November 2017, approving a right-of-way grant for the project to cross approximately 86 miles of BLM-administered land. The U.S. Forest Service issued its record of decision in November 2018, authorizing the project to cross approximately seven miles of National Forest lands. In September 2019, the Department of the Navy issued its record of decision authorizing the project to cross approximately seven miles of Department of the Navy lands. In November 2019, third parties filed a lawsuit in the federal district court of Oregon challenging the BLM and U.S. Forest Service records of decision for the Boardman-to-Hemingway ~~project.~~project on several grounds. In February 2020, Idaho Power filed a motion to intervene in the legal proceeding, and the motion was granted in April 2020. The litigation ~~is in its initial phases and~~ remains pending as of the date of this ~~report.~~report, and a decision is expected in the second half of 2021.

In the separate State of Oregon ~~state~~ permitting process, the Oregon Department of Energy (ODOE) issued a Proposed Order onin July 2, 2020 that recommends approval of the project to the state's Energy Facility Siting Council (EFSC). The project permit is actively undergoing the EFSC administrative process, and Idaho Power currently expects the EFSC to issue a final order and site certificate in the second half of ~~2021. Given~~2022.

Under the ~~status of ongoing permitting activities and the construction period,~~current joint funding agreement, Idaho Power ~~expects~~has an approximate 21 percent interest, BPA has an approximate 24 percent interest, and PacifiCorp has an approximate 55 percent interest in the ~~in-service date for the transmission line in 2026 or some time thereafter.~~

permitting phase. As the current joint funding agreement covers primarily permitting activities, which are nearing completion, Idaho Power and its co-participants are exploring several scenarios of ownership, asset, and service arrangements aimed at maximizing the value of the project to each of the co-participants' customers. ~~One option includes Idaho Power acquiring BPA’s ownership share~~In July 2021, the co-participants entered into an agreement and ~~providing long-term transmission service~~acknowledged that BPA does not intend to participate in the construction of the project or to be a co-owner, in whole or in part, of the project, and that BPA ~~in lieu of BPA ownership. Under the current joint funding agreement, BPA has approximately 24 percent~~intends to sell its interest in the ~~permitting phase. Discussions are preliminary, and any~~project to either Idaho Power or a third party. Any changes regarding the ownership structure would be addressed through amended or new funding agreements for the ~~design and construction~~future phases of the ~~project~~project.

Given the status of ongoing permitting activities and ~~would~~the construction period, Idaho Power expects the in-service date for the transmission line will be ~~subject to regulatory approval.~~no earlier than 2026.

Gateway West Transmission Line: Idaho Power and PacifiCorp are pursuing the joint development of the Gateway West project, a high-voltage transmission lines project between a substation located near Douglas, Wyoming and the Hemingway substation located near Boise, Idaho. In January 2012, Idaho Power and PacifiCorp entered a joint funding agreement for permitting of the project. Idaho Power has expended approximately ~~$43~~$46 million, including Idaho Power's AFUDC, for its share of the permitting phase of the project through June 30, ~~2020.~~2021. As of the date of this report, Idaho Power estimates the total cost for its share of the project (including both permitting and construction) to be between $250 million and $450 million, including AFUDC. Idaho Power's estimated share of ongoing expenditures for the permitting phase of the project (excluding AFUDC) is included in the capital requirements table above. Idaho Power's share of potential early construction costs are excluded from the capital requirements table above because the timing of construction of Idaho Power's portion of the project is uncertain. Idaho Power and PacifiCorp continue to coordinate the timing of next steps to best meet customer and system needs.

Defined Benefit Pension Plan Contributions

Idaho Power contributed $10 million to the defined benefit pension plan ~~during~~in the first half of ~~2020.~~2021. In July ~~2020,~~2021, Idaho Power contributed an additional $10 million to the plan. Idaho Power has no further minimum required ~~contribution~~contributions to be made to its defined benefit pension plan during ~~2020,~~2021, but depending on market conditions and cash flows, Idaho Power expects it will contribute up to a total of $40 million to the pension plan for the full year ~~2020.~~of 2021. Idaho Power's contributions are made in a continued effort to balance the regulatory collection of these expenditures with the amount and timing of contributions and to mitigate the cost of being in an underfunded position. The primary impact of pension contributions is on the timing of cash flows, as the timing of cost recovery lags behind contributions.

In March 2021, the American Rescue Plan Act of 2021 was signed into law, which included changes to the funding rules for single employer pension plans. The minimum funding requirements have been lowered by revising liability discount rates and by lengthening the period over which unfunded liabilities must be amortized. This did not have a material effect on Idaho Power's near-term pension contribution plans.

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Contractual Obligations

During the six months ended June 30, ~~2020,~~2021, IDACORP's and Idaho Power's contractual obligations, outside the ordinary course of business, did not change materially from the amounts disclosed in the ~~2019~~2020 Annual Report, except that Idaho Power entered into ~~one~~two new ~~contract with a hydropower PURPA-qualifying facility~~long-term transmission purchase agreements, which increased Idaho Power's contractual purchase obligations by approximately $16 million over the 5-year terms of the contracts, and ~~nine~~five new replacement contracts for expiring power purchase agreements with PURPA-qualifying hydropower ~~and cogeneration PURPA-qualifying~~ facilities, which increased Idaho Power's contractual purchase obligations by approximately ~~$28~~$29 million over the 20-year terms of the contracts.

Off-Balance Sheet Arrangements

IDACORP's and Idaho Power's off-balance sheet arrangements have not changed materially from those reported in MD&A in the ~~2019~~2020 Annual Report.

REGULATORY MATTERS

Introduction

Idaho Power is under the jurisdiction (as to rates, service, accounting, and other general matters of utility operation) of the IPUC, the OPUC, and the FERC. The IPUC and OPUC determine the rates that Idaho Power is authorized to charge to its retail customers. Idaho Power is also under the regulatory jurisdiction of the IPUC, the OPUC, and the WPSC as to the issuance of debt and equity securities. As a public utility under the Federal Power Act, ~~(FPA),~~ Idaho Power has authority to charge market-based rates for wholesale energy sales under its FERC tariff and to provide transmission services under its OATT. Additionally, the FERC has jurisdiction over Idaho Power's sales of transmission capacity and wholesale electricity, hydropower project relicensing, and system reliability, among other items.

Idaho Power's development of regulatory filings takes into consideration short-term and long-term needs for rate relief and involves several factors that can affect the timing of these regulatory filings. These factors include, among others, in-service dates of major capital investments, the timing and magnitude of changes in major revenue and expense items, and customer growth rates. Idaho Power's most recent general rate cases in Idaho and Oregon were filed during 2011. In 2012, large single-issue rate cases for the Langley Gulch power plant in Idaho and Oregon resulted in the resetting of base rates in both Idaho and Oregon. Idaho Power also reset its base-rate power supply expenses in the Idaho jurisdiction for purposes of updating the collection of costs through retail rates in 2014 but without a resulting net increase in rates. The IPUC and OPUC have also approved base rate changes in single issue cases subsequent to 2014. Between general rate cases, Idaho Power relies upon customer growth, a fixed cost adjustment mechanism, power cost adjustment mechanisms, tariff riders, and other mechanisms to mitigate the impact of regulatory lag, which refers to the period of time between making an investment or incurring an expense and recovering that investment or expense and earning a return. Management's regulatory focus in recent years has been largely on regulatory settlement stipulations and the design of rate mechanisms. In May 2021, the IPUC ordered Idaho Power to work with interested parties and initiate separate cases to review the PCA and FCA mechanisms and to propose any modifications it determines are appropriate so those cases may be processed before the filing of the 2022 PCA application in April 2022 and the 2022 FCA application in March 2022. Reviews of the mechanisms are ongoing, and to date, discussions have been productive and aimed toward mutually agreeable solutions. Idaho Power continues to assess the need and timing of filing a general rate case in its two retail jurisdictions, based on its consideration of factors such as those described above, but does not anticipate filing a general rate case in the next twelve months.

