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 June 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 Exact name of registrants as specified in their charters, state of I.R.S. Commission incorporation, address of Employer File principal executive offices, Identification Number and telephone number 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 June 30, 2000: IDACORP, Inc.: 37,612,351 Idaho Power Company: 37,612,351 shares, all of which are held by IDACORP, Inc. 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 9 Income 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 22 Income 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 26-32 Part II. Other Information: Item 4. Submission of Matters to a Vote of 33-34 Security Holders Item 6. Exhibits and Reports on Form 8-K 35-38 Signatures 39-40 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 June 30, 2000 1999 (Thousands of Dollars except for per share amounts) REVENUES: General business $139,168 $129,530 Off system sales 64,054 29,520 Other revenues 9,859 6,022 Total revenues 213,081 165,072 EXPENSES: Operation: Purchased power 101,630 22,527 Fuel expense 20,056 18,854 Power cost adjustment (21,943) 6,192 Other 37,885 41,196 Maintenance 13,902 11,499 Depreciation 19,949 19,404 Taxes other than income taxes 5,463 5,676 Total expenses 176,942 125,348 INCOME FROM OPERATIONS 36,139 39,724 OTHER INCOME: Allowance for equity funds used during construction 635 230 Energy marketing activities - Net 28,037 7,096 Other - Net 123 1,893 Total other income 28,795 9,219 INTEREST EXPENSE AND OTHER: Interest on long-term debt 13,253 13,758 Other interest 1,989 2,200 Allowance for borrowed funds used during construction (525) (134) Preferred dividends of Idaho Power Company 1,484 1,352 Total interest expense and other 16,201 17,176 INCOME BEFORE INCOME TAXES 48,733 31,767 INCOME TAXES 16,211 10,525 NET INCOME $ 32,522 $ 21,242 AVERAGE COMMON SHARES OUTSTANDING (000) 37,612 37,612 EARNINGS PER SHARE OF COMMON STOCK basic and diluted) $ 0.86 $ 0.56 The accompanying notes are an integral part of these statements. IDACORP, Inc. Consolidated Statements of Income Six Months Ended June 30, 2000 1999 (Thousands of Dollars except for per share amounts) REVENUES: General business $262,382 $259,222 Off-system sales 99,979 67,031 Other revenues 17,053 12,969 Total revenues 379,414 339,222 EXPENSES: Operation: Purchased power 114,519 40,415 Fuel expense 44,715 40,875 Power cost adjustment (18,685) 15,198 Other 73,121 73,964 Maintenance 22,912 19,382 Depreciation 39,836 38,575 Taxes other than income taxes 10,890 11,259 Total expenses 287,308 239,668 INCOME FROM OPERATIONS 92,106 99,554 OTHER INCOME: Allowance for equity funds used during construction 1,091 387 Gain on sale of asset 14,000 - Energy marketing activities - Net 36,560 7,843 Other - Net 3,553 4,126 Total other income 55,204 12,356 INTEREST EXPENSE AND OTHER: Interest on long-term debt 26,415 27,153 Other interest 4,686 4,429 Allowance for borrowed funds used during construction (1,012) (358) Preferred dividends of Idaho Power Company 2,912 2,720 Total interest expense and other 33,001 33,944 INCOME BEFORE INCOME TAXES 114,309 77,966 INCOME TAXES 39,707 27,224 NET INCOME $ 74,602 $ 50,742 AVERAGE COMMON SHARES OUTSTANDING (000) 37,612 37,612 EARNINGS PER SHARE OF COMMON STOCK (basic and diluted) $ 1.98 $ 1.35 The accompanying notes are an integral part of these statements. IDACORP, Inc. Consolidated Balance Sheets Assets June 30, December 31, 2000 1999 (Thousands of Dollars) ELECTRIC PLANT: In service (at original cost) $2,749,748 $2,726,026 Accumulated provision for depreciation (1,110,710) (1,073,722) In service - Net 1,639,038 1,652,304 Construction work in progress 118,107 91,637 Held for future use 2,018 1,742 Electric plant - Net 1,759,163 1,745,683 INVESTMENTS AND OTHER PROPERTY 160,643 146,019 CURRENT ASSETS: Cash and cash equivalents 43,669 111,338 Receivables: Customer 139,331 98,923 Allowance for uncollectible accounts (1,397) (1,397) Notes 7,046 4,353 Employee notes 4,326 4,105 Other 6,623 7,764 Energy marketing assets 377,479 37,398 Accrued unbilled revenues 42,397 31,994 Materials and supplies (at average cost) 30,471 29,611 Fuel stock (at average cost) 8,350 9,329 Prepayments 20,054 16,097 Regulatory assets associated with income taxes 3,232 893 Total current assets 681,581 350,408 DEFERRED DEBITS: American Falls and Milner water rights 31,585 31,585 Company-owned life insurance 39,048 40,480 Regulatory assets associated with income taxes 212,111 214,782 Regulatory assets - other 66,840 52,759 Other 59,859 55,277 Total deferred debits 409,443 394,883 TOTAL $3,010,830 $2,636,993 The accompanying notes are an integral part of these statements. IDACORP, Inc. Consolidated Balance Sheets Capitalization and Liabilities June 30, December 31, 2000 1999 (Thousands of Dollars) CAPITALIZATION: Common stock equity: Common stock without par value (shares authorized 120,000,000; shares outstanding - 37,612,351) $ 449,800 $ 451,343 Retained earnings 339,774 300,093 Accumulated other comprehensive income 2,277 1,534 Total common stock equity 791,851 752,970 Preferred stock of Idaho Power Company 105,583 105,811 Long-term debt 821,073 821,558 Total capitalization 1,718,507 1,680,339 CURRENT LIABILITIES: Long-term debt due within one year 8,155 89,101 Notes payable 25,458 19,757 Accounts payable 