Our IdaCorp Shareholder Proposal Wins Support of 34% of Shares Voted(A)
May 16, 2002
Lisa Leff, Trillium Asset Management (208) 387-0777 Sara Denniston Eddie, Idaho Rivers United (208) 343-7481 Connie Kelleher, American Rivers (206) 852-5583
BOISE – IdaCorp shareholders attending the company’s annual meeting today voted on a resolution requesting disclosure of financial and environmental information regarding the relicensing of its Hells Canyon Complex of hydropower dams. The filing at IdaCorp marks the first time a shareholder resolution has focused on hydropower dam relicensing. The resolution also called for IdaCorp to report on potential economic impacts to the company in the event that the four federally-owned lower Snake River dams are breached. According to preliminary numbers provided by IdaCorp, the proposal gained the support of 34% of votes cast.
“This vote is a huge victory for shareholders and the environment,” said Lisa Leff, Vice President of Trillium Asset Management. “The level of investor support far exceeds our expectations. In our experience, any shareholder vote over 10% indicates investor unrest. Today, over one third of voting stockholders have said that IdaCorp cannot continue to withhold information about the Hells Canyon Complex relicensing.”
Trillium Asset Management, which filed the resolution at IdaCorp, is the oldest and largest investment firm in the United States specializing exclusively in socially responsible asset management. Founded in 1982, it currently manages $700 million in assets for both individual and institutional clients. Leff, who manages the company’s regional office in Boise, said that her firm’s clients hold approximately $4.3 million in IdaCorp stock.
IdaCorp subsidiary Idaho Power is the owner and operator of the three-dam Hells Canyon Complex, which is one of the largest private hydropower projects in the country and provides roughly 50% of Idaho Power’s generated electricity in a typical year.
“This is a watershed vote on a critical disclosure issue for the energy company,” said Leff. “Any way you look at it, Hells Canyon is a strategic asset with enormous implications for the environment and endangered species, and for Idacorp’s bottom line. Shareholders need to know that Idacorp is fully disclosing the potentially huge economic costs of the new license terms.”
The current license for the Hells Canyon Complex expires in 2005, and Idaho Power is in the process of seeking a new license from the Federal Energy Regulatory Commission (FERC). The FERC must by law give “equal consideration” to fish and wildlife in setting the conditions of the new license for the project. The Hells Canyon Complex blocks the migration of Snake River salmon and steelhead trout, which are protected under the Endangered Species Act, and causes water quality problems downstream. As a condition of renewing its license, Idaho Power will be required to mitigate for its impacts on fish and wildlife by measures such as fish passage or water quality control structures.
“The Hells Canyon Complex has had devastating effects on Idaho’s salmon,” said Sara Denniston Eddie of Idaho Rivers United. “By disclosing information now on measures that would help salmon recovery, Idaho Power could avoid unnecessary legal battles and even more costly mitigation measures as salmon go further in decline.”
The cost and effectiveness of mitigation options vary widely, with price tags from the thousands to the billions of dollars. The shareholder resolution argued that IdaCorp should fully analyze and disclose the costs and benefits of the range of mitigation measures FERC may require. This would allow shareholders to be fully informed and allow the company to recommend the most cost-effective and environmentally responsible options in its application for a new license.
Environmental groups have criticized Idaho Power for lagging behind its industry peers in evaluating potential mitigation measures such as fish passage and working cooperatively with stakeholders. Northwest companies such as Tacoma Power, Avista Corporation, and PacifiCorp have successfully collaborated with stakeholders to expedite the relicensing process, largely due to the early and complete disclosure of potential mitigation measures. By contrast, Idaho Power has refused to disclose key environmental and economic data in its relicensing process, leading environmental stakeholders to withdraw from talks with the company.
“Idaho Power is behind the curve on getting its projects up to par with current environmental standards and in collaborating with stakeholders,” said Connie Kelleher of American Rivers. “This is dragging out the relicensing process, which could result in both disastrous impacts to salmon and dramatically increased costs to the company.”
The resolution also calls for IdaCorp to report on the economic impacts to the company associated with the four large federal dams downstream of the Hells Canyon Complex on the lower Snake River. While these lower Snake dams are neither owned nor operated by Idaho Power, their fate has potentially large economic implications for the company.
The lower Snake dams are a major factor in the decline of salmon and steelhead, and removal of the dams is under consideration by the federal government. Removal of the lower Snake dams is expected to greatly benefit endangered salmon and steelhead, which may reduce the need for Idaho Power to implement fish mitigation measures at the Hells Canyon Complex. Conversely, if the lower Snake dams are not removed, Idaho Power may be forced to implement costly measures to mitigate for its impacts on fish.
“The government’s decision whether to remove the lower Snake dams has a direct impact on the Hells Canyon Complex and IdaCorp,” said Leff. “And if removal of the federal Snake River dams would benefit the company financially, it’s critical that IdaCorp disclose that to its shareholders.”
A second shareholder proposal submitted by the Calvert Group also did well. The proposal, which called on Idacorp to adopt a formal policy on the rights of indigenous peoples, drew 12.8% of votes cast, preliminary figures indicate. Nikki Daruwala of Calvert commented, “The success with Idacorp clearly puts the rights of Indigenous peoples on the corporate agenda and sends a clear message to companies such as Idacorp that this is an important issue to investors.”##END##