Welcome to IDACORP's Third Quarter 2016 Conference Call. Today's call is being recorded and webcast live. A complete replay will be available from the end of the day for a period of 12 months on the Company's Web site at idacorpinc.com. [Operator Instructions] At this time, I will turn the call over to Justin Forsberg, Director of Investor Relations.

Thanks Takia. Before the markets opened today, we issued and posted to the IDACORP Web site our earnings release and Form 10-Q for the third quarter of 2016. The slides we’ll be using to supplement today's call are also on our Web site and will continue to be available for the next 12 months. We'll refer to these slides as we present today's update. As shown on Slide 2, on today's call we have Darrel Anderson, our President and Chief Executive Officer; and Steve Keen, Senior Vice President, Chief Financial Officer and Treasurer along with other individuals available to help answer your questions during the question-and-answer period. As noted on Slide 3, our presentation today will include forward-looking statements. While these forward-looking statements represent our current judgment or opinion of what the future holds, these statements are subject to risks and uncertainties that may cause actual results to differ materially from statements made today. So, we caution you against placing undue reliance on any forward-looking statements. The forward-looking statements listed on Slide 3 are described in more detail in our filings with the Securities and Exchange Commission, which we encourage you to review. On Slide 4, we present our quarterly financial results. IDACORP's 2016 third quarter earnings per diluted share were $1.65, an increase of $0.19 per share from last year's third quarter. For the first nine months of 2016, earnings per diluted share were $3.28, $0.04 more than for the same period in 2015. I will now turn the presentation over to Steve who will discuss the results in greater detail and we’ll review our revised 2016 key operating metrics.

Thanks Justin. We had a solid third quarter. Weather was near-normal but more moderate than last year lowering usage per customer and impacting energy sales. This was partially offset by continuing customer growth was positively contributed to operating income for the period. We believe the outlook for IDACORP's utility business remained strong, we're focused on managing cost and achieving growth for our owners. On Slide 5 you’ll see a reconciliation of the $9.8 million increase in net income from third quarter 2015 to the third quarter 2016. Addressing those quarter-over-quarter changes, customer growth in our service area increased operating income by $3.6 million. However, decreased usage per customer primarily related to weather more than offset that growth and lowered operating income by $4.1 million. An additional $3.9 million revenue decline in this quarter was primarily a result of lower peak demand-based revenue from irrigation customers to the mild weather. Other changes in operating revenue were primarily related to two factors. First, the fixed cost adjustment mechanism or FCA revenues increased by $2.1 million this quarter. We believe that the application of the FCA is working in a manner in which it was intended to assist recovery of fixed cost from residential and small commercial customers. The second factor was a $3.1 million increase in other operating and maintenance expenses primarily related to higher variable employee costs based on the expected achievement of customer satisfaction and reliability goals. Despite the increase for this quarter we are lowering our full year O&M range by $5 million. Overall Idaho Power's third quarter operating income decreased $6.7 million year-over-year. Lower operating income was more than offset by higher quarterly earnings from the Bridger Coal Company of $6.8 million contributing to an increase in Idaho Power's net income. The higher income was driven by timing…

Thanks Steve and good afternoon everyone. I want to start today with an economic new from our state. As of the end of September, Idaho’s unemployment rate held at 3.8% which was substantially lower than the national rate of 5%. There are also positive indictors coming out of the business community in Idaho Power service area. At the end of September, grocery giant Albertsons announced it is expanding its Boise headquarters. The move is expected to bring 300 new jobs and an estimated $38 million in additional state tax revenues to Idaho. Clif Bar which is located in the Magic Valley opened its new $90 million bakery at the end of August. The 300,000 square foot facility employees over 200 people. And the FBI is poised to expand its presence in the eastern part of Idaho with plans to build a facility in Pocatello. A 100,000 square foot $10 million facility will have a capacity of more than 5 megawatts. Side 8 includes several points of recognition that Idaho and the Boise area have received over the past several months. Idaho continued to receive positive medial acknowledgment during the quarter. On CNBC's top stage for business list what they call a score card on state economic climate, Idaho was ranked number 15 overall. We received high rankings in several breakout categories on the July 30 list, earning number 5 in business friendliness, number 6 in cost of doing business and number 7 in cost of living. We also received high marks in the economy category coming in at number 12. It seems that more and more people outside of Idaho are learning what those of us who live here have known for a long time it's a great place to live. For the 12 months ended September 30, 2016 Idaho…

[Operator Instructions] And our first question comes from Chris Ellinghaus at Williams Capital. Your line is now open.

