Avista Corp. (AVA) 2010年年度報告「NYSE」.pdf

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1、I N V E S T I N G I N O U R S H A R E D F U T U R E2 010 A N N UA L R E P O RTD E L I V E R I N G R E L I A B L E E N E R G Y S E R V I C E A N D T H E C H O I C E S T H A T M A T T E R M O S T T O Y O U.T H I S I S T H E I D E A T H A T G U I D E S O U R W O R K E V E R Y DAY I T I S T H E YA R D S

2、 T I C K AG A I N S T W H I C H W E G A U G E O U R P R I O R I T I E S A N D M E A S U R E O U R R E S U LT S.I T E X P R E S S E S W H AT W E WO R K T OWA R D O U R S H A R E D F U T U R E.ON THE COVER:Avista looks back on 2010 as a year of investment in our shared future.Operational challenges we

3、re met head-on and programs successfully implemented which resulted in strong financial health and a clear,empowered vision for moving forward.ON THIS PAGE:Natural gas is the cleanest burning fossil fuel.Its most efficient use is to directly heat homes and businesses.Construction of new natural gas

4、lines continues as Avista meets increasing residential and business demand for this clean heating source.A s tAt e m e n t o f O U R p U R p O S E:Lets talk about two thoughts:shared value and shared future.As a shareholder of Avista Corp.,you have invested in the work of this company for today and

5、for tomorrow.As the chairman of Avista Corp.,my job is to see that your trust in our work is paid back as a fair return on your investment.Together,we have a vested interest in the ongoing success of this company.So,please read on for a good sense of the work were doing and the direction were headin

6、g.F i n a n c i a l h i g h l i g h t sWeve come through 2010 with solid financial results and modest growth.We believe these are good outcomes given the weak economy both regionally and nationally.The year started with weather that once again set records.This time,though,it wasnt record snow levels

7、 as in 2009;instead 2010 was one of the warmest January to March time periods in this region.This resulted in lower than normal energy use from customers to heat their homes and businesses.However,improved results throughout the remainder of the year,power supply costs lower than the amount included

8、 in rates and our disciplined management of operating expenses helped to mostly offset the effects of the first quarter weather.With that,we delivered year-end earnings of$1.65 per diluted share,an increase from$1.58 in 2009.Our 2011 earnings are expected to benefit from a return to normal weather a

9、nd the effects of general electric and natural gas rate increases we received in Washington and Idaho.We expect this may be partially offset,however,by slower load growth due to the still-sluggish economy,a lag in the recovery of operating expenses and capital investments,as well as increased costs

10、for materials.Scott Morris Chairman,President and Chief Executive OfficerD E A R f E L L O w S H A R E H O L D E R S:We remain committed to investing in our utility infrastructure to keep system reliability high.Replacing and upgrading our transmission and distribution system and renewable hydroelec

11、tric generation plants,as well as building the infrastructure to meet regional demand growth were the primary drivers of our$210 million capital budget in 2010.The 2011 capital budget of$250 million includes funds to match our smart grid grants.As we invest in our system to reliably and safely bring

12、 energy to our customers,we are also diligently working with our regulators to receive timely recovery of these investments.In addition to the electric and natural gas rate increases in Washington and Idaho,we filed a natural gas rate case in Oregon in September.A proposed settlement has been reache

13、d subject to commission approval expected in the first half of 2011.We remain focused on maintaining a healthy balance sheet and credit rating strength.At the end of 2010 we had a combined$258 million of available liquidity under our two committed lines of credit.We also have a sales agency agreemen

14、t in place to sell shares of common stock from time to time.In 2010 we issued$43 million of common stock under this agreement,and we expect to issue up to$25 million of common stock in 2011 to maintain an appropriate capital structure.Another sign of progress:the Board of Directors raised the common

15、 stock dividend in 2010 for the eighth consecutive year,bringing our dividend payout ratio to 60 percent and reaching our goal of being in line with the industry average.This reflects the confidence our directors have in our continued progress toward achieving our corporate goals.2011 CApITAL BUDGET

16、(total capital budget$250 million)($in millions)Transmission&Distribution$68Generation$42Growth$40Technology$28Smart Grid$19Natural Gas$16Environmental$12Facilities$10Fleet$10Other$5s t r at e g i c e n e r g y m a n ag e m e n tWe are on the cusp of some of the biggest changes our industry has seen

17、 in decades driven by new technology,new information and new partnerships.The opportunities and challenges ahead are very exciting.Being innovative in the way we look for opportunities is nothing new for us.Its deeply rooted in our history.Avista has long been an innovative energy company,from pione

18、ering transmission and generation operations to helping create the automated meter reading industry;from developing fuel cell innovations to becoming the leader in energy management.Advantage IQ,our primary non-utility subsidiary,is a leading provider of strategic energy management solutions.It part

19、ners with Fortune 1000 organizations to maximize business results by reducing energy and other facility expenses,managing risk and improving environmental performance.Its strategic acquisitions including Ecos in 2009 and The Loyalton Group in 2010 have broadened the value proposition Advantage IQ br

20、ings to its clients.Through the energy consumption information it manages for clients,Advantage IQ has an electric usage database of more than 25,000 megawatts of commercial and industrial load.This business$0$50$100$150$200200520062007200820092010AVABase Period$100AVA$146AVA$128AVA$119AVA$139AVA$15

21、2Avista Corp.(AVA)S&P 500 IndexS&P 400 Electric Utilities IndexTOTAL RETURN TO SHAREHOLDERS(includes reinvestment of dividend)$0$20$40$60$10020062007200820092010ADVANTAGE IQ REVENUE($in millions)$120$80$40$47$59$77$102continues to show long-term growth potential in clients,revenues and its positive

22、contribution to Avista Corp.s earnings.s m a r t m ov e s at t h e r i g h t t i m eBeing in the right place,at the right time,with the right resources means we can capitalize on opportunities when they arise enhancing our annual revenues and helping moderate power supply costs for customers.For exa

23、mple,Avista regularly sells available capacity,energy,ancillary services and green,renewable energy in the western markets.By optimizing the value of our resources through these activities,we are able to capture millions of dollars in additional revenue that serves to lower costs for our retail cust

24、omers.Doing due diligence is our first step in implementing new technologies.Such is the case with the advent of smart grid.Theres a lot to know before we make full-scale investments in hardware and technology.As one of a handful of utilities to receive multiple smart grid grants under the American

25、Recovery and Reinvestment Act of 2009,were putting these funds to good use enhancing our distribution system to improve reliability and energy efficiency;modeling how to implement new technology and communicate with customers in the Smart Grid Demonstration Project (Pullman,Wash.);and developing the

26、 workforce needed to install and maintain the new technologies.The smart grid capabilities were building into our system today position us well as a trusted and knowledgeable partner with our customers in managing their energy use tomorrow.New,enabling technologies,plus a fast-changing market and ev

27、olving customer needs demand that we engage with our customers in new ways.Were working from our strength,building on a solid foundation of customer satisfaction.Among other indicators,our customer service center has achieved over 90 percent satisfaction ratings from customers for more than 10 conse

28、cutive years.And in 2010,J.D.Power and Associates ranked Avista“Highest in Customer Satisfaction with Residential Natural Gas Service in the Western U.S.among Mid-size Utilities in a Tie.”We are focusing on identifying more ways to create value-added interactions with our customers.Our award-winning

29、 Web site is a dynamic resource for doing business with us and finding information to help manage energy use.Were among the industry leaders in using social media channels such as the Avista blog,Twitter and Facebook to communicate with our customers where the conversations are happening in the digi

30、tal world.Were holding community meetings with opportunities for customers,civic leaders and elected officials to share ideas and help us deliver responsive energy solutions.Were undertaking outreach activities Gerard FischerAvista Utilities Residential CustomerOur energy future relies on making the

31、 most efficient use of the resources that produce the power we need.Avistas in-home audit showed where I could cut energy losses and better manage utility costs,saving money,making my home more comfortable and helping me be a better steward of the environment.With energy in the top five expense cate

32、gories for most businesses,visibility and understanding of how to best utilize energy is crucial.The value-added online tools,data resources and consulting we provide our clients make a competitive difference,helping them make informed decisions that can positively impact their financial stability a

33、nd the environment.It is a win-win situation.Doug BarryManager,Advanced Analysis,Advantage IQSM ART ADVANTAGES ADVANTAGE IQs t e wa r d s h i p a s a way o F b u s i n e s sWe are committed to doing our part to keep the communities we serve healthy,vibrant places for families and businesses to thriv

34、e.Our long-standing partnerships throughout our service territory serve us all well.Our environmental stewardship responsibilities are something else we take seriously.With two major hydroelectric facilities on the Clark Fork River in Montana and Idaho and six on the Spokane River from Idaho through

35、 eastern Washington,we invest millions of dollars each year in water quality,wetlands,fish and wildlife enhancements and other environmental benefits.In 2009 we received new federal licenses to operate our plants in the Spokane River Project.This success came from working closely with more than 200

36、stakeholders from governmental,tribal and community organizations.In the past year,weve embarked on the first stages of work to improve the aesthetic flows of the river through the jewel of downtown Spokane Riverfront Park.And in partnership with others,were working to protect and enhance water qual

37、ity in the Spokane River and nearby aquifer.Savannah Miller“Every Little Bit”video contestantMy friends and I talk about how our planet belongs to everybody and how we should make sure there is something left for generations to come.Making a video for Avistas“Every Little Bit”contest got me thinking

38、 about how important it is for teenagers to save energy,like turning off lights and unplugging cell phone chargers.such as our energy fairs that provide demonstrations,workshops and direct access to energy assistance for limited-income and senior customers.And were talking with customers,one person

39、at a time,answering questions and sharing more information about our business than ever before.Internally,were focused on strengthening the alignment of our actions to the companys strategic goals by enhancing planning and scheduling to boost the efficiency of our field workforce.Were developing pro

40、cesses to better prioritize projects so we spend money on what matters most when managing assets and technology.And were implementing collaborative strategies to guide our purchasing decisions what we buy,how we buy it and which suppliers we use.Through these and other initiatives,we are positioning

41、 the company to continue our success into the new energy future.Events like“Powering Our Future”brought the community together in 2010 to discuss energy challenges,choices,opportunities and costs.This event included interactive discussions with Avista energy experts,national energy leaders and commu

42、nity members sharing ideas about how all of us can help shape our energy future.An important outcome of Avistas partnerships with tribes,community organizations,and state and federal agencies is the environmental protection of 1,200 acres of riparian habitat along the Clark Fork River in Idaho and M

43、ontana.Wattson,Avistas energy watchdog,attended more than 25 community events and school presentations in 2010,reaching more than 100,000 people and bringing the message of energy efficiency and conservation to the next generation of Avista customers.Avista engages people of all ages,empowering them

