IDACORP (IDA) 8 May 222022 Q1 Earnings call transcript

Welcome to IDACORP First Quarter 2022 Earnings Conference Call. Today’s call is being recorded, and our webcast is live. A complete replay will be available later today and for the next 12 months on the IDACORP website. [Operator Instructions] I will now turn the call over to Justin Forsberg, Director of Investor Relations and Treasury.

Thank you, and good afternoon, everyone. and release IDACORP’s and issued quarter our we earnings XXXX Form morning, posted website to first This XX-Q.

integrity month. which We’re to also company’s aquatic Snake values. published culture, report, of our define Wild and River our you company highlights safety, last we the latest environmental, such life areas pleased social and and our to that as This report point as respect stewardship as many as governance and well

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to will throughout today. call by slides We the number those refer

made materially on spending noted our statements These note statements. Exchange more forward-looking uncertainties which in X, from As with undue filings subject are views forward-looking and today may to detail risks holds reliance for against your risks placing and Commission. differ also uncertainties. to is any current actual future our Securities and we what but review the on in cause caution results forecasts today, on the reflect included guidance earnings several our statements, including cautionary includes and Slide and discussion This

and IDACORP’s Officer. Buckham, and Vice Brian and IDACORP’s Executive call, we Financial As shown on Officer; X, Slide have Chief Chief Lisa President Senior Grow, today’s President on

X diluted were team In addition last Slide increase we after $X.XX, earnings Brian per of results. $X.XX first Lisa our to first and and from other for share per provide management have updates. quarter. our IDACORP’s Brian, XXXX shows quarterly quarter share Q&A of a available session financial members Lisa an year’s

need in we are X guidance results of Stipulation. turn XXXX support Idaho expectation the share call now the tax of These to normal over our quarter in Today, IDACORP year this utilize Regulatory than I’ll per additional Idaho more previously IDACORP’s that the Power over decades. any Settlement be $X.XX weather will assume first our to to diluted credits affirm estimates range available the The the under of estimate highest that to affirmed not with $X.XX issued full earnings are year its earnings also to conditions historically balance year. Lisa.

my everyone on Justin, strong across Thanks, on with area. call. customer and the you service update thank I’ll today’s growth, begin which remarks us Power to remains joining Idaho an

of X.X% since grown national growth last XXXX national increased base Idaho states year. X.X% the noted X.X% also our Slide has X.X% level. below economic reported QX within XXXX. sustained in in our is the Unemployment X.X%, the region area GDP Employment X.X% last forecast service calls a The going in and forward. at for of has since at growth robust trends. Power year As approximately one Idaho X, nation customer Idaho first U.S. on continues to of continues data. service area within predict as Power The the to in Census according economy fastest-growing be to Moody’s quarter outperform the of

a come pace. steady New continue connection in at requests to

plans spec for Power square developers the in manufacturing square us, to XXX,XXX during in business & feet QX the confidence is in of building data which of The the XXX,XXX call, of Meta near Idaho. earnings place a the addition square Center reflective announced Stowe migration been its that taking largest of at XXX,XXX to River this QX industrial has service to Logistics build and Examples large load Company, [indiscernible], Idaho. in projects building the continued mentioned spec the announcement, Red Idaho customers foot new center plant foot year. during area Solutions would Storage become In we businesses include to several facility Deposit the which

We Power to are class would like for customers it new operations. this meet customers. formalize cryptocurrency have evaluating rate mitigate Idaho Power building and our in establish significant large-scale high-density our service class low of growth. for and for to will We infrastructure forecast. existing area for we also risks class forecasted financial currently working which cryptocurrency inquiries customers, our important we a other considerable address the mining for company believe given mining new speculative parameters The we help Idaho the level is service mode items as are loan interruptible the in But past, not to for experienced pricing have separate already rate