Hi guys, how are you?

We just thank you before you take off. We appreciate you're picking up coverage. We want to welcome William Capital to call.

My pleasure. Thank you. Can you talk about the fourth quarter for Bridger Coal last year? Was that normal and you mentioned you expect lower prices in the fourth quarter, is that relative to last year? Is that relative to what your exceptional third quarter was?

Chris I think the best way to answer this, I’ll point you back to actual 10-K in the last year paid 78, there's a breakout within Idaho Power. That really shows the earnings of unconsolidated equity method investments for Idaho Power company, which is primarily Bridger Coal and it gives you a three-year look and if you look at that page you'll see that varied from $10.2 million and $13 million, $10.8 million and $14 million and it was low last year, $9.7 million or $9.8 million. So it varies in and around that $10 million mark, it’s actually little over $10 million I think is the target they aim for. Last year being low, I’m guessing last year's fourth quarter was probably not high and its similar to the way that PCA mechanism ebbs and flows and adjust as their low one year, they make up for some of the next year and it's not a perfect science and how you allocate the cost over expected Colburn. So it’s adjusted, they see what happened in the quarter and you just off of that quarter. So what we're expecting is that you’ll see us moderate down towards that year-end number in this coming fourth quarter - those product there.

Okay. From the irrigation numbers in the third quarter that it was very dry and can you just sort of discuss that?

It was somewhat driver, but we feel like the temperatures had probably more to do with the lower peak that we saw out of irrigation use. It just was a fairly mild summer. We didn't get that blistering hot days that make them, keep their irrigation on as long as they typically do. So we have dry summers typically and it was certainly dry through the portion of this summer as well, but I think we've identified up more than as a temperature issue this year.

Chris, this is Darrell, just to add to that a little bit on irrigation side. I think of needed it keep in consideration it from year-to-year irrigation - the mix of crops that the farmers use changing from year-to-year depending on what they think availability of water is going to be, how long they're going to have water so you’re going to be more or less intensive water usage depending on crops, depending on how much water they might have. So there are number of different variable that impact that irrigation number and as we looked in this last summer, there was a sense - there was a belief that water was going to be adequate for a growing season, new early enough. So they could grow a little longer and expect water to be around a little longer. So that does change from year-to-year. And as to the other point, Steve said, we didn’t have the extended top spill that really would require the farmers to put extra water on either. So there is some - there is a lot of variables - we didn't really have those big peak number that hit as from the standpoint on the irrigation side.

Okay. And one more question and I’ll hop back in the queue? The IFS sales, do you anticipate IFS having any additional property sales in this foreseeable future?

Chris, that's a good question. You see as a fairly modest number and we haven't had the number of that size for quite some time. I would say there is possibility of other cash distribution. They have been difficult to predict when and there are very much subject to market conditions and we are a limited partner in a partnership that owns another limited partnership. So it’s we’re pretty much a taker in terms of what comes out of that. So it isn’t an item that we have really banked on our projected but when they come they do help with the accounting method that we’re following.

And taxes get paid at the partnership level I assume.

We get a partnership return that shows an income or loss and that's consolidated in with our other tax.

Okay great. Thanks.

Thank you. And our next questions will comes the line of Brian Russo with Ladenburg Thalmann. Your line is now open.

Hi, good afternoon Just curious on the Bridger Coal, I mean is this - the pricing to be down in 4Q versus 3Q, I mean is that planned so to speak or you knew in advance that that's how the quarters would shake out.

No, I would say we’ve, especially if you would step back at the beginning of the year we were planning on where we’d still expect to end in the final number but between quarters that’s the shift that we didn't plan for that. It rolled out differently in terms of what they estimated for costs allocated over whatever the burn actually happened to be and the weather within a given year impacts how much that plant gets used. And sometimes they use more, sometimes they’ll use less as they’re estimating a cost that’s spread over that they don't get it perfect. But as I say it through us so what does happen is that it comes back to be fairly near our full year number. That number we have been planning on and we still think that fits well inside the numbers that we’ve given in for guidance.