The outcomes of significant proceedings are described in part in this report and further in the ~~2019~~2020 Annual Report. In addition to the discussion below, which includes notable regulatory developments since the discussion of these matters in the ~~2019~~2020 Annual Report, refer to Note 3 - "Regulatory Matters" to the condensed consolidated financial statements included in this report for additional information relating to Idaho Power's regulatory matters and recent regulatory filings and orders.

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Notable Retail Rate Changes During ~~2020~~2021

During ~~2020,~~2021, Idaho Power received orders authorizing the ~~rate~~rates changes summarized in the table below.

Description

Status

Estimated Annual Rate Impact⁽¹⁾

Notes

Power Cost Adjustment Mechanism - Idaho

New PCA rate became effective June 1, ~~2020~~2021

$~~58.7~~39.1 million PCA increase for the period from June 1, ~~2020~~2021 to May 31, ~~2021~~2022

The ~~potential revenue~~income statement impact of ~~rate increases and decreases~~revenue changes associated with the Idaho PCA mechanism is largely offset by associated increases and decreases in actual power supply costs and amortization of deferred power supply costs. The rate increase reflects a forecasted reduction in low-cost hydroelectric generation as well as higher costs associated with PURPA power purchases. The net increase in PCA revenues also reflects a smaller credit to customers through the ~~return to a more normal level of power supply costs as wholesale market prices have come down from unusually high levels reflected in last year's PCA.~~true-up component.

Fixed Cost Adjustment Mechanism - Idaho

New FCA rate became effective June 1, ~~2020~~2021

$~~0.7~~2.8 million FCA increase for the period from June 1, ~~2020~~2021 to May 31, ~~2021~~2022

The FCA is designed to remove a portion of Idaho Power’s financial disincentive to invest in energy efficiency programs by partially separating (or decoupling) the recovery of fixed costs from the volumetric kilowatt-hour charge and instead linking it to a set amount per customer.

(1) The annual amount collected in rates is typically not recovered on a straight-line basis (i.e., 1/12th per month), and is instead recovered in proportion to retail sales volumes.

Idaho Earnings Support and Sharing from Idaho Settlement Stipulation

In October 2014, the IPUC issued an order approving the October 2014 Idaho Earnings Support and Sharing Settlement Stipulation extending, with modifications, the terms of a December 2011 Idaho settlement stipulation for the period from 2015 through 2019. A May 2018 Idaho settlement stipulation related to tax reform (May 2018 Idaho Tax Reform Settlement Stipulation) provides for the extension of the October 2014 Idaho Earnings Support and Sharing Settlement Stipulation beyond the initial termination date of December 31, 2019, with modified terms related to the ADITC and revenue sharing mechanism that became effective beginning January 1, 2020. The more specific terms and conditions of the October 2014 Idaho Earnings Support and Sharing Settlement Stipulation and the May 2018 Idaho Tax Reform Settlement Stipulation areis described in Note 3 - "Regulatory Matters" to the consolidated financial statements included in the ~~2019~~2020 Annual Report. IDACORP and Idaho Power believe that the terms allowing additional amortization of ~~ADITC~~accumulated deferred investment tax credits (ADITC) in the settlement stipulations provide the companies with a greater degree of earnings stability than would be possible without the terms of the stipulations in effect.

Based on its estimate of full-year ~~2020~~2021 Idaho ROE, in both the second quarter and first six months of ~~2020,~~2021, Idaho Power recorded no additional ADITC amortization or provision against current revenues for sharing of earnings with customers for ~~2020~~2021 under the May 2018 Idaho Tax Reform Settlement Stipulation. Accordingly, at June 30, ~~2020,~~2021, the full $45 million of additional ADITC remained available for future use. Idaho Power also recorded no additional ADITC amortization or provision against revenues for sharing of earnings with customers during the second quarter and first six months of ~~2019,~~2020, based on its then-current estimate of full-year ~~2019~~2020 Idaho ROE.

Change in Deferred (Accrued) Net Power Supply Costs and the Power Cost Adjustment Mechanisms

Deferred (accrued) power supply costs represent certain differences between Idaho Power's actual net power supply costs and the costs included in its retail rates, the latter being based on annual forecasts of power supply costs. Deferred (accrued) power supply costs are recorded on the balance sheets for future recovery or refund through customer rates.

~~The table that follows summarizes the change in deferred (accrued) net power supply costs during the six months ended June 30, 2020 (in millions).~~

Idaho Oregon Total
Deferred (accrued) net power supply costs at December 31, 2019 $ (48.2 ) $ (0.3 ) $ (48.5 )
Current period net power supply costs deferred (accrued) (22.9 ) —
(22.9 )
Prior amounts refunded through rates 29.9
0.1
30.0
SO₂ allowance and renewable energy certificate sales
(2.9 ) (0.1 ) (3.0 )
Interest and other 1.2
—
1.2
Deferred (accrued) net power supply costs at June 30, 2020 $ (42.9 ) $ (0.3 ) $ (43.2 )

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Idaho Power's power cost adjustment mechanisms in its Idaho and Oregon jurisdictions address the volatility of power supply costs and provide for annual adjustments to the rates charged to retail customers. The power cost adjustment mechanisms and associated financial impacts are described in "Results of Operations" in this MD&A and in Note 3 - "Regulatory Matters" to the condensed consolidated financial statements included in this report. With the exception of power supply expenses incurred under PURPA and certain demand response program costs that are passed through to customers substantially in full, the Idaho PCA mechanism allows Idaho Power to pass through to customers 95 percent of the differences in actual net power supply expenses as compared with base net power supply expenses, whether positive or negative. Thus, the primary financial statement impact of power supply cost deferrals or accruals is that the timing of when cash is paid out for power supply expenses differs from when those costs are recovered from customers, impacting operating cash flows from year to year.

~~Deferred Costs for COVID-19 Public Health Crisis~~

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~~Idaho Power has incurred, and expects to continue to incur,~~The following table summarizes the change in accrued net power supply costs ~~associated with its response to~~during the COVID-19 public health crisis, including information technology expenditures for remote work, higher than average levels of bad debt expense related to uncollectible accounts associated in part with its suspension of disconnects, and the suspension of late payment fees. Accordingly, in March and April 2020, Idaho Power submitted applications to the OPUC and IPUC, respectively, requesting authorization to defer incremental costs associated with its response to the COVID-19 public health crisis. Idaho Power requested authorization to establish a new regulatory asset to record the deferral of incremental costs and, in the Idaho jurisdiction, unrecovered costs associated with the COVID-19 response. Both applications requested only the authority to defer these costs and to determine ratemaking treatment at a later date. Subsequent to Idaho Power's application, the IPUC opened a general docket to address the issue. On July 8, 2020, the IPUC issued an order authorizing Idaho Power and other utilities to account for unanticipated, emergency-related expenses incurred due to the COVID-19 public health crisis by recording the expenses as regulatory assets for possible recovery through future rates. The order also requires utilities to account for the decreases in expenses resulting from the COVID-19 public health crisis, such as reduced employee travel and training, and apply these reductions in expenses to offset the deferral account balance. Additionally, the order addressed potential reductions in revenue due to the COVID-19 public health crisis, allowing utilities to track reduced revenues from customer classes not included in an FCA-type mechanism for possible movement to the regulatory asset account at a later date. Idaho Power plans to resume disconnections and accruing late fees beginning in early August 2020. In the second quarter of 2020, Idaho Power recorded a $0.6 million regulatory asset for its estimate of unanticipated, emergency-related expenses, net of estimated savings. As of the date of this report, Idaho Power has not received authorization in the Oregon jurisdiction to defer any such costs.

~~Alternative AFUDC Calculation Formula~~

Onsix months ended June 30, ~~2020, the FERC issued an order allowing jurisdictional utilities the option to apply an alternative AFUDC calculation formula for March 2020 through February~~ 2021 to reflect conditions that arose as a result of responses to the COVID-19 pandemic. The optional alternative AFUDC calculation would recompute AFUDC each month by substituting average short-term debt outstanding in 2019 for the actual amounts in March 2020 through February 2021. All other aspects of the formula would be unchanged. As of the date of this report, Idaho Power's AFUDC rate would not be affected by the alternative calculation formula and thus far Idaho Power has not elected to apply the option.(in millions).