195,068 145,737 Energy marketing liabilities 378,329 33,814 Taxes accrued 23,707 21,313 Interest accrued 16,869 19,126 Deferred income taxes 3,232 893 Other 33,024 16,696 Total current liabilities 683,842 346,437 DEFERRED CREDITS: Regulatory liabilities associated with deferred investment tax credits 66,742 67,433 Deferred income taxes 435,448 430,468 Regulatory liabilities associated with income taxes 33,506 33,817 Regulatory liabilities - other 5,438 3,363 Other 67,347 75,136 Total deferred credits 608,481 610,217 COMMITMENTS AND CONTINGENT LIABILITIES TOTAL $3,010,830 $2,636,993 The accompanying notes are an integral part of these statements. IDACORP, Inc. Consolidated Statements of Capitalization June 30, December 31, 2000 % 1999 % (Thousands of Dollars) COMMON STOCK EQUITY: Common stock $ 449,800 $ 451,343 Retained earnings 339,774 300,093 Accumulated other comprehensive income 2,277 1,534 Total common stock equity 791,851 46 752,970 45 PREFERRED STOCK OF IDAHO POWER COMPANY: 4% preferred stock 15,583 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 105,583 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 7.5% to 9.52% 230,000 230,000 Total first mortgage bonds 557,000 637,000 Amount due within one year - (80,000) Net first mortgage bonds 557,000 557,000 Pollution control revenue bonds: 7 1/4%Series due 2008 4,360 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 174,820 170,460 REA notes 1,377 1,415 Amount due within one year (77) (76) Net REA notes 1,300 1,339 American Falls Bond guarantee 19,885 19,885 Milner Dam note guarantee 11,700 11,700 Unamortized premium/discount - Net (1,397) (1,441) Debt related to investments in affordable housing with rates ranging from 6.03% - 8.59% due 2000 to 2011 65,373 71,183 Amount due within one year (8,078) (9,025) Net affordable housing debt 57,295 62,158 Other subsidiary debt 470 457 Total long-term debt 821,073 48 821,558 49 TOTAL CAPITALIZATION $1,718,507 100 $1,680,339 100 The accompanying notes are an integral part of these statements. IDACORP, Inc. Consolidated Statements of Cash Flows Six Months Ended June 30, 2000 1999 (Thousands of Dollars) OPERATING ACTIVITIES: Net income $ 74,602 $ 50,742 Adjustments to reconcile net income to net cash provided by operating activities: Unrealized losses from energy marketing activities 4,434 29 Gain on sale of asset (14,000) - Depreciation and amortization 48,490 47,717 Deferred taxes and investment tax credits 6,669 (2,282) Undistributed earnings of affiliates (6,495) (1,438) Accrued PCA costs (18,962) 15,122 Change in: Accounts receivable and prepayments (46,138) (11,628) Accrued unbilled revenue (10,403) 1,024 Materials and supplies and fuel stock 119 (4,467) Accounts payable 49,331 (11,461) Taxes accrued 2,394 2,589 Other current assets and liabilities 7,208 2,778 Other - net 399 (3,280) Net cash provided by operating activities 97,648 85,445 INVESTING ACTIVITIES: Additions to utility plant (53,838) (51,517) Investments in affordable housing projects (10,704) (10,591) Proceeds from sale of asset 17,500 - Investments in Company - owned - (6,749) life insurance Other - net (5,809) (1,915) Net cash used in investing activities (52,851) (70,772) FINANCING ACTIVITIES: Proceeds from issuance of: Pollution control revenue bonds 4,360 - Long-term debt related to affordable housing projects 4,335 7,271 Retirement of: Long-term debt related to affordable housing projects (10,145) (4,279) First mortgage bonds (80,000) - Dividends on common stock (34,921) (34,931) Increase in short-term 5,701 9,626 borrowings Other - net (1,796) (556) Net cash used in financing activities (112,466) (22,869) Net decrease in cash and cash equivalents (67,669) (8,196) Cash and cash equivalents at beginning of period 111,338 22,867 Cash and cash equivalents at end of period $ 43,669 $ 14,671 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for: Income taxes $ 28,364 $ 24,784 Interest (net of amount capitalized) $ 31,204 $ 30,095 The accompanying notes are an integral part of these statements. IDACORP, Inc. Consolidated Statements of Comprehensive Income Three Months Ended June 30, 2000 1999 (Thousands of Dollars) NET INCOME $32,522 $21,242 OTHER COMPREHENSIVE INCOME: Unrealized gains on securities (net of tax of ($184)) 606 - TOTAL COMPREHENSIVE INCOME $33,128 $21,242 Six Months Ended June 30, 2000 1999 (Thousands of Dollars) NET INCOME $74,602 $50,742 OTHER COMPREHENSIVE INCOME: Unrealized gains on securities (net of tax of ($95)) 743 - TOTAL COMPREHENSIVE INCOME $75,345 $50,742 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 June 30, 2000, and its consolidated results of operations for the three and six months ended June 30, 2000 and 1999 and cash flows for the six months ended June 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 June 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 six months decreased from 34.9 percent in 1999 to 34.7 percent in 2000. Reconciliations between the statutory income tax rate and the effective rates are as follows (in thousands of dollars): Six Months Ended June 30, 2000 1999 Amount Rate Amount Rate Computed income taxes based on statutory federal income tax rate $ 40,008 35.0% $ 27,288 35.0% Changes in taxes resulting from: Investment tax credits (1,542) (1.4) (1,481) (1.9) Repair allowance (1,400) (1.2) (1,137) (1.5) Pension expense (950) (0.8) 7 0.0 State income taxes 5,607 4.9 4,230 5.4 Depreciation 3,461 3.0 2,662 3.4 Tax credits (5,499) (4.8) (4,222) (5.4) Preferred dividends of IPC 1,019 0.9 952 1.2 Other (997) (0.9) (1,075) (1.3) Total $ 39,707 34.7% $ 27,224 34.9% 3. PREFERRED STOCK OF IDAHO POWER COMPANY: The number of shares of IPC preferred stock outstanding were as follows: June 30, December 31, 2000 1999 Cumulative, $100 par value: 4% preferred stock (authorized 215,000 shares) 155,827 158,112 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 June 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. 