Power to Idaho goal energy X. XXXX. Slide Cleaner pursue its of continues to clean Turning by Clean providing XXX% Today, Tomorrow

ending in this convert meet an through by we Bridger Power Idaho the Bridger. help and and XXXX plant conversion recovery reduce X for beginning in which by contemplates depreciation targets schedule XXXX. made year to carbon Jim combine customers. gas service emissions units requesting filing working end XXXX, Idaho reliable electric continuing all X cleaner regional IRP operate coal power This regulators Bridger to would the claiming of at accelerated investments coal-related be the June fleet. for with We’ve the In a to will our ensure operations at XXXX coal of our Our Units co-owners natural while meantime, are and X to of

requests. assets GAAP-related removed from have regulatory We the our anticipated

the recent the earnings nonbinding earlier As remain to for success trend to than project very I Power future We of BXH of the in Boardman Bonneville with on noted clean we BXH and of plan to signed Idaho Power end by earnings transmission. service Hemingway enhanced Power. participants, year, calls, expect would that BPA focused no last on turning depends share sheet a item with XXXX. of our with the PacifiCorp on Administration be have still ultimate transfer other the X this project which call, part We finalize a critical line mentioned

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we and to evolve, more to share continue hope needs resource to this power summer. later Our have

Brian discuss will sustaining financial a a As management of our effective key moment, in success. remains cost component

and our inflationary the our acknowledged as flat in we with general to a to and within Idaho pressures operations and keep we for our Idaho Oregon. On rate to all address year. are case growth are work Power and experiencing. last file we costs accomplished we call, the past, area last need appreciate relatively approaching in maintenance earnings our to striving operate control the service budget employees’ we’ve As in I efforts expenses

hydro our X between been including capital resource cost significant and has dates Slide XXXX While that, base, see recent on April roles May, weather the reservoir influence late and from rate we remain on near-term and for Atmospheric single forecast things our as evaluate Administration. projections clean, begun of updated of conditions warm With this area. play base, low-cost effective generation for a general conditions growth have rate we and precipitation traditionally planning across boost will our overview. general management largest hand over currently numbers. expected helped shows megawatt the generation I drive our and side. their to likely economic major need bases. in hours. million the timing snowpack in-service Current snow customer projections summer. a of estimating that suggest service June and factors, Oceanic we our National X for X.X variety all for and have future Drought arriving of and Brian projections conditions investments, into hydro through our August will rate weather now outlook in the And financial storage low while growth million some remain With the

of a its and of portion the operating first of you’ll last I’ll more And last quarter results this off on normal start in higher Justin was growth, years. return I and positive where for Thanks, customer to were million continued industrial my solid first a QX had mentioned, more coming the strong had XX quarter-over-quarter first on detail to which year. weather economic abnormally would the offset added highest quarter as for Lisa, In XXXX our to year last quarter a table year. low year. activities impact and year, We’ve in results you’ll start compared had higher We’ve operating later. growth commercial revenues good $X booked an sales, That start that expenses year customer the quarter to to consider compared afternoon, transmission solid income. by and customers. what a to I’ll wheeling see seen everyone. first changes, I Slide earnings maintenance QX We’ve see X, explain

do the has of quarter usage in to and in first to and for a environment increase that. We economic rise customer in quality led business. and expect commercial relates increased activity conditions people this economic to life for in sustained and for service businesses marketing migration, higher year. our The to year’s locate from days of X% in and quarter continue people industrial area live and to business-friendly table, customer. first state usage last X% been Part heating on and its X% to X businesses existing continue seem next industrial of to last the Idaho responding while the the growth be commercial to over this more customer to residential as customers increased increase usage, for year of a activity nonpandemic to led in And compared

