20230601Direct Grow_Redacted.pdf

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
AUTHORITY TO INCREASE ITS RATES
AND CHARGES FOR ELECTRIC SERVICE
IN THE STATE OF IDAHO AND FOR
ASSOCIATED REGULATORY ACCOUNTING
TREATMENT.
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CASE NO. IPC-E-23-11

IDAHO POWER COMPANY

DIRECT TESTIMONY

OF

LISA A. GROW

GROW, DI 1
Idaho Power Company
Q. Please state your name, business address, and 1
present position with Idaho Power Company (“Idaho Power” or 2
“Company”). 3
A. My name is Lisa A. Grow. My business address 4
is 1221 West Idaho Street, Boise, Idaho 83702. I am 5
employed by Idaho Power as the President and Chief 6
Executive Officer (“CEO”). 7
Q. Please describe your educational background. 8
A. I received a Bachelor of Science in Electrical 9
Engineering from the University of Idaho in 1987 and an 10
Executive Master of Business Administration from Boise 11
State University in 2008, in addition to numerous industry 12
and leadership courses and trainings over the past 36 13
years. 14
Q. Please describe your work experience with 15
Idaho Power. 16
A. I have held 14 positions in my 36 years with 17
Idaho Power. I became President & CEO in June 2020. Before 18
that I held several officer positions: Senior Vice 19
President & Chief Operating Officer, Senior Vice President 20
of Power Supply, and Vice President of Engineering and 21
Construction. I was also the General Manager, Grid 22
Operations & Planning, and Senior Manager, Grid Operations, 23
and Control Area Operations Leader. In the early part of my 24

GROW, DI 2
Idaho Power Company
career, I held many engineering positions throughout the 1
Company. 2
Q. What is the purpose of your testimony in this 3
matter? 4
A. The purpose of my testimony is to 1) provide a 5
general overview of Idaho Power and its core business 6
practices, 2) generally discuss Idaho Power’s business 7
management and other financial considerations, 3) present 8
the Company’s request in this case and inform the Idaho 9
Public Utilities Commission (“Commission”) of the financial 10
and economic factors driving the need for the requested 11
base revenue adjustment, and 4) detail proposed rate 12
mitigation steps taken by the Company and the options 13
available to customers seeking assistance in managing their 14
energy costs. 15
Q. Are you the witness that can address overall 16
Company policy? 17
A. Yes. 18
Q. Please summarize your testimony. 19
A. The Company’s last general rate case (“GRC”) 20
was in 2011, and the number of Idaho Power customers has 21
increased by about 23 percent over the past decade. To 22
serve that growing customer base, the Company has made 23
significant investments in its infrastructure to maintain, 24
improve, and protect the electrical system. Idaho Power 25

GROW, DI 3
Idaho Power Company
will continue to have considerable ongoing investments in 1
response to rapid customer and load growth, as well as 2
aging infrastructure. 3
The Company has worked hard to keep Operations & 4
Maintenance (“O&M”) expenses low for the past decade, with 5
an average annual growth rate of only 1 percent since 2012. 6
This equates to a total increase of just over $50 million 7
to serve approximately 117,000 new customers, which 8
represents an average annual growth rate of 2 percent since 9
Idaho Power’s last GRC. The request in this case is largely 10
focused on the rate base additions needed to reliably serve 11
our customers and, to a lesser extent, growth in O&M 12
expenses. 13
Our case demonstrates a strong track record of 14
managing expenses and presents the necessary investments to 15
continue providing safe, reliable electric service to our 16
growing customer base. In recognition that price increases 17
can be difficult for customers to manage in today’s 18
economic environment, Idaho Power will present several ways 19
it was able to mitigate the requested increase in this 20
case. 21
I. COMPANY OVERVIEW 22
Q. Please provide an overview of Idaho Power. 23
A. Idaho Power Company is headquartered in Boise, 24
Idaho, and has been a locally operated energy company since 25

GROW, DI 4
Idaho Power Company
1916. The Company has approximately 2,000 employees that 1
proudly serve approximately 620,000 customers over a 2
24,000-square-mile service area in Idaho and Oregon. With 3
17 low-cost hydropower projects at the core of its diverse 4
energy mix, Idaho Power’s residential, business, and 5
agricultural customers pay among the nation's lowest prices 6
for electricity. 7
Q. What is Idaho Power’s overall business focus? 8
A. Idaho Power endeavors to remain a financially 9
strong, independent, vertically integrated utility 10
supported by a safe and engaged work force dedicated to 11
providing safe, reliable, and affordable electric service 12
to our customers. 13
Q. What are the key elements that guide Idaho 14
Power’s company culture? 15
A. Idaho Power’s culture is guided by our 16
purpose, values, and our commitment to each other. We are 17
passionate about powering lives with reliable, affordable, 18
clean energy, while developing innovative solutions every 19
day. Serving those who depend on us is at the center of 20
everything we do. We prosper by committing to the needs, 21
safety and success of our customers, communities, 22
employees, and owners. 23
Our Company’s three core values are Safety First, 24
Integrity Always, and Respect for All. Safety First - We 25

