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IDIDA

IDACORP (IDA) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Utilities· Jul 30, 2026

Source: earnings call transcript

Executive summary

IDACORP Q2 FY26 — Strong Load Growth Drives EPS Guidance Increase and Capital Investment

IDACORP delivered strong Q2 FY26 results, driven by robust customer and industrial load growth, particularly from large contract customers like Micron and Meta. The company raised its full-year EPS guidance and continues to execute on significant capital projects, including battery storage and transmission, to meet increasing demand. Management emphasizes sustainable growth and prudent capital allocation while navigating high SMR pricing and ongoing wildfire mitigation efforts.

Highlights

5

  • Diluted EPS increased to $1.79 in Q2 FY26 compared to $1.76 in Q2 FY25.

  • Full-year diluted EPS guidance raised by $0.05 to a new range of $6.30 to $6.45.

  • Customer count increased by 2.3% since Q2 FY25, with industrial revenues up 17% year-over-year.

  • Less than $15 million of additional tax credit amortization expected for FY26, a reduction from less than $30 million previously.

  • 250 MW of new company-owned battery storage brought online, marking the fourth straight year of battery additions.

Concerns

4

  • O&M expense increased by almost $12 million in Q2, driven by deferred costs and wildfire mitigation.

  • Hydropower generation guidance trimmed by 0.5 million MWh off the top end due to dry conditions in May and June.

  • SMR technology pricing is currently high, estimated over $150/MWh, making it less attractive for immediate adoption.

  • A wildfire incident in Mountain Home, though small and not material, highlights ongoing risk.

Guidance & targets

CategoryTargetConfidence
IDACORP Diluted EPS
$6.30 to $6.45
high materiality
High
Idaho Power Additional Tax Credit Amortization
less than $15 million
medium materiality
High
O&M Expense
$525 million to $535 million
medium materiality
High
Capital Expenditure
$1.3 billion and $1.5 billion
high materiality
High
Hydropower Generation
5.5 million to 6.5 million megawatt hours
medium materiality
Medium
B2H Transmission Project In-Service Date
late 2027
medium materiality
High
SWIP North Transmission Project Completion
2028
medium materiality
High
Gateway West Transmission Project In-Service Date (Partial)
as soon as 2028
medium materiality
Medium
Bennett Mountain Power Plant Expansion In-Service Date
2028
medium materiality
High
South Hills Project In-Service Date
2029
medium materiality
High
Peregrine Project In-Service Date
2030
medium materiality
High
Oregon Distribution System Sale Close
spring of 2027
low materiality
Medium
2032 RFP Final Shortlist
third quarter
medium materiality
High
Equity Content Funding Need
around $2 billion
high materiality
High
Equity Needs Solved (Current Plan)
roughly half
high materiality
High
Equity Needs Coverage
into 2027
high materiality
High
Incremental CapEx Financing Mix
roughly equal basis for incremental CapEx with the goal of keeping our balance sheet strong
medium materiality
High
Next Rate Case Filing
relatively probable
high materiality
Medium

Orderbook & backlog

Large Customer Pipeline multiple gigawatts Q2 FY26

Businesses across multiple industries looking to operate in the region. Not static, new requests fill space as others go into construction.

Deals & partnerships

OTEC Sale of Oregon distribution system assets

Applications filed with Oregon Commission, Idaho Commission, and FERC for approval.

Micron Energy service agreement for Fab 1 expansion and Fab 2 development

Micron's Fab 1 revenues started in June. Negotiations for Fab 2 ESA are very active, ground preparations started.

Meta Energy service agreement for new data center

Part of the large contract customers driving industrial revenue growth.

Capital programs

Boardman-to-Hemingway (B2H) Transmission Project underway
Spent to date: 70% of 1,300 structure pads completed; over 400 towers built

Benefit:critical system flexibility, access to diverse markets, transmission wheeling revenues

Work progressing nicely, stringing wire started.

SWIP North Transmission Project underway
Start: recently

Benefit:critical system flexibility, access to diverse markets, transmission wheeling revenues

Received CPCN from Idaho Commission, construction recently started in Nevada.

Gateway West Transmission Project underway

Benefit:critical system flexibility, access to diverse markets, transmission wheeling revenues

Joint request for CPCN filed with IPUC with PacifiCorp.

Bennett Mountain Power Plant Expansion underway

Benefit:167 MW (natural gas)

Construction underway, secured CPCN and air permit, EPC contract in place. Will help meet near-term capacity deficit.

South Hills Project planned

Benefit:222 MW (natural gas)

CPCN filed. Will help meet near-term capacity deficit.

Peregrine Project planned

Benefit:430 MW (natural gas)

CPCN filed. Will help meet near-term capacity deficit.

2032 RFP Resource Procurement under evaluation

Benefit:Minimum 200 MW per year (perfect capacity), likely higher to meet new loads

Evaluating bids, shortlist expected Q3 FY26. Includes 6 self-bid gas projects and 2 storage projects.

Risks & headwinds

Wildfire incidents and associated costs Ongoing

Relatively small fire in Mountain Home, not material impact to company

Mitigation:Approved 2026 wildfire mitigation plan, which is being implemented and followed. Standard of Care Act in Idaho applies to the plan.

