What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2022-02-17 compared with 2021-02-18 · 132 added, 102 removed, 388 unchanged (38% of the section changed)

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IDACORP’s other notable subsidiaries include IDACORP Financial Services, Inc.

(IFS), an investor in affordable housing and other real estate investments, and Ida-West Energy Company (Ida-West), an operator of small hydropower generation projects that satisfy the requirements of the Public Utility Regulatory Policies Act of 1978 (PURPA).

(IFS), an investor in affordable housing and other real estate tax credit investments, and Ida-West Energy Company (Ida-West), an operator of small hydropower generation projects that satisfy the requirements of the Public Utility Regulatory Policies Act of 1978 (PURPA).

IDACORP’s and Idaho Power’s principal executive offices are located at 1221 W.

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operating revenues;

operation and maintenance expense;

other operations and maintenance expense;

depreciation expense;

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Consistent with orders and directives of the IPUC, unless contrary to applicable income tax guidance, Idaho Power does not provide deferred income tax expense or benefit for certain income tax temporary differences and instead recognizes the tax impact currently (commonly referred to as flow-through accounting) for rate making and financial reporting.

Therefore, Idaho

Power's effective income tax rate is impacted as these differences arise and reverse.

Therefore, Idaho Power's effective income tax rate is impacted as these differences arise and reverse.

Idaho Power recognizes such adjustments as regulatory assets or liabilities if it is probable that the amounts will be recovered from or returned to customers in future rates.

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IDACORP is committed to its focus on competitive total returns and generating long-term value for shareholders.

IDACORP’s business strategy emphasizes Idaho Power as IDACORP’s core business, as Idaho Power's regulated utility operations are the primary driver of IDACORP's operating results.

IDACORP's board of directors regularly reviews IDACORP's long-term strategy, which as of the date of this report is focused on the following areas and initiatives:

In executing the focus areas above, IDACORP seeks to balance the interests of shareholders, Idaho Power customers, employees, and other stakeholders.

Idaho Power is committed to working for strong, sustainable financial results and strong credit ratings by continuing to provide reliable, affordable, safe service to its customers from a diversified source of generation resources.

IDACORP’s business strategy emphasizes Idaho Power as its core business, as Idaho Power's regulated utility operations are the primary driver of IDACORP's operating results.

IDACORP’s strategy is focused on four areas:

growing financial strength, improving Idaho Power's core business, enhancing Idaho Power’s brand, and keeping employees safe and engaged.

IDACORP's board of directors has reviewed and affirmed IDACORP’s long-term strategy.

In executing on these four strategic cornerstones, IDACORP seeks to balance the interests of shareowners, Idaho Power customers, employees, and other stakeholders.

Idaho Power is committed to working for strong, sustainable financial results by continuing to provide reliable, affordable, clean energy to its customers from diversified generation resources.

Rates and Revenues

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Participants in these proceedings include Idaho Power, the staffs of the IPUC or OPUC, and other interested parties.

The IPUC and OPUC are charged with ensuring that the prices and terms of service are fair, are non-discriminatory, and provide Idaho Power an opportunity to recover its prudently incurred or allowable costs and expenditures and earn a reasonable return on investment.

The IPUC and OPUC are charged with ensuring that the prices and terms of service are fair, non-discriminatory, and provide Idaho Power an opportunity to recover its prudently incurred or allowable costs and expenditures and earn a reasonable return on investment.

The ability to request rate changes does not, however, ensure that Idaho Power will recover all of its costs or earn a specified rate of return, or that its costs will be recovered in advance of or at the same time when the costs are incurred.

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Outside of base rates, three of the most significant mechanisms for recovery of costs are the power cost adjustment mechanisms, FCA mechanism, and energy efficiency riders.

The Idaho and Oregon power cost adjustment mechanisms are intended to address the volatility of power supply costs and provide for annual adjustments to the rates charged to retail customers by allowing partial recovery or refund of the difference between net power supply costs included in base rates and actual net power supply costs incurred by Idaho Power.

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

Under Idaho Power's current rate design, recovery of a portion of fixed costs is included in the variable kWh charge, which may result in overcollection or undercollection of fixed costs.

To return over-collection to customers or to collect under-collection from customers, the FCA mechanism allows Idaho Power to accrue, or defer, the difference between the authorized fixed-cost recovery amount per customer and the actual fixed costs per customer recovered by Idaho Power during the year.

Increases in FCA recovery may be capped at 3 percent of base revenue annually at the discretion of the IPUC, with any excess deferred for collection in a subsequent year.

Idaho Power collects most of its energy efficiency program costs through energy efficiency riders on customer bills.

Energy efficiency program revenues are recognized in the period efficiency rider-funded program expenditures are recorded as an operating expense, resulting in no net impact on earnings.

Wholesale Markets :

Idaho Power participates in the wholesale energy markets by purchasing power to help meet load demands and selling power that is in excess of load demands.

Idaho Power's market activities are guided by an energy risk management policy and frequently updated operating plans.

These operating plans are impacted by factors such as customer demand for power, market prices, generating costs, transmission constraints, and availability of generating resources.

Some of Idaho Power's 17 hydropower generation facilities are operated to optimize the water that is available by choosing when to run hydropower generation units and when to store water in reservoirs.

Idaho Power at times operates these and its other generation facilities to take advantage of market opportunities.