GROW, DI 5
Idaho Power Company
are committed to the safety of our employees, our 1
customers, and the communities we serve. Integrity Always - 2
Customers, owners, and employees can count on us to be fair 3
and ethical. Respect for All - We treat our customers, 4
partners, employees, and the environment with care and 5
dignity. 6
And finally, we are committed to an inclusive 7
environment where we are all valued, respected, and given 8
equal consideration for our contributions. We believe that 9
to be successful as a company we must be able to innovate 10
and adapt, which only happens when we seek out and value 11
diverse backgrounds, opinions, and perspectives. 12
Q. What is Idaho Power’s philosophy regarding 13
safety? 14
A. Because safety is a core value at Idaho Power, 15
the Company embraces and fosters a Safety First culture. 16
The Safety First culture recognizes that Idaho Power’s 17
family of employees is the Company’s greatest asset and 18
emphasizes that each employee’s most important 19
responsibility in their daily work is safety and that no 20
work is so critical that safety should be disregarded. The 21
Company is committed to the safety of its employees, 22
customers, and the public. 23
Q. How does Idaho Power measure the reliability 24
of its distribution system? 25

GROW, DI 6
Idaho Power Company
A. Idaho Power primarily uses four reliability 1
indices to measure reliability of the system: 2
SAIFI: System Average Interruption Frequency Index 3
SAIDI: System Average Interruption Duration Index 4
CEMI: Customers Experiencing Multiple Interruptions 5
MAIFI: Momentary Average Interruption Frequency 6
Index. 7
SAIFI, SAIDI, and CEMI are indices that measure 8
sustained outages. A sustained outage is defined as 9
customers out of power for five minutes or longer. MAIFI is 10
an index that measures momentary interruptions. Momentary 11
interruptions are when customers are out of power for fewer 12
than five minutes. 13
Idaho Power tracks performance for all of the 14
indices I just noted, but the primary focus of Idaho 15
Power’s distribution reliability programs over the years 16
has been to reduce the number of customer outages as 17
measured by SAIFI. 18
Q. What are Idaho Power’s reliability results? 19
A. Figure 1 shows Idaho Power’s improvement in 20
annual SAIFI since 2007. In 2022, Idaho Power customers 21
experienced an average of 1.16 sustained outages, which was 22
about 47 percent lower than 2007 when SAIFI was about 2.20 23
and 20 percent lower than in 2013 (10 years prior) when 24
SAIFI was 1.40. 25

GROW, DI 7
Idaho Power Company
FIGURE 1 1
IDAHO POWER ANNUAL SAIFI 2
3
System reliability can be dependent on major weather 4
events, specifically major wind or winter storms. Because 5
of the variation in reliability results due to weather, it 6
is helpful to look at five-year average SAIFI values to see 7
trends in performance. 8
Idaho Power also performs annual reliability 9
benchmarking with its northwest peer utilities. FIGURE 2 10
shows the five-year average of Idaho Power’s SAIFI compared 11
to the five-year average SAIFI of our seven peer utilities: 12
NorthWestern Energy, Pacific Power, Rocky Mountain Power, 13
Avista, Sierra Pacific Power, Portland General Electric, 14
and Puget Sound Energy. In the earlier years, shown on 15
Figure 2, Idaho Power lagged behind its peer utilities by 16
more than 50 percent and by about 15 percent in 2013. Over 17
the past four years, Idaho Power leads the peer utility 18
1.00
1.20
1.40
1.60
1.80
2.00
2.20
2.40
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Idaho Power Annual SAIFI 
IPC SAIFI Trend

GROW, DI 8
Idaho Power Company
group by an average of 11 percent.1 1
FIGURE 2 2
FIVE-YEAR AVERAGE SAIFI: IDAHO POWER VS PEERS 3
4
Q. Where does Idaho Power focus its efforts to 5
maintain and improve reliability? 6
A. Idaho Power makes significant efforts toward, 7
and investment in, improving and maintaining reliable 8
service to its customers. The Company recognizes that 9
providing safe, reliable service is among its highest 10
operational priorities for our customers. Idaho Power has 11
completed many projects in recent years to either maintain 12
or improve reliability. 13
At the generation level, Idaho Power must ensure it 14
has sufficient resources to fulfill its obligation to 15
reliably and safely serve customers, especially in light of 16

1 The data is through 2021. Idaho Power does not have all peer data
through 2022 at this point in time.
1.00
1.20
1.40
1.60
1.80
2.00
2.20
2.40
2.60
2.80
3.00
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
IPC 5yr Average SAIFI vs Peers
5 yr IPC SAIFI 5 yr Peer SAIFI