the transmission including net changes increases note megawatt to wheeling a Idaho of $X.X wheeling this tower were generally operating recovery usage that of a the for the that executed tariff usage. wheeling of increased impacts power led decrease income. transmission customer $X.X relates were adjustment of last cost income by decrease not increase rate higher that hour year slight through year, customers from of fuel mostly You’ll ultimately expenses fluctuations in run mechanism million income combined small to more QX Further transmission table, per cost down Power’s the related a Power offset in of million reflect and revenues see adjustment decrease fixed cost of million amount. cost XX% in and wheeling over Idaho of operating power transmission in power revenue. adjustment year as later supply million. the Idaho on new net XXXX. to also contributed cost in last The benefit October to on in in long-term through which That’s costs Power’s and residential year-to-date commercial table increased that the Idaho $X.X change costs. base March for April bear Those you’ll mechanisms. deferred Two supply revenues agreements And the higher agreements $X Recall in customers amount higher wheeling operating

$X.X more by the on a Next expenses to normal I would and operating what other table, increased maintenance million, level. call returning

supplies. And areas reductions the savings Looking maintenance comparative and in of we due the some plants than in first like level project the back Natural first jointly and higher additional the XXXX labor-related to services on COVID-XX-related as XXXX. LaLiga owned year costs the quarter returning of XXXX, as Gas O&M higher of was context But and well costs pressures about in Plant travel of had only typical more X.X% professional a inflationary increase first employee XXXX training. O&M, first quarter also coal and was O&M and planned to of X.X% this quarter normal than a for only quarter

due can to finally, increased led a tax just And plan to income shows So see this construction, of and A decrease mostly the QX funds million used that’s expense, was earnings. of expense as riders’ to Rabbi which the shy in and XXXX how pretax $X somewhat you greater in on income increase pension Trust was income. higher an table, $X.X anomaly. million some for in related it investment nonoperating quarter, during nonqualified allowance

So an net increase for of share or resulted income the IDACORP’s all in of $X.X those $X.XX in the aggregate million changes per in quarter.

plant The to on quarter of CapEx last output our for that our spending we of year first gas efficiency relative first is our note quarter level upgrades and the our quarter battery storage from expected. additional as some that bulk and additional to last year units. has first CapEx some project and -- the to by spent over we You’ll relative obtain what historic during XX% increased natural

X. IDACORP included end cash the increase plan to I’ll for mitigated XXXX. and and was most in plans and As balances. operating having our any the still forward, the products on for fund to the you liabilities’ in our and our Power. look impact we this current structure other dividend in the a credit under for balance signed equity timing mind, deliver X the we on And investment-grade with outside capacity. like expect Slide CapEx contracts potential strong Idaho have position to our based X. mostly of continue batteries impact of $X liquidity, inflationary IDACORP’s capital noncontracted from but will about going as enable Power’s Slide of on XXXX. Idaho of some available target spread already The At shown Cash Power think also quarter compensation factors and liquidity sound and growing likely March we our inflation for else. facilities in shown look million forecast first liquidity a Slide of liquidity are time, Idaho flows as been including work, CapEx spending related ratings The middle the available of shareowners. And to we and same flows point IDACORP higher to sheets, this at the we generally at than were in is that year, continued these in and operations seemingly much issuing don’t of to XX-XX period anticipate funding services everyone at us also payments

upcoming until to we that operating capital fund we of at the affirmed key plan XX and call, and our shows full the closer plans, on projects our Slide last finance estimates. to execution we those which metric as current we our target. mentioned the financial primarily guidance, year with ratio earnings earnings XXXX As to today work is least

still to a in reminder, to tax conditions X.X% as Idaho IDACORP’s normal Power on jurisdiction our the This $X.XX expect return Idaho XXXX and the we additional be earlier, use a the in As assumes economic guidance support noted share. still Idaho range year, equity. weather balance guidance of provides earnings also Stipulation, the and the $X.XX Justin of Regulatory at XXXX diluted for earnings in year-end credits assumes will which, no under per

year. challenging. level earlier, $XXX given We continue mentioned, the the flat even area, increases. in we’re million maintenance load And wage But inflation with also Keeping year last accomplish relatively the that million. our the our as well of that we’re as service full $XXX and mentioned fall in at of along expenses managed as general O&M to we’ve continued with to to up experiencing customer O&M working expect to Lisa keep make to the more planned range and I in growth past,

just annual has O&M seen and X% efforts rate X quarter growth O&M and past over a years only we to over efficiently remain First our long-standing average operate the control our committed to expenses.