44、 to make informed energy choices.In a historic move last fall,we replaced wooden,manually-operated flashboards with computerized spill gates at the Nine Mile Hydroelectric Development,the first permanent spill gates in the dams 102-year-history.Using innovative technology,the new gates allow us to m

45、aintain the upstream reservoir pool at a more consistent level throughout the year and generate more power using the same amount of water.We are proud that Avista has always been one of the cleanest utilities in the country.Today,we are ranked 11th lowest in the rate of CO2 emissions of the 100 larg

46、est electric power producers in the U.S.,according to the 2010 report of the National Resources Defense Council.And with the delivery of electric vehicles to mainstream consumers,were piloting a program with our own electric-hybrid cars and charging stations to help us plan for the ways in which thi

47、s will affect our customers and the new demand for resources.Upgrading Avistas hydroelectric projects,like the Nine Mile Dam,enhances power generation capacity and efficiency.BElOw:Installation of computerized spill gates provides sensitive control of water flow,enhancing the environment and the aes

48、thetics of the river.Hydro 50%(42%Avista owned 8%Long-term hydro contracts)Natural gas 35%Coal 10%Wind 2%Biomass 2%Other contracts 1%0%10%20%30%40%50%ELECTRICIT Y GENER ATION RESOURCE MIx(as of December 31,2010)20062007200820092010(therms in millions)02040608010021.51.00.50(kilowatts in millions)2.5

49、CUSTOMER ENERGY EffICIENCY SAVINGS(Washington and Idaho)Electricity(kilowatts)Natural Gas(therms)a r e F i n e d v i s i o n t o n av i g at e t o t h e F u t u r eThe economy in the Pacific Northwest remains challenged,with job markets slower than the national average to rebound from their recessio

50、n lows.Employment levels throughout our service area remain well below trend after significant and persistent cutbacks in the construction and forest product sectors.The mining and manufacturing sectors are above their recession lows,but they remain well below pre-recession levels.However,we remain

51、positive in our outlook of achieving our goal of 5 percent to 7 percent long-term earnings growth for our company through a combination of growth in rate base,customer numbers and load productivity,as well as growth at Advantage IQ.It will be important for us going forward that we are focused on ali

52、gnment and adaptability to align ourselves for the work that must be done today,with an eye to the changes in the industry that are ahead.We are poised to adapt to the changes in our industry and the markets as they come,while keeping our focus on the work of providing the reliable and safe energy s

53、ervices our customers want,expect and deserve.The days of utilities existing just to keep the lights and heat on are waning.As the energy industry moves forward,were seeing other businesses enter our marketplace,offering energy services.Our plans for the future are clear:grow our core reliable energ

54、y delivery business and continue to develop innovative energy services for our customers.By offering information,options for use and new technology,well increase the value our customers get from the energy they choose to use.No doubt,what happens in the next few years will be shaped by the continued

55、 discussion,debate and decisions about renewable energy,carbon emissions and new mandates that will impact our operations and costs.We are active participants in that dialogue,and we will remain nimble in our planning to accommodate and to capitalize on new requirements.Finally,and most importantly,

56、I want to extend my deep appreciation to our employees.It is their dedication,talent and innovation that truly inspire me.They are the energy for this energy company.And to you,our shareholder,or perhaps potential shareholder,thank you for your belief in and support for our company.We will continue

57、to do our very best to keep delivering shared value for our shared future.Sincerely,Scott L.Morris Chairman,President and Chief Executive OfficerMary B.VernerMayor,City of SpokaneIts our responsibility to lead by example in shaping our citys energy future a future that includes sustainable energy sa

58、vings,supports the development of jobs and positions our city as a national leader in the responsible use of energy for the benefit of our citizens.Avista employees turn ideas and plans into action,improving our infrastructure,maintaining our energy delivery systems and delivering reliable power to

59、our customers when and where they need it.Corporate Governance/Nominating CommitteeKristianne BlakeR.John TaylorJohn F.Kelly ChairExecutive CommitteeKristianne BlakeJohn F.KellyR.John TaylorScott L.Morris ChairAudit CommitteeRoy L.EigurenMichael L.Nol(Financial Expert)Heidi B.StanleyKristianne Blake

60、 ChairCompensation&Organization CommitteeJohn F.KellyRebecca A.KleinMichael L.NolR.John Taylor ChairFinance CommitteeMarc F.RacicotHeidi B.StanleyErik J.Anderson ChairEnergy,Environmental&Operations CommitteeErik J.AndersonRebecca A.KleinMarc F.RacicotRoy L.Eiguren ChairScott l.Morris,53Chairman of

61、the Board,President&CEOMark T.Thies,47Senior Vice President&CFOMarian M.Durkin,57Senior Vice President,General Counsel&Chief Compliance OfficerKaren S.Feltes,55Senior Vice President&Corporate SecretaryDennis P.Vermillion,49Senior Vice President&Environmental Compliance OfficerPresident,Avista Utilit

62、iesChristy M.Burmeister-Smith,54Vice President,Controller&Principal Accounting OfficerJames M.Kensok,52Vice President&CIODon F.Kopczynski,55Vice PresidentDavid J.Meyer,57Vice President&Chief Counsel for Regulatory&Governmental AffairsKelly O.Norwood,52Vice PresidentRichard l.Storro,60Vice PresidentJ

63、ason R.Thackston,40Vice PresidentRoger D.woodworth,54Vice PresidentDiane C.Thoren,58TreasurerJeffrey D.Heggedahl,46President&CEO,Advantage IQErik J.Anderson,52PresidentWestriver CapitalKirkland,WashingtonDirector since 2000Kristianne Blake,57PresidentKristianne Gates Blake,P.S.Spokane,WashingtonDire

64、ctor since 2000Roy l.Eiguren,59President Sullivan,Reberger&EigurenBoise,IdahoDirector since 2002John F.Kelly,66President&CEOJohn F.Kelly&AssociatesCoral Gables,FloridaDirector since 1997Rebecca A.Klein,45Principal Klein Energy,LLCAustin,TexasDirector since 2010Scott l.Morris,53Chairman of the Board,

65、President&CEOAvista Corp.Spokane,WashingtonDirector since 2007Michael l.Nol,69PresidentNol Consulting CompanyPrescott,ArizonaDirector since 2004Marc F.Racicot,62Bigfork,MontanaDirector since 2009Heidi B.Stanley,54Co-owner&ChairmanEmpire Bolt&Screw,Inc.Spokane,WashingtonDirector since 2006R.John Tayl

66、or,61Chairman&CEO CropUSA Insurance AgencyLewiston,IdahoDirector since 1985BOARD Of DIRECTORS C O R P O R A T E L E A D E R S H I pCORpOR ATE&BUSINESS UNIT OffICERS BOARD COMMITTEES f i N A N C i A L A N D O P E R A T i N g H I G H L I G H T S(dollars in thousands except statistics and per share amo

67、unts or as otherwise indicated)2010 2009 2008fINANCIAL RESULTS Operating revenues$1,558,740$1,512,565$1,676,763 Operating expenses 1,328,552 1,311,907 1,491,852 Income from operations 230,188 200,658 184,911 Net income 94,948 88,648 74,757 Net income attributable to Avista Corporation 92,425 87,071

68、73,620 Earnings per common share attributable to Avista Corporation,diluted 1.65 1.58 1.36 Earnings per common share attributable to Avista Corporation,basic 1.66 1.59 1.37 Dividends paid per common share 1.00 0.81 0.69 Book value per common share$19.71$19.17$18.30 Average common shares outstanding

69、55,595 54,694 53,637 Actual common shares outstanding 57,120 54,837 54,488 Return on average Avista Corporation stockholders equity 8.5%8.5%7.7%Common stock closing price$22.52$21.59$19.38 OpER ATING RESULTS Avista Utilities Retail electric revenues$683,340$703,951$635,102 Retail kWh sales(in millio

70、ns)8,843 8,942 9,017 Retail electric customers at year-end 358,895 356,536 354,657 Wholesale electric revenues$165,553$88,414$141,744 Wholesale kWh sales(in millions)3,803 2,354 1,964 Sales of fuel$106,375$32,992$44,695 Other electric revenues 19,015 15,426 16,916 Retail natural gas revenues 297,920

71、 396,203 440,692 Wholesale natural gas revenues 197,364 143,524 281,668 Transportation and other natural gas revenues$15,965$14,691$11,847 Total therms delivered(in thousands)923,096 888,301 845,710 Retail natural gas customers at year-end 318,996 316,201 314,102 Net income attributable to Avista Co

72、rporation$86,681$86,744$70,032 Advantage IQ Revenues$102,035$77,275$59,085 Net income attributable to Avista Corporation 7,433 5,329 6,090 Other Revenues$61,067$40,089$45,014 Net loss attributable to Avista Corporation (1,689)(5,002)(2,502)fINANCIAL CONDITION Total assets$3,940,095$3,606,959$3,630,7

73、47 Long-term debt(including current portion)1,101,857 1,071,338 826,465 Nonrecourse long-term debt of Spokane Energy(including current portion)58,934 Long-term debt to affiliated trusts 51,547 51,547 113,403 Total Avista Corporation stockholders equity$1,125,784$1,051,287$996,883R E L i A b L E E N

74、E R g y E M p O w E R I N G C h O i C E s2 0 1 0 F o r m 1 0-Kf O R m 1 0-Kav i s ta c o r p (ava)Successful navigation through a myriad of energy technologies and options is vital to the delivery of reliable,cost-effective energy solutions.Avista is installing smart circuit communication technologi

75、es as part of our energy distribution system.This automated technology identifies the location of power outages and re-routes power from other sources reducing the frequency and duration of outages for our electric customers.Filed:February 25,2011(Period:December 31,2010)Annual report which provides

76、 a comprehensive overview of the company for the past year.UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-K(Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31,2010 OR TRANSITION REPORT PURSUAN

77、T TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission file number 1-3701A V I S T A C O R P O R AT I O N(Exact name of Registrant as specified in its charter)Washington 91-0462470 (State or other jurisdiction of (I.R.S.Employer incorporation or o

78、rganization)Identification No.)1411 East Mission Avenue,Spokane,Washington 99202-2600 (Address of principal executive offices)(Zip Code)Registrants telephone number,including area code:509-489-0500Web site:http:/Securities registered pursuant to Section 12(b)of the Act:Title of Class Name of Each Ex

79、change on Which Registered Common Stock,no par value New York Stock Exchange Securities registered pursuant to Section 12(g)of the Act:Title of ClassPreferred Stock,Cumulative,Without Par ValueIndicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Secu

80、rities Act.Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d)of the Act.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during t

81、he preceding 12 months(or for such shorter period that the Registrant was required to file such reports),and(2)has been subject to such filing requirements for the past 90 days:Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site,if a

82、ny,every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to submit and post such files).Yes No Indicate by check mark if disclosure of d