GROW, DI 9
Idaho Power Company
the unprecedented growth Idaho Power has experienced over 1
the past decade. In their testimonies, Company Witnesses 2
Mr. Eric Hackett and Ms. Lindsay Barretto provide detailed 3
discussions of investments Idaho Power has made in new and 4
existing generation resources to ensure sufficient, 5
reliable generation capacity to serve customers. 6
With regard to the transmission and distribution 7
(“T&D”) systems, Idaho Power has made significant 8
investments to maintain aging infrastructure while 9
accommodating growth at the local level. These projects 10
include work such as the replacement of distribution wood 11
cross-arms and associated wood pins, the injection and 12
replacement of certain underground distribution cables, 13
vegetation management, and improvements to portions of the 14
transmission system and substations. Company Witness Mr. 15
Mitch Colburn describes in greater detail the Company’s 16
reliability-related investments and activities in his 17
testimony. 18
Q. What is the Company’s overall approach to 19
providing a positive customer experience? 20
A. Idaho Power strives to be regarded as an 21
exceptional utility by the customers it serves. To 22
accomplish this, the Company must provide superior and 23
satisfying customer service and experiences that meet or 24
exceed its customers’ needs and expectations. 25

GROW, DI 10
Idaho Power Company
The Company continually focuses on ways to cost-1
effectively improve its relationships with customers by 2
assessing customer perception of the Company, identifying 3
performance and experience gaps based on customer feedback, 4
and reviewing industry best practices and trends. 5
Q. What recent initiatives has Idaho Power 6
undertaken to enhance customer satisfaction? 7
A. The Company has recently implemented 8
enhancements to its digital offerings and solutions to 9
better align with industry trends and evolving customer 10
preferences and expectations. Most notably, the Company’s 11
investment in modernizing its My Account platform stemmed 12
from customers’ desire to digitally self-serve and manage 13
their accounts. By customers using their preferred method 14
of self-service through My Account, the Company was able to 15
manage customer service employee growth while our number of 16
customers grew over the past decade. Further, in early 17
2022, the Company released a Mobile Application (“App”) on 18
the Apple and Google Play stores in response to the 19
increasing shift in customers’ preferences toward accessing 20
their account and service-related information on the go. The 21
App provides enrolled customers with real-time alerts 22
regarding important billing information and connection or 23
outage status affecting one of their registered addresses. 24
The Direct Testimony of Company Witness Mr. Bo 25

GROW, DI 11
Idaho Power Company
Hanchey describes more fully the Company’s efforts to 1
enhance customers’ experiences with our Company. 2
II. IDAHO POWER’S BUSINESS MANAGEMENT OVERVIEW 3
AND FINANCIAL STATUS 4
Q. When was Idaho Power’s last GRC in Idaho? 5
A. Idaho Power’s last Idaho GRC, Case No. IPC-E-6
11-08, was filed on June 1, 2011, with rates becoming 7
effective January 1, 2012. 8
Q. What are the primary factors that have 9
contributed to the Company’s ability to avoid filing a 10
general rate case for the last 12 years? 11
A. There are a number of factors that have 12
contributed to the Company’s ability to avoid a GRC over 13
the last 12 years. First, the Company has diligently 14
managed its O&M expenses by creating a cost-conscious 15
culture among employees. As I mentioned earlier in my 16
testimony, O&M increased an average of 1 percent since 17
2012, while inflation averaged approximately 2 percent a 18
year and customers grew by approximately 2 percent a year—19
for a combined 4 percent increase. 20
Second, customer growth, and the associated growth 21
in sales revenue, has helped reduce the financial impact of 22
increasing costs over that period. Third, the Company’s 23
annual adjustment mechanisms, the Power Cost Adjustment 24
(“PCA”) and Fixed Cost Adjustment (“FCA”), have provided 25

GROW, DI 12
Idaho Power Company
timely revenue support addressing increases in power costs 1
and decreases in residential use-per-customer, 2
respectively. Finally, the Commission has approved several 3
single-issue adjustments to rate recovery, including, but 4
not limited to, the addition of the Langley Gulch natural 5
gas-fired power plant, the establishment of rate mechanisms 6
to recover the cost of early coal plant exits, recovery of 7
Energy Imbalance Market costs, as well as deferred 8
accounting treatment for certain incremental costs, 9
including those related to wildfire mitigation. 10
Q. Beyond the benefit to customers of avoiding 11
filing a GRC for the last 12 years, will the factors you 12
listed impact this case? 13
A. Yes, customers benefit from each of the items 14
that I listed in this case, as each of those benefits are 15
built into our request. 16
Q. Please describe the Company’s efforts to 17
reduce expenses related to hiring employees. 18
A. All new, un-budgeted positions must be 19
reviewed and approved by the vice president responsible for 20
each business unit. Despite adding approximately 117,000 21
customers between 2012 and 2022, employee headcount has 22
actually decreased by a total of 17 people over the same 23
time period. 24

