Positioned for performance:
An overview of 2016 and beyond
West Coast Utilities Seminar
Las Vegas, Nevada
March 23, 2017
NYSE: AVA www.avistacorp.com
All forward-looking statements are Avista management’s present expectations of future
events and are subject to a number of factors and uncertainties that could cause actual
results to differ materially from those described in the forward-looking statements.
For more information on such factors and uncertainties, consult Avista’s most recent form
10-K and 10-Q, which are available on our website at www.avistacorp.com
Disclaimer
2
3
Strong and stable utility core
Regulated electric and natural gas operations
Serves customers in Washington, Idaho and Oregon
Contributes about 95% of earnings
Regulated electric operations
Serves customers in City and Borough of Juneau
Avista Utilities
Alaska Electric Light
& Power Company
(AEL&P)
Long history of service, trust,
innovation and collaboration
Photo: Spokane River Upper Falls
4
Steadily building long-term value
Reliably building value for our customers,
investors, communities and employees
Projecting long-term earnings and dividend growth of 4% to 5%
Avista Utilities
AEL&P
Strategic
Investments
5% to 6% rate base growth through utility capital investments
Upgrading infrastructure; grid modernization
Customer and load growth ~1%
Near-term earnings are challenged due to 2016 Washington rate order
Committed to reducing timing lag and align our earned returns with those
authorized by the 2019-2020 time period
Strong near-term rate base growth through investment in generation
Customer and load growth ~1%
Developing platforms for future growth
□ Targeting expanded natural gas services via LNG*
□ Exploring data science and advanced analytics
□ Investing in emerging technologies
*LNG: Liquefied natural gas
Avista Utilities
Investments in utility infrastructure
5
6
Diverse customer base
□ 30,000 square mile service territory
□ Service area population 1.6 million
– 377,000 electric customers
– 340,000 natural gas customers
Strong customer focus
□ 90% percent or better customer satisfaction
ratings every year since 1999
□ Developing key customer initiatives
Invested in our communities
□ More than $2 million per year in charitable
donations and over 48,000 volunteer hours
from our employees
Providing safe and reliable service for 128 years
Solid foundation and continued commitment to innovation
Information as of Dec. 31, 2016
7
A responsible mix of generation
Hydro
49%
Biomass
2%Wind
4.5%
Coal
9.5%
Natural Gas
35%
Avista Utilities Electricity Generation Resource Mix*
Dec. 31, 2016
Strategy is to control a portfolio of resources that responsibly meet our long-term
energy needs
Long resources through 2021; evaluating preferred resource strategy and will file an
electric Integrated Resource Plan in August
Exceeds Washington state’s 15% Renewable Portfolio Standard for the next 20 years
Founded on clean, renewable hydropower
*Based on maximum capacity
Excludes AEL&PPost Falls Dam, Idaho
8
Projected
Investments to upgrade our systems
* Other includes Facilities and Fleet
** Excludes capital expenditures at AEL&P of $16 million in 2016, and projected capital
expenditures of $7 million in 2017, $7 million 2018 and $13 million in 2019
5% to 6% rate base growth
$139 $137
$164 $157
$55 $59
$48 $47
$53 $50
$47 $46
$50 $47
$43
$42
$46
$49
$46 $52
$36 $42 $40
$48
$17 $21 $14
$9
$403 $405 $405 $405
2016 2017 2018 2019
Avista Utilities Capital Expenditures**
($ millions)
Environmental
Other*
Gas
Customer Growth
Enterprise Technology
Generation
T&D
9
Investing in our utility
Little Falls Plant Upgrade
Grid Modernization
Aldyl A Natural Gas
Pipe Replacement
Advanced Metering
Infrastructure (AMI)
Preserving and enhancing service reliability
Electric Vehicle Pilot
Program
10
Driving effective regulatory outcomes
Planned recovery of costs and capital investments
Washington
Dec. 15, 2016, received an order which
denied the Company's proposed electric
and natural gas rate increase requests of
$38.6 million and $4.4 million, respectively,
that were originally filed in February 2016.
Current electric and natural gas retail
rates will remain unchanged in Washington
State.
Dec. 23, 2016, filed a Petition for
Reconsideration, or in the alternative, for
Rehearing. The Commission denied the
petition on Feb. 27, 2017.
Expect to file a new electric and natural gas
general rate case in the second quarter of
2017 that will address the issues raised by
the Commission.
New commissioner, Jay Balasbas,
appointed to Commission to begin serving
May 1, 2017; pending senate approval.
Idaho
Dec. 28, 2016, received approval of all-
party settlement agreement designed to
increase annual electric base revenues by
2.6% or $6.3 million, plus continued
recovery of $4.1 million of costs related to
Palouse Wind Project through the PCA
mechanism.
Based on a 9.5% return on equity with a
50.0% common equity ratio.
New rates took effect Jan. 1, 2017.
Alaska
Sept. 16, 2016, filed an electric general rate
request to increase revenues by 8.1% or
$2.8 million.
An interim rate increase of 3.86% or
$1.3 million was effective Nov. 23, 2016.
An additional $2.9 million annually from
interruptible service was approved to
reduce overall revenue requirement from
$5.7 million to $2.8 million.
Request based on a 58% equity ratio and a
13.8% return on equity.
The RCA has approximately 15 months to
rule on the permanent rate increase.