	Idaho		Oregon		Total
Accrued net power supply costs at December 31, 2020	$	(14.7)	$	(0.3)	$	(15.0)
Current period net power supply costs accrued	(16.1)		—		(16.1)

Prior amounts refunded through rates	18.3		0.1		18.4
SO2 allowance and renewable energy certificate sales	(3.3)		(0.1)		(3.4)
Interest and other	1.5		(0.1)		1.4
Accrued net power supply costs at June 30, 2021	$	(14.3)	$	(0.4)	$	(14.7)

Open Access Transmission Tariff Draft Posting

Idaho Power uses a formula rate for transmission service provided under its OATT, which allows transmission rates to be updated annually based primarily on financial and operational data Idaho Power files with the FERC. In June ~~2020,~~2021, Idaho Power publicly posted its ~~2020~~2021 draft transmission rate, reflecting a transmission rate of ~~$30.02~~$31.19 per "kW-year," to be effective for the period from October 1, ~~2020~~2021, to September 30, ~~2021.~~2022. A "kW-year" is a unit of electrical capacity equivalent to 1 kilowatt of power used for 8,760 hours. Idaho Power's draft rate was based on a net annual transmission revenue requirement of ~~$117.9~~$127.3 million. The existing OATT rate in effect from October 1, ~~2019~~2020, to September 30, ~~2020,~~2021, is ~~$27.32~~$29.95 per kW-year based on a net annual transmission revenue requirement of ~~$107.0 million.~~$117.7 million. The increase in the OATT rate is largely attributable to increased transmission plant as well as decreased short-term firm and non-firm transmission revenues in ~~2019,~~2020, which serve as an offset to the transmission revenue requirement.

~~2019~~ Integrated Resource Plan

The IPUC and OPUC require that Idaho Power prepare biennially an Integrated Resource Plan (IRP). The IRP seeks to forecast Idaho Power's loads and resources for a 20-year period; analyzes potential supply-side, demand-side, and transmission resource options; and identifies potential near-term and long-term actions. Idaho Power filed its most recent IRP with the IPUC and OPUC in June 2019 and filed an amended 2019 IRP with additional information and modeling results in January 2020, as described in Part 1, Item 1 - "Resource Planning and Renewable Energy Projects" in the ~~2019~~2020 Annual Report. ~~Subsequent to~~In March 2021 and April 2021, the ~~January 2020 filing, Idaho Power noted further complications with its modeling approach. On July 2, 2020,~~IPUC and OPUC, respectively, acknowledged the ~~OPUC granted Idaho Power's motion to suspend the procedural schedule for the~~second amended 2019 IRP. ~~On July 16, 2020,~~In May 2021, the IPUC issued an order ~~vacating~~approving Idaho Power's request to extend the ~~comment~~filing deadline ~~previously established in this case.~~of the 2021 IRP to the last business day of December 2021.

Depreciation Rate Update Requests

In 2021, Idaho Power ~~expects~~conducted a depreciation study of electric plant-in-service, which it performs approximately every five years. The study provided updates to ~~file~~net salvage percentages and service life estimates for Idaho Power plant assets. Based on the study, in June 2021, Idaho Power filed applications with the IPUC and OPUC, ~~on or around July~~requesting approval to institute revised depreciation rates for Idaho Power's electric plant-in-service and adjust base rates by an aggregate of $3.9 million to reflect the revised depreciation rates applied to electric plant-in-service balances subject to the most recent general rate cases. The proposed adjustments in these applications are an overall rate increase of 0.31 percent in Idaho and 0.24 percent in Oregon. Idaho Power requested an effective date of December 1, 2021, for these adjustments, and as of the date of this report, orders from the IPUC and OPUC are pending.

Jim Bridger Power Plant Rate Request

Also in June 2021, Idaho Power filed an application with the IPUC requesting authorization to (a) accelerate depreciation for the Jim Bridger plant, to allow the plant to be fully depreciated and recovered by December 31, ~~2020,~~2030, (b) establish a ~~status update on~~balancing account to track the incremental costs and benefits associated with ceasing participation in coal-fired operations at the Jim Bridger plant, and (c) adjust customer rates to recover the associated incremental annual levelized revenue requirement in the aggregate amount of $30.8 million, which includes Idaho ~~Power’s~~Power's share of all electric plant in service at the Jim Bridger plant. The proposed adjustment in this application is an overall rate increase of 2.53 percent in Idaho. Idaho Power requested an effective date of December 1, 2021, for this adjustment, and as of the date of this report, an order from the IPUC is pending.

Wildfire Mitigation Cost Deferral

In June 2021, the IPUC authorized Idaho Power to defer for future amortization incremental O&M and depreciation expense of

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~~anticipated schedule~~certain capital investments necessary to implement the company's WMP. The IPUC also authorized Idaho Power to record these deferred expenses as a regulatory asset until the company can request amortization of the deferred costs in a future IPUC proceeding, at which time the IPUC will have the opportunity to review ~~certain inputs~~actual costs and determine the amount of prudently incurred costs that Idaho Power can recover through retail rates. Idaho Power projects spending approximately $47 million in incremental wildfire mitigation-related O&M and roughly $35 million in wildfire mitigation system-hardening capital incremental expenditures over the next five years. The IPUC authorized a deferral period of five years, or until rates go into effect after Idaho Power's next general rate case, whichever is first. As of June 30, 2021, Idaho Power had not recorded any deferral related to the ~~model~~WMP, as Idaho Power does not expect to incur significant incremental costs in connection with many of the ~~company uses for~~projects identified in the ~~IRP, such as operational constraints and financial assumptions, and~~plan until the ~~modeling system’s logic. The proceedings relating to the amended 2019 IRP are pending at~~second half of 2021.

Valmy Plant Exit Date

In April 2021, Idaho Power filed an application with the IPUC requesting an acknowledgment that its year-end 2025 exit date from Valmy unit 2 is appropriate based on economics and ~~OPUC.~~reliability needs. As of the date of this report, comments from intervenors and an order from the IPUC are pending.

Renewable and Other Energy Contracts

Idaho Power has contracts for the purchase of electricity produced by third-party owned generation facilities, most of which produce energy with the use of renewable generation sources such as wind, solar, biomass, small hydropower, and geothermal. The majority of these contracts are entered into as mandatory purchases under PURPA. As of June 30, ~~2020,~~2021, Idaho Power had contracts to purchase energy from ~~131 on-line~~129 online PURPA projects. An additional three contracts are with ~~on-line~~online non-PURPA projects, including the Elkhorn Valley wind project with a 101-MW nameplate capacity.

The following table sets forth, as of June 30, ~~2020,~~2021, the resource type and nameplate capacity of Idaho Power's signed agreements for power purchases from PURPA and non-PURPA generating facilities. These agreements have original contract terms ranging from one to 35 years.


Resource Type	On-line megawatts (MW)	Under Contract but not yet On-line (MW)	Total Projects under Contract (MW)
PURPA:
Wind	627	—	627
Solar	316	3	319
Hydropower	150	1	151
Other	44	—	44
Total	1,137	4	1,141
Non-PURPA:
Wind	101	—	101
Geothermal	35	—	35
Solar	—	120	120
Total	136	120	256

Resource Type On-line megawatts (MW) Under Contract but not yet On-line (MW) Total Projects under Contract (MW)
PURPA:
Wind 627
—
627
Solar 316
3
319
Hydropower 147
3
150
Other 52
—
52
Total 1,142
6
1,148
Non-PURPA:
Wind 101
—
101
Geothermal 35
—
35
Solar —
120
120
Total 136
120
256

The projects not yet ~~on-line~~online include ~~two PURPA-qualifying~~one PURPA hydropower ~~projects~~project that ~~are~~is scheduled to be ~~on-line in 2021~~online later this year and one ~~PURPA-qualifying~~PURPA solar project scheduled to be on-line in 2022. The non-PURPA solar project is scheduled to be ~~on-line~~online in 2022.