GROW, DI 13
Idaho Power Company
Q. What is Idaho Power’s general compensation 1
philosophy? 2
A. As described more fully by Company Witness Ms. 3
Sarah Griffin in her testimony, Idaho Power’s compensation 4
philosophy is to provide a balanced, competitive, and 5
sustainable total compensation or “total rewards” package, 6
ensuring it attracts and retains high quality employees and 7
motivates them to achieve performance goals that benefit 8
customers and shareholders. Maintaining a competitive total 9
rewards package allows the Company to recruit and retain 10
its highly skilled workforce. The competitiveness of Idaho 11
Power’s total rewards package also supports the Company’s 12
intent to maintain a flexible workforce that can easily 13
adjust work duties and assignments to meet changing demands 14
and operational needs, which in turn keep the Company’s 15
costs of service lower. 16
Q. Please describe the Company’s efforts to 17
control budgets. 18
A. Idaho Power employs a robust capital and O&M 19
budgeting process. The capital budget process begins with 20
maintenance personnel, planners, and others within the 21
business identifying needs and submitting projects to 22
business unit management. Business unit management reviews 23
submitted projects and prioritizes them based on spending 24
guidelines provided by senior management. 25

GROW, DI 14
Idaho Power Company
O&M budgets are established based on extensive 1
discussions between the business units and senior 2
management and represent a combination of prior year 3
experience plus or minus identified changes and 4
adjustments. As the Company prepared its O&M budgets for 5
2023, the target was based on holding to a 2022 budget 6
adjusted down for known items and with only identified 7
unavoidable increases allowed as an adjustment. 8
Throughout the year, senior management reviews the 9
status of spending for both O&M and capital against updated 10
estimates as well as original budget. Variances are 11
reviewed and analyzed in order to determine changes that 12
may need to be made during the year to manage to budgeted 13
levels of spend. 14
Q. Have the Company’s cost-control measures 15
applied over the last decade been successful? 16
A. Yes, very much so. As can be seen in Figure 3, 17
the Company’s overall O&M expenses, excluding power supply 18
expenses and demand-side management expenses, have remained 19
relatively flat between 2012 and 2021, with an uptick in 20
2022 resulting from recent inflationary pressures. Even 21
with those recent inflationary factors, the Company has 22
held O&M expenses to an average annual growth rate of just 23
1 percent over the last decade. 24
25

GROW, DI 15
Idaho Power Company
FIGURE 3 1
2012-2022 OPERATING AND MAINTENANCE EXPENSES2
3 Q. Are there any other factors that have 4
contributed to Idaho Power’s ability to avoid a GRC over 5
the last decade? 6
A. Yes. Since 2009, the Company has been subject 7
to an Accumulated Deferred Investment Tax 8
Credits("ADITC")/Revenue Sharing Mechanism that includes 9
provisions for the accelerated amortization of ADITC to 10
help achieve a minimum specified percent Idaho-jurisdiction 11
return on year-end equity (“Idaho ROE”), currently set at 12
9.4 percent. The mechanism also provides for the potential 13
sharing between Idaho Power and Idaho customers of Idaho-14
jurisdictional earnings in excess of a 10.0 percent Idaho 15
ROE. Under the current mechanism, the ADITC and sharing 16
thresholds are to be reset at a GRC to align the sharing 17

GROW, DI 16
Idaho Power Company
threshold with the then-authorized ROE and the use of 1
accelerated amortization of ADITC at 95 percent of the 2
authorized ROE. 3
In addition to sharing earnings with customers over 4
the 10.0 percent Idaho ROE threshold, this mechanism has 5
created an additional incentive to the Company to preserve 6
ADITCs to be available to support earnings for as long as 7
possible. While the Company endeavors to thoughtfully 8
manage its costs as a standard practice, this additional 9
financial incentive has been beneficial for customers, 10
because the Company has continually looked for creative 11
ways to maximize its Idaho ROE without filing a GRC. 12
Because the Company has not used the full $45 million of 13
ADITC available, as of December 31, 2022, the credits can 14
be utilized in future periods under the mechanism or the 15
historical standard ITC amortization method. 16
Q. What is the amount of earnings Idaho Power has 17
shared with its customers under the earnings sharing 18
mechanism since its last general rate case? 19
A. Since the Company’s last general rate case the 20
Company has shared $126,752,809 of earnings with its 21
customers under the ADITC/Revenue Sharing Mechanism. 22
Q. Have Idaho Power’s cost management efforts, 23
along with the other factors just described, resulted in 24

GROW, DI 17
Idaho Power Company
the Company earning a reasonable rate of return on equity 1
between 2012 and 2022? 2
A. Generally, yes. As can be seen in Figure 4, 3
the Company has earned between a 9.5 percent and 10 percent 4
Idaho jurisdictional ROE on an actual basis over that time 5
period. 6
FIGURE 4 7
IDAHO JURISDICTIONAL ROE 2012-2022 8
9
Q. Considering the earnings performance presented 10
on the above chart, why do you believe it is necessary to 11
increase rates for customers now? 12
A. As I will detail later in my testimony, since 13
2012, the Company has invested approximately $1.7 billion 14
dollars on new property, plant, and equipment to serve its 15
customers safely and reliably. In addition, in 2023, the 16
Company expects to invest up to $700 million in additional 17
capital projects with nearly $400 million in O&M expense. 18
8.50%
9.00%
9.50%
10.00%
10.50%
11.00%
11.50%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Idaho Jurisdictional ROE 2012 ‐2022 

