Idacorp, Inc. · NYSE:IDA
Idacorp — Investor Presentation (September 2019)
53 slides from Idacorp's investor presentation, Sep 30, 2019
Slide 1: Fall 2019 Governance Outreach
Fall 2019 Governance Outreach ~ October 2019
Slide 2: Forward-Looking Statements
N 5 SNSIDACORP Forward-Looking Statements In additionto the historical information contained inthis presentation, this presentation contains (and orallcommunications madeby IDACORP, Inc. and Idaho Power Company may contain) statements, including, without limitation, eamingsguidance and estimated key
Slide 3: Table of Contents
Table of Contents IDACORP at a Glance Strong Track Record Clean Today, Cleaner Tomorrows Best Practice Pay Principles Compensation Design & Metrics for NEOs Robust Target Setting Process Reliability: Targets Stretched ‘Customer Relationship Index: Targets Consistently Increased Net Income Incentive:
Slide 4: IDACORP at a Glance
@NSIDACORP. IDACORP at a Glance IDACORP Financial Snapshot"): * Revenue: $1.37 billion * Diluted earnings per share: $4.49 Revenues by Customer Class (2018) + Eleventh consecutive year of earnings growth + Dividends per share: $2.52 . en + Return on Year-End Equity: 9.6% IDA Fes + Net Utility Plant
Slide 5: Strong Track Record
Strong Track Record Earnings Per Diluted Share °4.49 14% sersre Cumulative 0 Shareholder 11th Consecutive RETURN Year of Growth The Past 3 Years Quarterly Dividend Increase Idaho Power Ranked “Ranked QO nd 123% Increase Since 2011 in JD Power's Electric Residential Customer Satisfaction Study In its
Slide 6: Clean today. Cleaner tomorrow.
Clean today. Cleaner tomorrow.” At Idaho Power, our commitment to serving customers and communities with reliable, affordable energy has been the hallmark of our 100-year history. As we continue the next century of service, we look to build on that foundation with a new and exciting mission: 100% cl
Slide 7: Compensation
Over ion Compensat
Slide 8: Best Practice Pay Principles
Best Practice Pay Principles We tie our executives’ compensation to objectivemeasures of corporate performance, and over one-half of each of our NEOs" target compensation is “at-risk” Our compensation committee reviews and establishes performance metricsannually The compensation committeeconsists so
Slide 9: Compensation Design and Metrics for NEOs
Compensation Design and Metrics for NEOs Emphasis on Pay for Performance SHORT-TERM INCENTIVE 0) IDACORP. Incomehave increasedsignificantly, sevice (ONE YEAR) 100% Retibliy 155 90% customer Balancedscorecerdot financial and sstisacion operstingmeasures. Bo 158 | Ena Adjusted Target performance lerel
Slide 10: Robust Target Setting Process
Robust Target Setting Process Each year the Compensation Comi Customer Relations, and Net Income) in extensive detail with management and IDACORP’s internal subject matter experts. Based on this discussion, the Committee establishes rigorous threshold, target and maximum goals for each performance m
Slide 11: Reliability: Targets Stretched
2.00 1.50 1.00 @NSIDACORP. Reliability: Targets Stretched 10-year average System Average Interruption Frequency Index = 1.45 1.60 x iS ox > he se Ve No o1ag ‘ee 2015 2016 1.65 4.40 445 1.07 \ 2018 2019 [Threshold —=— Target Maximum —e. -Actual Reliability]
Slide 12: Customer Relationship Index: Targets Consistently Increased
Customer Relationship Index (CRI): Targets Consistently Increased 88% re 86.30% y 2 6% ie 85.50% - —- 85% 84.55% ve 7 _—_— 24008 0 —— 7 84% Go > a eal 83.75% 4-year average CRI = 84.49% 2015 2016 2017 2018 2019 [ == Threshord = Target Maximum —s=Aetwal CRI ]
Slide 13: Net Income Incentive: Targeting Optimum Shareholder Return
Net Income Incentive: Targeting Optimum Shareholder Return Electric utilities, such as Idaho Power, are provided an allowed return on ‘equity (ROE) in a given regulatory jurisdiction. Since 2009, idaho Power has regulatory agreement with Idaho's regulatory authorityto providean opportunity for addit
Slide 14: Targets Stretch Internal Forecasts
