CEO of Avista, I'd like to welcome you to our Avista's 2019 Annual Meeting of Shareholders. As we begin this meeting this morning, I will caution you that we will be making forward-looking statements that involve risks and uncertainties which are subject to change. I would direct you to Avista's Form 10-K, which was filed with the SEC on February 21st, and is also available on our website for reference to the various factors which could cause actual results to differ materially from the contemplated or to the extent these factors are not discussed in this meeting. Before I begin the business portion of the meeting, I would like to introduce our board. You'll notice the names of our board members and their backgrounds appeared in your proxy. I'm just going to introduce our board members and ask them to stand.
Christy Blake, Don Burke, Becky Klein, Scott Maw, Marc Racicot, Heidi Stanley, John Taylor, Dennis Vermillion, and Janet Widmann. This is a great opportunity for all of us to thank our directors for the amount of time they dedicate to the company. They do such a fantastic job for us, and I say this all the time, I am blessed by one of the very best boards a CEO could work with. I want to thank them personally for their dedication and their great work. Thank you very much. I'd also like to acknowledge two retired directors who are here with us today. Former Chairman, President, CEO, Paul Redmond, and former Chairman, Larry Stanley, are with us today.
If you didn't know this, earlier in the year, both Paul and Larry were honored by our Spokane community as people of outstanding, not just what they did in their businesses, but what they did in their communities. It was a well-deserved honor for both Paul and Larry, and I just want to congratulate them on that recognition. You guys have always been my mentors, and I appreciate all that you do. Before I introduce the executive officers, I'd like to acknowledge and thank all of our employees, both active and retired, for their dedication and support. They step up to all of our challenges, and they not only provide excellent service, but they show a sincere commitment to the company, our customers, and the communities that we serve.
Our employees are really what makes this company great, and I am so honored to work with all 1,800 of them every single day. Now I'd like to introduce our executive officers. I'm blessed to have one of the best executive officer teams in the industry, and I love coming to work, working with them, and being with them every single day. Kevin Christie, Bryan Cox, Marian Durkin, Karen Feltes, Jim Kensok, Ryan Krasselt, David Meyer, Heather Rosentrater, Ed Schlect, Jason Thackston, Mark Thies, Dennis Vermillion, and joining us from AEL&P, it's always fun to have the President of AEL&P join us this morning, Connie Hulbert. Connie, thanks for joining us all the way from Juneau. Our executive officer team. At this time, we'll convene the business portion of the meeting.
The first matter to be considered at this meeting is the election of directors. 10 directors are standing for election for a one-year term. The board recommends a vote for each director. There are no other nominations at this time. The second matter to be considered at this meeting is the proposal by the board that the shareholders ratify the board's appointment of the firm of Deloitte & Touche as the independent registered public accounting firm for 2019. The board also recommends a vote for this proposal. The third matter to be considered is an advisory vote, non-binding, on the company's executive compensation. The board recommends a vote for this proposal as well.
If there are any shareholders who did not yet vote, you may execute a ballot at our investor relations table when you leave the meeting today, and I want to assure you that your vote will be counted. Those who are voting this morning, again, your votes will be counted, and as you are aware, a very large majority of our shareholders have already voted, and the preliminary voting results as of this morning show that the proposals have all passed. That really concludes the business portion of our meeting today. I'd just like to talk a little bit about the business. This is such an exciting time for the utility industry. I'm in my 38th year, and I can tell you I've never seen anything quite like it.
With all the new and exciting technologies that are happening in our industry, the digitization and the automation of what's happening with the utility grid, and so many opportunities that are opened up because of that digitization and automation. Then with the decline of really the prices of green energy generation, is creating for us, I would say, not an evolution in our industry, but I will tell you that it truly is, we are at the cusp, I think, of an energy revolution in the utility industry. I can't think of a company that is more well-prepared to meet that revolutionary challenge than Avista. We've been in this business for 130 years, and that doesn't make us prepared. What makes us prepared is our history of innovation.