GROW, DI 18
Idaho Power Company
Considering the incremental depreciation and interest 1
expense associated with this significant capital 2
investment, Idaho Power will no longer be able to maintain 3
a reasonable rate of return without the requested rate 4
relief. 5
Q. Could Idaho Power utilize accelerated 6
amortization of ADITC to avoid the need for a GRC for at 7
least one more year? 8
A. Unfortunately, no. As noted in the Company’s 9
first quarter 2023 earnings release, Idaho Power plans to 10
utilize at least $15 million of accelerated amortization of 11
ADITC to reach a 9.4 percent Idaho ROE. In 2024, the year 12
rates would go into effect from this case, 13
14
15
III. CASE OVERVIEW AND DRIVERS 16
Q. What is Idaho Power’s requested revenue 17
increase in this case? 18
A. As discussed further in the Direct Testimonies 19
of Company Witnesses Mr. Timothy Tatum and Ms. Kelley Noe, 20
the Company is requesting rate relief of approximately 21
$111.3 million, which is net of a corresponding proposed 22
PCA decrease of $173.4 million and a reduction to annual 23
Energy Efficiency Rider collection of $3.5 million. If 24
approved, this request would result in an overall increase 25

GROW, DI 19
Idaho Power Company
to adjusted base revenue of 8.61 percent effective January 1
1, 2024. 2
Q. Why do you believe this increase is necessary? 3
A. This increase is important for Idaho Power to 4
achieve fair and timely recovery of its prudently incurred 5
expenses and a reasonable return on the Company’s 6
investment in its electrical system, which today’s rates 7
will not fully provide. High customer growth in demand for 8
electricity, aging infrastructure, and higher compliance 9
and reliability requirements are driving the need to invest 10
large amounts of capital to expand and improve electricity 11
supply, delivery, and reliability. This increases the 12
Company’s need to access both the debt and equity markets 13
to fund large amounts of capital investment in the system. 14
In this environment, timely and fair recovery of the 15
Company’s prudently incurred expenses and investments is 16
critically important to helping it attract capital 17
investment and manage financing costs. 18
Q. What is the Company’s proposed cost of 19
capital? 20
A. The Company’s request is based on a proposed 21
rate of return of 7.702 percent, with a capital structure 22
comprised of 51 percent equity and 49 percent debt, a 4.895 23
percent cost of debt, and a 10.4 percent return on equity 24
(“ROE”). Company Witnesses Mr. Adrien McKenzie and Mr. 25

GROW, DI 20
Idaho Power Company
Brian Buckham provide support for this recommendation in 1
their respective testimonies. 2
Q. What are the challenges facing the Company? 3
A. Rising prices and costs and constrained system 4
capacity are challenges facing many utilities in the West, 5
and Idaho Power is no different. Despite considerable 6
investment and expansion in recent years, much of the 7
Company’s system today is fully utilized by our current 8
customers and the Company continues to experience sustained 9
customer growth. To provide safe, reliable service to all 10
customers, the Company must continue to make major 11
investments in both new and existing infrastructure. 12
Supply chain constraints and worldwide demand for the 13
materials and services required to build needed 14
infrastructure has driven up prices dramatically in recent 15
years. 16
Idaho Power’s credit quality, as measured by the 17
national credit rating agencies, has recently been 18
downgraded and is now at the lower end of investment grade. 19
Rates in effect today will not provide the Company a 20
sufficient opportunity to earn the rate of return necessary 21
to assure access to the capital markets to finance needed 22
investments in 2024 and beyond. Any delay in or lack of 23
recovery of prudent operating or financing costs is seen as 24
risk by the financial community, including the credit 25

GROW, DI 21
Idaho Power Company
rating agencies, during this period of plant expansion and 1
difficult economic times. These pressures combine to 2
present a formidable challenge to sustaining the financial 3
health, operational excellence, and, ultimately, the 4
independence of the Company. 5
Q. You mentioned growth in investment over the 6
past few years. What is driving the growth in investment 7
since rates went into effect following the Company’s last 8
general rate case? 9
A. As can be seen on Figure 5, Idaho Power has 10
added approximately 117,000 customers between 2012 and 2022 11
and forecasts it will experience customer growth of another 12
58,000 customers over the next five-year period. 13

GROW, DI 22
Idaho Power Company
FIGURE 5 1
IDAHO POWER CUSTOMER COUNT 2
3
The Company must be financially prepared to serve 4
that growth as it occurs. To provide safe, reliable service 5
to all customers, the Company must make investments in both 6
new and existing infrastructure. The Company is adding 7
capacity to its generation fleet, transmission system, and 8
distribution facilities to ensure an adequate supply of 9
electricity to customers, to provide service to new 10
customers, and to maintain system reliability. 11
Idaho Power’s aging T&D infrastructure requires 12
continued investment in upgrades and replacement to 13
maintain their operational viability. The Company’s aging 14
hydroelectric and thermal generation facilities also 15