These decisions affect the timing and volumes of market purchases and market sales.

Even in below-normal water years, there are opportunities to vary water usage to capture wholesale marketplace economic benefits, maximize generation unit efficiency and meet peak loads.

Compliance factors such as allowable river stage elevation changes and flood control requirements also influence these generation dispatch decisions.

Idaho Power's wholesale energy sales depend largely on the availability of generation resources above the amount necessary to serve customer loads as well as market power prices at the time when those resources are available.

A reduction in either factor leads to lower wholesale energy sales.

Idaho Power also provides energy transmission services through its Open Access Transmission Tariff (OATT).

The OATT rate is revised each year based primarily on financial and operational data Idaho Power files annually with the FERC in its Form 1.

The FERC oversees mandatory transmission and network reliability standards, as well as power and transmission markets, including protection against market manipulation.

These mandatory transmission and reliability standards were developed by the North American Electric Reliability Corporation and the Western Electricity Coordinating Council, which have responsibility for compliance and enforcement of transmission and reliability standards.

For more information on these mechanisms, see Note 3 – “Regulatory Matters” and Note 4 - “Revenues” to the consolidated financial statements included in this report

Retail Energy Sales:

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Extreme temperatures increase sales to customers who use electricity for cooling and heating, and mild temperatures decrease sales.

Precipitation levels and extreme temperatures during the agricultural growing season impact electricity sales to customers who use electricity to operate irrigation pumps.

Availability of water and extreme temperatures during the agricultural growing season impact electricity sales to customers who use electricity to operate irrigation pumps.

Alternative methods of generation, including customer-owned solar and other forms of distributed generation, have the potential to decrease Idaho Power sales to existing customers.

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Wholesale energy sales 600 1,197 2,171

Bundled energy sales 690 680 617

Total energy 16,715 17,388 17,450

Energy sales bundled with renewable energy credits 739 690 680

Total energy sales 16,745 16,715 17,388

(1) The FCA mechanism is an alternative revenue program in the Idaho jurisdiction and does not represent revenue from contracts with customers as disclosed in Note 4 – “Revenues” to the consolidated financial statements included in this report.

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Idaho Power is collecting $8.8 million annually in the Idaho jurisdiction but is deferring revenue recognition of the amounts collected until the license is issued and the accumulated license costs approved for recovery are placed in service.

Wholesale Markets :

Idaho Power participates in the wholesale energy markets by purchasing power to help meet load demands and selling power that is in excess of load demands.

Idaho Power's market activities are guided by an energy risk management policy and frequently updated operating plans.

These operating plans are impacted by factors such as customer demand for power, market prices, generating costs, transmission constraints, and availability of generating resources.

Idaho Power at times operates these and its other generation facilities to take advantage of market opportunities.

These decisions affect the timing and volumes of market purchases and market sales.

Even in below-normal water years, there are opportunities to vary water usage to capture wholesale marketplace economic benefits, maximize generation unit efficiency, and meet peak loads.

Compliance factors such as allowable reservoir stage elevation changes and flood control requirements also influence these generation dispatch decisions.

A reduction in either factor leads to lower wholesale energy sales.

Idaho Power also provides energy transmission services through its OATT.

The OATT rate is revised each year based primarily on financial and operational data Idaho Power files annually with the FERC in its Form 1.

The FERC oversees mandatory transmission and network reliability standards, as well as power and transmission markets, including protection against market manipulation.

Idaho Power's electric utility business has historically been recognized as a natural monopoly.

Idaho Power competes with fuel distribution companies, including natural gas providers, in serving the energy needs of customers for space heating, water heating, and appliances.

Alternative methods of generation, including customer-owned solar and other forms of distributed generation, also have the potential to decrease Idaho Power sales to existing customers.

Alternative methods of generation, including customer-owned solar and other forms of distributed generation, and energy efficiency measures, also have the potential to decrease Idaho Power sales to existing customers.

Idaho Power also participates in the wholesale energy markets and in the electric transmission markets.

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Conversely, favorable hydropower generation conditions increase production at Idaho Power’s hydropower generating facilities and reduce the need for thermal generation and wholesale market purchased power.

Economic conditions, supply constraints, and governmental regulations can affect the market price of natural gas and coal, which impact fuel expense and market prices for purchased power.

Economic conditions, weather, supply constraints, and governmental regulations can affect the market price of natural gas and coal, which impact fuel expense and market prices for purchased power.

Idaho Power's power cost adjustment mechanisms mitigate in large part the financial impacts to Idaho Power of volatile fuel and power costs.

Idaho Power’s system is dual peaking, with the larger peak demand occurring in the summer.

Idaho Power reached its highest all-time system peak demand of 3,422 megawatts (MW) on July 7, 2017.

Idaho Power reached its highest all-time system peak demand of 3,751 megawatts (MW) on June 30, 2021.

Idaho Power's highest all-time winter peak demand of 2,527 MW was last achieved on January 6, 2017.

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Together, these hydropower facilities provide a total nameplate capacity of 1,799 MW and have averaged total annual generation of approximately 7.7 million MWh over the last 30 years.

The amount of water available for hydropower generation depends on several factors—the amount of snowpack in the mountains upstream of Idaho Power’s hydropower facilities, upstream reservoir storage, springtime precipitation and temperatures, main river and tributary base flows, the condition of the Eastern Snake Plain Aquifer and its spring flow impact, summer time irrigation withdrawals and returns, and upstream reservoir regulation.