OnIn July ~~16,~~ 2020, the FERC issued Order No. 872, ~~that~~which could affect how states determine PURPA project avoided cost rates for purchases of power generated from PURPA qualifying facilities (QF), which facilities are eligible for QF status, whether and when certain QFs can enter into purchase agreements with utilities, and how parties can contest the eligibility of a generation facility seeking QF status. As of the date of this report, Idaho Power is ~~still assessing the order, which remains pending, and is~~ unable to determine the impact of these potential changes on the company's future obligations for new PURPA power purchase contracts. Further action by the state public utility commissions is required to implement many of the changes. While the ultimate impact of implementation of those changes is yet to be determined, taken as a whole, Idaho Power believes that the changes could reduce the number of future PURPA generation projects, which could reduce purchased power costs for Idaho Power. Substantially all PURPA power purchase costs are recovered through base rates and Idaho Power's power cost adjustment mechanisms.

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Customer-Owned Generation Filings

Customer-owned generation allows customers to install solar panels or other on-site energy-generating resources and connect them to Idaho Power’s grid. If a customer requires more energy than its system generates, it utilizes energy supplied by Idaho Power’s grid. If ~~its~~a customer's system generates more energy than the customer uses, the energy goes back to the grid and Idaho Power applies a corresponding kWh credit to the customer’s bill. Idaho Power has filed various cases with the IPUC related to customer generation as described in Part II, Item 7 - "Regulatory Matters" in the 2020 Annual Report. In ~~May 2018,~~March 2021, the IPUC issued an order ~~authorizing~~approving Idaho Power's application as filed that establishes a smart inverter requirement for all new on-site energy-generating resources interconnected to the ~~creation of two new customer classes for residential and small commercial customers who install their own on-site generation, with no change to pricing or compensation. Since October 2018,~~company's system, among other things. In June 2021, Idaho Power ~~has initiated cases with~~filed an application requesting that the IPUC ~~and OPUC related to studying~~initiate the multi-phase process for a comprehensive study of the costs and benefits of ~~customer-owned~~on-site generation onas directed by previous IPUC orders. Idaho ~~Power’s system, and exploring whether, and~~Power expects to ~~what~~

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~~extent, there should be modifications to~~complete the ~~customer-owned generation pricing structure for residential and small general service customers, and large commercial, industrial, and irrigation customers. The IPUC issued orders in one~~first phase of the ~~residential and small commercial cases during December 2019 and February 2020 directing Idaho Power to (1) complete additional studies related to~~proposed process involving a study design by the ~~costs and benefits~~end of customer generation before changes to the compensation structure are implemented, and (2) continue to allow customers with on-site generation prior to December 20, 2019, to be subject to the billing terms in place on that date until December 20, 2045. In June 2020, Idaho Power filed an application with the IPUC seeking authority to remove the existing two-meter requirement for new large commercial, industrial, and irrigation (CI&I) customers with on-site generation and to establish a ten-year grandfathering term for existing CI&I customers with on-site generation. As of the date of this report, Idaho Power does not expect the pending cases relating to customer-owned generation matters to materially affect its financial condition or results of operations.2021.

Relicensing of Hydropower Projects

HCC Relicensing: In connection with Idaho Power's efforts to relicense the HCC, Idaho Power's largest hydropower complex and a major relicensing effort, as described in more detail in the ~~2019~~2020 Annual Report in Part II, Item 7 - "Regulatory Matters," Idaho Power filed water quality certification applications, required under Section 401 of the Clean Water Act (CWA), with the states of Idaho and Oregon requesting that each state certify that any discharges from the project comply with applicable state water quality standards. Idaho Power ~~has been working~~continues to work with the states to identify measures that will provide reasonable assurance that discharges from the HCC will adequately address applicable water quality standards.

In April 2019, the states of Idaho and Oregon, along with Idaho Power, reached a settlement pertaining to the CWA Section 401 certification that requires Idaho Power to increase the number of Chinook salmon it releases each year through expanded hatchery production. Additionally, Idaho Power is required to fund a total of $12 million of research and water quality improvements in the HCC over a 20-year period following the issuance of the license. Idaho Power estimates that the combined cost of the mandated water quality improvements and expanded hatchery production is $20 million in aggregate over the first 20 years of the new license term. In May 2019, Oregon and Idaho issued final CWA Section 401 certifications. These certifications have been submitted to the FERC as part of the relicensing process. In July 2019, three ~~third-parties~~third parties filed lawsuits against the Oregon Department of Environmental Quality in Oregon state court challenging the Oregon CWA Section 401 certification based on fish passage, water temperature, and mercury issues associated with the Snake River and the HCC. Two of the lawsuits were consolidated, and Idaho Power has intervened in that lawsuit. ~~Idaho Power is closely monitoring~~The court dismissed the ~~other pending lawsuit.~~third challenge to the Oregon CWA 401 certification with prejudice. No parties challenged the Idaho CWA 401 certification. In December 2019, Idaho Power filed an Offer of Settlement with the FERC requesting specific language be included in the new HCC license based upon the settlement among Idaho, Oregon, and Idaho Power. During the first quarter of 2020, the FERC received several comments opposing the Offer of Settlement and its decision relating to the Offer of Settlement is pending as of the date of this report.

In July 2020, the EPA published a rule amending regulations intended to implement the CWA Section 401 water quality certification process. The rule clarifies that a state must issue its water quality certification within a reasonable time period, up to one year from the certification request, and limits the scope of the certification to jurisdictional water quality matters. Further, the new regulations make clear that federal agencies, not the state departments of environmental quality, will enforce the certification conditions. This rule is scheduled to become effective on September 11, 2020. Idaho Power believes that the new CWA Section 401 regulations will be challenged by both states and environmental groups, and as of the date of this report, at least one consortium of environmental groups has filed a complaint in court. If these regulations are rejected by the courts, Idaho Power would continue to operate under the current CWA Section 401 regulations as described above.

In July 2020, Idaho Power submitted to the FERC its supplement to the final license application that incorporated the settlement agreement reached between Idaho and Oregon on the CWA Section 401 certifications, and provided feedback on proposed modification of the 2007 final environmental impact statement for the HCC. The July 2020 filing also contained an updated cost analysis of the HCC and a request for the FERC to issue a 50-year license and ~~initiates~~initiate a supplemental National Environmental Policy Act (NEPA) process at the FERC. Idaho Power ~~is also preparing a~~prepared draft biological ~~assessment, which will provide information to~~assessments in consultation with the U.S. Fish and Wildlife Service (USFWS)and the National Marine Fisheries Service (NMFS) ~~for~~and filed those with the FERC in October 2020. The draft biological assessments provide information to the USFWS and the NMFS that is necessary to issue their biological opinion as required under the Endangered Species Act (ESA). ~~Once the biological assessment is complete,~~In December 2020, FERC staff issued six requests for additional information from Idaho Power ~~plans~~ to ~~begin~~help with the analysis and baseline for the project moving forward. Idaho Power has filed responses to all six of the requests with FERC as of the date of this report. Once FERC has evaluated the additional information, Idaho Power expects it to decide what, if any, additional environmental analysis is necessary to issue a license. Idaho Power expects the FERC will also initiate formal ESA consultation with the USFWS and the NMFS. The FERC could issue an HCC license as early as 2022, but as of the date of this report, Idaho Power ~~continues to expect the FERC to issue a license for the HCC no earlier than 2022.~~

believes issuance is more likely in 2023 or thereafter.

Costs for the relicensing of Idaho Power's hydropower projects are recorded in construction work in progress until new multi-year licenses are issued by the FERC, at which time the charges are transferred to electric plant in service. Idaho Power expects to seek ~~timely~~ recovery of relicensing costs and costs related to a new long-term license through the ~~ratemaking~~regulatory process. Relicensing costs of ~~$339~~$372 million (including AFUDC) for the HCC were included in construction work in progress at June 30, ~~2020.~~2021. As of the date of this report, the IPUC authorizes Idaho Power to include in its Idaho jurisdiction rates $8.8 million of

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AFUDC annually relating to the HCC relicensing project. Collecting these amounts currently will reduce future collections when HCC relicensing costs are approved for recovery in base rates. As of June 30, ~~2020,~~2021, Idaho Power's regulatory liability for collection of AFUDC relating to the HCC was approximately ~~$160~~$178 million.