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 $9.2 million at June 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 (PCA) 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 $20.3 million as of June 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. In 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." This statement establishes accounting and reporting standards for derivative financial instruments and other similar instruments and for hedging activities. It was originally effective for fiscal years beginning after June 15, 1999. In June 1999 the FASB issued SFAS No. 137 "Accounting for Derivative Instruments and Hedging Activities - Deferral of the Effective Date of FASB Standard No. 133", which defers the effective date of SFAS No. 133 one year. In June 2000, SFAS No. 138 "Accounting for Certain Derivative Instruments and Certain Hedging Activities, an amendment of FASB Statement No. 133" was issued. The Company is reviewing SFAS No. 133 and SFAS No. 138 to determine their effect on the Company's financial position and results of operations. The Company will adopt this standard on January 1, 2001. 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 June 30, 2000 and December 31, 1999. The maximum term related to any forward position is five years. June 30, 2000 December 31, 1999 Gas Electricity Gas Electricity MMbtu's MWh's MMbtu's MWh's Total gross notional volume 444,536 22,556 112,513 10,818 The following table displays the fair values of the Company's energy marketing assets and liabilities at June 30, 2000 and December 31, 1999 and the average values for the six months ended June 30, 2000 (in thousands of dollars): Balance at June 30, Six Months Average Balance at 2000 Balance December 31, 1999 Assets Liabilities Assets Liabilities Assets Liabilities Gas $ 85,925 $ 86,732 $ 52,872 $ 53,343 $ 8,302 $ 8,220 Electricity 291,554 291,597 122,427 116,425 29,096 25,594 Total $377,479 $378,329 $175,299 $169,768 $ 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 June 30, 2000: Revenues $ 213,081 $ - $ - $ 213,081 Net income 12,762 17,499 2,261 32,522 Total assets at June 30, 2000 $2,348,688 $ 485,812 $ 176,330 $3,010,830 Three months ended June 30, 1999: Revenues $ 165,072 $ - $ - $ 165,072 Net income 15,482 4,486 1,274 21,242 Total assets at December 31, 1999 $2,355,907 $ 129,275 $ 151,811 $2,636,993 IPC Total Utility Marketing Other Enterprise (Thousands of Dollars) Six months ended June 30, 2000: Revenues $ 379,414 $ - $ - $ 379,414 Net income 37,856 22,664 14,082 74,602 Six months ended June 30, 1999: Revenues $ 339,222 $ - $ - $ 339,222 Net income 42,235 4,590 3,917 50,742 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 June 30, 2000, and the related consolidated statements of income and comprehensive income for the three and six month periods ended June 30, 2000 and 1999 and consolidated statements of cash flows for the six month periods ended June 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 Boise, Idaho July 25, 2000 Idaho Power Company Consolidated Statements of Income Three Months Ended June 30, 2000 1999 (Thousands of Dollars) REVENUES: General business $ 139,168 $ 129,530 Off system sales 64,054 29,520 Other revenues 9,859 6,022 Total revenues 213,081 165,072 EXPENSES: Operation: Purchased power 101,630 22,527 Fuel expense 20,056 18,854 Power cost adjustment (21,943) 6,192 Other 37,885 41,196 Maintenance 13,902 11,499 Depreciation 19,949 19,404 Taxes other than income taxes 5,463 5,676 Total expenses 176,942 125,348 INCOME FROM OPERATIONS 36,139 39,724 OTHER INCOME: Allowance for equity funds used during construction 635 230 Energy marketing activities - 25,981 7,860 Net Other - Net 2,355 788 Total other income 28,971 8,878 INTEREST CHARGES: Interest on long-term debt 13,226 13,720 Other interest 914 1,741 Allowance for borrowed funds used during construction (525) (134) Total interest charges 13,615 15,327 INCOME BEFORE INCOME TAXES 51,495 33,275 INCOME TAXES 19,341 10,479 NET INCOME 32,154 22,796 Dividends on preferred stock 1,484 1,352 EARNINGS ON COMMON STOCK $ 30,670 $ 21,444 The accompanying notes are an integral part of these statements. Idaho Power Company Consolidated Statements of Income Six Months Ended June 30, 2000 1999 (Thousands of Dollars) REVENUES: General business $262,382 $259,222 Off system sales 99,979 67,031 Other revenues 17,053 12,969 Total revenues 379,414 339,222 EXPENSES: Operation: Purchased power 114,519 40,415 Fuel expense 44,715 40,875 Power cost adjustment (18,685) 15,198 Other 73,121 73,964 Maintenance 22,912 19,382 Depreciation 39,836 38,575 Taxes other than income taxes 10,890 11,259 Total expenses 287,308 239,668 INCOME FROM OPERATIONS 92,106 99,554 OTHER INCOME: Allowance for equity funds used during construction 1,091 387 Energy marketing activities - Net 33,705 8,586 