83、elinquent filers pursuant to Item 405 of Regulation S-K(229.405 of this chapter)is not contained herein,and will not be contained,to the best of Registrants knowledge,in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 1

84、0-K.Indicate by check mark whether the registrant is a large accelerated filer,accelerated filer,a non-accelerated filer,or a smaller reporting company.See the definitions of“large accelerated filer,”“accelerated filer”and“smaller reporting company”in Rule 12b-2 of the Exchange Act.(Check one):Large

85、 accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company(Do not check if a smaller reporting company)Indicate by check mark whether the Registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act):Yes No The aggregate market value of the Registrants outstan

86、ding Common Stock,no par value(the only class of voting stock),held by non-affiliates is$1,081,138,342 based on the last reported sale price thereof on the consolidated tape on June 30,2010.As of January 31,2011,57,276,041 shares of Registrants Common Stock,no par value(the only class of common stoc

87、k),were outstanding.Documents Incorporated By Reference Part of Form 10-K into Which Document Document is Incorporated Proxy Statement to be filed in connection with the annual Part III,Items 10,11,meeting of shareholders to be held on May 12,2011 12,13 and 14 A V I S T A IINDEX ITEM NO.PAGE NO.Acro

88、nyms and Terms.IV Forward-Looking Statements.1 Available Information.2PART I1.Business.2 Company Overview.2 Avista Utilities.3 General.3 Electric Operations.3 Electric Requirements.3 Electric Resources.3 Hydroelectric Licensing.5 Future Resource Needs.5 Natural Gas Operations.6 Regulatory Issues.7 F

89、ederal Laws Related to Wholesale Competition.7 Regional Transmission Organizations.8 Reliability Standards.8 Avista Utilities Operating Statistics.9 Advantage IQ.12 Other Businesses.121A.Risk Factors.131B.Unresolved Staff Comments.152.Properties.16 Avista Utilities.163.Legal Proceedings.174.(Removed

90、 and Reserved).17PART II5.Market for Registrants Common Equity,Related Stockholder Matters and Issuer Purchases of Equity Securities.176.Selected Financial Data.187.Managements Discussion and Analysis of Financial Condition and Results of Operations.19 Business Segments.19 Executive Level Summary.19

91、 Avista Utilities Regulatory Matters.21 Results of Operations.24 Avista Utilities.25 Advantage IQ.29 Other Businesses.30 Accounting Standards to Be Adopted in 2011.30 Critical Accounting Policies and Estimates.30 Liquidity and Capital Resources.33 Review of Cash Flow Statement.33 Overall Liquidity.3

92、3 Credit and Nonperformance Risk.34 Dodd-Frank Wall Street Reform and Consumer Protection Act.34 Capital Resources.35 Avista Utilities Capital Expenditures.36A V I S T A I IINDEX(CONTINUED)ITEM NO.PAGE NO.Advantage IQ Credit Agreement.37 Advantage IQ Redeemable Stock.37 Accounts Receivable Financing

93、 Facility.37 Off-Balance Sheet Arrangements.37 Pension Plan.38 Credit Ratings.38 Dividends.38 Contractual Obligations.39 Competition.39 Economic Conditions and Utility Load Growth.40 Environmental Issues and Other Contingencies.407A.Quantitative and Qualitative Disclosures about Market Risk.448.Fina

94、ncial Statements and Supplementary Data.48 Report of Independent Registered Public Accounting Firm.49 Financial Statements.50-56 Consolidated Statements of Income.50 Consolidated Statements of Comprehensive Income.51 Consolidated Balance Sheets.52-53 Consolidated Statements of Cash Flows.54-55 Conso

95、lidated Statements of Equity and Redeemable Noncontrolling Interests.56 Notes to Consolidated Financial Statements.57-97 Note 1.Summary of Significant Accounting Policies.57 Note 2.New Accounting Standards.61 Note 3.Disposition of Avista Energy.63 Note 4.Impairment of Assets.63 Note 5.Advantage IQ A

96、cquisitions.63 Note 6.Derivatives and Risk Management.64 Note 7.Jointly Owned Electric Facilities.67 Note 8.Property,Plant and Equipment.67 Note 9.Asset Retirement Obligations.67 Note 10.Pension Plans and Other Postretirement Benefit Plans.68 Note 11.Accounting for Income Taxes.73 Note 12.Energy Pur

97、chase Contracts.75 Note 13.Accounts Receivable Financing Facility.76 Note 14.Short-Term Borrowings.76 Note 15.Long-Term Debt.78 Note 16.Long-Term Debt to Affiliated Trusts.79 Note 17.Leases.79 Note 18.Guarantees.80 Note 19.Preferred Stock-Cumulative(Subject to Mandatory Redemption).80 Note 20.Fair V

98、alue.80 Note 21.Common Stock.82 Note 22.Earnings per Common Share Attributable to Avista Corporation.83 Note 23.Stock Compensation Plans.83 Note 24.Commitments and Contingencies.86 Note 25.Information Services Contracts.91 Note 26.Avista Utilities Regulatory Matters.92 Note 27.Information by Busines

99、s Segments.95 Note 28.Selected Quarterly Financial Data(Unaudited).979.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.98*9A.Controls and Procedures.989B.Other Information.100A V I S T A I I IINDEX(CONTINUED)ITEM NO.PAGE NO.PART III10.Directors,Executive Officers

100、 and Corporate Governance.10011.Executive Compensation.10112.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.10213.Certain Relationships and Related Transactions,and Director Independence.10214.Principal Accounting Fees and Services.102PART IV 15.Exhibi

101、ts,Financial Statement Schedules.103 Signatures.104 Exhibit Index.105*=not an applicable item in the 2010 calendar year for Avista CorporationA V I S T A I VACRONYMS AND TERMS(The following acronyms and terms are found in multiple locations within the document)Acronym/Term MeaningaMW Average Megawat

102、t a measure of the average rate at which a particular generating source produces energy over a period of timeAFUDC Allowance for Funds Used During Construction;represents the cost of both the debt and equity funds used to finance utility plant additions during the construction periodAM&D Advanced Ma

103、nufacturing and Development,does business as METALfxAdvantage IQ Advantage IQ,Inc.,provider of facility information and cost management services for multi-site customers throughout North America,subsidiary of Avista CapitalASC Accounting Standards CodificationAvista Capital Parent company to the Com

104、panys non-utility businessesAvista Corp.Avista Corporation,the CompanyAvista Energy Avista Energy,Inc.,an electricity and natural gas marketing,trading and resource management business,subsidiary of Avista CapitalAvista Utilities Operating division of Avista Cprising the regulated utility operations

105、 BPA Bonneville Power AdministrationCapacity The rate at which a particular generating source is capable of producing energy,measured in KW or MWCabinet Gorge The Cabinet Gorge Hydroelectric Generating Project,located on the Clark Fork River in IdahoColstrip The coal-fired Colstrip Generating Plant

106、in southeastern MontanaCoyote Springs 2 The natural gas-fired Coyote Springs 2 Generating Plant located near Boardman,OregonCT Combustion turbineDeadband or ERM The first$4.0 million in annual power supply costs above or below the amount included in base retaildeadband rates in Washington under the

107、Energy Recovery Mechanism in the state of Washington Dekatherm Unit of measurement for natural gas;a dekatherm is equal to approximately one thousand cubic feet(volume)or 1,000,000 BTUs(energy)DOE The state of Washingtons Department of EcologyEcos A Portland,Oregon-based energy efficiency solutions

108、provider acquired by Advantage IQ in 2009Energy The amount of electricity produced or consumed over a period of time,measured in KWH or MWHEPA Environmental Protection AgencyERM The Energy Recovery Mechanism in the state of WashingtonFASB Financial Accounting Standards BoardA V I S T A VACRONYMS AND

109、 TERMS(CONTINUED)Acronym/Term MeaningFERC Federal Energy Regulatory CommissionGHG Greenhouse gasIPUC Idaho Public Utilities CommissionIRP Integrated Resource PlanJackson Prairie Jackson Prairie Natural Gas Storage Project,an underground natural gas storage field located near Chehalis,Washington kV K

110、ilovolt or 1000 volts,a measure of capacity on transmission linesKW,KWH Kilowatt or 1000 watts a measure of generating output,kilowatt-hour or 1000 watt hours a measure of energy producedLancaster Plant A natural gas-fired combined cycle combustion turbine plant located in IdahoMW,MWH Megawatt or 10

111、00 KW,megawatt-hour or 1000 KWHNERC North American Electricity Reliability CorporationNoxon Rapids The Noxon Rapids Hydroelectric Generating Project,located on the Clark Fork River in MontanaOPUC The Public Utility Commission of OregonPCA The Power Cost Adjustment mechanism in the state of IdahoPGA

112、Purchased Gas AdjustmentPLP Potentially liable partyPUD Public Utility DistrictPURPA The Public Utility Regulatory Policies Act of 1978RTO Regional Transmission OrganizationSpokane Energy Spokane Energy,LLC,a special purpose limited liability company and all of its membership capital is owned by Avi

113、sta Corp.Spokane River Project The five hydroelectric plants operating under one FERC license on the Spokane River(Long Lake,Nine Mile,Upper Falls,Monroe Street and Post Falls)Therm Unit of measurement for natural gas;a therm is equal to approximately one hundred cubic feet(volume)or 100,000 BTUs(en

114、ergy)Watt Unit of measurement for electricity;a watt is equal to the rate of work represented by a current of one ampere under a pressure of one voltWUTC Washington Utilities and Transportation CommissionA V I S T A 1 economicconditionsinourserviceareas,includingthe effect on the demand for,and cust

115、omers payment for,our utility services;thepotentialeffectsoflegislationoradministrativerulemaking,including the possible adoption of national or state laws requiring resources to meet certain standards and placing restrictions on greenhouse gas emissions to mitigate concerns over global climate chan

116、ges;changesinactuarialassumptions,interestratesandtheactualreturn on plan assets for our pension plan,which can affect future funding obligations,pension expense and pension plan liabilities;volatilityandilliquidityinwholesaleenergymarkets,includingtheavailability of willing buyers and sellers,and p

117、rices of purchased energy and demand for energy sales;unplannedoutagesatanyofourgeneratingfacilitiesortheinability of facilities to operate as intended;theoutcomeofpendingregulatoryandlegalproceedingsarisingout of the“western energy crisis”of 2000 and 2001,including possible refunds;theoutcomeoflega

118、lproceedingsandothercontingencies;changesin,andcompliancewith,environmentalandendangeredspecies laws,regulations,decisions and policies,including present and potential environmental remediation costs;wholesaleandretailcompetitionincluding,butnotlimitedto,alternative energy sources,suppliers and deli

119、very arrangements;theabilitytocomplywiththetermsofthelicensesforourhydroelectric generating facilities at cost-effective levels;naturaldisastersthatcandisruptenergygeneration,transmissionand distribution,as well as the availability and costs of materials,equipment,supplies and support services;explo