The amount of water available for hydropower generation depends on several factors—the amount of snowpack in the mountains upstream of Idaho Power’s hydropower facilities, upstream reservoir storage, springtime precipitation and temperatures, main river and tributary base flows, the condition of the Eastern Snake Plain Aquifer and its spring flow impact, summertime irrigation withdrawals and returns, and upstream reservoir regulation.

Idaho Power actively participates in collaborative work groups focused on water management issues in the Snake River Basin, with the goal of preserving the long-term availability of water for use at Idaho Power’s hydropower projects on the Snake River.

In 2021, below-normal snow accumulation and drought conditions resulted in lower than average hydropower generation of 5.4 million MWh.

In 2020, precipitation and snowpack were unevenly distributed across the Snake River Basin, with the Upper Snake River Basin experiencing near-normal winter snowpack but other key basins near the HCC experiencing below-normal snowpack.

These snowpack conditions, coupled with strong early season irrigation demands, yielded lower inflows to Idaho Power’s hydroelectric projects and resulted in 7.0 million MWh of hydropower generation in 2020.

In 2019 and 2018, above-normal reservoir storage carryover from the previous year coupled with near-normal winter snowpack resulted in 8.3 million MWh and 8.7 million MWh, respectively, of hydropower generation.

In 2019, above-normal reservoir storage carryover from the previous year coupled with near-normal winter snowpack resulted in 8.3 million MWh of hydropower generation.

During low water years, when stream flows into Idaho Power’s hydropower projects are reduced, Idaho Power’s hydropower generation is reduced, resulting in a greater reliance on other generation resources and wholesale power purchases.

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The licenses last from 30 to 50 years depending on the size, complexity, and cost of the project.

Idaho Power is actively pursuing the FERC relicensing of the HCC, its largest hydropower generation source.

Idaho Power is actively pursuing the FERC relicensing of the HCC, its largest hydropower generation source, and American Falls, its second largest hydropower resource.

Idaho Power also has Oregon licenses for the HCC under the Oregon Hydroelectric Act.

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IERCo, a wholly-owned subsidiary of Idaho Power, owns a one-third interest in BCC and PacifiCorp owns a two-third interest in BCC and is the operator of the Bridger Coal Mine.

The mine operates under a long-term sales agreement that provides for delivery of coal through 2024 from surface and underground sources.

The mine operates under a long-term sales agreement that provides for delivery of coal through 2024.

Idaho Power believes that BCC has sufficient reserves to provide coal deliveries for at least the term of the sales agreement.

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The Jim Bridger plant’s rail load-in facility and unit coal train, while limited, provides the opportunity to access other fuel supplies for tonnage requirements above established contract minimums.

Idaho Power's 2021 Integrated Resource Plan identified a preferred resource portfolio and action plan includes the conversion from coal to natural gas of two units at the Jim Bridger plant in 2024 and an end to Idaho Power's participation in the remaining two coal-fired units at the Jim Bridger plant by the end of 2028.

For more information on the 2021 Integrated Resource Plan, refer to "Resource Planning" in this Item 1 - "Business." In June 2021, Idaho Power filed an application with the IPUC requesting, among other things, authorization to allow the Jim Bridger plant to be fully depreciated and recovered by end-of-year 2030.

The status of Idaho Power's application is described more fully in Part II, Item 7 – MD&A – "Regulatory Matters."

NV Energy is the operator of the North Valmy power plant.

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Idaho Power ended its participation in unit 1 of the North Valmy plant in December 2019, as planned, and plans to end its participation in unit 2 no later than the end of 2025.

In October 2020, Idaho Power and co-owner Portland General Electric ceased coal-fired operations at their Boardman power plant consistent with Idaho Power's continued path away from coal-fired generation.

In October 2020, Idaho Power and co-owner Portland General Electric ceased coal-fired operations at their Boardman power plant, as planned.

Natural Gas-fired Generation :

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Idaho Power purchases and stores natural gas with the intent of fulfilling needs as identified for seasonal peaks or to meet system requirements.

As of December 31, 2020, Idaho Power had approximately 6.0 million MMBtu of natural gas financially hedged for physical delivery, primarily for the operational dispatch of the Langley Gulch plant through January 2022.

Idaho Power plans to manage the procurement of additional natural gas for the peaking units on the daily spot market or from storage inventory as necessary to meet system requirements and fueling strategies.

As of December 31, 2021, Idaho Power had approximately 10.6 million MMBtu of natural gas financially hedged for physical delivery, primarily for the operational dispatch of the Langley Gulch plant through February 2023.

Idaho Power plans to manage the procurement of additional natural gas for the peaking units primarily on the daily spot market or from storage inventory as necessary to meet system requirements and fueling strategies.

Purchased Power :

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During 2021 and 2020, Idaho Power sold 0.6 million MWh and 1.2 million MWh of power in wholesale market sales, respectively, with an average price of $68.07 per MWh and $28.12 per MWh, respectively.

Idaho Power has two firm multi-year wholesale purchased power contracts to address increased demand during summer months.

These agreements total approximately 150 MW per hour during peak summer periods through 2024.

Long-term Power Purchase and Exchange Arrangements :

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The contract term ends in 2033.