Other - Net 7,081 2,739 Total other income 41,877 11,712 INTEREST CHARGES: Interest on long-term debt 26,358 27,080 Other interest 2,391 3,903 Allowance for borrowed funds used during construction (1,012) (358) Total interest charges 27,737 30,625 INCOME BEFORE INCOME TAXES 106,246 80,641 INCOME TAXES 40,366 27,061 NET INCOME 65,880 53,580 Dividends on preferred stock 2,912 2,720 EARNINGS ON COMMON STOCK $ 62,968 $ 50,860 The accompanying notes are an integral part of these statements. Idaho Power Company Consolidated Balance Sheets Assets June 30, December 31, 2000 1999 (Thousands of Dollars) ELECTRIC PLANT: In service (at original cost) $2,749,748 $2,726,026 Accumulated provision for depreciation (1,110,710) (1,073,722) In service - Net 1,639,038 1,652,304 Construction work in progress 118,064 88,348 Held for future use 2,018 1,742 Electric plant - Net 1,759,120 1,742,394 INVESTMENTS AND OTHER PROPERTY 27,020 117,759 CURRENT ASSETS: Cash and cash equivalents 7,806 95,038 Receivables: Customer 111,019 83,412 Allowance for uncollectible accounts (1,397) (1,397) Notes 2,886 345 Employee notes 4,326 4,105 Related parties - 195 Other 3,964 7,095 Energy marketing assets 291,554 29,096 Accrued unbilled revenues 42,397 31,994 Materials and supplies (at average cost) 26,222 28,960 Fuel stock (at average cost) 8,350 9,329 Prepayments 19,856 16,054 Regulatory assets associated with income taxes 3,232 893 Total current assets 520,215 305,119 DEFERRED DEBITS: American Falls and Milner water rights 31,585 31,585 Company-owned life insurance 39,048 40,480 Regulatory assets associated with income taxes 212,111 214,782 Regulatory assets - other 66,840 52,759 Other 56,998 54,496 Total deferred debits 406,582 394,102 TOTAL $2,712,937 $2,559,374 The accompanying notes are an integral part of these statements. Idaho Power Company Consolidated Balance Sheets Capitalization and Liabilities June 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 362,278 362,203 Capital stock expense (3,814) (3,819) Retained earnings 280,138 274,181 Accumulated other comprehensive income 2,277 1,534 Total common stock equity 734,910 728,130 Preferred stock 105,583 105,811 Long-term debt 763,308 821,558 Total capitalization 1,603,801 1,655,499 CURRENT LIABILITIES: Long-term debt due within one year 77 89,101 Notes payable 14,500 19,757 Accounts payable 130,371 95,125 Notes and accounts payable to related parties 6,497 10,076 Energy marketing liabilities 291,598 25,594 Taxes accrued 15,553 21,773 Interest accrued 14,643 19,122 Deferred income taxes 3,232 893 Other 32,835 16,069 Total current liabilities 509,306 297,510 DEFERRED CREDITS: Regulatory liabilities associated with deferred investment tax credits 66,742 67,433 Deferred income taxes 428,645 428,923 Regulatory liabilities associated with income taxes 33,506 33,817 Regulatory liabilities - other 5,438 3,363 Other 65,499 72,829 Total deferred credits 599,830 606,365 COMMITMENTS AND CONTINGENT LIABILITIES TOTAL $2,712,937 $2,559,374 The accompanying notes are an integral part of these statements. Idaho Power Company Consolidated Statements of Capitalization June 30, December 31, 2000 % 1999 % (Thousands of Dollars) COMMON STOCK EQUITY: Common stock $ 94,031 $ 94,031 Premium on capital stock 362,278 362,203 Capital stock expense (3,814) (3,819) Retained earnings 280,138 274,181 Accumulated other comprehensive income 2,277 1,534 Total common stock equity 734,910 46 728,130 44 PREFERRED STOCK: 4% preferred stock 15,583 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 105,583 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 7.5% to 9.52% 230,000 230,000 Total first mortgage bonds 557,000 637,000 Amount due within one year - (80,000) Net first mortgage bonds 557,000 557,000 Pollution control revenue bonds: 7 1/4%Series due 2008 4,360 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 174,820 170,460 REA notes 1,377 1,415 Amount due within one year (77) (76) Net REA notes 1,300 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 8.77% due 2000 to 2010 - 71,183 Amount due within one year - (9,025) Net affordable housing debt - 62,158 Other subsidiary debt - 457 Unamortized premium/discount - Net (1,397) (1,441) Total long-term debt 763,308 48 821,558 50 TOTAL CAPITALIZATION $1,603,801 100 $1,655,499 100 The accompanying notes are an integral part of these statements. Idaho Power Company Consolidated Statements of Cash Flows Six Months Ended June 30, 2000 1999 (Thousands of Dollars) OPERATING ACTIVITIES: Net income $ 65,880 $ 53,580 Adjustments to reconcile net income to net cash: Unrealized losses from energy marketing activities 3,545 4,285 Depreciation and amortization 44,895 47,592 Deferred taxes and investment tax credits 6,118 (2,105) Undistributed earnings of affiliate (4,151) (1,189) Accrued PCA costs (18,962) 15,122 Change in: Accounts receivable and (33,684) 1,798 prepayments Accrued unbilled revenue (10,403) 1,024 Materials and supplies and fuel stock 763 (4,267) Accounts payable 38,126 (3,414) Taxes accrued (5,756) 2,242 Other current assets and 7,256 2,369 liabilities Other - net (426) (10,777) Net cash provided by operating activities 93,201 106,260 INVESTING ACTIVITIES: Additions to utility plant (53,838) (50,249) Investments in affordable housing projects - (10,591) Investments in Company - owned life insurance - (6,749) Net cash of affiliates transferred to