Avista Corporation

What they do

Avista Utilities generates, transmits and distributes electricity and distributes natural gas to retail customers in Washington, Idaho and Oregon, operating roughly 20,000 miles of electric distribution lines, about 700 miles of 230 kV transmission line, about 1,600 miles of 115 kV line, and natural gas distribution mains of 3,600 miles in Washington, 2,300 in Idaho and 2,400 in Oregon. Its generation portfolio includes hydroelectric projects and a 1,100 MW portfolio of power purchase agreements spanning hydro, thermal, wind and solar resources as of December 31, 2025. AEL&P is a regulated electric utility in Alaska, and other non-reportable subsidiaries include non-regulated businesses.

Revenue drivers

• Avista Utilities electric — Regulated electric retail sales and transmission/distribution service in Washington, Idaho and Oregon; this is by far the largest earnings contributor, with 2025 segment net income of $201 million.
• Avista Utilities natural gas — Regulated natural gas distribution service across approximately 8,300 combined miles of mains in Washington, Idaho and Oregon, with rates set in general rate cases.
• AEL&P — Alaskan regulated electric utility subsidiary; small relative to the group, with 2025 net income of $6 million versus $8 million in 2024.
• Other non-reportable businesses — Non-regulated subsidiaries that have recently produced losses tied to investment valuations, including a $14 million net loss in 2025 and a $12 million loss in Q2 2025.

Recent performance

Second quarter 2026 net income was $35 million, or $0.43 per diluted share, versus $14 million, or $0.17 per diluted share, in Q2 2025. First half 2026 net income was $127 million ($1.54 per diluted share) versus $93 million ($1.15) a year earlier. The improvement was driven primarily by net investment gains at the other businesses versus net investment losses in 2025, plus general rate case effects; non-GAAP utility earnings were $114 million for the first half of 2026 versus $105 million in 2025. Full-year net income has risen from $171 million in 2023 to $180 million in 2024 and $193 million in 2025.

Strategy

Management is pursuing resource additions identified in the 2025 electric IRP, including a planned self-build upgrade of the Rathdrum CT natural gas turbines adding 14 MW (staged in 2027 and 2029), a 100 MW four-hour battery storage project in eastern Washington targeted for 2028, a PPA for about 200 MW of Montana wind using the Colstrip transmission system targeted for 2029, and roughly 40 MW of demand response programs starting in 2026. In November 2024 the company signed a non-binding memorandum of understanding to join the North Plains Connector transmission line project from Bismarck, North Dakota to Colstrip, Montana. The company confirmed 2026 non-GAAP utility earnings guidance of $2.52 to $2.72 per diluted share. It has paused negotiations on a data center MOU signed in May 2026 to take additional time to evaluate data center energy requests.

Risks

• Regulatory rate recovery — The company states that Avista Utilities' operating expenses and incremental capital costs continue to grow faster than revenue, so results depend on timely and sufficient rate increases from regulators.
• Wildfire exposure — Wildfires occurred in its service territory in 2026, and the company has implemented enhanced system protections and public safety power shutoffs in response to elevated risk conditions.
• Non-regulated investment volatility — Results at the other businesses swing with investment gains and losses, producing a $14 million loss in 2025 and a $12 million loss in Q2 2025, and management says these items are difficult to predict.
• Hydroelectric and resource adequacy — Hydro generation depends on snowpack, temperature and precipitation, and extreme weather events have at times forced short-term wholesale energy purchases when resources were unavailable.

Outlook

Management expects 2026 non-GAAP utility earnings of $2.52 to $2.72 per diluted share and anticipates hydroelectric generation for the full year will be above normal. It says the transfer of its Colstrip ownership effective January 1, 2026 nets to an immaterial impact on net income, and it is proceeding with contract negotiations on the selected 2025 RFP projects. It has not provided GAAP earnings guidance, citing the inability to estimate investment gains and losses at the other businesses.