When the FERC issues a new long-term license, Idaho Power will begin operating under the requirements contained in the new license. Idaho Power expects those requirements to increase both O&M expenditures and capital expenditures. Because Idaho Power is uncertain when the FERC will issue a new license, it has not included the expected capital expenditure increases in the “Capital Requirements” section of “Liquidity and Capital Resources” of this MD&A. Idaho Power is unable to predict the exact timing of issuance of a new license for the HCC, or the ultimate financial or operational requirements of a new license.

American Falls Relicensing: In April 2020, the FERC formally initiated the relicensing proceeding for the American Falls hydropower facility, which is Idaho Power's largest hydropower facility outside of the HCC, with a generating capacity of 92.3 MW. Idaho Power owns the generation facility but not the structural dam itself, which is owned by the U.S. Bureau of Reclamation. The FERC recognized Idaho Power’s pre-application document, including a proposed process plan and schedule, and recognized Idaho Power’s intent to file an application for a license. A final license application is due to the FERC in 2023. The relicensing proceeding will begin the process of informal ESA Section 7 consultation with ~~Fish and Wildlife Service~~the USFWS and Section 106 of the National Historic Preservation Act consultation with the Idaho State Historic Preservation Office. American Falls' current license expires in 2025, and as of the date of this report, Idaho Power expects the FERC to issue a license for this facility prior to the expiration.

ENVIRONMENTAL MATTERS

Overview

Idaho Power is subject to a broad range of federal, state, regional, and local laws and regulations designed to protect, restore, and enhance the environment, including the ~~Affordable Clean Energy (ACE) rule and other~~ Clean Air Act, ~~(CAA) requirements,~~ the CWA, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, the Comprehensive Environmental Response, Compensation and Liability Act, and the ESA, among other laws. These laws are administered by various federal, state, and local agencies. In addition to imposing continuing compliance obligations and associated costs, these laws and regulations provide authority to regulators to levy substantial penalties for noncompliance, injunctive relief, and other sanctions. Idaho Power's ~~three~~two jointly-owned coal-fired power plants and three wholly-owned natural gas-fired combustion turbine power plants are subject to many of these regulations. Idaho Power's 17 hydropower projects are also subject to numerous water discharge standards and other environmental requirements.

Compliance with current and future environmental laws and regulations may:

•increase the operating costs of generating plants;

•increase the construction costs and lead time for new facilities;

•require the modification of existing generation plants, which could result in additional costs;

•require the curtailment or shut-down of existing generating plants; or

•reduce the output from current generating ~~facilities.~~facilities; or

•require the acquisition of alternative sources of energy or storage technology, increased transmission wheeling, or require construction of additional generating facilities, which could result in higher costs.

Current and future environmental laws and regulations may increase the cost of operating fossil fuel-fired generation plants and constructing new generation and transmission facilities, in large part through the substantial cost of permitting activities and the required installation of additional pollution control devices. In many parts of the United States, some higher-cost, high-emission coal-fired plants have ceased operation or the plant owners have announced a near-term cessation of operation, as the cost of compliance makes the plants uneconomical to operate. Beyond increasing costs generally, these environmental laws and regulations could affect IDACORP's and Idaho Power's results of operations and financial condition if the costs associated with these environmental requirements and early plant retirements and new replacement resource costs cannot be fully recovered in rates on a timely basis. Part I - "Business - Environmental Regulation and Costs" in the ~~2019~~2020 Annual Report, includes a summary of Idaho Power's expected capital and operating expenditures for environmental matters during the period from ~~2020~~2021 to ~~2022.~~2023. Given the uncertainty of future environmental regulations, Idaho Power is unable to predict its environmental-related expenditures and infrastructure investments beyond that time, though they could be substantial.

A summary of notable environmental matters impacting, or expected to potentially impact, IDACORP and Idaho Power is included in Part II, Item 7 - "MD&A - Environmental Issues" and "MD&A - Liquidity and Capital Resources - Capital Requirements - Environmental Regulation Costs" in the ~~2019~~2020 Annual Report. Developments in certain environmental matters relevant to Idaho Power are described below.

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Endangered Species Act Matters

The listing of a species of fish, wildlife, or plants as threatened or endangered under the ESA may have an adverse impact on Idaho Power's ability to construct generation, transmission, or distribution facilities or relicense or operate its hydropower facilities. When a species is added to the federal list of threatened and endangered species, it is protected from “take,” which is defined to include harming the species. The ESA directs that, concurrent with a designation of a threatened or endangered species, and where prudent and determinable, the applicable agencies also designate “any habitat of such species which is then considered to be critical habitat.” The ESA also provides that each federal agency must ensure that any action they authorize, fund, or carry out is not likely to jeopardize the continued existence of a listed species or result in the destruction or adverse modification of its critical habitat. If an action is determined to result in adverse modification of critical habitat, the federal agency must adopt changes to the proposed action to avoid the adverse modification. These changes are often quite extensive and can affect the size, scope, and even the feasibility of a project moving forward.

~~Boardman-to-Hemingway and Gateway West Transmission Projects and Other Infrastructure - Slickspot Peppergrass Designation~~:In ~~August 2016,~~June 2021, in response to the new Presidential Administration's executive order directing federal agencies to review certain environmental regulations (January 2021 Executive Order), the USFWS ~~re-instated~~and the ~~threatened~~NMFS released a plan to initiate rulemaking to revise, rescind, or reinstate five ESA regulations finalized by the prior administration. The agencies announced that they intend to rescind regulations that revised the USFWS's process for considering exclusions from critical habitat designations, rescind the regulatory definition of habitat, revise regulations for listing species ~~status of slickspot peppergrass~~and designating critical habitat, revise regulations for interagency cooperation, and reinstate certain protections for species listed as threatened under the ESA. ~~On July 23,~~As described in Part II, Item 7 - "MD&A - Environmental Issues" in the 2020 Annual Report, these ESA regulations could impact the timing and feasibility of the HCC relicensing project and the Gateway West and Boardman-to-Hemingway transmission projects and other infrastructure, which could lead to substantially higher construction, permitting, and licensing costs and could delay construction.

Clean Air Act Matters

Regional Haze Rules: In accordance with federal regional haze rules under the CAA, coal-fired utility boilers are subject to regional haze - best available retrofit technology (RH BART) if they were built between 1962 and 1977 and affect any "Class I" (wilderness) areas. This includes all units at the Jim Bridger plant.

In December 2009, the WDEQ issued a RH BART permit to PacifiCorp as the operator of the Jim Bridger plant. As part of the WDEQ's long term strategy for regional haze, the permit required that PacifiCorp install selective catalytic reduction (SCR) equipment for nitrogen oxide (NOx) control at Jim Bridger units 3 and 4 by December 31, 2015, and December 31, 2016, respectively, which has been completed, and submit an application by December 31, 2017, to install add-on NOx controls at Jim Bridger unit 2 by December 31, 2021, and unit 1 by December 31, 2022, which was submitted in December 2017. In November 2010, PacifiCorp and the WDEQ signed a settlement agreement under which PacifiCorp agreed to the timing and nature of the controls. The settlement agreement was conditioned on the EPA ultimately approving those portions of the Wyoming regional haze state implementation plan (SIP) that are consistent with the terms of the settlement agreement. In January 2014, the EPA approved Wyoming's regional haze SIP as to the Jim Bridger plant, with the NOx control compliance dates set forth in the settlement agreement.

