Welcome to the IDACORP's 4th Quarter and Year End 2020 Earnings Conference Call. Today's call is being recorded and our webcast is live. A complete replay will be available later today and in the next 12 months on the Ichorps website. I will now turn the call over to Justin Forsberg, Director of Investor Relations and Treasury.
Thank you, Jason, and good afternoon, everyone. This morning, we issued and posted to IDACORP's website our 4th quarter and full year 2020 earnings release and Form 10 ks. The slides that accompany today's call are also available on our website. We'll refer to those slides by number throughout the call today. As noted on Slide 2, our discussion includes forward looking statements, including earnings guidance and spending forecasts, which reflect our current views on what the future holds, but are subject to several risks and uncertainties, including those related to the COVID-nineteen pandemic.
This cautionary note is also included in more detail for your review in our filings with the Securities and Exchange Commission. These risks and uncertainties may cause actual results to differ materially from statements made today, and we caution against placing undue reliance on any forward looking statements. As shown on Slide 3, on today's call, we have Lisa Growe, IDACORP's President and Chief Executive Officer and Steve Keen, IDACORP's Senior Vice President and Chief Financial Officer. We also have other company representatives available for a Q and A session after Lisa and Steve provide updates. Slide 4 shows our quarterly and full year financial results.
IDACORP's 20 2Q4 earnings per diluted share were $0.74 a decrease of $0.19 per share over last year's record 4th quarter. IDACOR's earnings per diluted share for the full year 2020 were $4.69 an increase of $0.08 per diluted share from 2019. Today, we also issued our full year 2021 IDACORP earnings guidance estimate to be in the range of $4.60 to $4.80 per diluted share with our expectation that Idaho Power will not need to utilize in 2021 any of the additional tax credits that are available to support earnings in Idaho under its regulatory settlement stipulation. These, of course, are our estimates as of today and those estimates assume normal weather conditions over the balance of the year and includes customer usage returning closer to pre COVID-nineteen levels as we progress through the year. However, as you would expect, it is difficult to predict the full impact of evolving economic conditions on Idaho Power's customers and suppliers and how that could affect the upper end of the earnings guidance range or the use of tax credits.
I will now turn the call over to Lisa.
Thanks, Justin, and thanks to everyone joining us on today's call. As we look back on 2020, we acknowledge it has been a challenging year in so many ways. The COVID-nineteen pandemic created unforeseen difficulties for our customers and our employees. Economic uncertainty and interruptions to our daily lives became the norm. Our nearly 2,000 employees were challenged daily as we continued to carry out our mission as an essential service provider.
And yet through it all, IDACOR and Idaho Power continued to achieve tremendous results. As noted on Slide 5, 2019 2020 were our 2 safest years in custody history. I am so grateful for the continued focus of our employees on safety despite all the distractions surrounding their daily routine. Turning to Slide 6. We also saw some of our best third party customer satisfaction ratings being the top ranked utility among peers in the segment for overall customer satisfaction and 5th highest in the nation for business customer satisfaction.
And our reliability numbers remained among the best in the industry as we kept the lights on 99.96% of the time. The success we achieved and the continuation of our operations without significant interruption over the past year serve as testaments to our great people. Whether they were adapting to remote or hybrid work, finding innovative ways to serve our customers, meeting company goals or implementing additional measures to keep themselves, our customers and our communities safe. Our dedicated employees rose to the occasion and powered through it together. I can't thank them enough for their contribution, their perseverance and the support they gave me as I transitioned into my new role last year.
In addition to outstanding operating results, I am happy to report that IDACOR marked its 13th consecutive year of growth in earnings per share, as detailed on Slide 7. We believe this achievement is unparalleled among investor owned utilities in the U. S. In recent history, and it is particularly noteworthy in a year filled with economic headwinds and uncertainties. IDACOR and Idaho Power continue to benefit from strong customer growth and effective cost management, allowing us to preserve the full $45,000,000 of additional accumulated deferred investment tax credits for future earnings support.
We're pleased to continue to share the successes of the company with our owners by increasing quarterly common stock dividend again in 2020 from $0.67 to $0.71 per share, marking our 9th consecutive year with an increase to the dividend. As noted on Slide 8, Idaho Power service area continues to experience substantial customer growth. According to U. S. News and World Report and the United States Census Bureau, Idaho was once again the fastest growing state in the country during 2020, and Idaho Power's customer base grew 2.7%.