120、sions,fires,accidents,ormechanicalbreakdownsthatmayoccur while operating and maintaining our generation,transmission and distribution systems;blackoutsordisruptionsofinterconnectedtransmissionsystems;disruptiontoinformationsystems,automatedcontrolsandothertechnologies that we rely on for operations,

121、communications and customer service;thepotentialforterroristattacks,cybersecurityattacksorothermalicious acts,that cause damage to our utility assets,as well as the national economy in general;including the impact of acts of terrorism or vandalism that damage or disrupt information technology system

122、s;delaysorchangesinconstructioncosts,andourability to obtain required permits and materials for present or prospective facilities;changesinthelong-termclimateofthePacificNorthwest,which can affect,among other things,customer demand patterns and the volume and timing of streamflows to our hydroelectr

123、ic resources;changesinindustrial,commercialandresidentialgrowthanddemographic patterns in our service territory or the loss of significant customers;thelossofkeysuppliersformaterialsorservices;defaultornonperformanceonthepartofanypartiesfromwhich we purchase and/or sell capacity or energy;FORWARD-LO

124、OKING STATEMENTSFrom time to time,we make forward-looking statements such as statements regarding projected or future:financialperformance,cashflows,capitalexpenditures,dividends,capitalstructure,otherfinancialitems,strategicgoalsandobjectives,and plansforoperations.These statements have underlying

125、assumptions(many of which are based,in turn,upon further assumptions).Such statements are made both in our reports filed under the Securities Exchange Act of 1934,as amended(including this Annual Report on Form 10-K),and elsewhere.Forward-looking statements are all statements except those of histori

126、cal fact including,without limitation,those that are identified by the use of words that include“will,”“may,”“could,”“should,”“intends,”“plans,”“seeks,”“anticipates,”“estimates,”“expects,”“forecasts,”“projects,”“predicts,”and similar expressions.Forward-looking statements(including those made in thi

127、s Annual Report on Form 10-K)are subject to a variety of risks and uncertainties and other factors.Many of these factors are beyond our control and they could have a significant effect on our operations,results of operations,financial condition or cash flows.This could cause actual results to differ

128、 materially from those anticipated in our statements.Such risks,uncertainties and other factors include,among others:weatherconditions(temperaturesandprecipitationlevels)andtheir effects on energy demand and electric generation,including the effect of precipitation and temperatures on the availabili

129、ty of hydroelectric resources,the effect of temperatures on customer demand,and similar impacts on supply and demand in the wholesale energy markets;theeffectofstateandfederalregulatorydecisionsonourabilitytorecover costs and earn a reasonable return including,but not limited to,the disallowance of

130、costs and investments,and delay in the recovery of capital investments and operating costs;changesinwholesaleenergypricesthatcanaffect,amongother things,the cash requirements to purchase electricity and natural gas,the value received for sales in the wholesale energy market,the necessity to request

131、changes in rates that are subject to regulatory approval,collateral required of us by counterparties on wholesale energy transactions and credit risk to us from such transactions,and the market value of derivative assets and liabilities;globalfinancialandeconomicconditions(includingtheimpactoncapita

132、l markets)and their effect on our ability to obtain funding at a reasonable cost;ourabilitytoobtainfinancingthroughtheissuanceofdebtand/or equity securities,which can be affected by various factors including our credit ratings,interest rates and other capital market conditions;A V I S T A 2PART IITE

133、M 1.BUSINESSCOMPANY OVERVIEWAvista Corporation(Avista Corp.or the Company),incorporated in the state of Washington in 1889,is an energy company engaged in the generation,transmission and distribution of energy as well as other energy-related businesses.As of December 31,2010,we employed 1,554 people

134、 in our utility operations and 945 people in our subsidiary businesses.Our corporate headquarters are in Spokane,Washington,the hub of the Inland Northwest.Historically,the primary industries in our service areas were mining,lumber and wood products,military and agriculture.Although they remain impo

135、rtant,our economy is now more diversified.Health care,higher education,finance,manufacturing and tourism are also important sectors.Retail trade,governmental and professional services have expanded to serve a larger population.We have two reportable business segments as follows:Avista Utilities an o

136、perating division of Avista Corp.that comprises our regulated utility operations.Avista Utilities generates,transmits and distributes electricity and distributes natural gas.The utility also engages in wholesale purchases and sales of electricity and natural gas.Advantage IQ an indirect subsidiary o

137、f Avista Corp.(approximately 76 percent owned as of December 31,2010)provides energy efficiency and cost management programs and services for multi-site customers and utilities throughout North America.Advantage IQs primary product lines include expense management services for utility,telecom and le

138、ase needs as well as strategic energy management and efficiency services that include procurement,conservation,performance reporting,financial planning and energy efficiency program management for commercial enterprises and utilities.We have ancillary businesses and investments that include a sheet

139、metal fabrication business,emerging technology venture fund investments and commercial real estate investments,Spokane Energy,LLC(Spokane Energy)(which was consolidated effective January 1,2010)as well as certain natural gas storage facilities held by Avista Energy,Inc.(Avista Energy).These activiti

140、es do not represent a reportable business segment and are conducted by various indirect subsidiaries of Avista Corp.Over time as opportunities arise,we dispose of assets and phase out operations that do not fit with our overall corporate strategy.However,we may invest incremental funds to protect ou

141、r existing investments and invest in new businesses that fit with our overall corporate strategy.Advantage IQ,Avista Energy,and various other companies are subsidiaries of Avista Capital,Inc.(Avista Capital)which is a direct,wholly owned subsidiary of Avista Corp.Total Avista Corp.stockholders equit

142、y was$1,125.8 million as of December 31,2010,of which$77.7 million represented our investment in Avista Capital.See“Item 6.Selected Financial Data”and“Note 27 of the Notes to Consolidated Financial Statements”for information with respect to the operating performance of each business segment(and othe

143、r subsidiaries).deteriorationinthecreditworthinessofourcustomersandcounterparties;theeffectofanypotentialdeclineinourcreditratings,includingimpeded access to capital markets,higher interest costs,and certain covenants with ratings triggers in our financing arrangements and wholesale energy contracts

144、;increasinghealthcarecostsandtheresultingeffectonhealthinsurance provided to our employees and retirees;increasingcostsofinsurance,morerestrictedcoveragetermsandour ability to obtain insurance;workforceissues,includingchangesincollectivebargainingunitagreements,strikes,work stoppages or the loss of

145、key executives,availability of workers in a variety of skill areas,and our ability to recruit and retain employees;thepotentialeffectsofnegativepublicityregardingbusinesspractices,whether true or not,which could result in,among other things,costly litigation and a decline in our common stock price;c

146、hangesintechnologies,possiblymakingsomeofthecurrenttechnology obsolete;changesintaxratesand/orpolicies;and changesinourstrategicbusinessplans,whichmaybeaffectedbyany or all of the foregoing,including the entry into new businesses and/or the exit from existing businesses.Our expectations,beliefs and

147、projections are expressed in good faith.We believe they are reasonable based on,without limitation,an examination of historical operating trends,our records and other information available from third parties.However,there can be no assurance that our expectations,beliefs or projections will be achie

148、ved or accomplished.Furthermore,any forward-looking statement speaks only as of the date on which such statement is made.We undertake no obligation to update any forward-looking statement or statements to reflect events or circumstances that occur after the date on which such statement is made or to

149、 reflect the occurrence of unanticipated events.New factors emerge from time to time,and it is not possible for us to predict all such factors,nor can we assess the effect of each such factor on our business or the extent that any such factor or combination of factors may cause actual results to dif

150、fer materially from those contained in any forward-looking statement.AVAILABLE INFORMATIONOur Web site address is .We make annual,quarterly and current reports available at our Web site as soon as practicable after electronically filing these reports with the Securities and Exchange Commission.Infor

151、mation contained on our Web site is not part of this report.A V I S T A 3Our optimization process includes entering into hedging transactions to manage risks.Our generation assets are interconnected through the regional transmission system and are operated on a coordinated basis to enhance load-serv

152、ing capability and reliability.We provide transmission and ancillary services in eastern Washington,northern Idaho and western Montana.Transmission revenues were$12.8 million in 2010,$9.3 million in 2009 and$9.5 million in 2008.Electric RequirementsOur peak electric native load requirement for 2010

153、occurred on November 23,2010 at which time our total obligation was 2,507 MW consisting of:nativeloadof1,704MW,long-termwholesaleobligationsof237MW,and short-termwholesaleobligationsof566MW.At that time our maximum resource capacity available was 2,905 MW,which included:company-ownedelectricgenerati

154、onof1,537MW,long-termhydroelectriccontractswithcertainPublicUtilityDistricts(PUDs)of 152 MW,otherlong-termwholesalecontractsof563MW,and short-termwholesalepurchasesof653MW.Electric ResourcesWe have a diverse electric resource mix of hydroelectric projects,thermal generating facilities,and power purc

155、hases and exchanges.At the end of 2010,our facilities had a total net capability of 1,791 MW,of which 56 percent was hydroelectric and 44 percent was thermal.See“Item 2.Properties”for detailed information on generating facilities.Hydroelectric Resources We own and operate six hydroelectric projects

156、on the Spokane River and two hydroelectric projects on the Clark Fork River.Hydroelectric generation is our lowest cost source per megawatt-hour(MWh)of electricity and the availability of hydroelectric generation has a significant effect on total power supply costs.Under normal streamflow and operat

157、ing conditions,we estimate that we would be able to meet approximately one-half of our total average electric requirements(both retail and long-term wholesale)with the combination of our hydroelectric generation and long-term hydroelectric purchase contracts with certain PUDs in the state of Washing

158、ton.Our estimate of normal annual hydroelectric generation for 2011(including resources purchased under long-term hydroelectric contracts with certain PUDs)is 516 average megawatts(aMW)(or 4.5 million MWhs).Hydroelectric resources provided 476 aMW for 2010,526 aMW for 2009 and 535 aMW for 2008.AVIST

159、A UTILITIESGeneral Through our regulated utility operations,we generate,transmit and distribute electricity and distribute natural gas.Retail electric and natural gas customers include residential,commercial and industrial classifications.We also engage in wholesale purchases and sales of electricit

160、y and natural gas as an integral part of energy resource management and our load-serving obligation.Our utility provides electric distribution and transmission,as well as natural gas distribution services in parts of eastern Washington and northern Idaho.We also provide natural gas distribution serv

161、ice in parts of northeast and southwest Oregon.At the end of 2010,we supplied retail electric service to 359,000 customers and retail natural gas service to 319,000 customers across our entire service territory.Our service territory covers 30,000 square miles with a population of 1.5 million.See“Ite

162、m 2.Properties”for further information on our utility assets.See“Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations Economic Conditions and Utility Load Growth”for information on economic conditions in our service territory.Electric OperationsIn addition to p