GROW, DI 23
Idaho Power Company
require continuing investment in upgrades and component 1
replacement. In addition, environmental mandates require 2
the replacement or retrofitting of aging equipment with 3
technology that is often more expensive. Further, the 4
Company is operating in an environment of ever-increasing 5
reliability and compliance standards that also require 6
increased levels of investment. 7
As can be seen in Figure 6, since the Company’s last 8
GRC in 2011, Idaho Power’s net plant in service has 9
increased by approximately $1.7 billion reflecting new 10
infrastructure investment of around $3.3 billion. During 11
the same time period, annual depreciation expense has grown 12
from $116 million in 2012 to approximately $237 million in 13
2022. 14
FIGURE 6 15
NET ELECTRIC PLANT IN SERVICE 16
17
$2,618 
$4,363 
$116 
$237 *
 $100
 $120
 $140
 $160
 $180
 $200
 $220
 $240
 $260
 $280
 $300
 $2,000
 $2,500
 $3,000
 $3,500
 $4,000
 $4,500
2011
GRC
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
De
p
r
e
c
i
a
t
i
o
n
 Ex
p
e
n
s
e
Ne
t
 El
e
c
t
r
i
c
 Pl
a
n
t
 in
 Se
r
v
i
c
e
Net Electric Plant in Service
$ in millions

GROW, DI 24
Idaho Power Company
The Company can no longer absorb the depreciation 1
and financing expense associated with the incremental plant 2
investment without the requested rate relief in this case. 3
Q. How have rising interest rates impacted Idaho 4
Power’s financing costs? 5
A. Over the last decade, Idaho Power has taken 6
advantage of historically low interest rates to lower its 7
long-term debt interest rate by almost 100 basis points 8
over that period. However, borrowing costs have risen 9
dramatically since December 2021, as the Federal Reserve 10
has taken action to address inflation in the United States 11
(“US”) economy. As seen in Figure 7 from the Wall Street 12
Journal below, as of May 12, 2023, 30-year US Treasury 13
bond yields have risen from around 1.8 percent near the 14
start of 2022 to as high as 4.38 percent in late 2022 and 15
have recently been between 3.6 to 3.8 percent, a 100 16
percent increase over that period.17

GROW, DI 25
Idaho Power Company
FIGURE 7 1
30-YEAR BOND 2
3
Rapidly rising interest rates during an environment 4
of rapid economic growth not only increases the cost of 5
financing but also challenges Idaho Power’s ability to 6
raise efficient capital in the public and private debt 7
markets. 8
It should also be noted that when borrowing costs 9
rise, the ripple effects make their way into all of Idaho 10
Power’s commodities, materials, purchased services, and 11
other costs. This happens because all of the Company’s 12
vendors and counterparties need to price their rising 13
borrowing costs into the prices they charge to Idaho 14
Power. And while macro-economic inflation seems to be 15
curbing from recent highs, higher borrowing costs are more 16
likely to persist over the longer term.17

GROW, DI 26
Idaho Power Company
Q. Can you cite examples that show how inflation 1
has impacted the procurement of supplies? 2
A. A combination of supply and demand factors 3
have resulted in persistent high inflation since early 4
2020. Idaho Power is continuing to see escalated pricing 5
across most commodities: Since 2020, core steel is up 203 6
percent, aluminum pricing is up 78 percent, and high-grade 7
copper has increased 47 percent. 8
These increases translate directly into price 9
escalations for key pieces of equipment needed to serve 10
our customers and maintain the reliability of our system. 11
The average cost of transformers has increased by 47 12
percent, wood poles by 31 percent, and electrical cable by 13
58 percent. 14
Other factors driving procurement pricing 15
escalations are the cost of labor and the cost of freight. 16
In addition, capacity availability among manufacturers in 17
our industry has not been able to meet demand, causing the 18
Company to go to new suppliers that are charging higher 19
prices. 20
Q. Can you cite examples of how supply chain 21
disruptions have been a challenge? 22
A. Supply chain disruptions continue to affect 23
business operations, creating an environment of scarcity 24
where manufacturers are unable to manage costs or lead 25