We've been on the leading edge of so many innovative things in this industry for 130 years, as well as we have been one of the leaders in green energy for our entire 130-year effort. As this energy revolution happens, we're just not going to participate in it, we're going to lead it. We're going to lead this revolution. I can tell you that one of the things you saw that we just did recently, was that we said we were going to have 100% clean energy by 2045. The other thing, I think that was a goal for us to reach. Another thing that is just, I think, equally substantial is the fact that we're going to have carbon neutral generation by 2027. I'm absolutely convinced that that's something that's not just we're able to do, it's very attainable.
Again, it's because it's not something that we've been just working on in the last couple of years like a lot of utilities. We've been working on this stuff for decades. It's in our DNA. It's who we are. It's what we have done as a company, both past and this generation, and I know future generations will do all of that. What else is going on with technology is really exciting is with our customers. Of course, the customers are at the center of all that we do, and technology is enabling us to serve them much better. We also need to remember that we need to use this great technology, but we have to couple it with just good old-fashioned customer care.
You have to combine the technology and the customer care, and we know we can do that to create an outstanding customer experience every time our employees have the opportunity to touch one of our customers, and we're doing just that. As a utility that serves in five states, we know our communities are so important to us. We just celebrated our 130th anniversary. One of the things we wanted to do to say thank you, was to offer another $700 million. $7 million, not $700 million. Honest, board, it was just $7 million, not $700 million. $7 million of extra philanthropy on top of the over $2.5 million that we already do. We really wanted to focus it on the communities, really in three areas.
We wanted to think and really help address some of the issues around homelessness that happen in both large and small communities. We have so many in our five states. We have a lot of smaller communities. We wanted to be able to help energize their economy and their communities. A lot of the money will be focused on some of the smaller communities that we serve. Finally, we wanted to do what we always like to do, is just help the kids in our communities. That's where the $7 million is going. Finally, what's going to make all this happen, the tip of the spear, the thing that makes me come to work every day, is to work with the 1,800 outstanding people that really are what this company is all about.
Our employees come to work energized, dedicated, focused, and ready to go every single day. I am so proud to work for a company that really, that's what this company is all about, is our people. Finally, I can assure you as the Chairman and CEO, our focus always remains on providing you the very best shareholder return we possibly can. With that, to give you more detail about what all these strategies are about, the exciting things that are happening in the industry, I'm really proud to introduce to you the President of our company, Dennis Vermillion. Dennis?
Great. Thank you, Scott, and good morning, everyone. I'm very excited to be here this morning to, as Scott said, give you a little bit of detail about some of the things, just a few of the things that we're doing in our company. It's very exciting. As Scott talked about, we're doing some visionary things in our business, and I can tell you that we've been planning for today for many years. We're ready to go. Whether it's around the clean energy goals that Scott mentioned, the investing in economic development in our communities as a platform for growth, partnering with people in the community to drive prosperity in the communities that we serve, piloting new technology, and of course, investing in our utility infrastructure so that we can serve our customers today and into the future.
We have a clear path forward, and we are delivering on our vision of better energy for life. How about a little bit of detail on the clean energy? There's three things I'd like to talk to you this morning about briefly. Three things that we've done in the last three years, to drive to our goals of clean energy that Scott mentioned. The first one is the Adams-Nielson solar project . If you look at this slide, this is a solar project that came online in October. I think it was October. God, sorry, Jason. October of last year, and it's one of three solar projects that have come online in the last three years. This one was exciting because it's located just outside of Lind, Washington.
If you know where Lind, Washington is, it's in Adams County, which is a part of our service area, very rural. This is a big deal for them when it comes from an economic development perspective and providing a tax base and jobs for that community. A big win. This is actually the celebration dedication, the picture on the left. We partnered with Strata Clean Energy and a 28-megawatt facility, and we targeted the output of this facility to large business customers of ours. We knew that there was a need from our larger customers, our business customers, to want to buy into solar so that they could help meet some of their sustainability goals. We were able to do this. We crafted what I would call is a community solar project for commercial customers.