• Jackpot Holdings LLC - a 20-year power purchase agreement to purchase the output from a planned 120-MW solar facility, with an expected in-service date in 2022.

• Jackpot Holdings LLC - a 20-year power purchase agreement to purchase the output from a planned 120-MW solar facility, with a scheduled in-service date in late 2022.

PURPA Qualifying Facility Energy Sales Agreements :

Idaho Power purchases power from PURPA qualifying facilities as mandated by federal law.

As of December 31, 2020, Idaho Power had contracts with on-line PURPA qualifying facilities with a total of 1,134 MW of nameplate generation capacity, with an additional 6 MW nameplate capacity of projects projected to be on-line by 2022.

As of December 31, 2021, Idaho Power had contracts with on-line PURPA qualifying facilities with a total of 1,137 MW of nameplate generation capacity, with an additional 75 MW nameplate capacity of projects projected to be on-line through 2024.

The energy sales agreements for these qualifying facilities have original contract terms ranging from one to 35 years.

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Idaho Power provides wholesale transmission service for eligible transmission customers on a non-discriminatory basis.

Idaho Power is a member of the Western Electricity Coordinating Council, the Northwest Power Pool, NorthernGrid, and the North American Energy Standards Board.

Idaho Power is a member of the Western Electricity Coordinating Council, the Northwest Power Pool, NorthernGrid, and the North American

Energy Standards Board.

These groups have been formed to more efficiently coordinate transmission reliability and planning throughout the Western Interconnection.

Demand for transmission services can be affected by regional market factors, such as loads and generation of utilities in Idaho Power’s region.

Transmission to serve Idaho Power's retail customers is subject to the jurisdiction of the IPUC and OPUC for retail rate making purposes.

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The IPUC and OPUC require that Idaho Power prepare biennially an Integrated Resource Plan (IRP).

Idaho Power filed its most recent IRP with the IPUC and OPUC in June 2019, which was amended in January and October 2020.

The IRP seeks to forecast Idaho Power's loads and resources for a 20-year period, analyzes potential supply-side, demand-side, and transmission resource options, and identifies potential near-term and long-term actions.

Idaho Power filed its most recent IRP with the IPUC and OPUC in 2021 (2021 IRP).

The four primary goals of the IRP are to:

• identify sufficient resources to reliably serve the growing demand for energy within Idaho Power's service area throughout the 20-year planning period;

• ensure the selected resource portfolio balances cost, risk, and environmental concerns;

• give equal and balanced treatment to supply-side, demand-side, and transmission resources;

• ensure the selected resource portfolio balances cost and risk, while including environmental considerations;

• give balanced treatment to supply-side and demand-side measures;

• involve the public in the planning process in a meaningful way.

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Idaho Power makes periodic adjustments and corrections to the resource plan to reflect economic conditions, anticipated resource development, changes in technology, and regulatory requirements.

The load forecast assumptions Idaho Power used in its updated 2019 IRP are included in the table below, together with the average annual growth rate assumptions used in the prior two IRPs.

The load forecast assumptions Idaho Power used in its 2021 IRP are included in the table below, together with the average annual growth rate assumptions used in the prior two IRPs.

The rate of load growth can impact the timing and extent of development of resources, such as new generation plants or transmission infrastructure, to serve those loads.

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2017 IRP 1.1% 1.6% 0.9% 1.4%

In January and October 2020, Idaho Power amended the originally filed 2019 IRP with additional information and modeling results.

The updated 2019 IRP identified a preferred resource portfolio and action plan, which included the completion of the Boardman-to-Hemingway transmission line in 2026, the end to Idaho Power's participation in coal-fired operations at the North Valmy plant unit 2 as early as 2022, the end to Idaho Power's participation in coal-fired operations at the Jim Bridger plant by 2030, including the exit from two of the four Jim Bridger plant units in 2022 and 2026, respectively, and the addition of a 120-MW solar resource in 2022.

Idaho Power is currently planning to end its participation in coal-fired operations at the North Valmy Plant unit 2 no later than 2025, subject to approval by the IPUC and OPUC.

The final determination of the preferred exit date will require additional analysis to assess near-term impacts to reliability and economics and to confirm that the timing decision would minimize costs and risks for customers.

In addition, an earlier exit would also require regulatory approval and a notice to the co-owner of the plant 15 months prior to ending Idaho Power’s participation in the operations of the North Valmy Plant unit 2.

As noted in the 2019 IRP, there is considerable uncertainty surrounding the resource sufficiency estimates and project completion dates, including uncertainty around the timing and extent of third-party development of renewable resources, fuel commodity prices, the actual completion date of the Boardman-to-Hemingway transmission project, and the economics and logistics of coal-fired plant retirements.

These uncertainties, as well as others, may result in changes to the desirability of the preferred portfolio and adjustments to the timing and nature of anticipated and actual actions in the 2019 IRP.

As of the date of this report, proceedings relating to the amended 2019 IRP are pending at the IPUC and OPUC.

Idaho Power's 2021 IRP identified a preferred resource portfolio and action plan, which included the addition of a 120-MW solar resource in late 2022, the conversion from coal to natural gas of two units at the Jim Bridger plant in 2024, the end to Idaho Power's participation in coal-fired operations at the North Valmy plant unit 2 in 2025, the completion of the Boardman-to-Hemingway transmission line in 2026, and an end to Idaho Power's participation in the remaining two coal-fired units at the Jim Bridger plant by the end of 2028.