A national study by United Bandlines also ranked VoIP as the number 3 metropolitan area for inbound moves during 2020. Idaho Power now serves more than 587,000 customers, and we view the reliable, affordable, clean energy our company provides as an important factor in continuing to attract business and residential customers to Southern Idaho and Eastern Oregon. It did not seem that long ago that we crossed the 500,000 customer mark. Looking ahead at future loads, inquiries for large load projects came in at a strong pace during 2020. On Slide 9, you'll see the highlighted notable milestones, including the announcement of a 240,000 Square Foot True West East Facility, the opening of Amazon's 2,500,000 Square Foot Fulfillment Center and the announcement of a 90,000,000, 50,000 Square Foot expansion to an existing Lamb Weston potato processing plant.
Amidst the global pandemic, the economy within Idaho Power Service Area continues to outperform national trends. Moody's predicts sustained economic growth going forward. After experiencing a GDP decrease of 1.7% in 2020, the Moody's forecast calls for growth of 6.1% in 2021 6.8% in 2022. Unemployment within Idaho Power's service area is at 4.7%, an increase over recent years, but still well below the 6.7% reported at the national level. As I mentioned earlier, IDACOR was pleased to announce a dividend increase of 6% this past fall.
Going forward, management expects to recommend to the Board of Directors future annual increases in the dividend of 5% or more with the intent of keeping the company within our target payout ratio of between 60% 70% of sustainable IDACOR earnings. As outlined on Slide 10, IDACOR continues its strategy into 2021, striving toward our cornerstone goals of growing financial strength, improving the core business, enhancing Idaho Power's brand and keeping employees safe and engaged. As we execute on these goals, we work to balance the interests of our owners, customers, employees and other stakeholders. We are committed to working for sustainable financial results and strong credit ratings by continuing to provide safe, reliable, affordable service to customers from an already clean and increasingly cleaner, reliable mix of generation resources. Idaho Power's goal to achieve 100% clean energy by 2,045 fits well into our overall strategy as we expect it to lead to new investment and system improvements that will enhance the customer experience.
You'll see highlighted on Slide 11 that the Fort McMurray project or B2H continues to advance. This project is a key energy pathway that will allow us to buy, transport and sell more clean energy across the Northwest. Last July, the Oregon Department of Energy issued a proposed order recommending authorization of the transmission line. Idaho Power anticipates finalizing B2H permitting in 2022, with the line planned to be in service in 2026 or later. Discussions are ongoing about the ownership structure of the line with the Idaho Power with Idaho Power exploring with the partners both its planned share of ownership as well as the potential additional investment opportunity.
Our path towards a cleaner tomorrow continued in 2020 as the jointly owned Boardman coal fired power plant in Oregon ceased operations in October. Idaho Power had previously ended participation in 1 unit at the North Baumy coal fired plant in Nevada at the end of 2019. And depending on further analysis on economics and system reliability, the remaining Balmi unit could follow with exit plans as early as next year, but no later than 2025. We also continue to explore options with our partner for the appropriate end of life of the Jim Bridger coal fire plant in Wyoming, which will be our final coal plant in the Idaho Power Energy recent integrated resource plan calls for a full exit from coal fired generation by 2,030. Receiving a new long term federal license for the 3 dam Hell Canyon Complex is another top priority to help ensure Idaho Power's clean energy future.
Significant steps in 2020 include filing a supplement to Idaho Power's final license application with the Federal Energy Regulatory Commission or FERC, and preparing draft biological assessments in consultation with the U. S. Fish and Wildlife Service and the National Marine Fisheries Service that were also filed with the FERC. The FERC could issue the license as early as 2022, but as of today, we believe issuance is more likely in 20 23 or thereafter. The FERC also recently formally initiated the relicensing proceeding for the American Falls Hydro Power Facility, which is Idaho Power's largest hydropower facility outside of the Hell Canyon.
Idaho Power currently expects the FERC to issue a new license for this facility prior to the 2025 expiration. Last quarter, we stated Idaho Power did not plan to file a general rate case in Idaho or Oregon in the next 12 months. That remains true today as we look at 2021. Customer growth, constructive regulatory outcomes, major project completion dates and effective cost management all play significant roles as we look at the need and timing of a future general rate case. As part of our overall regulatory strategy, I'll highlight that Idaho Power filed an application last month with the Idaho Public Utilities Commission requesting authorization to defer the Idaho portion of O and M expenses, including insurance costs and depreciation expense of certain capital investments expected to be necessary to implement its recently enhanced wildfire mitigation plan or WMP.