We called it Solar Select, and it was fully subscribed in less than one day. 28 megawatts fully subscribed in less than one day. It gives you an idea of how much demand there was from our customers to want to buy in to meet their sustainability goals. It's a great project. We're excited to be able to bring that online. The second one I wanted to mention, it's actually not online yet, but we just signed a 20-year power purchase agreement for a wind project, also in Adams County. Our partners there are Clearway Energy Group. It's a 144-megawatt capacity wind project with 50 average megawatts of energy. On an average basis, that's about enough energy to power 38,000 of our customers' homes. Obviously, a lot of environmental attributes that come with this project.
As Scott mentioned, when he talked about price, it's remarkable that the price of this project, 20-year power purchase agreement price is less than half of the Palouse Wind Project that came online on our system just seven years ago. It's a great example of just how much the price of these renewable technologies has come down. We're excited to bring that one on. The third one was our original community solar that came online, and at the time, it was the largest community solar project in the state of Washington that served our residential customers could buy into. That's been a big success. Also, one note on this solar farm here, it is currently the largest one in the state of Washington.
We're making a lot of progress in bringing in cost-effective renewables onto our system, and there's more to come, obviously, as we march towards our goals. The other thing on this is you may have seen that we recently announced that we're joining the Western Energy Imbalance Market or the Western EIM. It's a market that's administered by the California Independent System Operator, the Cal ISO, and many or most, I would say, of the large utilities in the West are now part of this market. It's usually utilities that have a lot of renewables on their system, and it more effectively allows them and us to integrate our renewables and capture the most value for them, for our customers. We're excited to engage in that, and we expect to be fully operational with the Western EIM in April 2022.
A lot of good stuff happening on clean energy. Of course, we're continuing to invest in creating communities of the future. A lot going on downtown, South Landing. If you're familiar with the University District, it is a cluster that is just east of downtown. What we have been doing is driving development in what we call the South Landing. It's across the railroad tracks in the south of the U District, and we've got a couple things going on. One I wanted to focus on is the Catalyst building. This is a revolutionary structure in building what we're trying to do and what we are creating in downtown Spokane. The Catalyst building, I think we're setting records and standards on collaboration with community partners.
It's been a lot of hard work, it's been very rewarding as well, it's a place where academia and industry will come together to innovate and collaborate when it is completed. On the right here is an artist rendering of the building itself. 5 stories, nearly 160,000 sq ft. It's a beautiful building. It's under construction. It'll be completed next year, and it's constructed of mass timber, cross-laminated timber or CLT. It's half the energy usage of a conventional building. It is a net zero energy and net zero carbon building, and it's able to do that with on-site distributed generation at that site and then elsewhere in the area there. It will be one of the largest net zero buildings in the world, and it is the first one in Eastern Washington. It comes in at a cost of a minimum code standard building.
Very remarkable. Also, Eastern Washington University, when I talk about academia being with industry, Eastern Washington University has announced that they're going to move their entire College of Science, Technology, Engineering, and Math here. Pretty awesome. You can see how they are an initial tenant and largest tenant, anchor tenant, if you will, and that's just going to be the catalyst to really kick that area off. Exciting. The other building here is what we call the Hub building. It's part of our eco-district. We recently were awarded a grant from the Washington State Department of Commerce, their Clean Energy 3 Fund, and we're using some of that funding to build out our eco-district in this area.
Think of, there's going to be a number of buildings in this cluster at the South Landing that not only will we experiment with building controls and optimizing building management for each building, but within the group of buildings, within the cluster. Think of it as a shared energy economy. In this case, it's a shared building management kind of concept, and we're excited about that. We can test autonomous demand management, load shifting, a lot of different things there that will really help the grid. The final thing I just wanted to mention was some of the innovative things we're doing. We've partnered with the Department of Energy's Pacific Northwest National Labs, PNNL, to test new battery technologies and thermal storage technologies.