The 2021 IRP preferred resource portfolio and action plan also includes a need to acquire significant generation and storage resources to meet energy and capacity needs.

Including the resources noted above, over the next 20 years the IRP plans for the addition of 1,685 MW of storage capacity, 1,405 MW of solar capacity, 700 MW of wind capacity, 500 MW of transmission capacity, and 400 MW of capacity from demand response.

As noted in the 2021 IRP, there is uncertainty surrounding the resource sufficiency estimates and project completion dates, including uncertainty around the timing and extent of third-party development of renewable resources, fuel commodity prices, regulatory requirements, the actual completion date of the Boardman-to-Hemingway transmission project, and the economics and logistics of coal-fired plant conversions and retirements.

These uncertainties, as well as others, may result in changes to the desirability of the

preferred portfolio and adjustments to the timing and nature of anticipated and actual actions in the 2021 IRP.

As of the date of this report, proceedings relating to the 2021 IRP are pending at the IPUC and OPUC.

Energy Efficiency and Demand Response Programs:

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• participation in the Northwest Energy Efficiency Alliance, which supports market transformation efforts across the region.

In 2020, Idaho Power’s energy efficiency programs reduced energy usage by approximately 195,000 MWh compared with 205,000 in 2019.

In 2021, Idaho Power’s energy efficiency programs reduced energy usage by approximately 138,000 MWh compared with 195,000 MWh in 2020.

For 2021, Idaho Power had a demand response available capacity of approximately 379 MW.

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IDACORP’s and Idaho Power’s boards of directors, with considerable focus from the corporate governance and nominating committee, are responsible for the oversight of the companies’ environmental, social, and governance (ESG) initiatives and are regularly informed of the goals, measures, and results of the companies' ESG and sustainability programs.

IDACORP and Idaho Power publicly release annual sustainability reports and the most current sustainability report is located on Idaho Power’s website, together with other information on ESG issues relevant to Idaho Power.

The sustainability reports and related website content are not incorporated by reference into this 2020 Annual Report.

Idaho Power has established an internal ESG Steering Committee co-led by two officers and composed of employees from the legal, finance, operations, investor relations, and other departments to oversee ESG activities and inform leadership and the board of directors on ESG related activities and matters it identifies as material to the company's operations.

IDACORP and Idaho Power publicly release annual ESG reports and the most current report is located on Idaho Power’s website, together with other information on ESG issues relevant to Idaho Power, including short-, medium-, and long-term carbon dioxide (CO 2 ) emission reduction targets that Idaho Power believes are aligned with the Paris Agreement goal of reducing CO 2 emissions to net zero by 2050.

IDACORP's and Idaho Power's 2021 ESG Report incorporated elements of the Task Force on Climate-Related Financial Disclosures (TCFD) guidelines and the Sustainability Accounting Standards Board (SASB) repor ting framework, as well as the Edison Electric Institute (EEI) E SG reporting template.

Additionally, Idaho Power responded to the Climate Disclosure Project (CDP) annual questionnaire, providing emissions data and management plans to address risks associated with climate change.

The ESG reports, CDP filing, and related website content are not incorporated by reference into this 2021 Annual Report.

IDACORP’s and Idaho Power’s ESG initiatives include:

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®" goal to provide Idaho Power's customers with 100-percent clean energy by 2045,

◦ the sustainability benefits from the Boardman-to-Hemingway transmission project, which includes integrating renewable energy generation and deferring or eliminating the need for development of additional fossil-fueled resources,

◦ the sustainability benefits from the Boardman-to-Hemingway and Gateway West transmission projects, which include integrating renewable energy generation and deferring or eliminating the need for development of additional fossil-fueled resources,

◦ integrating renewable resources into Idaho Power's generation mix and identifying and investigating new generation and storage technologies;

as part of this effort, Idaho Power issued requests for proposals in June

2021 and December 2021 for additional energy resources, including renewables or natural gas resource convertible to hydrogen gas power,

◦ continuing various environmental stewardship programs along the Snake River, including fish habitat preservation, water temperature reduction, and fish and plant restoration,

◦ wildfire mitigation planning and actions, and

◦ wildlife habitat, archaeological and cultural resource, and raptor protection stewardships;

• operational excellence in providing reliable, affordable, and clean energy;

◦ wildlife habitat, archaeological and cultural resource, and raptor protection stewardship;

• operational excellence in providing reliable, affordable, and clean energy, including enhancing grid resiliency and reliability;

• engaging and empowering Idaho Power’s workforce (including succession planning at all levels, employee development, leadership education, retirement planning education, and providing competitive compensation and benefits, including post-retirement benefits);

• promoting a culture of safety, diversity, equity, and inclusiveness for all employees;

• promoting a culture of safety, security, and inclusiveness for all employees;

• building strong community partnerships for healthy, sustainable economic development in Idaho Power’s service area.

Based on shareholder engagement feedback, in 2021 Idaho Power also publicly released its EEO-1 statement to report its demographic workforce data.

Reducing Carbon Emissions Intensity:

Carbon emissions intensity is a measure of the pounds of carbon dioxide (CO 2 ) emitted per MWh of energy generated.

Carbon emissions intensity is a measure of the pounds of CO 2 emitted per MWh of energy generated.