Targets Stretch Internal Forecasts 10 $230,000 $220,000 's) $210,000 $200,000 $190,000 $180,000 $170,000 $ Above Internal Forecasts (000 $160,000 $150,000 2017 2018 2019 ™Forecast/Budget ™ Eamings Stretch Amount ml Remaining Tax Credits Needed @NSIDACORP. The Internal Forecast is the basis for earni
Slide 15: Net Income Targets Above Budget and Prior Year Target
Net Income Targets Above Budget and Prior Year Target a 225,000 220,000 215,000 210,000 Earnings 205,000 200,000 195,000 190,000 185,000 180,000 Prior Year Actual 2018 m Earnings Target Earnings 2019 Opening Guidance Below this line, tax credits support earnings but are 1d to $25M per year and $45M
Slide 16: Incenting Achievement of Return on Equity
a Incenting Achievement of Return on Equity Variance from allowed Idaho Power ROE in Idaho 2.0% | 4.0% | Allowed ROEin Idaho = currently implied to be 10% Taxcredit mechanism p in place since 2009 5 out of 8 years from 2011 to 2018 Idaho Power earned over its allowed ROE and was required to share be
Slide 17: Total Return Outperforms the Market
Total Return Outperforms the Market B @NSIDACORP. $100 Invested June 30, 2014 —*—IDACORP, Inc. S&P 500 Index == EEL Electric Utilities Index 2014 2015 2016 2017 2018 2019 Period ending June 30 $225 $200 $175 $150 $125 $100
Slide 18: Peer Group Selection Process
@NSIDACORP. Peer Group Selection Process 4 Idaho Power’s low-cost hydropower generation portfolio leads to customer rates well below national averages These low energy rates translate into lower revenue when compared with results that would occur with rates closer to national average rates Thus, usi
Slide 19: Peer Group of Companies Used for Compensation - 2019
Fey Peer Group of Companies Used for Compensation - 2019 Allete Inc. Alliant Energy Corporation Atmos Energy Corporation Avista Corp. Black Hills Corporation El Paso Electric Co. Great Plains Energy Inc. Hawaiian Electric Company Northwestern Corporation OGE Energy Corp. ONE Gas Inc. Pinnacle West C
Slide 20: CEO Compensation Tied to Performance
: : MNSIDACORP. CEO Compensation Tied to Performance ($5,000 $400 $5,000 $5 $350 z $4,000 = $4,000 H $300 _ 3 2 $3,000 $250 4 = $3,000 | £ : a 2 “yg 4 5200 @ 2 % $2,000 wes g $2,000 Ss rf $150 % 5 F 51,000 5 S 51,000 8 si0 E g : 8 So, $50 s $3 20142015, 2016 2017, 2018 2014 2015 2016 2017 2018 =o ee
Slide 21: Award Winning Total Shareholder Returns
Award Winning Total Shareholder Returns Best TSR Best TSR EEI Small-Cap Companies: EEI Small-Cap Companies: 5 years Ended September 30, 2016 5 years Ended September 30, 2018
Slide 22: Governance Practices
Governance Practices
Slide 23: Experienced, Diverse, Independent Directors
Governance Experienced, Diverse, a va pete acre Independent Directors svereese Syetejeteteletete! sa nmittees of the Board of Directors. Energy ty bas «|e Co Sonal HI CS mE — ees [es | er es © eet [ele v v v Z Zz Inlomoton Technolo LI I ° v v eal Estate Investment and Development | e [ v a ter Pub o
Slide 24: Corporate Governance Highlights
rt) Governance Corporate Governance Highlights airman Majority vote resignation policy for 5 en . directors in uncontested elections independent Compensation clawback policy Stock retention requirement for officers Mandatory continuing education requirements for our directors No shareholder rights p
Slide 25: Responsibly Addressing Risk
20 —~ Governance Identify day-to-day risks, processes and mitigation efforts on an enterprise basis and report to Board of Directors and Board Committees Ensure appropriate culture of risk management exists within ‘the company and assist with identifying specific risks ‘Oversee risk management proce
Slide 26: IDACORP's Long-Term Business Strategy and 2019 Initiatives
a The September board meeting each year is dedicated primarily to assessing the company's long-term strategy, industry developments and trends, and metrics used to measure and drive performance. @NSIDACORP. Governance IDACORP’s Long-Term Business Strategy & 2019 Initiatives Focus Areas Initiatives G