163、roviding electric distribution and transmission services,we generate electricity from facilities that we own and we purchase capacity and energy and fuel for generation under long-term and short-term contracts.We also sell capacity and energy,and surplus fuel in the wholesale market in connection wi

164、th our resource optimization activities as described below.As part of our resource procurement and management operations in the electric business,we engage in an ongoing process of resource optimization,which involves the economic selection from available energy resources to serve our load obligatio

165、ns and the use of these resources to capture available economic value.We sell and purchase wholesale electric capacity and energy and fuel as part of the process of acquiring and balancing resources to serve our load obligations.These transactions range from terms of one hour up to multiple years.We

166、 make continuing projections of:electricloadsatvariouspointsintime(rangingfromonehourtomultiple years)based on,among other things,estimates of customer usage and weather,historical data and contract terms,and resourceavailabilityatthesepointsintimebasedon,amongotherthings,fuel choices and fuel marke

167、ts,estimates of streamflows,availability of generating units,historic and forward market information,contract terms,and experience.On the basis of these projections,we make purchases and sales of electric capacity and energy and fuel to match expected resources to expected electric load requirements

168、.Resource optimization involves generating plant dispatch and scheduling available resources and also includes transactions such as:purchasingfuelforgeneration,wheneconomical,sellingfuelandsubstitutingwholesaleelectricpurchases,and otherwholesaletransactionstocapturethevalueofgenerationand transmiss

169、ion resources and fuel delivery capacity contracts.A V I S T A 4Coyote Springs 2,which is operated by Portland General Electric Company,is supplied with natural gas under both term contracts and spot market purchases,including transportation agreements with unilateral renewal rights.Colstrip,which i

170、s operated by PPL Montana,LLC,is supplied with fuel from adjacent coal reserves under coal supply and transportation agreements in effect through 2019.The primary fuel for the Kettle Falls GS is wood waste generated as a by-product and delivered by trucks from forest industry operations within 100 m

171、iles of the plant.A combination of long-term contracts and spot purchases has provided,and is expected to meet,fuel requirements for the Kettle Falls GS.The Northeast CT,Rathdrum CT,Boulder Park and Kettle Falls CT generating units are primarily used to meet peaking electric requirements.We also ope

172、rate these facilities when marginal costs are below prevailing wholesale electric prices.These generating facilities have access to natural gas supplies that are adequate to meet their respective operating needs.did not allow us to include the costs associated with the power purchase agreement for t

173、he Lancaster Plant in rates.We subsequently filed for and received approval for deferred accounting treatment for these net costs.In the 2010 Washington general rate case settlement,the parties agreed that recovery of the deferred net costs associated with the power purchase agreement for the Lancas

174、ter Plant would be limited to$6.8 million for 2010.These net deferred costs will be recovered over a five-year amortization period with a rate of return on the unamortized balance.The parties agreed that the costs for the Lancaster Plant for 2011 and going forward are reasonable and should be recove

175、red in rates.As part of the settlement related to the 2010 Lancaster Plant deferred net costs,the parties agreed that there would be no deferrals under the ERM for 2010.Thermal Resources We own:thecombinedcyclecombustionturbine(CT)naturalgas-firedCoyote Springs 2 Generation Project(Coyote Springs 2)

176、located near Boardman,Oregon,a15percentinterestinatwin-unit,coal-firedboilergeneratingfacility,the Colstrip 3&4 Generating Project(Colstrip)in southeastern Montana,awoodwaste-firedboilergeneratingfacilityknownastheKettle Falls Generating Station(Kettle Falls GS)in northeastern Washington,atwo-unitna

177、turalgas-firedCTgeneratingfacility,locatedinnortheast Spokane(Northeast CT),atwo-unitnaturalgas-firedCTgeneratingfacilityinnorthernIdaho(Rathdrum CT),and twosmallnaturalgas-firedgeneratingfacilities(BoulderParkand Kettle Falls CT).Lancaster Plant Power Purchase Agreement The Lancaster Plant is a 270

178、 MW natural gas-fired combined cycle combustion turbine plant located in Idaho,owned by an unrelated third-party.All of the output from the Lancaster Plant is contracted to us through 2026 under a power purchase agreement.The majority of the rights and obligations under this agreement were conveyed

179、to Shell Energy through the end of 2009.These rights and obligations were conveyed to Avista Corp.(Avista Utilities)beginning in January 2010.In Idaho,the net costs of the Lancaster power purchase agreement were determined to be prudent by the Idaho Public Utilities Commission(IPUC)and are currently

180、 being recovered through general rates and the Power Cost Adjustment mechanism.In Washington,the Washington Utilities and Transportation Commission(WUTC)initially The following table shows our hydroelectric generation(in thousands of MWhs)during the year ended December 31:2010 2009 2008Noxon Rapids

181、1,503 1,673 1,696Cabinet Gorge 942 1,061 1,081Post Falls 90 84 85Upper Falls 71 52 78Monroe Street 106 104 104Nine Mile 101 106 105Long Lake 480 487 497Little Falls 201 199 205 Total company-owned hydroelectric generation 3,494 3,766 3,851Long-term hydroelectric contracts with PUDs 685 839 833 Total

182、 hydroelectric generation 4,179 4,605 4,684The following table shows our thermal generation(in thousands of MWhs)during the year ended December 31:2010 2009 2008Coyote Springs 2 1,661 1,559 1,696Colstrip 1,749 1,277 1,758Kettle Falls GS 312 184 201Northeast CT and Rathdrum CT 12 44 15Boulder Park an

183、d Kettle Falls CT 14 33 23 Total thermal generation 3,748 3,097 3,693A V I S T A 5In March 2001,we received a 45-year operating license from the FERC for the Cabinet Gorge Hydroelectric Generating Project(Cabinet Gorge)and the Noxon Rapids Hydroelectric Generating Project(Noxon Rapids).As part of th

184、e Clark Fork Settlement Agreement,we initiated the implementation of protection,mitigation and enhancement measures in March 1999.Measures in the agreement address issues related to fisheries,water quality,wildlife,recreation,land use,cultural resources and erosion.See“Cabinet Gorge Total Dissolved

185、Gas Abatement Plan”in“Note 24 of the Notes to Consolidated Financial Statements”for discussion of dissolved atmospheric gas levels that exceed state of Idaho and federal water quality standards downstream of Cabinet Gorge during periods when we must divert excess river flows over the spillway and ou

186、r mitigation plans and efforts.We own and operate six hydroelectric plants on the Spokane River.Five of these(Long Lake,Nine Mile,Upper Falls,Monroe Street,and Post Falls)are under one FERC license and are referred to as the Spokane River Project.The sixth,Little Falls,is operated under separate Con

187、gressional authority and is not licensed by the FERC.The FERC issued a new 50-year license for the Spokane River Project in June 2009.For further information see“Spokane River Licensing”in“Note 24 of the Notes to Consolidated Financial Statements.”Future Resource NeedsWe have operational strategies

188、to provide sufficient resources to meet our energy requirements under a range of operating conditions.These operational strategies consider the amount of energy needed over hourly,daily,monthly and annual durations,which vary widely because of the factors that influence demand.Our average hourly loa

189、d was 1,075 aMW in 2010,1,082 aMW in 2009 and 1,102 aMW in 2008.Other Purchases,Exchanges and Sales We purchase and sell power under various long-term contracts.We also enter into short-term purchases and sales.See“Electric Operations”for additional information with respect to the use of wholesale p

190、urchases and sales as part of our resource optimization process.Pursuant to the Public Utility Regulatory Policies Act of 1978(PURPA),as amended by the Federal Energy Regulatory Commission(FERC)as required by the Energy Policy Act of 2005(Energy Policy Act),we are required to purchase generation fro

191、m qualifying facilities.This includes,among other resources,hydroelectric projects,cogeneration projects and wind generation projects at rates approved by the WUTC and the IPUC.Existing contracts expire at various times between 2011 and 2022.See“Avista Utilities Operating Statistics Electric Operati

192、ons Electric Energy Resources”for annual quantities of purchased power,wholesale power sales and power from exchanges in 2010,2009 and 2008.Hydroelectric Licensing We are a licensee under the Federal Power Act as administered by the FERC,which includes regulation of hydroelectric generation resource

193、s.Except for the Little Falls Plant,all of our hydroelectric plants are regulated by the FERC through project licenses.The licensed projects are subject to the provisions of Part I of the Federal Power Act.These provisions include payment for headwater benefits,condemnation of licensed projects upon

194、 payment of just compensation,and take-over of such projects after the expiration of the license upon payment of the lesser of“net investment”or“fair value”of the project,in either case,plus severance damages.The following is a forecast of our average annual energy requirements and resources for 201

195、1,2012,2013 and 2014:FORECASTED ELECTRIC ENERGY REQUIREMENTS AND RESOURCES(aMW)2011 2012 2013 2014Requirements:System load 1,094 1,109 1,131 1,148 Contracts for power sales 138 138 124 107 Total requirements 1,232 1,247 1,255 1,255Resources:Company-owned and contract hydro generation(1)523 528 533 5

196、36 Company-owned base load thermal generation(2)516 494 469 490 Contracts for power purchases 376 421 405 422 Total resources 1,415 1,443 1,407 1,448 Surplus resources 183 196 152 193 Additional available energy(3)144 153 153 153 Total surplus resources 327 349 305 346(1)The forecast assumes near no

197、rmal hydroelectric generation.(2)Excludes the Northeast CT and Rathdrum CT.We generally use these resources to meet electric load requirements due to either below normal hydroelectric generation or increased loads or outages at other generating facilities,and/or when operating costs are lower than s

198、hort-term wholesale market prices.(3)Northeast CT and Rathdrum CT.The combined maximum capacity of the Northeast CT and Rathdrum CT is 243 MW,with estimated available energy production as indicated for each year.A V I S T A 6Natural Gas Operations General We provide natural gas distribution services

199、 to retail customers in parts of eastern Washington,northern Idaho,and parts of northeast and southwest Oregon.Market prices for natural gas,like other commodities,can be volatile.To provide reliable supply and to manage the impact of volatile prices on our customers,we procure natural gas through a

200、 diversified mix of spot market purchases and forward fixed price purchases from various supply basins and over various time periods.We also use natural gas storage capacity to support high demand periods and to procure natural gas when prices may be seasonally lower.Securing prices throughout the y

201、ear and even into subsequent years mitigates potential adverse impacts of significant purchase requirements in a volatile price environment.Like prices,natural gas loads can also be volatile.Daily natural gas loads can differ significantly from the monthly load projections.We make continuing project

202、ions of our natural gas loads and assess available natural gas resources.On the basis of these projections,we plan and execute a series of transactions to hedge a significant portion of our projected natural gas requirements through forward market transactions and derivative instruments.These transa