parent (4,737) - Other - net (3,733) 2,803 Net cash used in investing activities (62,308) (64,786) FINANCING ACTIVITIES: Issuance of: Long-term debt related to affordable housing projects - 7,271 Pollution control revenue bonds 4,360 - Retirement of: First mortgage bonds (80,000) - Long-term debt related to affordable housing projects - (4,279) Dividends on common stock (34,921) (34,979) Dividends on preferred stock (2,912) (2,720) Decrease in short-term borrowings (4,467) (21,232) Other - net (185) (56) Net cash used in financing activities (118,125) (55,995) Net decrease in cash and cash (87,232) (14,521) equivalents Cash and cash equivalents at beginning of period 95,038 20,029 Cash and cash equivalents at end of period $ 7,806 $ 5,508 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for: Income taxes $ 30,788 $ 23,844 Interest (net of amount capitalized) $ 29,331 $ 29,466 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 June 30, 2000 1999 (Thousands of Dollars) NET INCOME $ 32,154 $ 22,796 OTHER COMPREHENSIVE INCOME: Unrealized gains on securities (net of tax of ($184)) 606 - TOTAL COMPREHENSIVE INCOME $ 32,760 $ 22,796 Six Months Ended June 30, 2000 1999 (Thousands of Dollars) NET INCOME $ 65,880 $ 53,580 OTHER COMPREHENSIVE INCOME: Unrealized gains on securities (net of tax of ($95)) 743 - TOTAL COMPREHENSIVE INCOME $ 66,623 $ 53,580 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 six months ended June 30, 1999 included net income of $525 thousand and $840 thousand, 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 5 - Commitments and Contingent Liabilities Note 6 - Regulatory Issues Note 7 - New Accounting Pronouncement 2. INCOME TAXES: IPC's effective tax rate for the first six months increased from 33.6 percent in 1999 to 38.0 percent in 2000. Reconciliations between the statutory income tax rate and the effective rates are as follows (in thousands of dollars): Six Months Ended June 30, 2000 1999 Amount Rate Amount Rate Computed income taxes based on statutory federal income tax rate $ 37,186 35.0% $ 28,224 35.0% Changes in taxes resulting from: Investment tax credits (1,542) (1.4) (1,481) (1.8) Repair allowance (1,400) (1.3) (1,137) (1.4) Pension expense (950) (0.9) 7 0.0 State income taxes 5,145 4.8 4,230 5.2 Depreciation 3,461 3.3 2,662 3.3 Affordable housing tax - - (4,222) (5.2) credits Other (1,534) (1.5) (1,222) (1.5) Total $ 40,366 38.0% $ 27,061 33.6% 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 June 30, 2000 and December 31, 1999. The maximum term related to any forward position is five years. June 30, 2000 December 31, 1999 Electricity Electricity MWh's MWh's Total gross notional volume 22,556 10,818 The following table displays the fair value of IPC's energy marketing assets and liabilities (all electricity) at June 30, 2000 and December 31, 1999 and the average values for the six months ended June 30, 2000 (in thousands of dollars): Balance at June 30, 2000 Six Months Average Balance at December 31, Balance 1999 Assets Liabilities Assets Liabilities Assets Liabilities $291,554 $291,598 $122,427 $116,425 $ 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 June 30, 2000: Revenues $ 213,081 $ - $ - $ 213,081 Net income 14,246 16,195 1,713 32,154 Total assets at June 30, 2000 $2,348,688 $ 336,288 $ 27,961 $2,712,937 Three months ended June 30, 1999: Revenues $ 165,072 $ - $ - $ 165,072 Net income 16,834 4,858 1,104 22,796 Total assets at December 31, 1999 $2,355,907 $ 72,023 $ 131,444 $2,559,374 Regulated Electric Total Operations Marketing Other Enterprise (Thousands of Dollars) Six months ended June 30, 2000: Revenues $ 379,414 $ - $ - $ 379,414 Net income 40,768 20,840 4,272 65,880 Six months ended June 30, 1999: Revenues $ 339,222 $ - $ - $ 339,222 Net income 44,955 5,302 3,323 53,580 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 June 30, 2000, and the related consolidated statements of income and comprehensive income for the three and six month periods ended June 30, 2000 and 1999 and consolidated statements of cash flows for the six month periods ended June 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 Boise, Idaho July 25, 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 June 30, 2000 vs. Quarter ended June 30, 1999: Earnings per share of IDACORP Common Stock: Earnings per share (EPS) of IDACORP common stock (basic and diluted) was $0.86 for the quarter ended June 30, 2000, an increase of $0.30 over the same quarter last year. The increase in EPS was due primarily to improved results from energy marketing activities, which increased EPS approximately $0.34. 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: Precipitation, which affects sales to irrigators, decreased 38 percent in May and June, the heavier irrigation sales months in the quarter. MWh sales to irrigation customers increased 44 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. Our revenue per MWh was mostly unchanged. 