Lower hydropower generation due to dry weather May and June 2026, remainder of FY26

Trimmed 0.5 million MWh off the top end of FY26 guidance

Mitigation:Guidance adjusted to reflect current forecast of hydropower operating conditions and normal weather for rest of year.

High cost and limited commercial availability of Small Modular Reactor (SMR) technology Current and near-term

Pricing likely over $150/MWh

Mitigation:Company continues to evaluate technologies but will not be an early adopter due to cost and timing; focusing on least cost, least risk answers.

Regulatory uncertainty for rate case Early 2027 for decision, June 2027 for potential filing

Decision to file a rate case in June 2027 is 'relatively probable' but depends on QIP conversion and large load revenues.

Mitigation:Ongoing evaluation of financial needs, plant in service conversion, customer affordability, and ADITC mechanism usage. Avoiding trackers that shift costs unfairly.

Capital expenditure growth beyond current plan Next 5-year window and beyond

Current CapEx forecast does not include Micron Fab 2 or other promising loads; QIP balance over $1.8 billion.

Mitigation:Actively working through RFP, load forecast updates, and annual capital budgeting. Planning to blend debt and equity equally for incremental CapEx; exploring upfront payments from customers.

What to watch in Q3 FY26

2032 RFP Final Shortlist

Q3 FY26
Current Bids submitted, review team narrowing contenders.
Target Final shortlist announced.

Why it matters

This will indicate the potential generation resources and their types (gas, storage) to meet future load growth, impacting long-term capital plans and resource mix.

We expect to have a final shortlist in the third quarter and begin contract negotiations soon thereafter.

Find out whether IDA delivers this. Inve re-checks your case every morning.

Q&A highlights

Is the current pace of battery deployment sustainable, and is gas plus batteries the long-term solution, or are SMRs being considered?

The pace of battery deployment is high, but batteries are not a complete solution due to operating characteristics (e.g., 4-hour duration). The near-term plan includes more gas projects (Bennett 2, South Hills, Peregrine) and solar. SMR technology is liked, but current pricing (over $150/MWh) and commercial availability are prohibitive. Transmission projects are also a big part of the plan.

“Our summary is that we like the SMR technology. At this time, we don't love the pricing, which, as you probably know, is likely over $150 a megawatt hour at this point.”

asked by Whitney Mutalemwa · answered by Adam Richins

3 min read 7 chapters

Detailed narrative

Strong Customer and Load Growth

IDACORP continues to experience robust customer growth, with a 2.3% increase since Q2 FY25 across all segments. Industrial revenues surged by 17% year-over-year, driven by large contract customers like Micron and Meta, whose projects are now ramping up. The company's large customer pipeline remains strong at multiple gigawatts, attracting businesses across various industries to the region, and is a key driver helping to avoid a 2026 general rate case.

Strategic Capital Investments

The company is actively executing on significant capital projects to meet growing energy demand and enhance grid reliability. This includes bringing 250 MW of new company-owned battery storage online, completing the conversion of Valmy Unit 2 from coal to natural gas, and commissioning a 125 MW third-party solar project. These resources support efforts to add capacity, flexibility, and reliable, affordable energy to serve the growing regions.

Transmission Infrastructure Development

IDACORP is progressing on three major transmission projects: Boardman-to-Hemingway (B2H), SWIP North, and Gateway West. B2H is 70% complete on structure pads and is expected in service by late 2027. SWIP North construction has begun in Nevada with completion expected in 2028. A portion of Gateway West is also anticipated to come online as soon as 2028, providing critical system flexibility and market access.

Future Generation Resource Planning

Construction is underway for three company-owned natural gas fuel projects: a 167 MW resource at Bennett Mountain (2028 in-service), the 222 MW South Hills project (2029), and the 430 MW Peregrine project (2030). The company is also evaluating bids for its 2032 RFP, with a shortlist expected in Q3, and is considering increasing resource procurement to accommodate incremental loads like Micron Fab 2, which is not yet in current forecasts.

Financing and Balance Sheet Management

IDACORP has identified a need for approximately $2 billion in equity content over the next five years to fund its current capital plan, having already secured about half of this amount through ATM forward sale agreements. The company plans to blend debt and equity on a roughly equal basis for incremental CapEx to maintain a strong balance sheet, preferring regular-way financing over holding company debt to preserve credit ratings and avoid unnecessary complications.

Regulatory Strategy and Rate Case Outlook

The company anticipates a "relatively probable" rate case filing around June 2027, driven by significant Construction Work in Progress (QIP) converting to plant in service and associated depreciation. However, large load revenues are helping to cover costs, and the ADITC mechanism provides flexibility. Management is cautious about depreciation or interest trackers, ensuring costs are not shifted unfairly to other customer classes, and will evaluate the math early in 2027.

SMR Technology Evaluation

While IDACORP acknowledges the potential of Small Modular Reactor (SMR) technology and has spent time learning about it, current pricing (estimated over $150/MWh) and commercial availability make it less attractive for immediate deployment. The company continues to monitor SMR developments but is not expected to be an early adopter due to cost and timing considerations, prioritizing least-cost, least-risk solutions for its load.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.