I am sorry, go ahead.

I believe it is a quarter to quarter issue. This isn’t something we're looking at the shift for the year and this one may be a little bigger than some but that if you look at those prior years you'll see that it shifted around before, just hasn’t always jumped out quite the same.

Okay, great. And then any update on the scrubber recovery strategy.

Yes, Brian this is Darrell. So right now we are not planning any one off sort of filing it with respect to the SCRs at this point. And there is nothing in the works along those lines to take that on an one off basis.

Okay great. Thank you.

Thank you. And our next question will come from Paul Ridzon with KeyBanc. Your line is now open.

So just back to Jim Bridger year-to-date you are up 4.5 million and that implies that you expect the fourth quarter to have a $.5 million headwind relative to last year to flatten out the year?

It’s going to be down whether it exactly that much that’s partly why I gave you. If you flip your – if you pull your K when you’re done and go back page 78, you’ll see that my guess is last year we ended on the low side, there is probably some probability we won't get all the way down to the target. But it will be moderating back towards that and it will finish whatever it doesn’t pickup in the fourth quarter as it moves into next year with the goal that all the years end up in and around 10 million.

Well this Darrel. If you look at we’re at year-to-date through September and we’re sitting at about $11.5 million today. So you think about that in the context of something around 10 millionish plus or minus you could argue that there is about 1.5 million or so headwind plus or minus the incentives looking at the fourth quarter for us. But that’s all incorporated into the guidance that Steve talked about earlier.

Okay, thank you, that helps. And then Slide 5, the $4.1 million lower usage and then a $2.1 million FCA. Are those - I mean is that the 4.1 what you actually realize and then the 2.1 helps to offset that from a regulatory standpoint?

Yes, I think partly what you might be picking up there is the FCA doesn’t get all customers and another point that worth point out the FCA it does adjust that average rate and what we experience in terms of the weather moderation can often be at our top rate for instance the residential customer if they are a customer that gets into Tier 3 and they use less it’s Tier 3 revenue that we lose yet the FCA replace it based on a blended average of volume rates so that’s little imperfect there.

So in extreme cases where you’re coming off extremely it's left less perfect.

That’s a good way to put it but it is working as planned and it's a really valuable mechanism and it does replace a good part of your exposure. And we use moderate a couple times in our script. This was just a year we didn't have those. It didn't get as extreme even the days that contributed to cooling degree days they just weren’t quite as extreme. It was a little warmer overall but it wasn't - you didn't get as many 100-degree plus days like we have seen in the last few years.

What are your latest thoughts on the regulatory front. You mentioned in your script you’re looking to preserve the ADITCs. Does that mean you could be pushing out potential rate case?

I think right now Paul what we’re looking at is, we don’t have any intention right now for a filing over the next 12 months. As we sit here today we don't anticipate that and as Steve said earlier we’re doing everything we can do that, to minimize the utilization of credits and so what we will continue to look and assess I’ll say you today that we’re not planning but it doesn’t mean that if things change we might do it but right now we don’t have plans over the next 12 months to make a filing. Part of it we believe - Paul just to add. Part of that too as we continue - as I talked about growth earlier we think that growth helps to keep us out and so growth were to slow down we would have to reassess.

Any new economic development projects to keep in mind here next 12 to 18 months.

I talk about a few of them. From time to time we talk about these projects and a lot of them have long lead times and so what I would tell you is there is a fair number of these things we’ve seen actually will begin we expect to start taking load, taking service in 2017. So we’ve seen an uptick in that activity it’s just that a lot of it’s under construction today and I would suggest an anecdotal for most of you who have been to Boise, we've got just in the down town four hotels that are under construction right now all of which will generally come in service in sometime in 2017. But four brand new places for folks to stay which will then we think will attract other folks here but that wasn’t here a year ago. And so those types of things, those types of things are happening across the property. The question for us in trying to predict what load will be coming with all this new construction and that's a thing that we are challenged with the fact that Steve talked earlier about the challenges associated with decreased in usage for customers so there's that piece about there too with efficiencies that are going on. So some would suggest we have conservative growth numbers but we’re trying to be as realistic as possible with based on what we see. And until we see otherwise we generally are pretty conservative that way.