Idaho Power tracks carbon emissions intensity to measure the impact of its efforts to reduce carbon emissions relative to growing power demand in its service area.

Idaho Power has actively engaged in voluntary carbon emissions intensity reduction over the past decade with an original goal to reduce emissions 10-15 percent from the baseline year of 2005 levels.

Idaho Power has achieved and furthered the reduction goal several times.

Idaho Power increased the goal to reduce carbon emission intensity by at least 15-20 percent for the period from 2010 to 2020, and exceeded this goal with an estimated average reduction of 29 percent over that period compared with 2005.

In May 2020, IDACORP’s and Idaho Power’s boards of directors approved an increased goal to reduce carbon emission intensity by 35 percent for the period from 2021-2025 compared with 2005.

In January 2022, Idaho Power posted its emissions reduction report on its website that establishes short-, medium-, and long-term targets for further CO 2 reductions.

This report also includes annual power generation levels and associated CO 2 emissions and emissions intensity for the 2021-2040 period.

The emissions reduction report is not incorporated in this 2021 Annual Report.

Idaho Power has significantly reduced its CO 2 emissions since the 2005 baseline year, primarily by decreasing its coal generation levels, including terminating coal generation at the North Valmy Unit 1 in 2019 and at the Boardman plant in 2020, and also by upgrading it s hydropower facilities , and through its energy efficiency, demand-side management and cloud-seeding programs.

Idaho Power plans to continue to reduce CO 2 emissions in future years, including a targeted 79 percent reduction in annual CO 2 emissions tons by 2030, compared to the 2005 baseline year.

Reduction in Coal-Fired Generation:

Idaho Power monitors environmental requirements and assesses whether environmental control measures are or remain economically appropriate.

Continued review of the economic appropriateness of further investments in coal-fired plants was included in an IPUC order in February 2014, in which the IPUC requested that Idaho Power continue monitoring environmental requirements at a national level and account for their impact in resource planning and promptly apprise the IPUC of developments that could impact the company's continued reliance on the North Valmy plant as a coal-fired resource.

In 2017 and 2018, the IPUC and OPUC approved settlement stipulations allowing accelerated depreciation and cost recovery for the North Valmy plant in connection with Idaho Power's plan to end its participation in the operation of units 1 and 2.

Idaho Power ended its participation in the operation of unit 1 in December 2019, as planned, and plans to end its participation in unit 2 no later than the end of 2025.

The plan to end Idaho Power's participation in operations of units 1 and 2 at the North Valmy plant was based primarily on the economics of operating the plant.

The settlement stipulations are described in Part II, Item 7 - MD&A - "Regulatory Matters” in this report.

In October 2020, Idaho Power and co-owner Portland General Electric ceased coal-fired operations at their Boardman, as planned.

In June 2021, Idaho Power filed an application with the IPUC requesting, among other things, authorization to allow the Jim Bridger plant to be fully depreciated and recovered by end-of-year 2030.

In September 2021, the co-owner and operator of the Jim Bridger plant submitted its integrated resource plan to the IPUC that contemplates ceasing coal-fired generation in units 1 and 2 in 2023 and converting those units to natural gas generation by 2024.

The status of Idaho Power's application is described more fully in Part II, Item 7 – MD&A – "Regulatory Matters."

As of the date of this report, Idaho Power expects to cease participation in operations of all jointly-owned coal-fired generation plants by the end of 2028.

Climate Change Adaptation :

Idaho Power believes its practice of in-depth planning and prudent preparation helps the company adapt to and address the risks of climate change.

For more than 100 years, Idaho Power has adapted to changes in temperatures, water conditions, economic impacts, and regulatory requirements.

In recent years, Idaho Power has proactively addressed risks associated with climate change through preventative measures.

To address the physical impacts of climate change, Idaho Power conducts cloud-seeding operations, implements a wildfire mitigation plan, enhances grid resiliency and reliability, and continues to further Snake River shading and in-stream river enhancement projects.

Idaho Power also plans for the social and economic impacts of climate change by furthering its carbon emissions intensity reduction goal, continuing efforts to achieve its path away from coal generation, increasing the integration of renewable energy, and enhancing outage communication efforts.

Additionally, to plan for the potential regulatory impacts of climate change, Idaho Power emphasizes climate-related impacts in planning efforts, plans and advocates for additional transmission capacity to integrate additional renewable energy onto its system, identifies and investigates new technologies, including battery storage, and evaluates modifications to its pricing structure it believes will help ensure fair pricing for all customers.

Environmental Regulation and Costs

Idaho Power's activities are subject to a broad range of federal, state, regional, and local laws and regulations designed to protect, restore, and enhance the quality of the environment.

Environmental regulation impacts Idaho Power’s operations due to the cost of installation and operation of equipment and facilities required for compliance with environmental regulations, the

modification of system operations to accommodate environmental regulations, and the cost of acquiring and complying with permits and licenses.

In addition to generally applicable regulations, Idaho Power's co-owned coal-fired power plants, natural gas combustion turbine power plants, and hydropower generating plants are subject to a broad range of environmental requirements, including those related to air and water quality, waste materials, and endangered species.

For a more detailed discussion of these and other environmental issues, refer to Item 7 - MD&A - "Environmental Matters" in this report.

Environmental regulation impacts Idaho Power’s operations due to the cost of installation and operation of equipment and facilities required for compliance with environmental regulations, the modification of system operations to accommodate environmental regulations, and the cost of acquiring and complying with permits and licenses.