203、ctions may extend for multiple years into the future with the highest volumes hedged for the current and most immediately upcoming natural gas operating year(November through October).We also leave a significant portion of our natural gas supply requirements unhedged for purchase in short-term and s

204、pot markets.As part of the process of balancing natural gas retail load requirements with resources,we engage in wholesale purchases and sales of natural gas.We also optimize natural gas resources by using excess resources and market opportunities to generate economic value that reduces retail rates

205、.Wholesale sales are delivered through wholesale market facilities outside of our natural gas distribution system.Natural gas resource optimization activities include,but are not limited to:wholesalemarketsalesofsurplusnaturalgassupplies,purchasesandsalesofnaturalgastooptimizeuseofpipelineand storag

206、e capacity.We also provide transportation service to certain large commercial and industrial natural gas customers who purchase natural gas through third-party marketers.For these customers,we move their natural gas through our distribution system from natural gas transmission pipeline delivery poin

207、ts to the customers premises.The total volume transported on behalf of our transportation customers for 2010,2009 and 2008 was 142.1,144.6 and 148.7 million therms,representing 15 percent,16 percent and 18 percent of total system deliveries.Natural Gas Supply We purchase all of our natural gas in wh

208、olesale markets.We are connected to multiple supply basins in the western United States and western Canada through firm capacity delivery rights on six pipeline networks.Access to this diverse portfolio of natural gas resources allows us to make natural gas procurement decisions that benefit our nat

209、ural gas customers.We have interstate pipeline capacity to serve approximately In the third quarter of 2009,we filed our 2009 Electric Integrated Resource Plan(IRP)with the WUTC and the IPUC.The IRP identifies a strategic resource portfolio that meets future electric load requirements,promotes envir

210、onmental stewardship and meets our obligation to provide reliable electric service to customers at rates,terms and conditions that are fair,just,reasonable and sufficient.We regard the IRP as a tool for resource evaluation,rather than an acquisition plan for a particular project.Highlights of the 20

211、09 IRP include:Upto150MWofwindpowerby2012,Anadditional200MWofwindpowerby2022,750MWofnaturalgas-firedgenerationfacilities,Aggressiveenergyefficiencymeasurestoreducegenerationrequirements by 26 percent or 339 MW,Transmissionupgradestointegratenewgenerationresourcesinto our system,and Hydroelectricupgr

212、adesatexistingfacilitiestogenerateadditional renewable energy.We are required to file an IRP every two years.We will file an IRP in August 2011 and our resource strategy may change from the highlights included above based upon market,legislative and regulatory developments.We are subject to the Wash

213、ington state Energy Independence Act,which includes renewable energy portfolio standards and we must obtain a portion of our electricity from qualifying renewable resources or through purchase of renewable energy credits.Our IRP identified that additional qualifying renewable energy is needed by 201

214、6 and that new capacity and energy resources are needed by 2018.In February 2011,we issued a request for proposals(RFP)seeking qualifying renewable electric resources to meet a portion of our renewable energy portfolio standards requirements under the Washington state Energy Independence Act.We seek

215、 to acquire up to 35 aMW of renewable energy,or as much as 100 MW of nameplate wind capacity with deliveries beginning in 2012.We have issued this RFP due to recent market changes,tax incentives that remain in effect and a recent WUTC policy statement indicating support of the acquisition of renewab

216、le resources in advance of renewable portfolio standards deadlines,if early acquisition can be cost-justified.We completed the acquisition of the development rights for a wind generation site in 2008.While this RFP does not include the development of this site,we will continue to study this site in

217、preparation for later development.We plan to meet the state of Washingtons renewable energy standards until 2016 with a combination of qualified upgrades at our existing hydroelectric generation plants and the purchase of a small amount of renewable energy credits from 2012 through 2015.Future gener

218、ation resource decisions will be impacted by legislation for restrictions on greenhouse gas emissions and renewable energy requirements.See“Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations Environmental Issues and Other Contingencies”for information related

219、 to existing laws,as well as potential legislation that could influence our future electric resource mix.A V I S T A 7costs through subsequent changes in rates.Oregon currently allows a forecasted test year,which generally is more effective in providing timely recovery of costs.Our rates for wholesa

220、le electric and natural gas transmission services are based on either“cost of service”principles or market-based rates as set forth by the FERC.See“Notes 1 and 26 of the Notes to Consolidated Financial Statements”for additional information about regulation,depreciation and deferred income taxes.Gene

221、ral Rate Cases We regularly review the need for electric and natural gas rate changes in each state in which we provide service.See“Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations Avista Utilities Regulatory Matters General Rate Cases”for information on ge

222、neral rate case activity.Power Cost Deferrals We defer the recognition in the income statement of certain power supply costs that vary from the level currently recovered from our retail customers as authorized by the WUTC and the IPUC.See“Item 7.Managements Discussion and Analysis of Financial Condi

223、tion and Results of Operations Avista Utilities Regulatory Matters Power Cost Deferrals and Recovery Mechanisms”and“Note 26 of the Notes to Consolidated Financial Statements”for detailed information on power cost deferrals and recovery mechanisms in Washington and Idaho.Purchased Gas Adjustment(PGA)

224、Under established regulatory practices in each respective state,we are allowed to adjust natural gas rates periodically(with regulatory approval)to reflect increases or decreases in the cost of natural gas purchased.Differences between actual natural gas costs and the natural gas costs included in r

225、etail rates are deferred and charged or credited to expense when regulators approve inclusion of the cost changes in rates.We typically propose such adjustments at least once per year.See“Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations Avista Utilities Reg

226、ulatory Matters Purchased Gas Adjustments”and“Note 26 of the Notes to Consolidated Financial Statements”for detailed information on natural gas cost deferrals and recovery mechanisms in Washington,Idaho and Oregon.Federal Laws Related to Wholesale Competition Federal law promotes practices that open

227、 the electric wholesale energy market to competition.The FERC requires electric utilities to transmit power and energy to or for wholesale purchasers and sellers,and requires electric utilities to enhance or construct transmission facilities to create additional transmission capacity for the purpose

228、 of providing these services.Public utilities(through subsidiaries)and other entities may participate in the development of independent electric generating plants for sales to wholesale customers.Public utilities operating under the Federal Power Act are required to provide open and non-discriminato

229、ry access to their transmission systems to third parties and establish an Open Access Same-Time Information System to provide an electronic means by which transmission customers can obtain information about available transmission capacity and purchase transmission access.The FERC also requires each

230、public utility subject to the rules to operate its transmission and wholesale power merchant operating functions separately and to comply with standards of conduct designed to 25 percent of natural gas supplies from domestic sources,with the remaining 75 percent from Canadian sources.Natural gas pri

231、ces in the Pacific Northwest are affected by global energy markets,as well as supply and demand factors in other regions of the United States and Canada.Future prices and delivery constraints may cause our source mix to vary.Natural Gas Storage We own a one-third interest in the Jackson Prairie Natu

232、ral Gas Storage Project(Jackson Prairie),an underground natural gas storage field located near Chehalis,Washington.Jackson Prairie has a total peak day deliverability of 11.5 million therms,with a total working natural gas capacity of 249.5 million therms.Avista Utilities will gain 30.3 million ther

233、ms of additional capacity at Jackson Prairie on May 1,2011 for use in its utility operations.This capacity was originally held by Avista Energy and as part of the asset sales agreement this capacity is assigned to Shell Energy through April 30,2011.We also contract with Northwest Natural Gas for sto

234、rage at the Mist Natural Gas storage facility.This contract is for 5 million therms of capacity and up to 150 million therms of deliverability.This contract expires on March 31,2011.Natural gas storage enables us to place natural gas into storage when prices may be lower or to satisfy minimum natura

235、l gas purchasing requirements,as well as to meet high demand periods or to withdraw natural gas from storage when spot prices are higher.Regulatory IssuesGeneral As a regulated public utility,we are subject to regulation by state utility commissions for prices,accounting,the issuance of securities a

236、nd other matters.The retail electric and natural gas operations are subject to the jurisdiction of the WUTC,the IPUC,the Public Utility Commission of Oregon(OPUC),and the Public Service Commission of the State of Montana(Montana Commission).Approval of the issuance of securities is not required from

237、 the Montana Commission.We are also subject to the jurisdiction of the FERC for licensing of hydroelectric generation resources,and for electric transmission services and wholesale sales.Our rates for retail electric and natural gas services(other than specially negotiated retail rates for industria

238、l or large commercial customers,which are subject to regulatory review and approval)are determined on a“cost of service”basis.Rates are designed to provide,after recovery of allowable operating expenses,an opportunity for us to earn a reasonable return on“rate base.”“Rate base”is generally determine

239、d by reference to the original cost(net of accumulated depreciation)of utility plant in service,subject to various adjustments for deferred taxes and other items.Over time,rate base is increased by additions to utility plant in service and reduced by depreciation and retirement of utility plant and

240、write-offs as authorized by the utility commissions.In general,a request for new rates in Washington and Idaho is made on the basis of net investment,operating expenses and revenues as of a date prior to the date of the request.Although the current ratemaking process in these states provides recover

241、y of some future changes in net investment,operating costs and revenues,it does not reflect all changes in costs for the period in which new retail rates will be in place.This historically has resulted in a lag between the time we incur costs and the time when we start recovering the A V I S T A 8in

242、 other forums to attain operational efficiencies and to meet FERC policy objectives.The FERC requires RTOs to provide various data and is currently requesting non-RTO regions to report similar data for the purpose of establishing performance metrics.We expect the FERC to use this data to compare RTO

243、 and non-RTO regions.We cannot foresee what policy objectives the FERC may develop as a result of establishing such performance metrics.Reliability Standards Among its other provisions,the U.S.Energy Policy Act provides for the implementation of mandatory reliability standards and authorizes the FER

244、C to assess fines for non-compliance with these standards and other FERC regulations.The FERC subsequently certified the North American Electricity Reliability Corporation(NERC)as the single Electric Reliability Organization authorized to establish and enforce reliability standards and delegate auth

245、ority to regional entities for the purpose of establishing and enforcing reliability standards.As of January 2011,the FERC has approved 111 NERC Reliability Standards,including nine western region standards,making up the set of legally enforceable standards for the United States bulk electric system

246、.The first of these reliability standards became effective in June 2007.We are required to self-certify our compliance with these standards on an annual basis and undergo regularly scheduled periodic reviews by the NERC and its regional entity,the Western Electricity Coordinating Council(WECC).Our f

247、ailure to comply with these standards could result in financial penalties of up to$1 million per day per violation.Annual self-certification and audit processes to date have demonstrated our substantial compliance with these standards.ensure that all wholesale users,including the public utilitys pow

248、er merchant operations,have equal access to the public utilitys transmission system.Our compliance with these standards has not had any substantive impact on the operation,maintenance and marketing of our transmission system or our ability to provide service to customers.Regional Transmission Organi

