Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2026, for IDACORP, Inc. (IDACORP) and its principal operating subsidiary, Idaho Power Company (Idaho Power). IDACORP is a holding company whose primary business is the regulated electric utility operations of Idaho Power, serving southern Idaho and eastern Oregon. The filing includes unaudited condensed consolidated financial statements for both entities.
Key Financial Metrics (Six Months Ended June 30, 2026)
| Metric | IDACORP (in millions) | Idaho Power (in millions) |
|---|---|---|
| Total Operating Revenues | $873.2 | $871.4 |
| Net Income | $170.9 | $167.9 |
| Net Income Attributable to IDACORP | $170.6 | N/A |
| Diluted Earnings Per Share (IDACORP) | $3.00 | N/A |
| Operating Cash Flow | $179.0 | $168.6 |
| Capital Expenditures (Cash) | ($808.0) | ($807.8) |
| Long-Term Debt | $3,677.9 | $3,677.9 |
| Cash and Cash Equivalents | $83.6 | $49.9 |
Material Changes vs. Prior Period
- Revenue Growth: Total operating revenues for IDACORP decreased slightly to $873.2 million from $883.3 million in the prior year period, primarily due to lower wholesale energy sales volumes and reduced energy sales bundled with renewable energy credits. However, retail revenues increased by $39.6 million, driven by rate increases effective January 1, 2026, and customer growth.
- Profitability: Net income attributable to IDACORP increased by $15.2 million (9.8%) to $170.6 million compared to the first six months of 2025. This was driven by higher retail revenues per MWh and customer growth, partially offset by higher operating expenses.
- Operating Expenses: Other operations and maintenance (O&M) expenses increased by $24.8 million, largely due to the amortization of previously deferred costs related to the conversion of the Jim Bridger plant from coal to natural gas and wildfire mitigation program expenses.
- Power Supply Costs: Fuel expense decreased by $12.2 million (12%) due to lower generation volumes from jointly-owned thermal and natural gas facilities. Purchased power expense decreased by $7.4 million due to lower wholesale market prices.
- Income Taxes: Income tax expense increased significantly compared to the prior year, primarily due to a decrease in additional Accumulated Deferred Investment Tax Credits (ADITC) amortization ($6.3 million in 2026 vs. $36.5 million in 2025) and higher pre-tax income.
Guidance, Outlook, and Risks
- Capital Requirements: Idaho Power expects capital expenditures (excluding AFUDC) to range from $1.3 billion to $1.5 billion in 2026, $1.4 billion to $1.6 billion in 2027, and $3.6 billion to $4.1 billion from 2028 to 2030. Major projects include the Boardman-to-Hemingway (B2H) transmission line, Gateway West (GWW) transmission line, and new natural gas generation facilities.
- Regulatory Developments: The 2025 Settlement Stipulation resulted in rate increases effective January 1, 2026. In May 2026, the Idaho Public Utilities Commission (IPUC) approved a $51.3 million increase in Power Cost Adjustment (PCA) revenues for the 2026-2027 period due to decreased forecast hydroelectric generation.
- Strategic Transactions: On February 13, 2026, Idaho Power signed an agreement to sell its Oregon electric distribution business and certain transmission assets to Oregon Trail Electric Consumers Cooperative (OTEC) for a base price of $154 million. These assets are classified as "held for sale."
- Resource Planning: Idaho Power is addressing projected capacity deficits by filing for new natural gas facilities (222 MW and 430 MW) and entering into power purchase agreements (PPAs) for solar and battery storage. The company expects to complete the conversion of the North Valmy plant from coal to natural gas, ending coal-fired generation at that site.
- Risks: Key risks include regulatory lag in cost recovery, variability in hydropower generation due to weather conditions, supply chain constraints for infrastructure projects, and potential liability from wildfires. Credit ratings remain investment grade (Moody's Baa3/Baa2, S&P BBB) with a stable outlook.
Investor Verification Checklist
- ADITC Amortization: Verify the impact of the reduced ADITC amortization ($6.3M YTD 2026 vs. $36.5M YTD 2025) on effective tax rates and future earnings stability.
- Hydrological Conditions: Monitor precipitation levels and hydroelectric generation forecasts, as lower hydro output increases reliance on purchased power and fuel costs, impacting cash flow timing via PCA mechanisms.
- Capital Project Execution: Track the progress and cost estimates of major transmission projects (B2H, GWW, SWIP-N) and new generation facilities, as delays or cost overruns could impact rate base recovery.
- Large Contract Customers: Review the ramp-up status of new large industrial customers (e.g., Micron, Chobani) and their impact on load growth and revenue stability.
- Oregon Sale Closing: Confirm the regulatory approvals (OPUC, IPUC, FERC) required to close the Oregon distribution asset sale and the final purchase price adjustments.