BENEFIT PLANS

Idaho Power has the following pension plans - a noncontributory defined benefit pension plan (pension plan) and two nonqualified defined benefit plans for certain senior management employees called the Security Plan for Senior Management Employees I and Security Plan for Senior Management Employees II (collectively, SMSP). Idaho Power also has a nonqualified defined benefit pension plan for directors that was frozen in 2002. Remaining vested benefits from that plan are included with the SMSP in the disclosures below. The benefits under the pension plan are based on years of service and the employee’s final average earnings. Idaho Power also maintains a defined benefit postretirement benefit plan (consisting of health care and death benefits) that covers all employees who were enrolled in the active-employee group plan at the time of retirement as well as their spouses and qualifying dependents. The following table shows the components of net periodic benefit costs for the pension, SMSP, and postretirement benefits plans for the three months ended September 30, 2016 and 2015 (in thousands of dollars).



	Pension Plan						SMSP				Postretirement Benefits
	2016			2015			2016		2015		2016			2015
Service cost	$	8,004		$	8,291		$	307	$	422	$	279		$	308
Interest cost	9,453			8,792			1,069		967		692			670
Expected return on plan assets	(10,519		)	(10,994		)	—		—		(619		)	(669		)
Amortization of prior service cost	15			56			42		47		7			3
Amortization of net loss	3,332			3,482			883		1,048		—			—
Net periodic benefit cost	10,285			9,627			2,301		2,484		359			312
Adjustments due to the effects of regulation⁽¹⁾	(5,538		)	(4,902		)	—		—		—			—
Net periodic benefit cost recognized for financial reporting⁽¹⁾	$	4,747		$	4,725		$	2,301	$	2,484	$	359		$	312

⁽¹⁾ Net periodic benefit costs for the pension plan are recognized for financial reporting based upon the authorization of each regulatory jurisdiction in which Idaho Power operates. Under IPUC order, income statement recognition of pension plan costs is deferred until costs are recovered through rates.

The table below shows the components of net periodic benefit costs for the pension, SMSP, and postretirement benefits plans for the nine months ended September 30, 2016 and 2015 (in thousands of dollars).



	Pension Plan						SMSP				Postretirement Benefits
	2016			2015			2016		2015		2016			2015
Service cost	$	24,014		$	24,873		$	921	$	1,267	$	837		$	926
Interest cost	28,360			26,378			3,206		2,901		2,075			2,009
Expected return on plan assets	(31,560		)	(31,733		)	—		—		(1,856		)	(2,010		)
Amortization of prior service cost	44			166			126		139		20			11
Amortization of net loss	9,998			10,446			2,649		3,146		—			—
Net periodic benefit cost	30,856			30,130			6,902		7,453		1,076			936
Adjustments due to the effects of regulation⁽¹⁾	(16,643		)	(15,873		)	—		—		—			—
Net periodic benefit cost recognized for financial reporting⁽¹⁾	$	14,213		$	14,257		$	6,902	$	7,453	$	1,076		$	936

Idaho Power has no minimum contribution requirement to its defined benefit pension plan in 2016. However, during the nine months ended September 30, 2016, Idaho Power made $40 million of discretionary contributions to its defined benefit pension plan. Idaho Power's contributions are made in a continued effort to balance regulatory collection of these expenditures with the amount and timing of contributions and to mitigate the cost of being in an underfunded position.

Idaho Power also has an Employee Savings Plan that complies with Section 401(k) of the Internal Revenue Code and covers substantially all employees. Idaho Power matches specified percentages of employee contributions to the Employee Savings Plan.