SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) May 27, 2004
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Exact name of registrants as
specified in their charters, address IRS Employer
Commission of principal executive offices and Identification
File Number registrants' telephone number Number
- ---------------- ----------------------------------------- ------------------
1-14465 IDACORP, Inc. 82-0505802
1-3198 Idaho Power Company 82-0130980
1221 W. Idaho Street
Boise, ID 83702-5627
(208) 388-2200
State or Other Jurisdiction of Incorporation: Idaho
None
- --------------------------------------------------------------------------------
Former name or former address, if changed since last report.
IDACORP, Inc.
IDAHO POWER COMPANY
Form 8-K
Item 5. OTHER EVENTS AND REGULATION FD DISCLOSURE.
Moody's Places Ratings of IDACORP and IPC Under Review for Possible Downgrade
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On June 8, 2004, Moody's Investors Service (Moody's) placed the long-term
ratings of IDACORP, Inc. and the long-term and short-term ratings of Idaho Power
Company (IPC) under review for possible downgrade. Any downgrade would be
expected to increase the cost of new debt and other issued securities going
forward.
Moody's stated that their review of the ratings reflected concerns about 1) the
lower than expected rate increase granted in Idaho Power's general rate case; 2)
potentially higher external funding for Idaho Power's estimated capital
expenditures of $643 million over the next three years; and 3) the fifth year of
drought conditions and resulting higher costs of power supply.
The following outlines the current Standard & Poor's Ratings Services (Standard
& Poor's), Moody's and Fitch Inc. (Fitch) ratings of IDACORP's and IPC's
securities, with the ratings currently under review by Moody's marked with an
asterisk:
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Standard and Poor's Moody's Fitch
- --------------------------------------------------------------------------------
IPC IDACORP IPC IDACORP IPC IDACORP
- --------------------------------------------------------------------------------
Corporate A- A- A3* Baa1* None None
Credit
Rating
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Senior A None A2* None A None
Secured Debt
- --------------------------------------------------------------------------------
Senior BBB+ BBB+ A3* Baa 1* A- BBB+
Unsecured
Debt
- --------------------------------------------------------------------------------
Preferred BBB None Baa2* None BBB+ None
Stock
- --------------------------------------------------------------------------------
Trust None BBB None Baa2* None BBB
Preferred
Stock
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Short-Term BBB+/A-2 None A3/ None None None
Tax-Exempt VMIG-1*
Debt
- --------------------------------------------------------------------------------
Commercial A-2 A-2 P-1* P-2 F-1 F-2
Paper
- --------------------------------------------------------------------------------
Rating Stable Stable Negative Negative Stable Stable
Outlook
- --------------------------------------------------------------------------------
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These security ratings reflect the views of the rating agencies. An explanation
of the significance of these ratings may be obtained from each rating agency.
Such ratings are not a recommendation to buy, sell or hold securities. Any
rating can be revised upward or downward or withdrawn at any time by a rating
agency if it decides that the circumstances warrant the change. Each rating
should be evaluated independently of any other rating.
Idaho Supreme Court Denies IPUC's Petition for Rehearing
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On May 27, 2004, the Idaho Supreme Court issued an order denying the Idaho
Public Utilities Commission's (IPUC) petition for rehearing of the Court's
opinion released March 30, 2004. In the March 30 opinion, the Court vacated an
IPUC order denying IPC's recovery of reduced/lost revenues resulting from IPC's
Irrigation Load Reduction Program (Program). The Program was implemented, with
IPUC approval, to encourage IPC's large irrigation customers to reduce their
energy consumption during the 2001 growing season. While the IPUC allowed IPC to
recover the direct costs of the Program under the annual 2002-2003 Power Cost
Adjustment, the IPUC issued an order on April 15, 2002 denying IPC's request to
recover reduced/lost revenues resulting from the Program. In May 2002, IPC filed
a Petition for Reconsideration, which the IPUC denied in August 2002. As a
result of this decision, IPC expensed approximately $12 million and appealed the
decision to the Court.
The matter has now been remanded to the IPUC to determine the amount of
reduced/lost revenues to be recovered by IPC in connection with the Program. IPC
had submitted its calculation of reduced/lost revenues of $12 million in the
earlier IPUC proceeding, and upon remand will again request recovery of this
amount. IPC cannot predict what level of recovery it will receive or the timing
of such recovery.
Certain statements contained in this current report on Form 8-K, including
statements with respect to future earnings, ongoing operations, and financial
conditions, are "forward-looking statements" within the meaning of federal
securities laws. Although IDACORP and Idaho Power believe that the expectations
and assumptions reflected in these forward-looking statements are reasonable,
these statements involve a number of risks and uncertainties, and actual results
may differ materially from the results discussed in the statements. Important
factors that could cause actual results to differ materially from the
forward-looking statements include: changes in governmental policies and
regulatory actions, including those of the Federal Energy Regulatory Commission,
the Idaho Public Utilities Commission and the Oregon Public Utility Commission,
with respect to allowed rates of return, industry and rate structure,
acquisition and disposal of assets and facilities, operation and construction of
plant facilities, relicensing of hydroelectric projects, recovery of purchased
power, recovery of other capital investments, and present or prospective
wholesale and retail competition (including but not limited to retail wheeling
and transmission costs) and other refund proceedings; litigation resulting from
the energy situation in the western United States; economic, geographic and
political factors and risks; changes in and compliance with environmental and
safety laws and policies; weather variations affecting customer energy usage;
operating performance of plants and other facilities; system conditions and
operating costs; population growth rates and demographic patterns; pricing and
transportation of commodities; market demand and prices for energy, including
structural market changes; changes in capacity and fuel availability and prices;
changes in tax rates or policies, interest rates or rates of inflation; changes
in actuarial assumptions; adoption of or changes in
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critical accounting policies or estimates; exposure to operational, market and
credit risk; changes in operating expenses and capital expenditures; capital
market conditions; rating actions by Moody's, Standard & Poor's and Fitch;
competition for new energy development opportunities; results of financing
efforts, including the ability to obtain financing on favorable terms, which can
be affected by various factors, including credit ratings and general economic
conditions; natural disasters, acts of war or terrorism; increasing health care
costs and the resulting effect on health insurance premiums paid for employees
and on the obligation to provide post retirement health care benefits;
increasing costs of insurance, changes in coverage terms and the ability to
obtain insurance; technological developments that could affect the operation and
prospects of our subsidiaries or their competitors; legal and administrative
proceedings (whether civil or criminal) and settlements that influence business
and profitability; and new accounting or Securities and Exchange Commission
requirements, or new interpretation or application of existing requirements. Any
such forward-looking statements should be considered in light of such factors
and others noted in the companies' Form 10-K for the year 2003, the Quarterly
Report on Form 10-Q for the quarter ended March 31, 2004 and other reports on
file with the Securities and Exchange Commission.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
Dated: June 9, 2004
IDACORP, Inc.
By:/s/Darrel T. Anderson
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Darrel T. Anderson
Vice President, Chief Financial
Officer and Treasurer
IDAHO POWER COMPANY
By:/s/Darrel T. Anderson
------------------
Darrel T. Anderson
Vice President, Chief Financial
Officer and Treasurer
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