20260618Decision Memo.pdf

DECISION MEMORANDUM
TO: COMMISSIONER LODGE
COMMISSIONER HAMMOND
COMMISSIONER HARDIE
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM: JAMES CHANDLER,AUDITOR 3
KELSEA E. ROSS,DEPUTY ATTORNEY GENERAL
DATE: JUNE 23, 2026
RE: IN THE MATTER OF IDAHO POWER COMPANY'S APPLICATION FOR
AUTHORITY TO ISSUE AND SELL UP TO $1,500,000,000 OF FIRST
MORTGAGE BONDS AND DEBT SECURITIES; CASE NO. IPC-E-26-18.
BACKGROUND
On June 6, 2026, Idaho Power Company ("Company") applied to the Idaho Public
Utilities Commission("Commission")requesting authority to issue and sell from time to time
(1)up to $1,500,000,000 aggregate principal amount of one or more series of the Company's
first Mortgage Bonds ("Bonds") and (2) up to $1,500,000,000 aggregate principal amount of
one or more series of unsecured debt securities ("Debt Securities"); provided that the total
principal amount of these issuances shall not exceed $1,500,000,000 ("Application").
Application at 1. The requested authority is in addition to the previous authorizations approved
by the Commission, of which$150,000,000 remains. Id. The Company requested the authority
be authorized through June 30, 2029, consistent with the three-year authority authorized by
the Commission in Commission Order Nos. 36092 and 35420 that approved the Company's
issuance of Bonds and Debt Securities. Id. The required filing fees were received by the
Commission on June 17, 2026.
The Company stated that the Bonds will be issued pursuant to one or more
supplemental indentures to the Mortgage and Deed of Trust and will be secured with the
Company's other First Mortgage Bonds. Id. The Company represents the Bonds and/or Debt
Securities may be sold by the Company, agents of the Company, or through designated
DECISION MEMORANDUM - 1 - JUNE 23, 2026

underwriters. Id. at 7. The types and terms of issuance will be determined at the time of
issuance. Id. at 1. The Company stated that a copy of the shelf registration, any Prospectus,
Prospectus Supplements, Pricing Supplements, statement of net proceeds, and any agent
information along with all final documents will be filed with the Commission. Id. at 7. The
Company is also requesting continued authority to enter into interest rate hedging
arrangements with respect to the Bonds and/or Debt Securities including treasury interest rate
lock,treasury interest rate caps,treasury interest rate collars,treasury options, forward starting
interest rate swaps, and/or swaptions. Id. at 3.
The Company represents its net proceeds from the issuances will be used for the
acquisition of. (1) property; (2) construction, extension or improvement of utility facilities;
(3) improvement or maintenance of service; (4) discharge or lawful refunding of its
obligations; and(5) general corporate purposes. Id. at 9. To the extent that the proceeds from
the sale of the Bonds or Debt Securities are not immediately used, the Company explained
that they will be temporarily invested in liquid investments such as U.S. Treasury Bills,
commercial paper, money market funds, and/or bank deposits. Id. at 8-9.
The Company currently has in place with the Securities and Exchange Commission a
shelf registration that allows it to issue debt in one or more series and to take advantage of
attractive market conditions efficiently and rapidly, allowing issuances to be made at lower
cost and facilitating ongoing review. Id. at 4. The current shelf registration authority
approved in Commission Order No. 36092 expires December 31, 2026. The Company
currently has $150,000,000 remaining under current shelf authority and the Company requests
this authority to remain in effect for 21 days following the date of the Commission's order in
this case where it will automatically terminate if no petitions for reconsideration are received.
Id. at 10.
The Company's current outstanding First Mortgage Bonds and unsecured senior debt
are currently rated A3 and Baa2 by Moody's Investors Services("Moody's")and A-and BBB
by Standard and Poor's Rating Service ("S&P"), respectively. Id. at 7.
STAFF DISCUSSION AND RECOMMENDATIONS
Staff believes that the requested authority, if approved, will be continuous and would
remain in effect until June 30, 2029. As a condition of the continuous three-year term, Staff
believes the Company must continue to maintain "investment grade" ratings by S&P, which is
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BBB-and a Baa3 or higher senior secured debt rating by Moody's. Staff believes that authorization
of the Company's request in this case would not significantly impact the Company's capital
structure or result in changes to customer rates. Staff notes that should the requested authority
be issued, the Company's debt load would increase significantly. Staff calculates that if all
the debt was issued without an increase in equity, the Company's capital structure would
change from 48.9 percent equity and 51.1 percent debt to 40.5 percent equity and 59.5 percent
debt.
Staff recommends the Commission authorize the Company's request to issue and sell from
time to time (1) $1,500,000,000 aggregate principal amount of one or more series of Bonds; and
(2) $1,500,000,000 aggregate principal amount of Debt Securities. Staff recommends that the
Commission determine that the total outstanding combined principal amount of the Bonds and
Debt Securities shall not exceed$1,500,000,000. Staff also recommends the Commission require
the Company to notify the Commission in writing if its secured debt credit ratings fall below
investment grade. Furthermore, Staff recommends the Commission require the Company to file
copies of the shelf registration,any Prospectus,Prospectus Supplements,Pricing Supplements,
statement of net proceeds, and any agent information along with all final documents.
COMMISSION DECISION
Does the Commission wish to:
1. Authorize the Company's request to issue and sell from time to time $1,500,000,000
aggregate principal amount of one or more series of Bonds?
2. Authorize the Company's request to issue and sell from time to time $1,500,000,000
aggregate principal amount of Debt Securities?
3. Order the Company's limit of total outstanding combined principal of Bonds and Debt
Securities to $1,500,000,000?
4. Require the Company to be subject to the reporting and filing requirements identified
in Staff's comments?
James Chandler
Auditor 3
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DECISION MEMORANDUM - 3 - JUNE 23, 2026