104918--2/27/2009--AVISTA

related topics

{capital, credit, financial}

{condition, economic, financial}

{gas, price, oil}

{financial, litigation, operation}

{operation, natural, condition}

{control, financial, internal}

{regulation, change, law}

Our results of operations, financial condition and cash flows are significantly affected by weather. Financial market conditions may impact our results and our liquidity We rely on access to credit from financial institutions for short-term borrowings. We are dependent on our ability to access long-term capital markets. We are subject to commodity price risk. Regulators may not grant rates that provide timely or sufficient recovery of our costs or allow a reasonable rate of return for our shareholders. Deferred power and natural gas costs are subject to regulatory review; costs higher than those recovered in base rates reduce cash flows, and it may take several years for us to recover deferred costs. Relicensing our hydroelectric facilities located on the Spokane River at a cost-effective level with reasonable terms and conditions may not be possible. We are subject to credit risk. Our energy resource management activities may cause volatility in our cash flows and results of operations. Risk management procedures may not prevent losses. Downgrades in our credit ratings could limit our ability to obtain financing, adversely affect the terms of financing and impact our ability to acquire energy resources. An increase in interest rates could negatively affect our future results of operations and cash flows. We are subject to various operational and event risks that are common to the utility industry. We are currently the subject of several regulatory proceedings, and we are named in multiple lawsuits related to our participation in western energy markets as disclosed in Note 26 of the Notes to Consolidated Financial Statements. We are subject to legislation and related administrative rulemaking which may adversely effect our operational and financial performance. We may be affected by long-term global climate changes. We have contingent liabilities, as disclosed in Note 26 of the Notes to Consolidated Financial Statements, and cannot predict the outcome of these matters.

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104918--2/27/2009--AVISTA_CORP