range most into expectations top I range. on lowered this not months. potentially as and they I’d of million happy to $XXX Lisa fortunate to for with power-supplied on hydro higher the $XXX portfolio XXXX the adverse expectation Our and at answer as a of in end, though your updated the the to head our the as resources spending we on stream our given continues at be summer And already forecast discussed, to we’re flows, say that, questions. more year the little point, are if over CapEx of be have likely call generation the we to finally, to power were And others million Lisa

from Your first Zimbardo Bank comes Instructions] Paul [Operator with of question America.

to off you want tariffs. the I kick crypto it mentioned since

I with could how you where initial if potential a know there you lot regulatory conversations was off-takers? it of like didn’t those have that had uptake. filing appear evolved discuss Just some of the

have been So going. just curious conversations how those

had I’ll in cryptocurrency start, sort Adam and talk about Idaho. that conversations side. to the with I’ll over sitting and development talk then business the we’ve it interest have Tim to turn of years regulatory to in about Certainly,

everyone’s needs. lowest fast, to an need haven’t come find the rates ever to they agreement met and find, However, just we really can they generally need to that move

of that we it mitigate setting wanted we just we to the to So up were given make risk. getting were that amount inquiries sure,

of that come assume given customers, did the risk quickly. folks the service neither rest our So company out of these pretty didn’t and our and in we -- can area

want So Adam, to do start, you that, and the... with

continue flow Yes. on but actual good. the just see couple filing. of the it sounds we small commercial the haven’t a inquiries, that major anything are mean steady And hookups, there. haven’t hookups the Yes, to system. come think, but seen we after inquiries seen coming, we’ve made I I a Again,

Tatum, Paul, Affairs. Regulatory of is Vice this Tim Yes. President

favorable at the staff fully our We So from filing. case is commission supporting point received the submitted. this comments

We’re point. just commission order a now this at awaiting

cryptocurrency that side note price inquiries price be associated Paul, on cryptocurrency. the the bit terms of in And one with scale to seems based I’d thing is there quite sensitivity of on of a the

miners So crypto price I mind to lot electric -- as power model being up, their their cost primary down so goes the think more interest of terms prices go you or a have see to tend structure in on if you see a inputs goes certainly, and in down, cryptocurrencies one of interest. of accelerates

Yes, absolutely.

on congrats I Okay. the unrelated, other question O&M impact had And that. appreciate and the the with keeping all new I pressures. then

little And some think know rate could inflationary you accelerate about how than the of I talked Just things the you and just cadence curious how about case you faster new case rate the that. thought potentially that service subsequent because environment bit before? even dates a like commercial

bigger that kind the what would be picture helpful. be, beyond So of would strategy

start? you want Do to

Sure. take Thanks, I that. can Paul.

looking well, mentioned increases. increases guidance from the projects our a pressure at we capital, now, could that. some looking certainly $XXX -- as as we’re we’re side, Obviously, $XXX our noted. million an from suppliers the we’re O&M little some seen it. at Inflation say I inflation million. It’s labor having well. top, the on a impact putting capital the I ended is on of at we’re on at on million. we’re seeing XXXX So is We would over of I range to to $XXX We’ve and holding which be where seeing as our of

of terms of at resources cases. some rate impact how date drivers actually timing like In case, of our primary as the we’re in-service might the of that the and factors our rate looking being timing of

send it battery Health prices pushing I it project potential those obviously, those the of like to low, case go the So we bias the is some really like [indiscernible] we’re of larger in would while There rate low. projects come near But as more keep projects Canyon licensing term into higher storage a the to towards that a capital customer things up, some on. some those capital date rates keep of and for capital to have expense there’s as and a in-service accelerating. and projects of trying