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." Heating and cooling degree-days, common measures used in the utility industry to analyze demand, were below 1999 levels by 35 percent. The combination of these factors resulted in an increase in general business revenue of $9.6 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 $34.5 million from last year while purchased power expenses increased $79.1 million. Our purchased power costs increase is due to a number of factors: Hydro generation was down 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 market- priced power. Market prices of purchased power increased significantly late in the quarter, resulting in a 64 percent increase in average price per MWh. Off-system revenues were also lifted by the increase in market prices, with a 117 percent increase in the average price per MWh. The $1.2 million increase in fuel expenses is due to two factors, a five percent increase in total MWhs generated at our coal-fired plants, and an increase in the average cost per ton of coal used. We increased utilization of these plants because of less hydro generation. Cost per ton was higher because a greater proportion of our generation was from our Valmy plant, which has a higher delivered cost of coal than our other plants. The PCA decreased $28.1 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. 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 below that year's forecast. 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 $18 million. Other expenses Other operating expenses decreased $3.3 million. The decrease is due primarily to a reduction in pension costs for our defined benefit pension plan and decreased falling water expenses resulting from our refinancing of the American Falls bonds. Other income IDACORP's other income increased for the quarter, due to improved results from energy marketing activities, which increased IDACORP's other income by $20.9 million and IPC's other income by $18.1 million. This increase is due primarily to an increase in volumes and price volatility over last year. 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. Six months ended June 30, 2000 vs. Six months ended June 30, 1999: Earnings per share of IDACORP Common Stock Earnings per share of IDACORP common stock (basic and diluted) was $1.98 for the six months ended June 30, 2000, an increase of $0.63 over last year. The increase in EPS was due primarily to two factors, improved results from energy marketing activities, which increased EPS approximately $0.46, 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 changes affected our general business revenue: The average number of general business customers we served increased 2.7 percent, due primarily to economic growth in our service territory. Precipitation, which affects sales to irrigators, decreased 38 percent in May and June, the heavier irrigation sales months in the period. MWh sales to irrigation customers have increased 42 percent year-to- date. Our revenue per MWh decreased 4.1 percent 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 and cooling degree-days, common measures used in the utility industry to analyze demand, were below 1999 levels by 13 percent. Sales (in MWhs) to commercial and industrial customers increased 4.3 percent, due primarily to positive economic factors in our service territory. The combination of these factors resulted in an increase in general business revenue of $3 million compared to 1999. Power Supply Off-system sales, consisting primarily of long-term sales contracts and opportunity sales of surplus system energy increased $32.8 million from last year while purchased power expenses increased $74.1 million. Our purchased power costs increase is due to a number of factors: Hydro generation was down 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 market- priced power. Market prices of purchased power increased significantly late in June, resulting in a 79 percent increase in average price per MWh. Off-system revenues were also lifted by the significant increase in market prices, with a 75 percent increase in the average price per MWh. The $3.8 million increase in fuel expenses is due to two factors, a ten percent increase in total MWhs generated at our coal-fired plants, and an increase in average price of coal used. We increased utilization of these plants because of less hydro generation. Cost per ton was higher because a greater proportion of our generation was from our Valmy plant, which has a higher delivered cost of coal. The PCA decreased $33.9 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. 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 below that year's forecast. 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 $11.1 million. Other expenses Maintenance expenses increased $3 million. The increase is due primarily to tree trimming and pole maintenance efforts around our distribution system, and maintenance of the Bridger generation plant. Other income IDACORP's other income increased due primarily to the sale of our interest in the Hermiston Power Project, a 536 MW, gas-fired cogeneration project located near Hermiston, Oregon. We recorded a pre-tax gain of $14.0 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. In addition, improved results from energy marketing activities increased IDACORP's other income by $28.7 million and IPC's other income by $25.1 million. This increase is due primarily to an increase in volumes and price volatility over last year. 