249、zations Beginning with FERC Orders No.888 and No.2000(issued in 2000)and continuing with subsequent rulemakings and policies,the FERC has encouraged the formation of various forms of Regional Transmission Organizations(RTOs),including independent system operators(ISOs).While it has not mandated ISO

250、formation,the FERC has issued orders and made public policy statements indicating its support for the development and formation of regional independently-governed transmission organizations,including those intended to implement a number of regional transmission planning coordination requirements.We

251、have participated in discussions with transmission providers and other stakeholders in the Pacific Northwest for several years regarding the possible formation of an ISO in the region.We ultimately became a member of ColumbiaGrid,a Washington nonprofit membership corporation with an independent slat

252、e of directors formed to improve the operational efficiency,reliability,and planned expansion of the transmission grid in the Pacific Northwest.ColumbiaGrid is not an ISO,but performs limited functions as set forth in specific agreements with ColumbiaGrid members and other stakeholders.ColumbiaGrid

253、and its members also work with other western RTOs and groups to address operational efficiencies,including WestConnect and the Northern Tier Transmission Group.We will continue to assess the benefits of entering into other functional agreements with ColumbiaGrid and/or participating A V I S T A 9AVI

254、STA UTILITIES OPERATING STATISTICSAvista CorporationYears Ended December 31,2010 2009 2008 Electric Operations Electric Operating Revenues(Dollars in Thousands):Residential$296,627$315,649$279,641 Commercial 265,219 273,954 247,714 Industrial 114,792 107,741 101,785 Public street and highway lightin

255、g 6,702 6,607 5,962 Total retail 683,340 703,951 635,102 Wholesale 165,553 88,414 141,744 Sales of fuel 106,375 32,992 44,695 Other 19,015 15,426 16,916 Total electric operating revenues$974,283$840,783$838,457 Electric Energy Sales(Thousands of MWhs):Residential 3,618 3,791 3,744 Commercial 3,100 3

256、,177 3,188 Industrial 2,099 1,948 2,059 Public street and highway lighting 26 26 26 Total retail 8,843 8,942 9,017 Wholesale 3,803 2,354 1,964 Total electric energy sales 12,646 11,296 10,981 Electric Energy Resources(Thousands of MWhs):Hydro generation(from Company facilities)3,494 3,766 3,851 Ther

257、mal generation(from Company facilities)3,748 3,097 3,693 Purchased power hydro generation from long-term contracts with PUDs 685 839 833 Purchased power wholesale 5,315 4,152 3,253 Power exchanges (15)(18)(17)Total power resources 13,227 11,836 11,613 Energy losses and Company use (581)(540)(632)Tot

258、al energy resources(net of losses)12,646 11,296 10,981 Number of Electric Retail Customers(Average for Period):Residential 315,283 313,884 311,381 Commercial 39,489 39,276 39,075 Industrial 1,376 1,394 1,388 Public street and highway lighting 449 444 434 Total electric retail customers 356,597 354,9

259、98 352,278 Electric Residential Service Averages:Annual use per customer(KWh)11,476 12,079 12,023 Revenue per KWh(in cents)8.20 8.33 7.47 Annual revenue per customer$940.83$1,005.62$898.07 Electric Average Hourly Load(aMW)1,075 1,082 1,102 A V I S T A 1 0AVISTA UTILITIES OPERATING STATISTICS(CONTINU

260、ED)Avista CorporationYears Ended December 31,2010 2009 2008 Electric Operations(continued):Resource Availability at time of system peak(MW):Total requirements(winter):Retail native load 1,704 1,763 1,821 Wholesale obligations 803 608 562 Total requirements(winter)2,507 2,371 2,383 Total resource ava

261、ilability(winter)2,905 2,514 2,480 Total requirements(summer):Retail native load 1,556 1,522 1,602 Wholesale obligations 822 685 431 Total requirements(summer)2,378 2,207 2,033 Total resource availability(summer)2,662 2,499 2,250 Cooling Degree Days:(1)Spokane,WA Actual 380 589 478 30-year average 4

262、34 394 394%of average 88%149%121%(1)Cooling degree days are the measure of the warmness of weather experienced,based on the extent to which the average of high and low temperatures for a day exceeds 65 degrees Fahrenheit(annual degree days above historic indicate warmer than average temperatures).A

263、V I S T A 1 1AVISTA UTILITIES OPERATING STATISTICS(CONTINUED)Avista CorporationYears Ended December 31,2010 2009 2008 Natural Gas Operations Natural Gas Operating Revenues(Dollars in Thousands):Residential$193,169$251,022$276,386 Commercial 98,257 135,236 152,147 Industrial and interruptible 6,494 9

264、,945 12,159 Total retail 297,920 396,203 440,692 Wholesale 197,364 143,524 281,668 Transportation 6,470 6,067 6,327 Other 9,495 8,624 5,520 Total natural gas operating revenues$511,249$554,418$734,207 Therms Delivered(Thousands of Therms):Residential 188,546 207,979 210,125 Commercial 113,422 126,34

265、5 128,224 Industrial and interruptible 9,755 10,918 12,196 Total retail 311,723 345,242 350,545 Wholesale 468,887 397,977 345,916 Transportation 142,093 144,580 148,723 Interdepartmental and Company use 393 502 526 Total therms delivered 923,096 888,301 845,710 Sources of Natural Gas Supply(Thousand

266、s of Therms):Purchases 787,836 751,057 710,137 Storage injections (86,750)(99,330)(76,491)Storage withdrawals 83,333 95,183 66,271 Natural gas for transportation 142,093 144,580 148,723 Distribution system losses (3,416)(3,189)(2,930)Total natural gas supply 923,096 888,301 845,710 Number Of Natural

267、 Gas Retail Customers(Average for Period):Residential 282,721 280,667 277,892 Commercial 33,431 33,214 32,901 Industrial and interruptible 292 300 297 Total natural gas retail customers 316,444 314,181 311,090 Natural Gas Residential Service Averages:Annual use per customer(therms)667 741 756 Revenu

268、e per therm(in dollars)$1.02$1.21$1.32 Annual revenue per customer$683.25$894.37$994.58 Heating Degree Days:(1)Spokane,WA Actual 6,320 6,976 7,052 30-year average 6,647 6,820 6,820%of average 95%102%103%Medford,OR Actual 4,119 4,485 4,569 30-year average 4,402 4,533 4,533%of average 94%99%101%(1)Hea

269、ting degree days are the measure of the coldness of weather experienced,based on the extent to which the average of high and low temperatures for a day falls below 65 degrees Fahrenheit(annual degree days below historic indicate warmer than average temperatures).A V I S T A 1 2revenues.On December 3

270、1,2010,Advantage IQ acquired substantially all of the assets and liabilities of The Loyalton Group,a Minneapolis-based energy management firm known for its energy procurement and price risk management solutions.In January 2011,Advantage IQ acquired substantially all of the assets and liabilities of

271、Building Knowledge Networks,a Seattle-based real-time building energy management services provider.OTHER BUSINESSESAvista Energy still owns natural gas storage facilities and we expect these assets to be transferred to our utility operations on May 1,2011.This business had operating revenues and res

272、ource costs through the end of 2009 related to the power purchase agreement for the Lancaster Plant.The rights and obligations related to the power purchase agreement for the Lancaster Plant were conveyed to Avista Corp.(Avista Utilities)in January 2010.The implementation of amendments to accounting

273、 standards(See Note 2 of the Notes to Consolidated Financial Statements)resulted in the Company including Spokane Energy in its consolidated financial statements effective January 1,2010.Spokane Energy is a special purpose limited liability company and all of its membership capital is owned by Avist

274、a Corp.Spokane Energy was formed in December 1998,to assume ownership of a fixed rate electric capacity contract between Avista Corp.and Portland General Electric Company.The consolidation of Spokane Energy results in an increase in operating revenues,operating expenses and interest expense with no

275、impact on net income.Our other businesses also include Advanced Manufacturing and Development(AM&D)doing business as METALfx,a subsidiary that performs custom sheet metal fabrication of electronic enclosures,parts and systems for the computer,telecom,renewable energy and medical industries.Our other

276、 investments and operations include:realestateinvestments(primarilycommercialofficebuildings),investmentsinemergingtechnologyventurecapitalfundsandlowincome housing,and theremaininginvestmentinafuelcellbusinessthatwaspreviously a subsidiary of the Company.Over time as opportunities arise,we dispose

277、of assets and phase out operations that do not fit with our overall corporate strategy.However,we may invest incremental funds to protect our existing investments and invest in new businesses that fit with our overall corporate strategy.ADVANTAGE IQOur subsidiary,Advantage IQ provides sustainable ut

278、ility expense management and energy management solutions to multi-site companies across North America.Advantage IQs invoice processing,auditing and payment services,coupled with energy procurement,comprehensive reporting and advanced analysis,provide the critical data clients need to balance the fin

279、ancial,social and environmental aspects of doing business.As part of the expense management services,Advantage IQ analyzes and audits invoices,then presents consolidated bills on-line,and processes payments.Information gathered from invoices,providers and other customer-specific data allows Advantag

280、e IQ to provide its clients with in-depth analytical support,real-time reporting and consulting services.Advantage IQ also provides comprehensive energy efficiency program management services to utilities across North America.As part of these management services,Advantage IQ helps utilities develop

281、and execute energy efficiency programs with a complete turn-key solution.Advantage IQ has secured five patents on its two critical business systems:FacilityIQsystem,whichprovidesoperationalinformationdrawn from facility bills,and AviTrackdatabase,whichprocessesandreportsoninformationgathered from se

282、rvice providers to ensure that customers are receiving the most effective services at the proper price.We are not aware of any claimed or threatened infringement on any of Advantage IQs patents issued to date and we expect to continue to expand and protect existing patents,as well as file additional

283、 patent applications for new products,services and process enhancements.The following table presents key statistics for Advantage IQ:2010 2009 2008Customers at year-end 534 532 537Billed sites at year-end 360,596 421,080 417,078Dollars of customer bills processed(in billions)$17.3$17.4$16.7The decre

284、ase in billed sites at year-end 2010 as compared to prior periods was due to the loss of a customer that had a significant number of billed sites,but represented only approximately 1 percent of annual A V I S T A 1 3ITEM 1A.RISK FACTORSRISK FACTORSThe following factors could have a significant impac

285、t on our operations,results of operations,financial condition or cash flows.These factors could cause actual results or outcomes to differ materially from those discussed in our reports filed with the Securities and Exchange Commission(including this Annual Report on Form 10-K),and elsewhere.Please

286、also see“Forward-Looking Statements”for additional factors which could have a significant impact on our operations,results of operations,financial condition or cash flows and could cause actual results to differ materially from those anticipated in such statements.Weather(temperatures,precipitation

