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