We're working with them on transactive building controls that we can deploy in our system and in other systems that will help with grid reliability and resiliency, and the list goes on and on. I could stand here and talk about innovation all day, but I'll move on to our customer because obviously, as Scott mentioned, we have customers at the center, and everything we do really is better service delivery for our customers. Advanced metering infrastructure, AMI, is a key component of that. We work hard to improve service delivery and give customers the information they need so they can best manage their energy usage. AMI, our smart meter project, we started this last fall. We did a small part of our system in Washington state. We took a break over the winter, and now we're at a full steam ahead. It's going very well.
Electric and gas smart meters, Washington customers. More information at their fingertips. Personalized, customized information allows them to make better energy choices, manage their bill. Of course, restoration times when you have an outage are much quicker. It is a foundational element of a clean energy future, and it's a major investment step forward for us in modernizing our infrastructure. Speaking of infrastructure, of course, capital investments in infrastructure, we're continuing. Mark, I'm sure will talk about our capital investment here when he gets up and speaks. We continue to invest in modernizing our utility infrastructure, and sometimes I call it the blocking and tackling of what we do in the company. Just a couple of examples here on the upper right, we've got a big empty, what's going to be Saddle Mountain substation and some substation equipment going in there.
This is a key station that will integrate renewable energy into our system when it comes online. We have a picture of a service in one of our big downtown new buildings. We're powering economic growth in our communities. Just maybe a reminder that we are continuing to invest in our natural gas system as well. We're in the middle of a 20-year pipe replacement program. We have some certain vintage of plastic pipe that tends to get brittle under certain conditions and can leak a little bit. We're in the middle of a program to replace that. It's going well. We'll continue to modernize infrastructure. Finally, I just wanted to ask Scott to just recognize our employees. We have a lot of good things happening in our company. We're marching forward.
We have a clear path, nothing happens without the skill and dedication of our employees and all 1,800 of them. Scott, I'm stealing your line here, but it is remarkable. They come to work every day ready to get after it, we're so fortunate to have such a great group here as we move forward. With that, I would like to hand it over to Mark Thies, our Senior Vice President and Chief Financial Officer.
Got it? Okay. Thanks, Dennis Vermillion. Like I start out every earnings call, we have a hockey comment. We're down to the final four in hockey, right? We're down to the conference finals in the West and the East. We got the San Jose Sharks playing the St. Louis Blues. We got the Carolina Hurricanes playing the Boston Bruins. I hate all of them. Our company is doing great things financially. Last year was a great year. We had a lot of things going on, as everybody recalls. We still focused on what we were supposed to do, which is, as Dennis Vermillion said, blocking and tackling. It's run the business. We ran the business. We had a good year financially. The board raised the dividend 4% last February.
As Dennis Vermillion said, we invested over $400 million in our system to, again, maintain and upgrade our electric and natural gas system and technology to serve our customers. That's what we're doing. To pay for that, we had rate increases. In 2018, we did have rate increases in Idaho, 2018 and 2019, in Washington, we had an increase in May. We are behind for 2019. If you listen to our last earnings call, we are going to spend our focus now to grow shareholder value, to enhance it is file rate cases. We did file.
We're off to a great start, but we filed in Washington and Oregon already this year, and we're evaluating filing in Idaho because that's how we get back on track to recover and earn on the capital that we're spending so we can earn for our shareholders our return. Our first quarter, again, we had a big number with the termination payment, but otherwise we are slightly off just because of the ERM and higher taxes. We are on track to make our numbers this year, and I expect a strong year. Just in February, the board did increase the dividend again 4%. This morning, the board approved the dividend for the second quarter. We continue to have a strong dividend profile for our company. Here's where we spend our capital, and there's a lot of it on asset condition. It's, again, maintaining a 130-year-old system.