GROW, DI 27
Idaho Power Company
times. For example, lead times for transformers have 1
increased by almost five times since 2020—from 32 weeks to 2
156 weeks. Meter packages have increased sixfold, from 12 3
weeks to 72 weeks, and breaker lead times have grown from 4
32 weeks to 72 weeks. These challenges are expected to 5
continue for the next several years. They have caused 6
delays in project execution, increased costs, and created 7
additional workload as the Company works to find other 8
vendors that can support its needs on a timely basis. All 9
of these factors have combined to cause the Company to 10
increase its inventory to levels necessary to support its 11
obligation to serve at an escalating cost. 12
Q. Are the supply chain disruptions unique to 13
Idaho Power? 14
A. No. Cost increases and longer lead times are 15
not just being seen at Idaho Power. In June 2022, an Idaho 16
Power supplier delivered a Utility Market Commodity 17
Impacts and Outlook presentation to the Company, 18
highlighting several key themes including those previously 19
discussed. In addition, the presentation noted that 20
utilities are likely to continue to see significant 21
disruption from changing weather patterns. Further, 22
sweeping energy policy changes—such as the US Department 23
of Energy’s recent Notice of Proposed Rulemaking on 24
transformer efficiency—could further add significant 25

GROW, DI 28
Idaho Power Company
disruption for all utilities. 1
Q. What is Idaho Power doing to actively manage 2
supply chain disruptions? 3
A. Idaho Power monitors its inventory closely and 4
takes action to mitigate the concerns regarding the 5
tracking of more than 80,000 items and 30,000 unique 6
catalog identifiers. In addition, the Company works with 7
suppliers and others to ensure they are taking the proper 8
actions, such as rationing inventory, providing 9
alternative and substitute products, managing lead times, 10
and investing in forward-looking buys. 11
Q. How have recent changes to Idaho Power’s 12
credit ratings impacted its cost of doing business? 13
A. While Idaho Power’s credit ratings continue to 14
be investment grade, a recent downgrade by Moody’s from A3 15
to Baa1 and a recent note from Standard and Poor’s (“S&P”) 16
downgrading its liquidity assessment of the Company from 17
“strong” to “adequate” provide a backdrop for Idaho 18
Power’s need to increase its cash collections from 19
customers. 20
While credit rating changes impact both short-term 21
and long-term borrowing costs, as lower ratings drive 22
higher risk premiums, those changes also impact Idaho 23
Power’s wholesale commodity contracts, and the perception 24
of suppliers, contractors, and other vendors on our 25

GROW, DI 29
Idaho Power Company
ability to pay for normal O&M costs, as well as 1
construction contracts. 2
Q. Has Idaho Power taken any actions to improve 3
its credit rating in recent years? 4
A. Yes. The Company began increasing the equity 5
ratio immediately following the last GRC. In fact, the 6
year-end 2012 equity ratio was 53 percent, and it grew 7
from that level to 55 percent at year-end 2022. The 8
increased equity ratio has had a significant positive 9
impact to the Company’s credit ratings, partially 10
offsetting some of the lower ratios the rating agencies 11
use for calculating applicable ratings. 12
Q. What rationale was given by the ratings 13
agencies to support their recent actions regarding Idaho 14
Power’s credit downgrades? 15
A. Moody’s stated, “without the benefit of more 16
incremental and timelier rate relief through riders or 17
cost tracking mechanisms, more frequent base rate 18
increases and lower imputed debt from pension obligations, 19
IPC’s credit metrics will not improve materially, and the 20
utility will have limited financial cushion at its current 21
rating level to manage unforeseen events.” And S&P cited 22
our reliability and economic growth-driven capital 23
spending needs as reflecting its liquidity downgrade, as 24
it perceives “elevated capital spending that will result 25

GROW, DI 30
Idaho Power Company
in a modest weakening of the company[’s] liquidity 1
throughout the forecast period.” 2
Q. Do you believe the relief requested in this 3
case will serve to stabilize or improve the Company’s 4
credit ratings going forward? 5
A. Yes, it should stabilize the credit ratings 6
but likely will not improve the ratings. The credit rating 7
agencies have built their models and assumptions, in part, 8
based on forecasts Idaho Power has discussed with them over 9
the past few years. Those forecasts have contemplated the 10
rate relief requested in this case. In addition, this case 11
requests additional return of and return on rate base that 12
has been placed into service since the last GRC that have 13
carried regulatory lag from a cash flow perspective over 14
several years. Finally, the request in this case seeks to 15
address cash collections related to regulatory deferrals 16
such as those related to wildfire mitigation and pension 17
expenses that, if approved by the Commission, will be 18
viewed by the credit rating agencies as positive for their 19
assumed liquidity and other credit metrics. 20
IV. RATE MITIGATION AND CUSTOMER ASSISTANCE 21
Q. Did you provide any specific instructions to 22
the Regulatory Affairs Department in preparing this GRC 23
filing? 24
A. Yes. In recognition of the broader economic 25

GROW, DI 31
Idaho Power Company
conditions and concern for the impact of any rate increase 1
on Idaho Power’s customers, I instructed Mr. Tatum, Vice 2
President of Regulatory Affairs, to identify areas where 3
the Company could forego requesting an increase at this 4
time. Mr. Tatum and his department identified the following 5
areas where the Company is not asking for incremental 6
increases: 7
 Reduce ROE from the recommended level of 8
10.6 percent to 10.4 percent; 9
 Hold test year non-labor O&M to the 2022 10
level with the exception of a limited number of known and 11
measurable adjustments; 12
 Maintain Valmy and Bridger cost recovery 13
at current levels with the exception of collection related 14
to previously deferred revenue requirement amounts; 15
 Minimize the current revenue increase 16
related to wildfire mitigation and pension costs by 17
leveraging existing cost recovery mechanisms; and 18
 Delay recovery of the revenue requirement 19
associated the 120 megawatts of battery storage resources 20
to be online in 2023, with interim earnings support from 21
the associated federal investment tax credit generated from 22
the battery storage resources. 23
Mr. Tatum describes the rationale and quantification 24
of each of these adjustments in his testimony. 25