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 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 six months ended June 30, 2000, IDACORP generated $97.6 million in net cash from operations. After deducting for common stock dividends, net cash generation from operations provided approximately $62.7 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 six months of 2000, we spent approximately $53.8 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 June 30, 2000, our short- term borrowings totaled $25.5 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 June 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 June 30, 2000, none had been issued. 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 (PCA) 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 $20.3 million as of June 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. In 2000, the Idaho Supreme Court affirmed the IPUC order, after hearing an appeal by a group of industrial customers. OTHER MATTERS: Energy Marketing Over the last three years we have been implementing a strategy to become a competitive energy provider throughout the western markets. In order to compete as an energy provider of choice we needed to build a foundation of an effective and efficient trading operation that competently participates in the electricity, natural gas and other related markets. In 1997 we opened natural gas trading operations in Houston, Texas and in Boise, Idaho. We also began to expand our electricity marketing, which, along with natural gas, is included in other income. We have seen increasing positive results from our strategy. 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. While building this business capability over the last three years, we have also been developing appropriate controls to mitigate the operational, market and credit risks inherent in the marketing business. When buying and selling energy, the high volatility of energy prices can have a significant impact on profitability if not managed. Also, counterparty creditworthiness is key to ensuring that transactions entered into withstand dramatic market fluctuations. To manage these risks while implementing our business strategy, the Company has a Risk Management Committee, comprised of Company officers, to oversee the risk management program as defined in the risk management policy. The program is intended to minimize fluctuations in earnings while managing the volatility of energy prices by mitigating commodity price risk, credit risk, and other risks related to the energy trading business. The aggregate potential daily loss in earnings from our energy trading activity as of June 30, 2000 is estimated to be $1.3 million at a 95 percent confidence interval and for a holding period of one business day. The 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 June 30, 2000. The value-at-risk is understood to be a forecast and is not guaranteed to occur. The chosen confidence level and holding period are industry standards. The confidence level and holding period imply that there is a five percent chance that the daily loss will exceed $1.3 million. The primary factors causing the increase in our value-at- risk since December 31, 1999 is the large increase in electricity and natural gas prices and volatility since the beginning of the year. The value-at-risk estimate is reported on a daily basis and managed within acceptable limits by the Risk Management Committee. 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 is expected to contribute to earnings beginning 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. Since then, two additional units have been delivered with the final seven "alpha" units scheduled to go out by the end of 2000. IdaTech also received 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 is on schedule to demonstrate a natural gas fuel cell system later this summer and it continues to work on key alliances to meet the goal of commercializing fuel cell systems for home and small commercial applications by 2003. 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. The National Weather Service's projected inflows into Brownlee were 3.9 MAF for the 2000-2001 water year, compared to the 70-year median of 4.9 MAF and 1999's 7.9 MAF. Integrated Resource Plan (IRP) Every two years, IPC is required to file with the IPUC and OPUC an Integrated Resource Plan (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. The plan calls for IPC to issue a request for proposals (RFP) to acquire additional generating capacity accessible to 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. In response to IPC's IRP filing, Ida-West Energy Company, IDACORP's unregulated subsidiary, has announced plans to respond to the RFP when it is issued. 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. Regional Transmission Organization IPC and other regional utility entities are moving forward on the development of a regional transmission organization (RTO) proposal for an October 15, 2000 filing as ordered by the FERC. The group has formed RTO West and filed articles of incorporation in May 2000. RTO West will use a collaborative approach to draft a proposal for establishing a transmission organization that gives power producers and marketers equal access to high voltage power lines and ensures regional grid reliability. New Accounting Pronouncements In June 1998 the FASB issued SFAS No. 133 "Accounting for Derivative Instruments and Hedging Activities." This statement establishes accounting and reporting standards for derivative financial instruments and other similar instruments and for hedging activities. In June 1999 the FASB issued SFAS No. 137 "Accounting for Derivative Instruments and Hedging Activities - Deferral of the Effective Date of FASB Standard No. 133" which defers the effective date of SFAS No. 133 until fiscal years beginning after June 15, 2000. In June 2000, the FASB issued SFAS No. 138 "Accounting for Certain Derivative Instruments and Certain Hedging Activities, an amendment of FASB Statement No. 133." We are reviewing SFAS No. 133 and SFAS No. 138 to determine their effect on our financial position and results of operations. Significant interpretation, system development and potential derivative identification have been accomplished and the project is ongoing. We will adopt these statements on January 1, 2001. 