Fair Value (Tables)

3 Months Ended

Mar. 31, 2015

Fair Value Inputs, Liabilities, Quantitative Information [Line Items]

Fair Value Inputs, Liabilities, Quantitative Information [Table Text Block]

The following table presents the quantitative information which was used to estimate the fair values of the Level 3 assets and liabilities above as of March 31, 2015 (dollars in thousands):

	Fair Value (Net) at
	March 31, 2015			Valuation Technique	Unobservable Input	Range
Power exchange agreement	$	(25,903	)	Surrogate facility pricing	O&M charges	$30.66-$55.56/MWh (1)
					Escalation factor	3% - 2015 to 2019
					Transaction volumes	396,984 - 397,116 MWhs
Power option agreement	(251		)	Black-Scholes- Merton	Strike price	$37.87/MWh - 2015
						$56.46/MWh - 2019
					Delivery volumes	157,517 - 287,147 MWhs
					Volatility rates	0.20 (2)
Natural gas exchange agreement	817			Internally derived weighted average cost of gas	Forward purchase prices	$2.10 - $2.34/mmBTU
					Forward sales prices	$2.22 - $3.17/mmBTU
					Purchase volumes	158,469 - 310,000 mmBTUs
					Sales volumes	279,990 - 800,000 mmBTUs

Carrying Value and Estimated Fair Value of Financial Instruments

The following table sets forth the carrying value and estimated fair value of the Company’s financial instruments not reported at estimated fair value on the Condensed Consolidated Balance Sheets as of March 31, 2015 and December 31, 2014 (dollars in thousands):

	March 31, 2015				December 31, 2014
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Long-term debt (Level 2)	$	951,000	$	1,132,109	$	951,000	$	1,118,972
Long-term debt (Level 3)	492,000		542,349		492,000		527,663
Snettisham capital lease obligation (Level 3)	69,398		79,928		69,955		79,290
Nonrecourse long-term debt (Level 3)	—		—		1,431		1,440
Long-term debt to affiliated trusts (Level 3)	51,547		37,629		51,547		38,582

Fair Value of Assets And Liabilities Measured on Recurring Basis

	Level 1		Level 2		Level 3		Counterparty and Cash Collateral Netting (1)			Total
March 31, 2015
Assets:
Energy commodity derivatives	$	—	$	96,319	$	—	$	(95,557	)	$	762
Level 3 energy commodity derivatives:
Natural gas exchange agreement	—		—		1,607		(790		)	817
Foreign currency derivatives	—		14		—		(14		)	—
Deferred compensation assets:
Fixed income securities (2)	1,866		—		—		—			1,866
Equity securities (2)	6,233		—		—		—			6,233
Total	$	8,099	$	96,333	$	1,607	$	(96,361	)	$	9,678
Liabilities:
Energy commodity derivatives	$	—	$	111,188	$	—	$	(103,001	)	$	8,187
Level 3 energy commodity derivatives:
Natural gas exchange agreement	—		—		790		(790		)	—
Power exchange agreement	—		—		25,903		—			25,903
Power option agreement	—		—		251		—			251
Foreign currency derivatives	—		24		—		(14		)	10
Interest rate swaps	—		112,835		—		(50,490		)	62,345
Total	$	—	$	224,047	$	26,944	$	(154,295	)	$	96,696

	Level 1		Level 2		Level 3		Counterparty and Cash Collateral Netting (1)			Total
December 31, 2014
Assets:
Energy commodity derivatives	$	—	$	96,729	$	—	$	(95,204	)	$	1,525
Level 3 energy commodity derivatives:
Natural gas exchange agreement	—		—		1,349		(1,349		)	—
Foreign currency derivatives	—		1		—		(1		)	—
Interest rate swaps	—		966		—		(506		)	460
Funds held in trust account of Spokane Energy	1,600		—		—		—			1,600
Deferred compensation assets:
Fixed income securities (2)	1,793		—		—		—			1,793
Equity securities (2)	6,074		—		—		—			6,074
Total	$	9,467	$	97,696	$	1,349	$	(97,060	)	$	11,452
Liabilities:
Energy commodity derivatives	$	—	$	127,094	$	—	$	(110,714	)	$	16,380
Level 3 energy commodity derivatives:
Natural gas exchange agreement	—		—		1,384		(1,349		)	35
Power exchange agreement	—		—		23,299		—			23,299
Power option agreement	—		—		424		—			424
Interest rate swaps	—		77,568		—		(29,386		)	48,182
Foreign currency derivatives	—		21		—		(1		)	20
Total	$	—	$	204,683	$	25,107	$	(141,450	)	$	88,340

(1) The Company is permitted to net derivative assets and derivative liabilities with the same counterparty when a legally enforceable master netting agreement exists. In addition, the Company nets derivative assets and derivative liabilities against any payables and receivables for cash collateral held or placed with these same counterparties.

(2) These assets are trading securities and are included in other property and investments-net on the Condensed Consolidated Balance Sheets.

Reconciliation for All Assets Measured At Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)

	Natural Gas Exchange Agreement			Power Exchange Agreement			Power Option Agreement			Total
Three months ended March 31, 2015:
Balance as of January 1, 2015	$	(35	)	$	(23,299	)	$	(424	)	$	(23,758	)
Total gains or losses (realized/unrealized):
Included in net income	—			—			—			—
Included in other comprehensive income	—			—			—			—
Included in regulatory assets/liabilities (1)	777			(6,381		)	173			(5,431		)
Purchases	—			—			—			—
Issuance	—			—			—			—
Settlements	75			3,777			—			3,852
Transfers to/from other categories	—			—			—			—
Ending balance as of March 31, 2015	$	817		$	(25,903	)	$	(251	)	$	(25,337	)
Three months ended March 31, 2014:
Balance as of January 1, 2014	$	(1,219	)	$	(14,441	)	$	(775	)	$	(16,435	)
Total gains or losses (realized/unrealized):
Included in net income	—			—			—			—
Included in other comprehensive income	—			—			—			—
Included in regulatory assets/liabilities (1)	1,849			2,026			347			4,222
Purchases	—			—			—			—
Issuance	—			—			—			—
Settlements	(3,048		)	(1,209		)	—			(4,257		)
Transfers to/from other categories	—			—			—			—
Ending balance as of March 31, 2014	$	(2,418	)	$	(13,624	)	$	(428	)	$	(16,470	)

(1) The UTC and the IPUC issued accounting orders authorizing Avista Corp. to offset commodity derivative assets or liabilities with a regulatory asset or liability. This accounting treatment defers the recognition of mark-to-market gains and losses on energy commodity transactions until the period of delivery. The orders provide for Avista Corp. to not recognize the unrealized gain or loss on utility derivative commodity instruments in the Condensed Consolidated Statements of Income. Realized gains or losses are recognized in the period of delivery, subject to approval for recovery through retail rates. Realized gains and losses, subject to regulatory approval, result in adjustments to retail rates through purchased gas cost adjustments, the ERM in Washington, the PCA mechanism in Idaho, and periodic general rates cases.