In February 2019, PacifiCorp submitted a SIP revision to the WDEQ as an alternative regional haze compliance plan for the Jim Bridger plant that includes a reduced plant-wide monthly limit on emissions for NOx and SO2 and an annual total emissions cap for NOx and SO2 for units 1-4. In May 2020, the ~~USFWS published a~~WDEQ approved the alternative plan as proposed, ~~rule designating critical habitat for~~which would eliminate the ~~species. Idaho Power is reviewing the proposed rule~~requirement to ~~determine the extent of any potential overlap~~install add-on NOx controls at Jim Bridger units 1 and 2. As of the designation with Idaho Power’s proposed line routes for the Boardman-to-Hemingway and Gateway West transmission projects, as well as other transmission and distribution lines. If critical habitat is designated within the vicinity of the transmission line projects, Idaho Power expects that the designation could increase the cost of obtaining permits for the projects, require changes to the route and tower configuration, and could further delay the in-service date of this report, the ~~projects. Costs for maintenance, repair, and reconstruction of other transmission and distribution lines within the critical habit areas could also increase as a result of the designation.~~

~~Hydroelectric Projects:~~ In May 2016, the United States District Court for the District of Oregon issued an opinion finding that in the context of hydropower facilities owned and operated by the U.S. Army Corps of Engineers and locatedEPA has not formally acted on the ~~lower Snake River, National Oceanic~~SIP revision; however, the EPA has been in discussions with the WDEQ and ~~Atmospheric Administration's National Marine Fisheries Service (NOAA Fisheries) violated~~PacifiCorp regarding the ESA by using improper standards, failing to consider adequately the impact of climate change on habitat conditions, and placing undue reliance on unproven, future federal habitat conservation measures, particularly to the degree that the success of the measures could be undermined by climate change. The court also found that other federal agencies violated the NEPA by failing to prepare a comprehensive environmental impact statement on implementation of the conservation measures ordered by NOAA Fisheries, including analysis of the measures directed by NOAA Fisheries and other reasonable alternatives. The court’s opinion and its emphasis on a climate change-driven analysis element, if generalized to other situations, could require ESA-driven avoidance, minimization, and compensatory mitigation efforts to incorporate surplus measures to ensure species’ protection, which could result in considerable increases in cost beyond the cost of additional analysis in the NEPA process. In September 2016, federal agencies initiated an environmental impact statement process to examine hydropower dams on the lower Snake River, which Idaho Power expects will take place over a five-year period. None of Idaho Power’s hydropower facilities are included in the studies.SIP revision.

~~Changes to NEPA:~~ On July 15, 2020, the Presidential Administration's Council on Environmental Quality announced its final rule to narrow federal agencies' NEPA obligations. NEPA applies to Idaho Power’s transmission and distribution lines that are located on federal land, as well as other infrastructure projects that have federal land implications. While Idaho Power believes the changes to NEPA will be subject to legal challenge, if upheld they may expedite and make less costly Idaho Power’s permitting and right-of-way processes for those projects.

Clean Water Act Matters

Definition of “Waters of the United States” Under the ~~CWA~~CWA: : In August 2015, the EPA and U.S. Army Corps of Engineers' (USACE) final rule defining the phrase "waters of the United States" (WOTUS) under the CWA became effective (WOTUS Rule). Idaho Power believes that the 2015 rule potentially expanded federal jurisdiction under the CWA beyond traditional navigable waters, interstate waters, territorial seas, tributaries, and adjacent wetlands, to a number of other waters, including waters with a "significant nexus" to those traditional waters. The WOTUS Rule was widely challenged in both federal district and circuit courts. In January 2020, the EPA and USACE finalized the first of a two-part rule to repeal the WOTUS Rule and set new and more expansive standards for determining which waters are subject to the CWA, which substantially restored the definitions and guidance used prior to the WOTUS Rule. In April 2020, the EPA and USACE published the second

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part of the final rule to replace the WOTUS Rule with the "Navigable Waters Protection Rule" that provides a final definition of "waters of the United States," which ultimately narrows the scope of waters subject to federal regulation under the CWA. The Navigable Waters Protection Rule became effective in June 2020. In June 2021, in response to the January 2021 Executive Order, the EPA and USACE announced their intent to initiate a new rulemaking process that restores the protections in place prior to the WOTUS Rule and develop a new rule to establish a new definition of "waters of the United States."

Idaho Power believes the repeal rule, the WOTUS Rule, ~~and~~ the Navigable Waters Protection Rule, and the potential new rule will continue to be

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challenged in court, but expects that, even if the WOTUS Rule is reinstated in Idaho or another expansive rule is enacted in Idaho and should the revised definition take effect in Idaho, while it may cause Idaho Power to incur additional permitting, regulatory requirements, and other costs associated with the rule, the aggregate amount of increased costs is unlikely to have a material adverse effect on Idaho Power's operations or financial condition, in part due to the relatively arid climate of Idaho Power's service area. Similarly, because the CWA, as interpreted even prior to the WOTUS Rule, applies to most of Idaho Power's facilities, including its hydropower plants, Idaho Power does not expect reinstatement or a similar rule would have a material impact on Idaho Power's operations or financial condition.

Section 401 Water Quality Certification: As described more fully under “Relicensing of Hydropower Projects” in the "Regulatory Matters" section of this MD&A and in the ~~2019~~2020 Annual Report in Part II, Item 7 - "Regulatory Matters," Idaho Power filed water quality certification applications, required under Section 401 of the CWA, with the states of Idaho and Oregon requesting that each state certify that any discharges from the HCC comply with applicable state water quality standards. The states issued final certifications in May 2019, ~~but the~~after reaching a settlement with Idaho Power on fisheries-related matters. The Oregon certification, however, was challenged in state court by third parties. Idaho Power intervened in one of those lawsuits and ~~is closely monitoring~~ the ~~other.~~other lawsuit was dismissed by the court. In December 2019, Idaho Power filed an Offer of Settlement with the FERC requesting specific language be included in the new HCC license based upon the fish settlement among Idaho, Oregon, and Idaho Power. During the first quarter of 2020, the FERC received several comments opposing the Offer of Settlement and its decision relating to the Offer of Settlement is pending as of the date of this report.

OnIn July ~~13,~~ 2020, the EPA published a rule amending regulations intended to implement the CWA Section 401 water quality certification ~~process, which is scheduled~~process. The rule clarifies that a state must issue its water quality certification within a reasonable time period, up to ~~become~~one year from the certification request, and limits the scope of the certification to jurisdictional water quality matters. Further, the new regulations make clear that federal agencies, not the state departments of environmental quality, will enforce the certification conditions. This rule became effective onin September ~~11,~~ 2020. ~~Idaho Power believes that the~~The new CWA Section 401 regulations ~~will be~~have been challenged ~~by both states~~in court and ~~environmental groups, and as~~Idaho Power has joined a coalition of utilities to defend the ~~date~~EPA’s regulation in a case being tried in the Northern District of ~~this report, at least one consortium of environmental groups has filed a complaint in court.~~California. If these regulations are rejected by the courts, Idaho Power would continue to operate under the current CWA Section 401 ~~regulations.~~

~~Clean Air Act Matters~~

regulations as described above.

~~Overview:~~

In ~~addition~~May 2021, in response to the ~~CAA developments related~~January 2021 Executive Order, the EPA announced its intention to ~~GHG emissions described in Part II, Item 7 - "MD&A - Environmental Issues"~~reconsider and revise the CWA Section 401 regulations. Idaho Power expects the EPA to expand state and tribal authority over water quality certifications; however, such expanded authority would not likely impact the timing and cost of the ~~2019 Annual Report, several other regulatory programs developed under~~HCC certification unless the ~~CAA apply~~401 certification is invalidated by either the Oregon litigation or the FERC declines to adopt the Offer of Settlement,

in which case Idaho ~~Power. These include the final Mercury~~Power would file new water quality certification applications in Idaho and ~~Air Toxics Standards (MATS), National Ambient Air Quality Standards (NAAQS), New Source Review / Prevention of Significant Deterioration Rules, and the Regional Haze Rule. Developments related~~Oregon with revisions necessary to address changes to the ~~Regional Haze Rule are discussed below.~~

~~Regional Haze Rules:~~ In accordance with federal regional haze rules under the CAA, coal-fired utility boilers are subject to regional haze - best available retrofit technology (RH BART) if they were built between 1962 and 1977 and affect any "Class I" (wilderness) areas. This includes all four units at the Jim Bridger and the Boardman coal-fired plants. The RH BART rules would have required installation of a suite of emissions controls at the Boardman plant; however, in December 2010, the Oregon Environmental Quality Commission approved a plan to install a less costly suite of environmental controls and cease coal-fired operations at the Boardman power plant no later than December 31, 2020.