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". Item 4. Submission of Matters to a Vote of Security Holders (a) Regular annual meeting of IDACORP'S stockholders, held May 11, 2000 in Boise, Idaho. (b) Directors elected at the meeting for a three-year term: Jan B. Packwood Peter T. Johnson Peter S. O'Neill Continuing Directors: Rotchford L. Barker Roger L. Breezley Robert D. Bolinder John B. Carley Jon H. Miller Jack K. Lemley Robert A. Tinstman Evelyn Loveless (c)(1)a) To elect three Director Nominees; Name For Withheld Total Voted Peter T. Johnson 32,836,864 1,013,057 33,849,921 Peter S. O'Neill 32,686,504 1,163,417 33,849,921 Jan B. Packwood 32,782,516 1,067,405 33,849,921 b) To approve the IDACORP 2000 Long-Term Incentive and Compensation Plan, and; Class of Stock For Against Abstain Total Voted Common 25,112,143 7,800,812 936,966 33,849,921 c) To ratify the selection of Deloitte & Touche LLP (D&T) as independent auditors for the fiscal year ending December 31, 2000. Class of Stock For Against Abstain Total Voted Common 33,241,217 299,596 309,108 33,849,921 Item 4. Submission of Matters to a Vote of Security Holders (a) Regular annual meeting of Idaho Power Company's stockholders, held May 11, 2000 in Boise, Idaho. (b) Directors elected at the meeting for a three-year term: Jan B. Packwood Peter T. Johnson Peter S. O'Neill Continuing Directors: Rotchford L. Barker Roger L. Breezley Robert D. Bolinder John B. Carley Jon H. Miller Jack K. Lemley Robert A. Tinstman Evelyn Loveless (c)(1)a) To elect three Director Nominees; Common 4% Preferred 7.68% Preferred Name For Withheld For Withheld For Withheld Peter T. Johnson 37,612,351 - 2,221,420 59,940 98,779 150 Peter S. O'Neill 37,612,351 - 2,215,380 65,980 98,779 150 Jan B. Packwood 37,612,351 - 2,219,660 61,700 98,779 150 b) To amend certain articles of Idaho Power Company Restated Articles of Incorporation to conform to Idaho law and the amended Bylaws of Idaho Power; and Broker Class of Stock For Against Abstain Non-Votes Total Voted Common 37,612,351 - - - 37,612,351 4% Preferred 1,587,120 98,800 65,220 530,220 2,281,360 7.68% Preferred 72,069 200 260 26,400 98,929 Total 39,271,540 99,000 65,480 556,620 39,992,640 c) To ratify the selection of Deloitte & Touche LLP (D&T) as independent auditors for the fiscal year ending December 31, 1999. Class of Stock For Against Abstain Total Voted Common 37,612,351 - - 37,612,351 4% Preferred 2,188,700 59,920 32,740 2,281,360 7.68% Preferred 98,749 100 80 98,929 Total 39,899,800 60,020 32,820 39,992,640 (2) Director Nominees Class of Stock For Withheld Total Voted Common 37,612,351 - 37,612,351 4% Preferred 2,215,380 65,980 2,281,360 7.68% Preferred 98,779 150 98,929 Total 39,926,510 66,130 39,992,640 PART II - OTHER INFORMATION 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) Articles of Amendment to Restated Articles of Incorporation of IPC as 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)(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) Instruments relating to IPC American Falls bond guarantee (see 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 IDACORP, dated Inc. and the Bank of New York as September 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) Guaranty Agreement, dated April 11, 2000, between IPC and Bank One 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 Senior Form 10-K 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 effective for 1998 August 1, 1996, revised March 2, 1999. *10(h)(v)1 14465 10(e) IDACORP, Inc. Non-Employee Directors Form 10-Q Stock Compensation Plan as of May for 6/30/99 17, 1999. *10(h)(vi) 1-3198 10(y) Executive Employment Agreement dated Form 10-K November 20, 1996 between IPC and for 1997 Richard R. Riazzi. *10(h)(vii) 1-3198 10(g) Executive Employment Agreement dated Form 10-Q April 12, 1999 between IPC and for 6/30/99 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. __________________________ 1 Compensatory plan *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. No reports on Form 8- K were filed during the three-month period ended June 30, 2000. * Previously filed and Incorporated herein by Reference. 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 August 4, 2000 By: /s/ J LaMont Keen J LaMont Keen Senior Vice President Administration and Chief Financial Officer (Principal Financial Officer) Date August 4, 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 August 4, 2000 By: /s/ J LaMont Keen J LaMont Keen Senior Vice President Administration and Chief Financial Officer (Principal Financial Officer) Date August 4, 2000 By: /s/ Darrel T Anderson Darrel T Anderson Vice President Finance and Treasurer (Principal Accounting Officer)