In addition to generally applicable regulations, Idaho Power's jointly-owned coal-fired power plants, natural gas combustion turbine power plants, and hydropower generating plants are subject to a broad range of environmental requirements, including those related to air and water quality, waste materials, and endangered species.

For a more detailed discussion of these and other environmental issues, refer to Part II - Item 7 - MD&A - "Environmental Matters" in this report.

Environmental Expenditures:

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Total operations and maintenance $ 31 $ 64

Idaho Power anticipates that finalization, implementation, or modification of a number of federal and state rulemakings and other proceedings addressing, among other things, greenhouse gases and endangered species could result in substantial changes in operating and compliance costs, but Idaho Power is unable to estimate those changes in costs given the uncertainty associated with existing and potential future regulations.

Idaho Power anticipates that finalization, implementation, or modification of a number of federal and state rulemakings and other proceedings addressing, among other things, greenhouse gases (GHG) and endangered species could result in substantial changes in operating and compliance costs, but Idaho Power is unable to estimate those changes in costs given the uncertainty associated with existing and potential future regulations.

Idaho Power expects that it would seek to recover increases in costs through the ratemaking process.

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However, Idaho Power estimates that the annual costs it will incur to obtain a new long- term license for the HCC, including AFUDC, are likely to range from $30 million to $40 million until issuance of the license.

Subsequent to the issuance of a new license, Idaho Power expects to incur increased annual operating and maintenance costs to comply with the requirements of any new license.

Subsequent to the issuance of a new license, Idaho Power expects to incur increased annual capital expenditures and operating and maintenance costs to comply with the requirements of any new license.

Human Capital

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and respect for all.

To further its mission, Idaho Power’s human capital programs are designed to attract, retain, and develop the highest quality employees.

To further its mission, Idaho Power’s human capital programs are designed to attract, retain, and develop high quality employees.

Idaho Power believes it maintains a good relationship with its employees due to a strong safety culture, respectful and inclusive environment, opportunities for development, and competitive compensation and benefits.

Idaho Power regularly conducts employee engagement surveys to seek feedback from its employees on a variety of topics, including safety reporting, support for development, understanding of the company’s initiatives, communication, and being treated with respect and feeling valued.

Idaho Power regularly

conducts employee engagement surveys to seek feedback from its employees on a variety of topics, including safety reporting, support for development, understanding of the company’s initiatives, communication, being treated with respect, and feeling valued.

Idaho Power shares the survey results with employees, and senior management incorporates the results of the surveys in their action plans in order to respond to the feedback and improve employee relations.

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IDACORP had 7 part-time employee s, 5 of whom were employed by Idaho Power.

Of IDACORP's full-time employees, 55 percent have worked at the company for over 10 years as of the date of this report.

Of IDACORP's full-time employees, 53 percent h ave worked at the company for over 10 years as of the date of this report.

All IDACORP and Idaho Power employees work in the United States.

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Each committee of the board of directors is delegated and takes on specific roles in this oversight.

The compensation committee is responsible for overseeing employee compensation and benefit plans and general labor issues.

The compensation and human resources committee is responsible for overseeing employee compensation, benefit plans, and general labor issues.

The audit committee is responsible for overseeing risk management, including compliance with the code of business conduct and physical security risks relating to employees.

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Idaho Power consistently ranks in the top 30 percent of all United States utilities in safety performance.

Reflective of Idaho Power's focus on safety, the company’s Occupational Health and Safety Administration recordable injury rate was below the industry average rate during four of the past five years, and its safety metrics in 2019 and 2020 were the strongest in the company’s history.

In response to the COVID-19 pandemic, Idaho Power implemented significant changes that it determined were in the best interest of its employees, as well as the communities in which it operates, in addition to complying with government regulations.

While the nature of Idaho Power’s industry necessitated that much of its field-based workforce continue to operate in the field, Idaho Power implemented numerous measures to help ensure the safety of those employees, and the public, amidst the pandemic.

Most of Idaho Power’s non-field employees worked remotely beginning in March 2020 and remain working remotely as of the date of this report.

For more information on the Idaho Power's response to the COVID-19 pandemic, see the “Executive Overview” section of Part II, Item 7 – MD&A.

Reflective of Idaho Power's focus on safety, the company’s Occupational Health and Safety Administration (OSHA) recordable injury rate was below the industry average rate during the last four years, and its safety metrics in 2021 were the strongest in the company’s history.

In 2021, for example, Idaho Power's severity rate for injuries, measured by the number of lost workdays per 100 employees, decreased 84 percent, and its lost-time injury rate, measured by the number of lost time injuries divided by the number of OSHA-recordable injuries, decreased 79 percent, compared to its previous five-year averages for those rates.

In recognition of Idaho Power's safety culture and the dedication of its employees, the EEI presented the inaugural Thomas F.

Farrell, II Safety Leadership and Innovation Award in the Member Company Project category to Idaho Power in January 2022.

Idaho Power was selected for its approach of combining psychological safety and behavioral safety with practical application of human performance principles.

The award recognizes the contributions of leadership and innovation to the advancement of safety in the energy industry.

Recipients of the award are selected by a panel consisting of leadership from the labor, contractor, and academic communities;

regulatory agencies;

and EEI senior leadership.