next question Sidoti. Brian comes Your Russo with from

X.X% too is noticed I months might March trailing through I XX Any ended but was growth granular, be that December brief XX recall as X.X%. there? months customer of getting

chain to garage they people it’s ovens. is point, lot if some quarter a can’t this And trend. supply they doesn’t point tell. or One into of hard at it not homes of the make don’t don’t sure Certainly, At of there’s reflective certainly we’re doors have that move this have disruption. a because

so certainly, seeing And a just construction some we’re you But through of move as amount going still on. of tremendous there’s disruptions. those our territory,

much it we be we’ll watching read So haven’t it. into in think But point too this carefully. I at time,

Understood. consistent service And forecast? the Are changed ‘XX forecast they for the Or for those territory. ‘XX? prior and GDP have with your

X.X% higher think the slightly in of lower XXXX, is I numbers. and not the prior XXXX slightly than in if consistent, then X.X% think I is forecast

it greater like season, which year, you electricity normal soon, class? might it maybe looks Any temperatures. I expectation And but above yes. get customer the weather given And Great. demand dynamic, some last believe as -- as as normal extreme pre-IP from below the Okay. if that not irrigation starts then for seems

their And planting. Yes. for It prices irrigation And in may crops. from expand does delay their free, sort April, of sometimes coming they that is some true the that then that got sky. got the you’ve commodity of their

to load. look generally it’s going going and does hot is which But So for to watch like dry, carefully. be it we’re that good

of how sort develops. tuned the stay we’ll see season So and

of which I’m maybe signed Duke with noticed there’s upside going ago. of base lot then couple a IDACORP mentioned billion. just BXH much you’ve weeks of think calls, increased several Energy, I just kind RFP And XX% invest? I $X.X and/or PPAs, think I’m in contingent is is that lastly, curious, a X And I to prior about wondering, is CapEx, you be on ownership? that And the firmly your committed roughly XX% to I outcomes Okay. to how for Or believe, of upside this

Energy part now while But Yes. looking was we’re to think in new to ago, contract I a actually early quite have fairly one was we Duke Brian, batteries we the XXX so It signed was a in-service XXXX soon, process. that XX-megawatt our the XXXX. that for we a RFP dedicated the solar to of be also facilities. will facility, of It then specific customer, had purchased. and megawatts

rebate megawatts is us XXX you’ve have component capital of the outcome subject So an owning some resources, the are of out not. RFP to the that Obviously, that is are of PPAs does put in process. chart we’ve that There seen that additional our forecast. the forecast from and process additional the and also if regulatory

that. we’re through working So still

the that have of gas that, to stages we what received. in project. received in like We’ve plants are that a well. there things include of components back stuff some early though, ownership there. are We’re of are got Other some as upgrades Hemingway big pieces we self-build the we’ve in and Obviously, reviewing that the natural Boardman does

refurbishments in hydro there. some have We

piece. that generation So beyond future of other there resource of there’s a in lot CapEx

question next Chris from Williams. Your Siebert with Ellinghaus comes

missed I give you this, a time did the line Maybe RFP but for shortlist?

Adam, to take want that? do you

Yes.

a at the summer. looking XXXX be RFP list should for and proposals reviewing short currently this are We

reviewing proposals XXXX In be of and the date there, options shortlist will RFP, probably terms for the than reviewing kind our later we’re of the summer XXXX. that for the

was at pretty assume It factored cool. I like Okay. this that point? looks your April guidance you’ve into

we of typically large loads for our as and the And getting as further isn’t bigger get months, we a looking irrigation into normal start start summer this conditions. April and June impact. hotter forecast when into We have Yes. well. into month into weather one anyway, more those we’ll can

be I our will So April drivers below larger typical think than average temperatures April, area. in our service were those do but

we the the how water quarter? in color into back dry factors irrigation give is to how good. much and water coming us do for and how hot you availability little Can definitely irrigation Okay. about you just that should But a -- is how available outlook think