As described more fully in the 2019 Annual Report in Part II, Item 7 - "Environmental Matters," in December 2009, the WDEQ issued a RH BART permit to PacifiCorp as the operator of the Jim Bridger plant. In February 2019, PacifiCorp submitted a SIP revision to the WDEQ as an alternative regional haze compliance plan for the Jim Bridger plant that includes a reduced plant-wide monthly limit on emissions for NO_x~~and SO~~₂~~and an annual total emissions cap for NO~~_x~~and SO~~₂~~for units 1-4. In May 2020, the WDEQ approved the alternative plan as proposed,~~regulations, which ~~would eliminate the requirement to install add-on NO~~_x controls at Jim Bridger units 1 and 2. The new enforceable emissions limits are scheduled to go into effect on January 1, 2022. As of the date of this report, the EPA is reviewing the plan and will provide a public comment period, but Idaho Power ~~is uncertain when the EPA will finalize its decision on the proposed SIP revision.~~cannot currently predict.

OTHER MATTERS

Critical Accounting Policies and Estimates

IDACORP's and Idaho Power's discussion and analysis of their financial condition and results of operations are based upon their condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles. The preparation of these financial statements requires IDACORP and Idaho Power to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and related disclosure of contingent assets and liabilities. On an ongoing basis, IDACORP and Idaho Power evaluate these estimates, including those estimates related to rate regulation, retirement benefits, contingencies, asset impairment, income taxes, unbilled revenues, and bad debt. These estimates are based on historical experience and on other assumptions and factors that are believed to be reasonable under the

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circumstances, and are the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. IDACORP and Idaho Power, based on their ongoing reviews, make adjustments when facts and circumstances dictate.

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IDACORP’s and Idaho Power’s critical accounting policies are reviewed by the audit committees of the boards of directors. These policies have not changed materially from the discussion of those policies included under "Critical Accounting Policies and Estimates" in the ~~2019~~2020 Annual Report.

Recently Issued Accounting Pronouncements

~~For~~There have been no recently issued accounting pronouncements that have had or are expected to have a ~~listing of new and recently adopted accounting standards, see Note 1 - "Summary of Significant Accounting Policies" to the notes to the condensed~~material impact on IDACORP's or Idaho Power's consolidated financial ~~statements included in this report.~~statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

IDACORP is exposed to market risks, including changes in interest rates, changes in commodity prices, credit risk, and equity price risk. The following discussion summarizes material changes in these risks since December 31, ~~2019,~~2020, and the financial instruments, derivative instruments, and derivative commodity instruments sensitive to changes in interest rates, commodity prices, and equity prices that were held at June 30, ~~2020.~~2021. IDACORP has not entered into any of these market-risk-sensitive instruments for trading purposes.

Interest Rate Risk

IDACORP manages interest expense and short- and long-term liquidity through a combination of fixed rate and variable rate debt. Generally, the amount of each type of debt is managed through market issuance, but interest rate swap and cap agreements with highly-rated financial institutions may be used to achieve the desired combination.

Variable Rate Debt: As of June 30, ~~2020,~~2021, IDACORP had no net ~~floating~~variable rate debt, as the carrying value of short-term investments exceeded the carrying value of outstanding ~~variable-rate~~variable rate debt.

Fixed Rate Debt: As of June 30, ~~2020,~~2021, IDACORP had ~~$2.1~~$2.0 billion in fixed rate debt, with a fair market value of approximately ~~$2.5~~$2.3 billion. These instruments are fixed rate and, therefore, do not expose the companies to a loss in earnings due to changes in market interest rates. However, the fair value of these instruments would increase by approximately ~~$338~~$234 million if market interest rates were to decline by one percentage point from their June 30, ~~2020,~~2021, levels.

Commodity Price Risk

IDACORP's exposure to changes in commodity prices is related to Idaho Power's ongoing utility operations that produce electricity to meet the demand of its retail electric customers. These changes in commodity prices are mitigated in large part by Idaho Power's Idaho and Oregon power cost adjustment mechanisms. To supplement its generation resources and balance its supply of power with the demand of its retail customers, Idaho Power participates in the wholesale marketplace. IDACORP's commodity price risk as of June 30, ~~2020,~~2021, had not changed materially from that reported in Item 7A of IDACORP's Annual Report on Form 10-K for the year ended December 31, ~~2019 (2019~~2020 (2020 Annual Report). Information regarding Idaho Power’s use of derivative instruments to manage commodity price risk can be found in Note 1110 - "Derivative Financial Instruments" to the condensed consolidated financial statements included in this report.

Credit Risk

IDACORP is subject to credit risk based on Idaho Power's activity with market counterparties. Idaho Power is exposed to this risk to the extent that a counterparty may fail to fulfill a contractual obligation to provide energy, purchase energy, or complete financial settlement for market activities. Idaho Power mitigates this exposure by actively establishing credit limits; measuring, monitoring, and reporting credit risk; using appropriate contractual arrangements; and transferring credit risk through the use of financial guarantees, cash, or letters of credit. Idaho Power maintains a current list of acceptable counterparties and credit limits.

The use of performance assurance collateral in the form of cash, letters of credit, or guarantees is common industry practice. Idaho Power maintains margin agreements relating to its wholesale commodity contracts that allow performance assurance collateral to be requested of and/or posted with certain counterparties. As of June 30, ~~2020,~~2021, Idaho Power had posted ~~$3.6~~$0.4 million of performance assurance collateral related to these contracts. Should Idaho Power experience a reduction in its credit rating on Idaho Power's unsecured debt to below investment grade Idaho Power could be subject to requests by its wholesale

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counterparties to post additional performance assurance collateral. Counterparties to derivative instruments and other forward contracts could request immediate payment or demand immediate ongoing full daily collateralization on derivative instruments and contracts in net liability positions. Based upon Idaho Power's energy and fuel portfolio and market conditions as of June 30, ~~2020,~~

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2021, the amount of collateral that could be requested upon a downgrade to below investment grade was approximately ~~$5.1~~$27.6 million. To minimize capital requirements, Idaho Power actively monitors the portfolio exposure and the potential exposure to additional requests for performance assurance collateral calls through sensitivity analysis.

IDACORP's credit risk related to uncollectible accounts, net of amounts reserved, as of June 30, ~~2020,~~2021, had not changed materially from that reported in Item 7A of the ~~2019~~2020 Annual Report, except as disclosed in Note 14 - ~~"Summary of Significant Accounting Policies"~~"Revenues" to the condensed consolidated financial statements included in this report. Additional information regarding Idaho Power’s management of credit risk and credit contingent features can be found in Note 1110 - "Derivative Financial Instruments" to the condensed consolidated financial statements included in this report.

Equity Price Risk

IDACORP is exposed to price fluctuations in equity markets, primarily through Idaho Power's defined benefit pension plan assets, a mine reclamation trust fund owned by an equity-method investment of Idaho Power, and other equity security investments at Idaho Power. The equity securities held by the pension plan and in such accounts are diversified to achieve broad market participation and reduce the impact of any single investment, sector, or geographic region. Idaho Power has established asset allocation targets for the pension plan holdings, which are described in Note 10 - "Benefit Plans" to the consolidated financial statements included in the ~~2019~~2020 Annual Report.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

IDACORP: The Chief Executive Officer and the Chief Financial Officer of IDACORP, based on their evaluation of IDACORP’s disclosure controls and procedures (pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934 (Exchange Act)) as of June 30, ~~2020,~~2021, have concluded that IDACORP’s disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) are effective as of that date.

Idaho Power: The Chief Executive Officer and the Chief Financial Officer of Idaho Power, based on their evaluation of Idaho Power’s disclosure controls and procedures (pursuant to Rule 13a-15(b) of the Exchange Act) as of June 30, ~~2020,~~2021, have concluded that Idaho Power’s disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) are effective as of that date.

Changes in Internal Control over Financial Reporting

There have been no changes in IDACORP's or Idaho Power's internal control over financial reporting during the quarter ended June 30, ~~2020,~~2021, that have materially affected, or are reasonably likely to materially affect, IDACORP's or Idaho Power's internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None

ITEM 1A. RISK FACTORS

The factors discussed in Part I - Item 1A - "Risk Factors" in IDACORP's and Idaho Power's Annual Report on Form 10-K for the year ended December 31, ~~2019,~~2020, could materially affect IDACORP’s and Idaho Power's business, financial condition, or future results. In addition to those risk factors ~~the risk factor set forth below,~~ and other risks discussed in this report, see "Cautionary Note Regarding Forward-Looking Statements" in this report for additional factors that could have a significant impact on IDACORP's or Idaho Power's operations, results of operations, or financial condition and could cause actual results to differ materially from those anticipated in forward-looking statements.