Slide 27: Environmental Practices
Environmental Practices
Slide 28: Clean Energy Mix
Environmental 2 Natal es Hytoeectic 73 6% Coal term purchases a ected 6 yo 25% Ot Fl ong Tem Purchases ies 107% 33% 193% One O38 ‘ote 3 ‘About our Long-Term Purchases Idaho Power s committed to supporting renewable energy sources, such a5 wind and solar, and we buy them as part of our energy mix. In
Slide 29: A Foundation of Clean Energy
Environmental A Foundation of Clean Energy Generation Sources and Capacities © Hydroelectric rose A Coat aaueaeae 4 NoturalGas — 7a2000 WASHINGTON solaet pow = wind® aw © Diesel ‘wroming singer ory ura NEVADA 2B ews aeny Snpsanasina Soeoauatal amnion coniasomcan @NSIDACORP. Decreased Idaho Power Coa
Slide 30: A Tradition of Sustainability
ory Environmental @NSIDACORP. Highlights of 2018 Sustainability Report: Adapting to a Changing Climate Y FishHabitatRestoration ‘ion of Sustainability ¥ Hydroelectric Project Operations ¥ Electricity Demand Y Vegetation Management Y CO2Emissionsintensity ¥_£SG Initiatives For information on Idaho Po
Slide 31: Social Practices
Slide 32: Our Commitment to Each Other
Social Diversity in Leadership Board Members Senior Management = Men = Women ™ Men = Women Our Commitment to Each Other At Idaho Power, we are committed to an inclusive environment where we are all valued, respected and given equal consideration for our contributions. We believe that to be successfu
Slide 33: Our Commitment to Safety
Social Our Commitment to Safety a OSHA Recordable Rates 3.5 3 25 1s \ 0.5 I Salty ono ao Power Conny cr vas. ‘or most npn epee dy woe 2000 2014 2015 2016-2017 +2018 Jul 2019 pereonpsrnesnemaenartorsenrmmm FOCUS ASSESS Sein poromed Nowotknso cel et an National Average EI (1k-<2k Employees) ml Idaho P
Slide 34: Our Commitment to Our Customers
7 Social Our Commitment to Our Customers ; Idaho Power n d Jess uy FROM 2005 Level\ Ranked M3 in JD Power's | SAIDI Electric Residential | \ =%rmns Wp Customer Satisfaction Study | \ In its West Midsize Segment \ for Second Year in a Row
Slide 35: Our Commitment to Our Employees
Social SNSIDACORP ocia Our Commitment to Our Employees We work together. We build together. We stand together. Throughout Idaho Power's 100-year history, our skilled and dedicated employees have remained the foundation of our company. They fulfill our commitments to customers, shareowners and each o
Slide 36: Appendix
| Appendix
Slide 37: Why Invest in IDACORP?
Ad GNSIDACORP. Why Invest in IDACORP? _ Constructive =~ ¥ Common Stock Regulatory Environment Dividend Growth Economic ‘Strong Growth Balance Sheet . Sustainable Environmental & Social Cost Control Responsibility Achieving - Record Customer - Return on Equity Satisfaction ccs Hells Canyon Dam, Idaho
Slide 38: Increasing Customer Growth Rate
@SIDACORP. Increasing Customer Growth Rate AD 565,000 Idaho Power Customer Growth ia | Twelve 2015 2016 2017-2018 Ended June 30,2019 —US. Census Bureau, published December 2018 1 me ica (Boise) —Livability.com, published March 2019 — United Van Lines, January 2019 — Milken Institute, January 2019 Ho
Slide 39: Idaho Economic Snapshot
Idaho Economic Snapshot rey $66.28 2% | 833,350 Binswierics ‘Top Emerging Industries Q as 18% rom Joyr Forecasted ‘0 Job Growth $41,312 2" 312 vss Top Traditional Industries oaDAS 5-Year Historic Job Growth ec 2013, 201420152016. 2017,—«2018
Slide 40: Forecasted Average Peak System Load and Resource Capacity 2019-2023
@NSIDACORP. Forecasted Average Peak System Load and Resource Capacity 2019-2023 (mw) 4,100 3,600 3,100 2,600 2,100 Ad —Total Requirements —=Total Capacity
Slide 41: Integrated Resource Plan (IRP)
@NIDACORP. Integrated Resource Plan (IRP) 2019 IRP Load Forecast vs. Prior IRPs Annual Annual Annual Annual Growth Rate: Growth Rate: Growth Rate: Growth Rate: Retail Sales Annual Peak Retail Sales Annual Peak (Billed MWh) Demand (Billed MWh) Demand 2019 1RP 1.3% 1.4% 1.0% 1.2% 2017 IRP 1.1% 1.6% 0.