Thank you very much.

Thank you. And we have a follow-up from the line of Chris Ellinghaus with William Capital. Your line is now open.

Thank you. Guys you have a very good problem in terms of your - you have a growing free cash flow production and you have an equity layer that’s at 55% this quarter. Could you just talk about how you think about that plans to manage it for the future.

Well, Chris, as you say that it is a good thing to have that growth and that growth is what we're using to attempt to pay for the fact that we're looking at new customers and we've had inflation like everybody else that works against those numbers. While we have focused on our management of O&M it's really hard to keep it at zero. And so what gives us the opportunity to not go back and put pressure on customer rates as often is that growth. And I would say that's really been our model we've targeted this trying to live within what that brings and to not overspend. And as you know our mechanism works such that in a way it lifts our earnings year to year because it takes the year-end equity and it applies your return on it and just trying to keep up with that that growth has been an important element. But if you look at our history we've paid out some really large amount of sharing and those have gotten smaller, the years have gone on, we’ll find ourselves in the year right now where we are kind of on the cost whether we will use credits or not. I think it's - that growth story is a good one, but trying to live within that's really a challenge. It's - well, we like that it isn’t like that much extra money that make things easy, it's actually really quite difficult to live within the growth - with the revenues that provides. But that's why we are doing that, and I think in doing that we've been able to not go back to our customers quite as often as might have been expected.

Right, okay. The growth in customers continues to accelerate a little bit. Yet the last IRP anyway had a fairly modest load growth. Two questions, one, can we infer that the difference between your customer growth and sort of that last IRP I think the load growth was 1.1%. Is sort of your estimate of usage, sort of degradation? And two, since you've been maintaining this higher customer growth for over a year now, do you anticipate that the next IRP will be a little more robust in terms of load growth expectations?

Well, Chris in this quarter's 10-Q we have a table and if you have chance to look at it, but it's got the assumptions built in there for the last three IRPs including our 2017 IRP. And we are showing in the near term in the five-year window is about 1.3% retail sales growth, the 20 year number is 1%. So on the - those first five years we do see a 1.3% growth number and built into that number is it's somewhere between 50 to 60 basis points of reduced usage per customer due to energy efficiency and those sort of things. So that takes that into account on a net basis, so without obviously we would be looking something on actual sales number or somewhere two percentage or so, but we do take into account that those other aspects and so we are in the 17 IRP or in the five-year window was 1.3. And that's around page 34 of the 10-Q if you have a copy in and around that page.

Okay, great.

The other thing is looking at our - as we've done our forecast our slope on our current forecast is pretty similar to what we had before. And there may be an element to what Darrel referred to in that the growth the customers are here, but the load maybe just a little behind that and we're not sure how much that plays into the full equation and time will tell.

And are you expecting that 50, 60 basis points of usage efficiency declination to the sort of a steady-state or does that decline over time?

Chris, that is a great question. And that is something we continue to look at and trying to understand where technology goes as logic would tell you at some point its planned out because it doesn’t get to zero we don’t think. But we still going to use and so I think it's a good question. We are using our best estimates today to trying to figure out what that is and we don't know what the next which bank thing is going to come that may provide even more efficiencies so we just have to, this is our best estimate as we said it today.

Okay. You were talking about new hotels for next year, do you have any idea what a typical hotel looks like in terms of load, I know you don't know what next year brings exactly, but you must have some experience with historical new properties?

I can - we have Vern Porter, he is here, who is part of our customer side of the business, heads up the customer operations side. I'll let him comment and qualifying this with. Again these are varying difference sizes of hotels that he can I think give a sense as to something in that neighborhood.

Hi, Chris. Just based on some of the other hotels that we have in the area downtown here, I would get in or around maybe a half a megawatt for a hotel that size which is the significant amount of load.

Okay. That's interesting. Okay. Well, thanks for your comments, guys. I appreciate it.

[Operator Instructions] That concludes the question-and-answer session for today. Mr. Anderson I will turn the conference back over to you.

First, I'd like to thank everybody for participating on our call this afternoon and your continued interest in our company. We look forward to seeing many of you at the EEI Financial Conference in a week or so. Thanks and hope you have a great day. Thank you.

That concludes today's conference. Thank you for your participation.