Well, from be the rights are now, we certainly those there precise. get has weekend largely state work need. But and be of and what able allocate to think they a to or weather we carefully priority spread carefully people gets know is the that around resource. be and And who the point what prioritization again, we it stormy over certainly, going and and at responsible with will the sort watching another in we is see of right. right are, who water But what now over time, to we’ll this more will

are at But good So we it’s see it’s to the really that hard to forecast news continuing moment. precipitation.

talk might about pretty you new big you individual of for overall magnitude know look what developing I Okay. some new got customers? the loads. Can can’t really talk sort about new customers, your you’ve like but

This Adam. Yes. is Sure.

starting the the food diverse, really of to beverage more growth are I bit some see door, We everything of a continue dairies, that processing see, electric buses as amount well. steady coming and to has area buses, in load we’re to little and in biodigesters inquiries technology the manufacturing from been and to think, a electric to

come So seem hook I the think Meta, and we’re of space we some Idaho, slew to them Westin, start the they terms benefits ASIC, a going up, Red True just be in door in West load. in lot this of to B, up at had as see are the office that much River, come pretty we’ve door to Cobalt, of all of course, point. public, loads And except Lam for in a categories our

about megawatts? talking of we hundreds Are

Yes.

a are megawatts XX-plus IRP the through project We in Yes. the plan. and projections current year, those

comes Crowdell Anthony from question next Mizuho. with Your

at talking to additional Idaho actually balance I you’re Just, versus sheet how IDACORP guess, capital. thought financing about Any this utilizing quickly the Power?

of we core dividend on that some actually, a look be cash could mean be I balance sheet And as -- of lot could we have some of currently. So at it for uses purposes. that. the

done equity we’ve of that be in could issuance to that potential a again, using the help housing see of considered like of as some of loan equity Power portion investment like Idaho in quite an we things a or that some have a fund for Some push contribution affordable ways we past. equity to things But this. like issuance, that for which, CapEx, out

to a a case. have get debt XX-XX rate headroom to target into of lot our going We

debt So side. a of the headroom lot there on

utility. Yes. earnings And GAAP state debt of But the way. headroom if mechanism, reconcile a you equity down? a to in look why layer a sort sharing of the I have could then I the that of I guess at based do off thought of that’s of Clearly, question the work of maybe lot think just different when

Yes. just taken say we any point. would table at option the I haven’t this off

But some there little potential we’re So out that. a ways is from there.

So our we to put that. would do together trying on how plans still

believe Great. don’t then there’s much just And -- I impact.

or hydro I of think the of of the hydro. think you you XX% conditions, cost lower to in through impact had year? the I lower expected dry seeing But customers any about I think earlier, Idaho talk also expectation payers. do type mean consumers power rate get to are said passed XX, this I from you Slide

more have we when hydro, lower-cost portfolio. certainly, mean it’s I a

year. we dry pretty year, remember -- had also So but last that a

more to comparing high you’re difference. year-to-year, not cost lower or customers. it the big be So the certainly, But a may overall it growth our

conference the turn [Operator concludes you. Ms. the back question-and-answer session Instructions] will today. for Grow, to That I

will with been held May time. ago to continued on attend in a wonderful all all you. the look instructions issued you to Thank I moms with invite time this out questions. Day from weeks interest this short afternoon a.m. We to responding press online a good the XXXX listening to IDACORP to evening. and to IDACORP. release sent health I from to of a happy would weekend. via shareholders instructions Annual continue our shareholder of XX wish all at and updates we like be meeting, a XXXX the virtual for and Mother’s how in on participate Thank X you there, Mountain website. very listen notice and sharing how which Shareholders, the and Meeting A to XX, has formal today, you all to for your joining to forward Have

today’s conference. for participation. you Thank That concludes your