The statutory timeline for the AEL&P GRC,
with the consent of the parties, has been
extended to Feb. 8, 2018.
Oregon
Nov. 30, 2016, filed a natural gas rate
request to increase revenues by 9% or
$8.5M.
Request based on 50% equity ratio and
9.9% return on equity.
The PUC has up to 10 months to review
and rule; if approved, new rates would take
effect no later than Oct. 1, 2017.
Alaska Electric Light & Power Company
(AEL&P)
Growing the utility core
11
Oldest regulated electric utility in Alaska, founded in 1893
12
Serves 17,000 electric customers in the City and Borough of
Juneau, meeting nearly all of its energy needs with hydropower
One of the lowest-cost electric utilities in the state
Approved capital structure of 53.8% equity and an authorized
return on equity of 12.875%
Diversifying our utility footprint
Juneau, Alaska
13
Strategic Investments
Developing platforms for future growth
Expand natural gas services via LNG
□ Salix (subsidiary)
– Generation – diesel substitution
– Marine fueling
– Rail fueling
Targeted investments
□ Energy Impact Partners
– Private equity fund that invests in emerging technologies,
products, services, and business models throughout
electricity supply chain with a collaborative, strategic
investment approach
□ Plum Energy
– Small LNG project investments
□ TROVE
– Leverage AMI, consumer and other data through predictive
analytics
Creating new growth platforms
14
15
Financial
Performance Metrics
Prudent balance sheet and liquidity
Debt
52.9%
Equity
47.1%
Consolidated Capital Structure
Dec. 31, 2016
16
Additional long-term debt maturities beyond 2027 not shown
$245.6 million of available liquidity at Avista Corp. as of Dec. 31, 2016
In 2016, issued and sold $175.0 million of first mortgage bonds due in 2051
Issued 1.6 million shares of common stock under our sales agency agreements for total net proceeds
of approximately $65 million as of Dec. 31, 2016
In second half of 2017, expect to issue approximately $110.0 million of long-term debt and up to $70.0
million of common stock
$273
$90
$52
$250
14
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027
No significant maturities until 2018
($ millions)
$1.85
$3.10
$1.97
$2.15
2013 2014 2015 2016 2017
Guidance
Continuing Operations Ecova (DiscOp)
$1.80-$2.00
17
Continued long-term earnings growth
Total Earnings per Diluted Share
Attributable to Avista Corporation
Business Segments Q4 2016 Q4 2015
Avista Utilities $0.59 $0.51
AEL&P $0.05 $0.04
Other $(0.02) $(0.01)
Continuing Operations Diluted EPS $0.62 $0.54
Ecova (DiscOp) - $0.07
TOTAL Diluted EPS $0.62 $0.61
18
2017 Earnings Guidance
Avista Utilities $1.71 $1.85
AEL&P $0.10 $0.14
Other $(0.01) $0.01
Consolidated $1.80 $2.00
Guidance Assumptions
Our outlook for Avista Utilities assumes, among other variables, normal precipitation, temperatures and hydroelectric generation for the remainder of the year.
Our outlook for AEL&P assumes, among other variables, normal precipitation, temperatures and hydroelectric generation for the remainder of the year.
Our guidance range for Avista Utilities encompasses expected variability in power supply costs and the application of the ERM to that power supply cost
variability.
As a change from earnings guidance in prior years, the midpoint of our Avista Utilities guidance range for 2017 includes $.07 of expense under the ERM; which
is within the 90 percent customers/10 percent shareholders sharing band. The impacts of the ERM are included in the midpoint of our guidance for 2017 as
power supply costs were not reset in the Washington order for 2017.
Our earnings guidance range results in an expected return on equity range for Avista Utilities of 7.4 percent to 7.8 percent. The difference between our
authorized ROE and expected ROE is made up of continued unrecovered structural costs of 70 to 90 basis points (bps) and 100 to 120 bps of regulatory timing
lag directly associated with the Washington jurisdiction and resulting from the 2016 order.
2017 Earnings negatively impacted by Washington order
*Current quarterly dividend of $0.3575 annualized
19
Dividend growth expected to keep pace with long-term earnings growth
Attractive and growing dividend
$1.22
$1.27
$1.32
$1.37
$1.43
2013 2014 2015 2016 2017*
20
An attractive investment
Strong and responsible core utility
□ Investing substantially to modernize infrastructure and
upgrade systems
□ Steady returns and attractive dividend yield
□ One of the greenest utilities in the U.S.*
□ Committed to reducing current regulatory timing lag of
100-120 bps by the 2019-2020 time period
Focus on utility growth
□ Selective acquisitions
□ Developing new products and services and supporting
economic development throughout service area
Positioning for the future
□ Strategically investing in ways to extend access to
natural gas via LNG, leverage AMI data through
applied analytics, gain insight into leading-edge
energy solutions
□ Track record of innovation (e.g. Itron, ReliOn, Ecova)
*Source: Benchmarking Air Emissions of the 100 Largest Power Producers in the United
States, NRDC, July 2016
Photo: Cabinet Gorge Dam
Reliably building value for
our customers, investors,
communities and employees
We welcome your questions
Company Contact
Lauren Pendergraft, Investor Relations Manager
509-495-2998
Lauren.pendergraft@avistacorp.com
www.avistacorp.com
Photo: Huntington Park, Spokane, Wash.
21