Slide 42: 2010-2019 Historic Earnings Guidance
2010-2019 Historic Earnings Guidance Mid-Point vs. Actual EPS* @NSIDACORP. feb 24.2088 ax saag ““yunoseas li Mid-Point of Opening Guidance ui Actual Diluted EPS $4.30 $4.0 a2 $3.90 8 $3.70 3.50 set ont aint 53.30 i a Mechnismin place s0 5.39% CAGR $2.90 a im $2.70 $2.50 2010 2011 2012 2013 2014 2015
Slide 43: Common Stock Dividend Growth
Common Stock Dividend Growth “IDACORP’s Board of Directors has approved a dividend increase effective every year since 2012. Cumulatively, these changes represent an increase of 110 percent in IDACORP’s quarterly dividend over that period. As customer and earnings growth has continued, we have also
Slide 44: Sustained Cost Control
ZSIDACORP Sustained Cost Control 2012-2019 O&M Expenses (S Millions) ‘August 1, 2019 Other Operating and Maintenance Expenses Reaffirmed $400 Guidance $350 — $260 saad $364.5 $300 $250 $200 2012 2013 2014 2015 2016 2017 2018 2019 AB
Slide 45: Return on Year-End Equity - IDACORP
@NSIDACORP. Return on Year-End Equity - IDACORP 12% 2015 2016 Shoshone Falls, near Twin Falls, idaho Ag
Slide 46: ADITC Earnings Support/Revenue Sharing Mechanism: Terms Through December 31, 2019
; : SNSIDACORP. ADITC Earnings Support/Revenue Sharing Mechanism: Terms Through December 31, 2019 Existing™ ose If Idaho ROE < 9.5% Abilityto utilizeup | to $25 million of additional ADITCs annually to achieve |—___ daho ROE of 9.5%” Earnings Support Line As of December 31, 2018, Idaho Power has uti
Slide 47: ADITC Earnings Support/Revenue Sharing Mechanism: Sharing Terms Through December 31, 2019
@NSIDACORP. ADITC Earnings Support/Revenue Sharing Mechanism: Sharing Terms Through Existing™ December 31, 2019 Revenue Sharing: If Idaho ROE?) If Idaho ROE >10% saa 5: (OOD Benefit per $1: ay sa Future rate reduction Idaho Power ® Eamings Benefit per $1: Benefit $126.2 million shared with Idaho cus
Slide 48: ADITC Earnings Support/Revenue Sharing Mechanism: Terms Beginning January 1, 2020
: @SIDACORP. ADITC Earnings Support/Revenue Shari ng Mechanism: Terms Beginning January 1, 2020 As Approved) aN If Idaho ROE < 9.4% _t | Earnings Support Line Ability to utilizeup | to $25 million of additional ADITCs annually to achieve Ifthe Idaho Public Utilities Commission were to approve a chan
Slide 49: ADITC Earnings Support/Revenue Sharing Mechanism: Sharing Terms Beginning January 1, 2020
@NSIDACORP. ADITC Earnings Support/Revenue Sharing Mechanism: As Approved() Revenue Sharing: Customer If Idaho ROE > 10%!) Sharing Terms Beginning January 1, 2020 >10.5% GO If Idaho ROE Benefit per $1: Pension Future rate reduction @ eae stata Idaho Power — _ Benefit per $1: 2) Benefit ® Benefit $12
Slide 50: 2019 Earnings Per Share Guidance and Estimated Key Financial and Operating Metrics
@NSIDACORP. 2019 Earnings Per Share Guidance & Estimated Key Financial & Operating Metrics (Millions Except for Per Share Amounts) 2019 Estimates Current!) Previous’) IDACORP Earnings Per Diluted Share Guidance $ 4.35-$ 4.50 $ 4.30-$ 4.45 Idaho Power Additional Amortization of Accumulated No Change
Slide 51: Capital Expenditures Forecast 2019-2023
A K @NSIDACORP. Capital Expenditures Forecast") 2019 — 2023 ($ Millions) oe Approximately $300M* 50 0 2019 2020 2021-2023 W Distribution ($85-§105M) Hydro ($50-§70M) *Amounts do not include potential long- Transmission ($35-$65M) Ml General Plant ($40-$60M) term project additions beyond 2020 fa Ther
Slide 52: Strong Financial Position: Debt Maturity Profile
0) : : = IDACORP. Strong Financial Position Debt Maturity Profile ($ Millions) Long-term Baal BBB Issuer Rating Short-term P.2 A2 P.2 A2 Outlook Stable Stable Stable Stable Manageable refinancing needs ‘and faa a Lid tho Li 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2
Slide 53: Contact Information
Contact Information rev Justin S. Forsberg Director of Investor Relations & Treasury (208) 388-2728 JForsberg@idacorpinc.com Patrick A. Harrington Corporate Secretary (208) 388-2878 PHarrington@idahopower.com Board of Directors idacorpinc.com/governance/contact-the-board @NSIDACORP. WWWIDACORPINC.CO