During the COVID-19 public health crisis, Idaho Power implemented significant changes that it determined were in the best interest of its employees, as well as the communities in which it operates, in addition to complying with government regulations.

Most of Idaho Power’s non-field employees worked remotely beginning in March 2020 and many remain working remotely or under a hybrid, in-office and remote schedule as of the date of this report.

For more information on Idaho Power's response to the COVID-19 public health crisis, see the “Executive Overview” section of Part II, Item 7 – MD&A.

Total Rewards:

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Idaho Power utilizes a structured compensation schedule and regularly conducts compensation analyses that helps mitigate the potential for gender, race, or ethicity-based disparities in compensation.

Beyond base salaries and incentive compensation, benefits for all full-time employees include an employee savings (401(k)) plan and company matching contributions, healthcare and insurance benefits, health savings and flexible spending accounts, paid time off, family leave, parental leave, employee assistance programs, and tuition assistance.

Beyond base salaries and incentive compensation, benefits for all full-time employees include a 401k plan with company matching contributions, healthcare and insurance benefits, health savings and flexible spending accounts, paid time off, family leave, parental leave, employee assistance programs, and tuition assistance.

Currently after five years of employment, a full-time employee vests in Idaho Power’s defined benefit pension plan.

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Idaho Power matches a portion of employee donations, which supplements the company’s separate charitable contributions.

Diversity, Equity, and Inclusion:

Unity - Diversity, Equity, and Inclusion:

One of Idaho Power’s core values as a company is “respect for all.” IDACORP’s and Idaho Power’s Code of Business Conduct, available publicly on IDACORP’s website, states Idaho Power's position that employees deserve a workplace where they can be treated in a professional and respectful manner, and each of the company's employees has the responsibility to create and maintain such an environment.

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As of December 31, 2021, 44 percent of Idaho Power’s senior management were women, 21 percent of its officers were women, and 36 percent of its board of directors were women.

Idaho Power also has programs in place to encourage STEM participation, training to minimize bias and ensure a respectful and inclusive workplace, community outreach to underserved communities, and partnerships with multiple diversity-focused organizations.

I daho Power also has programs in place to encourage STEM participation, training to minimize bias and ensure a respectful and inclusive workplace, with a mindset of unity, community outreach to underserved communities, and partnerships with multiple diversity-focused organizations.

IDACORP FINANCIAL SERVICES, INC.

IFS invests in real estate projects, such as affordable housing developments, which provide a return principally by reducing federal and state income taxes through tax credits and accelerated tax depreciation benefits.

IFS invests in real estate tax credit projects, such as affordable housing developments, which provide a return principally by reducing federal and state income taxes through tax credits and accelerated tax depreciation benefits.

IFS has focused on a diversified approach to its investment strategy in order to limit both geographic and operational risk with most of IFS’s investments having been made through syndicated funds.

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IFS generated tax credits of $6.2 million in 2021, $5.3 million in 2020, and $2.9 million in 2019.

In 2020, IFS received no distributions related to fully-amortized affordable housing investments.

In 2019 and 2018, IFS received distributions related to fully-amortized affordable housing investments that reduced IDACORP's income tax expense by $3.2 million and $0.3 million, respectively.

In 2021 and 2019, IFS received distributions related to fully-amortized real estate tax credit investments that reduced IDACORP's income tax expense by $1.0 million and $3.2 million, respectively.

In 2020, IFS received no distributions related to fully-amortized real estate tax credit investments.

IDA-WEST ENERGY COMPANY

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All nine projects are “qualifying facilities” under PURPA.

Idaho Power purchased all of the power generated by Ida-West’s four Idaho hydropower projects at a cost of approximately $9 million in both 2020 and 2019 and $10 million in 2018.

Idaho Power purchased all of the power generated by Ida-West’s four Idaho hydropower projects at a cost of approximately $8 million in 2021 and $9 million in both 2020 and 2019.

INFORMATION ABOUT OUR EXECUTIVE OFFICERS

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and Idaho Power Company, April 2016 - February 2017

• In-house legal counsel of IDACORP, Inc.

and Idaho Power Company, April 2010 - March 2016

MITCH COLBURN, 38

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• Senior Vice President and Chief Operating Officer of Idaho Power Company, April 2016 - October 2019

• Senior Vice President of Operations of Idaho Power Company, January 2016 - March 2016

• Vice President of Customer Operations and Chief Safety Officer of Idaho Power Company, October 2019 - present

7 unchanged sentences

and Idaho Power Company, April 2016 - present

• Vice President of Public Affairs of IDACORP, Inc.

and Idaho Power Company, October 2008 - March 2016

• Vice President, Chief Accounting Officer and Treasurer of IDACORP, Inc.

2 unchanged sentences

and Idaho Power Company, January 2014 - March 2020

ADAM RICHINS, 42

• Senior Vice President and Chief Operating Officer of Idaho Power Company, October 2019 - present

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• General Manager of Customer Operations, Engineering and Construction, January 2014 - February 2017

*As previously reported to the SEC on Form 8-K on November 19, 2021, Mr.

Buckham will succeed Mr.

Keen as Chief Financial Officer of IDACORP, Inc.

and Idaho Power, and Patrick A.

Harrington will succeed Mr.

Buckham as General Counsel of IDACORP, Inc.

and Idaho Power, effective March 1, 2022.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business