IDA Q2 2025: Load Inquiries Jump 30%, Pipeline Tops 3,800 MW
- Robust Demand and Pipeline Expansion: Large load inquiries increased 30% compared to last year, indicating strong market interest in expanding service territory and supporting future load growth.
- Conservative IRP Forecast Upside: Management acknowledged that actual load growth could exceed the IRP estimates, suggesting potential upside as economic activity and new customer investments accelerate.
- Ongoing Customer and Project Expansion: Continued investments such as Micron's phase two fab and rising new customer engagements demonstrate a healthy growth trend that supports a bullish outlook.
- Regulatory Uncertainty: The rate case procedural schedule remains unsettled, and the introduction of new depreciation and interest expense tracking mechanisms poses execution risks that could adversely affect financial outcomes if not approved or implemented as planned.
- Execution and Timing Risks in Capacity Projects: Ambiguity around the precise timing and scale of projects such as the Micron second fab and the Jackalope Wind development, which face potential permitting hurdles, could lead to delays or cost overruns, negatively impacting future earnings.
- Ambiguous Customer Pipeline Metrics: While the pipeline exceeds peak load, there is a lack of detailed clarity on the number of potential connections and how many load additions will ultimately translate into revenue, raising concerns about overestimating future load growth.
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Diluted Earnings Per Share (EPS) | FY 2025 | $5.65 to $5.85 | $5.70 to $5.85 | raised |
Tax Credit Amortization | FY 2025 | $60 million to $77 million | $60 million to $77 million | no change |
Operating and Maintenance (O&M) Expense | FY 2025 | no prior guidance | $465 million to $475 million | no prior guidance |
Capital Expenditures (CapEx) | FY 2025 | no prior guidance | $1 billion to $1.1 billion | no prior guidance |
Hydropower Generation | FY 2025 | no prior guidance | 7 million to 8 million megawatt hours | no prior guidance |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Robust Demand and Load Growth | In Q1 2025, Q3 2024, and Q4 2024, discussions centered on strong customer growth, industrial expansion, record system peaks, and increasing load forecasts ( ). | Q2 2025 highlighted robust demand driven by customer growth with a 2.5% increase, a pipeline exceeding historical peak load, and large load requests to support future growth ( ). | Consistent strong growth with an increased focus on prospective load growth and diversification of customer segments. |
Regulatory Environment | Earlier periods (Q1 2025, Q3 2024, Q4 2024) emphasized rate case filings, reducing regulatory lag, and legislative updates like wildfire acts, with detailed discussions of innovative tracking mechanisms and multiyear strategies ( ). | Q2 2025 continued to address regulatory uncertainty with federal legislation and executive orders affecting renewable projects, and introduced a new depreciation and interest expense tracking mechanism ( ). | Ongoing focus with evolving mechanisms to manage regulatory lag; challenges from legislative actions are now more prominently impacting project approvals. |
Project Execution and CapEx Conversion Risks | Q1 2025, Q3 2024, and Q4 2024 discussed pipeline ambiguity, conservative CapEx forecasts, and execution risks—including transmission project timing delays and regulatory lag impacting cost recovery ( ). | Q2 2025 emphasized a growing customer base with a pipeline that exceeds historical peaks and noted equity transactions planned to support CapEx, while still acknowledging uncertainty in project execution ( ). | Persistent risks with proactive financing strategies; pipeline ambiguity remains while strategic equity moves are undertaken to mitigate conversion risks. |
Financial Metrics and External Financing Pressure | Prior discussions in Q1 2025, Q3 2024, and Q4 2024 noted increasing net income, operating cash flow improvements, credit metrics near downgrade thresholds, and significant external financing needs through equity and debt issuances ( ). | Q2 2025 reported increased net income and EPS, robust operating cash flow, and forward sale agreements totaling significant equity transactions, alongside proposals (e.g. tracking mechanisms) to support credit metrics ( ). | Earnings are improving with strategic financing and regulatory actions, yet high CapEx continues to drive considerable external financing pressure. |
Renewable Energy and Infrastructure Investments | Earlier periods (Q1 2025, Q3 2024, Q4 2024) featured extensive investments in renewables (hydropower, wind, solar, battery storage) and major transmission projects, along with cap-and-growth financing considerations ( ). | Q2 2025 maintained the commitment with ongoing renewable projects and infrastructure investments, while noting challenges from recent federal legislation and executive orders that affect constructability (e.g. Jackalope Wind project) ( ). | A steady drive toward renewables and infrastructure, with an added layer of regulatory challenges impacting project implementation. |
Dispatchable Resource Timeline Risks | Q1 2025 mentioned dispatchable resources targeted for 2029/2030, Q3 2024 noted the need for additional winter resources through the IRP, and Q4 2024 discussed potential delays in transmission projects like Boardman to Hemingway ( ). | Q2 2025 expressed increased uncertainty in dispatchable resource timelines due to federal legislation and executive orders impacting renewable project constructability and prompting alternative resource strategies ( ). | Timeline risks remain a concern with previous scheduling challenges now compounded by new regulatory hurdles, heightening uncertainty in meeting planned resource timelines. |
Wildfire Risk Management | Q1 2025, Q3 2024, and Q4 2024 provided detailed discussions on wildfire mitigation measures including the Wildfire Standard of Care Act, PSPS events, increased mitigation expenses, and regulatory support for recovery of wildfire costs ( ). | Q2 2025 briefly noted an increase in O&M expenses linked to wildfire mitigation and related insurance, indicating ongoing cost pressures ( ). | While wildfire risk remains a consistent issue, the current period’s discussion is less detailed, suggesting stable management but continuous cost pressure in this area. |
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Pipeline Load
Q: How many pipeline connections exist?
A: Management noted that the pipeline exceeds the 3,800 MW peak load figure, driven largely by data centers, though they did not have an exact project count available. -
IRP Growth
Q: Could future IRP load growth be higher?
A: They indicated that current IRP forecasts are conservative and, with ongoing customer interest and strong pipeline data, higher load growth in future IRPs is a distinct possibility. -
Rate Schedule
Q: When is the rate case schedule expected?
A: The team expects a procedural schedule for the rate case within the next few weeks, potentially as early as next week. -
Irrigation Impact
Q: How significant was the irrigation load change?
A: The call mentioned a year-over-year increase in irrigation sales of roughly 15%, mainly due to low precipitation, although weather-adjusted growth remained nearly flat. -
Micron Phase
Q: When will Micron phase two begin?
A: Although the second Micron fab is expected to match the first in size, management is still finalizing timing details with Micron and has not disclosed a specific start date. -
RFP Adjustments
Q: How will RFP numbers adjust with new load?
A: Management explained that RFP selections will continue to reflect evolving load forecasts and project responses, meaning adjustments will be made based on current needs rather than a fixed numerical formula.
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