287、levels and storms)has a significant effect on our results of operations,financial condition and cash flows.Weather impacts are described in the following subtopics:retailelectricityandnaturalgassales,thecostofnaturalgassupply,thecostofpowersupply,and damagestofacilities.Retail electricity and natura

288、l gas sales volumes vary directly with changes in temperatures.We normally have our highest retail(electric and natural gas)energy sales during the winter heating season in the first and fourth quarters of the year.We also have high electricity demand for air conditioning during the summer(third qua

289、rter).In general,warmer weather in the heating season and cooler weather in the cooling season will reduce our customers energy demand and retail operating revenues.The cost of natural gas supply tends to increase with increased demand during periods of cold weather.Increased costs adversely affect

290、cash flows when we purchase natural gas for retail supply at prices above the amount then allowed for recovery in retail rates.We defer differences between actual natural gas supply costs and the amount currently recovered in retail rates and we have generally been allowed to recover substantially a

291、ll of these differences after regulatory review.However,these deferred costs require cash outflows from the time of natural gas purchases until the costs are later recovered through retail sales.The cost of power supply can be significantly impacted by weather.Precipitation(consisting of snowpack,it

292、s water content and melting pattern plus rainfall)and other streamflow conditions(such as regional water storage operations)significantly affect hydroelectric generation capability.Variations in hydroelectric generation inversely affect our reliance on market purchases and thermal generation.To the

293、extent that hydroelectric generation is less than normal,significantly more costly power supply resources must be acquired and the ability to realize net benefits from surplus hydroelectric wholesale sales is reduced.The price of power in the wholesale energy markets tends to be higher during period

294、s of high regional demand,such as occurs with temperature extremes.We may need to purchase power in the wholesale market during peak price periods.The price of natural gas as fuel for natural gas-fired electric generation also tends to increase during periods of high demand which are often related t

295、o temperature extremes.We may need to purchase natural gas fuel in these periods of high prices to meet electric demands.The cost of power supply during peak usage periods may be higher than the retail sales price or the amount allowed in retail rates by our regulators.To the extent that power suppl

296、y costs are above the amount allowed currently in retail rates,the difference is partially absorbed by the Company in current expense and it is partially deferred or shared with customers through regulatory mechanisms.Therefore,the impact on our results of operations may be larger or smaller than th

297、e weather-related impact on power supply cost.As a result of these factors operating in combination,our net cost of power supply the difference between our costs of generation and market purchases,reduced by our revenue from wholesale sales varies significantly because of weather.Damages to faciliti

298、es may be caused by severe weather,such as snow,ice or wind storms.The cost to implement rapid repair to such facilities can be significant.Overhead electric lines are most susceptible to such severe weather.Collateral damage from utility assets that are damaged by external forces may result in thir

299、d party claims against the Company for property damage and/or personal injuries.We are subject to commodity price risk.A combination of factors exposes our operations to commodity price risks.We rely on energy markets and other counterparties for energy supply,surplus and optimization transactions a

300、nd commodity price hedging.These factors include:Ourobligationtoserveourretailcustomersatratessetthrough the regulatory process.We cannot change retail rates to reflect current energy prices unless and until we receive regulatory approval.Customerdemand,whichisbeyondourcontrolbecauseofweather,custom

301、er choices,prevailing economic conditions and other factors.Someofourenergysupplycostisfixedbynatureoftheenergy-producing assets or through contractual arrangements.However,a significant portion of our energy resource costs are not fixed.Because we must supply the amount of energy demanded by our cu

302、stomers and we must sell it at fixed rates and only a portion of our energy supply costs are fixed,we are subject to the risk of buying energy at higher prices in wholesale energy markets(and the risk of selling energy at lower prices if we are in a surplus position).Electricity and natural gas in w

303、holesale markets are commodities with historically high price volatility.Changes in wholesale energy prices affect,among other things,the cash requirements to purchase electricity and natural gas for retail customers or wholesale obligations and the market value of derivative assets and liabilities.

304、When we enter into fixed price energy commodity transactions for future delivery,we are subject to credit terms that may require us to provide collateral to wholesale counterparties related to the difference between current prices and the agreed upon fixed prices.These collateral requirements can pl

305、ace significant demands on our cash flows or borrowing arrangements.Price volatility can cause collateral requirements to change quickly and significantly.A V I S T A 1 4Regulators may not grant rates that provide timely or sufficient recovery of our costs or allow a reasonable rate of return for ou

306、r shareholders.We have experienced higher costs for utility operations in each of the last several years.We have also made significant capital investments into utility plant assets.Our ability to recover these costs depends on the amount and timeliness of retail rate changes allowed by regulatory ag

307、encies.We expect to periodically file for rate increases with regulatory agencies to recover our costs and provide an opportunity to earn a reasonable return for shareholders.If regulators grant substantially lower rate increases than our requests in the future,it could have a negative effect on our

308、 operating revenues,net income and cash flows.Deferred power and natural gas costs are subject to regulatory review;costs higher than those recovered in base rates reduce cash flows.We defer income statement recognition and recovery from customers of certain power and natural gas costs that are high

309、er than what is currently authorized by regulators.These power and natural gas costs are recorded as deferred charges with the opportunity for future recovery through retail rates.These deferred costs are subject to review for prudence and potential disallowance by regulators.Despite the opportunity

310、 to recover deferred power and natural gas costs,our operating cash flows are negatively affected until these costs are recovered from customers.Our energy resource management activities may cause volatility in our cash flows and results of operations.We engage in active hedging and resource optimiz

311、ation practices;however,we cannot and do not attempt to fully hedge our energy resource assets or our forecasted net positions for various time horizons.To reduce energy cost volatility and economic exposure related to commodity price fluctuations,we routinely enter into contracts to hedge a portion

312、 of our purchase and sale commitments for electricity and natural gas,as well as forecasted excess or deficit energy positions and inventories of natural gas.We use physical energy contracts and derivative instruments,such as forwards,futures,swaps and options traded in the over-the-counter markets

313、or on exchanges.We do not cover the entire market price volatility exposure for our forecasted net positions.To the extent we have positions that are not hedged,or if hedging positions do not fully match the corresponding purchase or sale,fluctuating commodity prices could have a material effect on

314、our operating revenues,resource costs,derivative assets and liabilities,and operating cash flows.In addition,actual loads and resources typically vary from forecasts,sometimes to a significant degree,which requires additional transactions or dispatch decisions that impact cash flows.Financial market

315、 conditions may impact our results of operations and our liquidity.We have significant capital requirements that we expect to fund,in part,by accessing capital markets.As such,the state of financial markets and credit availability in the global,United States and regional economies could have an impa

316、ct on our operations.We could experience increased borrowing costs or limited access to capital on reasonable terms.We need to access long-term capital markets to finance capital expenditures,repay maturing long-term debt and obtain additional working capital from time to time.Our ability to access

317、capital on reasonable terms is subject to numerous factors and market conditions,many of which are beyond our control.If we are unable to obtain capital on reasonable terms,it may limit or prohibit our ability to finance capital expenditures and repay maturing long-term debt.Our liquidity needs coul

318、d exceed our short-term credit availability and lead to defaults on various financing arrangements.We would also likely be prohibited from paying dividends on our common stock.Performance of the financial markets could also result in significant declines in the market values of assets held by our pe

319、nsion plan(which impacts the funded status of the plan)and could increase future funding obligations and pension expense.We rely on access to credit from financial institutions for short-term borrowings.We need to maintain access to adequate levels of credit with financial institutions for short-ter

320、m liquidity.In February 2011,we entered into a new$400 million committed line of credit,which is scheduled to expire in February2015.We cannot guarantee that we will have access to credit beyond the expiration date.The line of credit agreements contain customary covenants and default provisions.In t

321、he event of default,it would be difficult for us to obtain financing on reasonable terms to pay creditors or fund operations.We would also likely be prohibited from paying dividends on our common stock.Downgrades in our credit ratings could limit our ability to obtain financing,adversely affect the

322、terms of financing and impact our ability to transact for or hedge energy resources.If we do not maintain our investment grade credit rating with the major credit rating agencies,we could expect increased debt service costs,limitations on our ability to access capital markets or obtain other financi

323、ng on reasonable terms,and requirements to provide collateral(in the form of cash or letters of credit)to lenders and counterparties.In addition,credit rating downgrades could reduce the number of counterparties willing to do business with us.We are subject to various operational and event risks tha

324、t are common to the utility industry.Our utility operations are subject to operational and event risks that include:blackoutsordisruptionstodistribution,transmissionortransportation systems,forcedoutagesatgeneratingplants,fuelcostandavailability,includingdeliveryconstraints,cybersecurityattacksoroth

325、erdisruptionstoourinformationsystems and other administrative resources required for normal operations,explosions,fires,accidents,ormechanicalbreakdownsthatmayoccur while operating and maintaining our generation,transmission and distribution systems,naturaldisastersthatcandisruptenergygeneration,tra

326、nsmissionand distribution,and terrorismandothermaliciousthreats.A V I S T A 1 5As protection against operational and event risks,we maintain insurance coverage against some,but not all,potential losses and we seek to negotiate indemnification arrangements with contractors for certain event risks.How

327、ever,insurance or indemnification agreements may not be adequate to protect us against liability from all of the operational and event risks described above.In addition,we are subject to the risk that insurers and/or other parties will dispute or be unable to perform their obligations to us.We are c

328、urrently the subject of several regulatory proceedings,and we are named in multiple lawsuits related to our participation in western energy markets.Through our utility operations and the prior operations of Avista Energy,we are involved in a number of legal and regulatory proceedings and complaints

329、related to energy markets in the western United States.Most of these proceedings and complaints relate to the significant increase in the spot market price of energy in 2000 and 2001.This allegedly contributed to or caused unjust and unreasonable prices.These proceedings and complaints include,but a

330、re not limited to:refundproceedingsinCaliforniaandthePacificNorthwest,marketconductinvestigationsbytheFERC,and complaintsfiledbyvariouspartiesrelatedtoallegedmisconductby parties in western power markets.As a result of these proceedings and complaints,certain parties have asserted claims for signifi

331、cant refunds and damages from us,which could result in a negative effect on our results of operations and cash flows.See“Note 24 of the Notes to Consolidated Financial Statements”for further information.Any potential refunds or obligations arising from western energy market issues(or any other conti

332、ngent matters)were retained by Avista Energy as part of its asset sale agreement in June 2007.We are subject to legislation and related administrative rulemaking,including periodic audits of compliance with such rules,which may adversely affect our operational and financial performance.We expect to

333、continue to be affected by legislation at the national,state and local level,as well as by administrative rules and requirements published by government agencies,including but not limited to the FERC and the EPA.We are also subject to NERC and WECC reliability standards.The FERC,the NERC and the WECC may perform periodic audits of the Company.Failure to comply with the FERC,the NERC,or the WECC re