GROW, DI 32
Idaho Power Company
Q. What options are available to customers to 1
help them manage their energy costs? 2
A. There are a number of options available to 3
customers who need assistance in managing their energy 4
costs. Project Share is a year-round bill pay assistance 5
program started by Idaho Power in 1982 and administered by 6
the Salvation Army. Funding is provided by Idaho Power’s 7
customers and shareholders, other utilities, and private 8
donations, with 100 percent of Idaho Power customers’ 9
donations going to Project Share recipients. 10
The Company also offers several energy efficiency 11
programs targeting low-income customers - Weatherization 12
Assistance for Qualified Customers (“WAQC”), Weatherization 13
Solutions for Eligible Customers (“Solutions”), and Easy 14
Savings, a low-income energy efficiency educational 15
program. 16
Idaho Power provides just over $1,212,000 annually, 17
funded by base rates, to the Idaho Weatherization 18
Assistance Program to weatherize additional electrically 19
heated customer homes under the WAQC program. Idaho Power 20
also provides a “Near Low Income” weatherization program 21
called Solutions. This program provides weatherization 22
assistance to customers just under or just over the income 23
limit for WAQC. Most of the Solutions customers are seniors 24
who are barely over the federal cutoff, as well as Idaho 25

GROW, DI 33
Idaho Power Company
Power customers on the waiting list for the longest time to 1
receive weatherization services. Finally, the Easy Savings 2
program provides $125,000 annually to five Community Action 3
Partnership (“CAP”) Agencies in the Idaho Power service 4
area and develops and runs the program with a planning 5
committee consisting of CAP Agency, Commission Staff, and 6
Idaho Department of Health and Welfare representatives. 7
Q. How much do Idaho Power shareowners contribute 8
to Project Share annually? 9
A. Idaho Power shareowners contribute 10 percent 10
of monthly customer donations to support the Salvation 11
Army’s program administration costs. In addition, 12
shareowners make an annual Project Share donation of 13
approximately $25,000 to directly fund customer bill 14
assistance. In recognition of the current cost pressures on 15
customers’ bills, in 2023, Idaho Power shareowners elected 16
to contribute an additional $100,000 to support Project 17
Share for a total of $125,000 of shareowner-funded customer 18
bill assistance. 19
V. CONCLUSION 20
Q. Can you summarize the Company’s requested rate 21
increase and explain why it is important not only to Idaho 22
Power but in the best interest of customers? 23
A. This general rate request reflects a revenue 24
requirement increase of approximately $111.3 million, or an 25

GROW, DI 34
Idaho Power Company
8.61 percent increase and includes a requested ROE of 10.4 1
percent. This increase is important for Idaho Power to 2
achieve fair and timely recovery of its prudently incurred 3
expenses and a reasonable return on the Company’s 4
investment in its electrical system, which today’s rates 5
will not fully provide. Continued growth in demand for 6
electricity, aging infrastructure, and higher compliance 7
and reliability requirements are driving the need to invest 8
large amounts of capital to expand and improve electricity 9
supply, delivery, and reliability. 10
Timely and fair recovery of the Company’s prudently 11
incurred expenses and investments is critically important 12
to helping it attract capital investment and manage 13
financing costs. A low cost of capital ultimately has a 14
beneficial impact on customers’ rates. By providing for 15
fair and timely recovery of the Company’s expenses it 16
incurs on behalf of customers and investments in the 17
systems and activities that serve its customers, this rate 18
increase is in the best interests of the Company, its 19
shareholders, and the people and communities it serves. 20
Q. Does this conclude your direct testimony in 21
this case? 22
A. Yes, it does. 23
// 24
//25

GROW, DI 35
Idaho Power Company
DECLARATION OF LISA A. GROW 1
I, Lisa A. Grow, declare under penalty of perjury 2
under the laws of the state of Idaho: 3
1. My name is Lisa A. Grow. I am employed by 4
Idaho Power Company as the President and Chief Executive 5
Officer. 6
2. To the best of my knowledge, my pre-filed 7
direct testimony and exhibits are true and accurate. 8
I hereby declare that the above statement is true to 9
the best of my knowledge and belief, and that I understand 10
it is made for use as evidence before the Idaho Public 11
Utilities Commission and is subject to penalty for perjury. 12
SIGNED this 1st day of June 2023, at Boise, Idaho. 13
14
Signed: 15
_____________________ 16
Lisa A. Grow 17
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