We spend a lot of money to make sure that that system runs efficiently, and that's the bulk of it. That's also where we also have the AMI project. That'll be, as Dennis mentioned, the meters for the customers. We spend performance and capacity. The one I always hate, it's failed plant. Who wants to talk about failed plant? Things break. It's the smallest part of our capital. It's really tiny. We do have things that break. We also have the customer service and reliability. Significant dollars we're spending there just so we can make sure, as Scott mentioned, we focus on our customers. Our dividend growth continues to be 4%-5%. Our earnings growth is going to be a little bit different the next couple of years because we're catching up with rate cases.
We expect higher earnings growth in 2020, 2021, and 2022, and then back to a long-term earnings growth of 4%-5%. That's consistent with our dividend growth, and it'll get our dividend back to a target of 60%-70% of earnings by 2022, which is where we expect to be earning our allowed return. We have a solid balance sheet. I'm very proud of that. We have a great balance sheet. We have a few smaller maturities in 2019 and 2020. We had a big maturity in 2018. We had to raise over $375 million in debt for that. The next one's in 2022, our balance sheet is very strong, 48.5% equity, 51% debt. We do expect to issue $165 million in debt this year and up to $50 million in equity.
The reason the debt nets so well balanced is we expect to refinance the $90 million. Really, we're about $75 and $50 for our debt and equity to maintain a strong balance sheet. With that, I will turn it back to Scott.
Thank you. You see what a great story. We are in great shape, and we do have an
Sure. Open to answering any questions you might have. You notice we have microphones on each side of the room. If you do have a question, go over to the microphone, and you can just tell me your name. If you represent somebody, that would be great, or if you're just representing yourself. I'm open for questions.
My name is Billy Pass. I live here in Spokane.
Hey, good morning, Billy. Thanks for joining us this morning.
My question-- ooh, that came on real loud, didn't it?
Yeah.
Yeah. My question is, in regards to our natural gas-fired generating plants, with this carbon elimination that we're going through, what's going to happen to those, like the one down in Oregon?
Well.
The one over in Idaho.
Yes. I can tell you that natural gas will still be a very important piece of what we have to do, particularly on what we would call a capacity basis. More and more of our generation can be renewable, but we know the sun doesn't always shine, the wind doesn't always blow. When it doesn't, we need to have some generation ready to go, and to make sure that we can turn it on in a moment's notice. We don't always have enough water in our hydro dams to support that. Natural gas has to play a role. It'll continue to play a role. It'll be a part of our portfolio.
Part of the strategy will be to get to carbon neutral, is to look at opportunities to add more generation on the renewable side, to be able to buy renewable energy credits and a number of different strategies in order to make it so that net at the end of the day, by 2027, we're carbon neutral on our emissions. Gas has to play a role in the industry on a going forward basis. Until some new technology happens, particularly around primarily batteries and storage and other things, so that when the wind is blowing and the sun is shining, we don't need it, we could store it, we could turn it on later.
Aren't there some government regulations and laws being passed that would forbid the generation by that method?
Well, there are right now some, I would say, there is some, pardon the pun, some energy around continuing to look for non-carbon solutions. At this point, there isn't any laws that prohibit that, but there are some new laws that require us to continue to reduce our carbon emissions. We have strategies in place through conservation and other avenues in order to be able to do that. Yes, that public policy in the energy world is something that we just have to deal with. We get used to it. Our elected officials make that public policy. We try to educate them on what that public policy should be, but at the end of the day, they're our elected officials, and what happens in Olympia or Boise or Washington, D.C., are the rules that we play by.
Because of our history of innovation, we've been working on it for decades. It can make it challenging, but again, because of who we are and what we've done, we're probably in the best position of any utility in the country to be able to kind of maneuver around those policies.
Okay. Thank you.
Any other questions for me or the team? Our team is going to be here afterwards a little bit, so if you do want to ask anyone at the microphone, grab us and we'll be happy to answer. Not seeing any more questions. I want to thank you for coming this morning. Again, thank you for investing in our company. It's an exciting time to be in the utility industry, and you have a great investment and a great company. Thank you very much.