~~The COVID-19 coronavirus outbreak could adversely affect IDACORP's and Idaho Power's business functions, financial condition and results of operations.~~ The COVID-19 coronavirus outbreak has resulted in widespread impacts on the global economy and on Idaho Power's employees, customers, contractors, and suppliers. There is considerable uncertainty regarding the extent to which the coronavirus will spread and the extent and duration of measures to try to contain the virus, such as travel bans and restrictions, quarantines, shelter-in-place and other restrictive orders and mandates (including those in effect in Idaho Power's service area in the states of Idaho and Oregon), and business and government shutdowns. Restrictions of this nature may cause Idaho Power or its contractors to miss milestones on construction projects and experience operational delays, delay the delivery of electrical infrastructure and other supplies that it sources from around the globe, delay the connection of electric service to new customers, prolong the time period necessary to perform maintenance of our infrastructure, and significantly reduce the use of electricity by commercial and industrial customers.

Further, while Idaho Power has modified certain business and workforce practices (including employee travel, employee work locations, and cancellation of physical participation in meetings, events, and conferences) to conform to government restrictions and best practices encouraged by government and regulatory authorities, Idaho Power has a limited number of highly skilled operators for some of its critical power plants and its grid operations centers. If a large proportion of Idaho Power's employees in those critical facilities were to contract COVID-19 at the same time, it would rely upon its business continuity plans in an effort to continue operations at those facilities, but there is no certainty that such measures will be sufficient to mitigate the adverse impact to its operations.

Additionally, the effects of COVID-19 on the U.S. capital markets may significantly impact Idaho Power. For example, the costs related to the noncontributory defined benefit pension plan we provide to Idaho Power employees, as well as a defined benefit postretirement benefit plan (consisting of health care and death benefits) that covers eligible retirees, are based in part on the value of the plans’ assets and, therefore, adverse investment performance for these assets or the failure to maintain sustained growth in pension investments over time could increase its plan costs and funding requirements related to the plans. Similarly, Idaho Power relies on access to the capital markets to fund its capital requirements. To the extent that access to the capital markets is adversely affected by COVID-19, Idaho Power may need to consider alternative sources of funding for its operations and for working capital, which may increase its cost of, as well as adversely impact its access to, capital. These uncertain economic conditions may also result in the inability of Idaho Power's customers to pay for electric service, which could affect the collectability of its revenues and adversely affect its financial results.

The degree to which COVID-19 may impact IDACORP's and Idaho Power's liquidity, financial condition and results of operations is unknown at this time and will depend on future developments, including the continuing spread of the virus, the severity of the disease, the duration of the outbreak, actions that may be taken by governmental authorities, and to what extent normal economic and operating conditions can resume.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Restrictions on Dividends

See Note 65 - "Common Stock" to the condensed consolidated financial statements included in this report for a description of restrictions on IDACORP's and Idaho Power's payment of dividends.

~~Table of Contents~~

Issuer Purchases of Equity Securities

IDACORP did not repurchase any shares of its common stock during the quarter ended June 30, ~~2020.~~2021.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

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

ITEM 5. OTHER INFORMATION

None

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ITEM 6. EXHIBITS

The following exhibits are filed or furnished, as applicable, with the Quarterly Report on Form 10-Q for the quarter ended June 30, ~~2020:~~2021:

Incorporated by Reference

Exhibit No.

Exhibit Description

Form

File No.

Exhibit No.

Date

Included Herewith

15.1

Letter Re: Unaudited Interim Financial Information

15.2

Letter Re: Unaudited Interim Financial Information

31.1

Certification of IDACORP, Inc. Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

Certification of IDACORP, Inc. Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.3

Certification of Idaho Power Company Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.4

Certification of Idaho Power Company Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1

Certification of IDACORP, Inc. Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2

Certification of IDACORP, Inc. Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.3

Certification of Idaho Power Company Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.4

Certification of Idaho Power Company Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

95.1

Mine Safety Disclosures

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

104

Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101.)

Incorporated by Reference
Exhibit No. Exhibit Description Form File No. Exhibit No. Date Included Herewith

4.1
Idaho Power Company Forty-ninth Supplemental Indenture, dated effective as of June 5, 2020, to Mortgage and Deed of Trust, dated as of October 1, 1937
8-K 1-03198 4.1 6/8/2020
10.1⁽¹⁾
IDACORP, Inc. and/or Idaho Power Company Executive Officers with Amended and Restated Change in Control Agreements chart, as of July 30, 2020
X
15.1
Letter Re: Unaudited Interim Financial Information
X
15.2
Letter Re: Unaudited Interim Financial Information
X
31.1
Certification of IDACORP, Inc. Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
31.2
Certification of IDACORP, Inc. Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
31.3
Certification of Idaho Power Company Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
31.4
Certification of Idaho Power Company Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
32.1
Certification of IDACORP, Inc. Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
32.2
Certification of IDACORP, Inc. Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
32.3
Certification of Idaho Power Company Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
32.4
Certification of Idaho Power Company Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
95.1
Mine Safety Disclosures
X
101.SCH Inline XBRL Taxonomy Extension Schema Document X
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document X
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document X
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document X
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document X
104 Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101.) X
⁽¹⁾Management contract or compensatory plan or arrangement.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized.



		IDACORP, INC.
		(Registrant)



Date:	July ~~30, 2020~~29, 2021	By:	/s/ Lisa A. Grow
			Lisa A. Grow
			President and Chief Executive Officer

Date:	July ~~30, 2020~~29, 2021	By:	/s/ Steven R. Keen
			Steven R. Keen
			Senior Vice President and Chief Financial Officer






		IDAHO POWER COMPANY
		(Registrant)



Date:	July ~~30, 2020~~29, 2021	By:	/s/ Lisa A. Grow
			Lisa A. Grow
			President and Chief Executive Officer

Date:	July ~~30, 2020~~29, 2021	By:	/s/ Steven R. Keen
			Steven R. Keen
			Senior Vice President and Chief Financial Officer



	June 30, 2020			December 31, 2019
	(in thousands)
Assets

Current Assets:
Cash and cash equivalents	$	460,365		$	217,254
Receivables:
Customer (net of allowance of $3,501 and $1,401, respectively)	78,516			72,675
Other (net of allowance of $318 and $343, respectively)	14,604			18,789
Income taxes receivable	—			3,106
Accrued unbilled revenues	85,277			64,545
Materials and supplies (at average cost)	62,987			56,660
Fuel stock (at average cost)	50,717			57,448
Prepayments	18,732			17,638
Current regulatory assets	56,683			56,626
Other	160			405
Total current assets	828,041			565,146
Investments	130,941			98,218
Property, Plant and Equipment:
Utility plant in service	6,211,610			6,113,567
Accumulated provision for depreciation	(2,213,715		)	(2,155,783		)
Utility plant in service - net	3,997,895			3,957,784
Construction work in progress	575,509			552,499
Utility plant held for future use	3,697			3,872
Other property, net of accumulated depreciation	17,308			17,299
Property, plant and equipment - net	4,594,409			4,531,454
Other Assets:
Company-owned life insurance	60,524			58,922
Regulatory assets	1,345,954			1,326,433
Other	60,663			61,028
Total other assets	1,467,141			1,446,383
Total	$	7,020,532		$	6,641,201



	5-Year Forecasted Annual Growth Rate		20-Year Forecasted Annual Growth Rate
	Retail Sales (Billed MWh)	Annual Peak (Peak Demand)	Retail Sales (Billed MWh)	Annual Peak (Peak Demand)
2019 IRP	1.3%	1.4%	1.0%	1.2%
2017 IRP	1.1%	1.6%	0.9%	1.4%
2015 IRP	1.5%	1.8%	1.2%	1.5%

Expected capital expenditures (excluding AFUDC)

$1,000-$1,050