This WMP outlines actions Idaho Power is taking or plans to implement in the future to reduce wildfire risk and to strengthen the resiliency of its transmission and distribution systems to wildfire. These enhancements are in part a response to the degree of annual destruction from wildfires that the Western U. S. Has experienced in recent years. We expect to spend approximately $47,000,000 in incremental WMP wildfire related O and M expenses and $35,000,000 in incremental capital expenses over the next 5 years.
The case is now pending at the Idaho Public Utilities Commission. Next, I'd like to highlight our newest Board member, Doctor. Mark Peters, who was appointed last week. Doctor. Peters is currently the Executive Vice President responsibilities for governance and oversight of U.
S. Department of Energy and U. S. Department of Homeland Security National Laboratory for which Patel has a significant lab management role. Previously, he was the Director of the Idaho National Laboratory since 2015.
Leader in our Idaho community as well as an internationally recognized expert in his field, including energy and security. We're excited to welcome him to our Board of Directors. I will close with a look at weather on Slide 12. The most current projections from the National Oceanic and Atmospheric Administration suggest normal conditions from March to May. Our mountain regions have received some good precipitation in recent weeks and we are hopeful the resulting snowpack should provide decent conditions for generating low cost hydropower and to provide irrigation customers with enough water to operate in 2021.
As a reminder, our power cost adjustment mechanisms in Idaho and Oregon significantly reduced earnings volatility related to changes in our resource mix and associated power supply costs that can fluctuate greatly due to weather. With that, I will hand things over to Steve for an overview of last year's financial
performance. Thank you, Lisa. Let's now move to Slide 13, where you'll see our full year 2020 financial results as compared to the same period in 2019. Overall, we had solid results during a challenging year driven by customer growth in our service area and continued successful efforts to control costs. First up on the table is our strengthening customer growth of 2.7%, which added $14,000,000 to operating income.
Higher usage per residential and irrigation customer of 1% 11%, respectively, more than offset the negative used impacts of the pandemic, which contributed to decreased commercial and industrial sales volumes by a respective 4% to 1% during the year. Irrigation sales volumes benefited from a return to more normal spring precipitation levels over 2019. Residential customer usage was partly impacted by weather variations, but many customers also spent more time at home due to the public health crisis. The net result was a relatively modest $900,000 increase in overall usage per customer. Also on the table, you will see that the increase in residential sales was offset by a $1,000,000 decrease in fixed cost adjustment revenues.
Next, changes in net power supply expenses led to a $2,600,000 decrease in retail revenues per megawatt hour, largely due to fewer opportunities for office and sales than in the prior year. Transmission, Wheeling related revenues also decreased $2,200,000 primarily due to a 13% decline in Idaho Power's open access transmission tariff rate in October of 2019. This decrease was partially offset by an increase in wheeling volumes this past summer related to warmer weather in the Southwest, U. S. And California as well as roughly 10% increase in tariff rate beginning October 1, 2020.
Next on the table, other operating and maintenance expenses decreased by $3,700,000 A portion of this decrease was expected due to Idaho Power's exit from Unit 1 of the North Lomi plant last year, but much of the decrease resulted from lower costs related to discretionary maintenance projects at the jointly owned coal plant as well as lower performance based variable compensation accruals. In prior quarters, we mentioned a small deferral of expenses related to COVID-nineteen. As of year end, the current amount is nominal. However, Idaho Power plans continue to monitor these those related ongoing costs. Finally, our higher pretax earnings led to an increase in income tax expense of $2,100,000 this quarter.
The changes collectively resulted in an increase to Idaho Power's net income of $8,800,000 Other Idaho net income changes were lower primarily because distributions from the sale of low income housing properties in 2019 did not recur in 2020. IDACORP's full year net income for 2020 was a net $4,500,000 higher than 2019. IDACORP and Idaho Power continue to maintain strong balance sheets, including investment grade credit ratings and sound liquidity, which enable us to fund ongoing capital expenditures and distribute dividends to share owners. IDACORP's operating cash flows along with our liquidity positions as of the end of 2020 are included on Slide 14. Cash flows from operations were about $22,000,000 higher than the prior year.
The increase was mostly related to working capital and deferred tax fluctuations, offset partially by the timing of net collections of regulatory assets and liabilities. The liquidity available under IDACORP's and Idaho Power's credit facilities is shown on the middle of Slide 14. At this time, we do not anticipate issuing additional equity in 2000 or in 2021 other than nominal amounts under our compensation plans. While cash flows have been minimally affected by the pandemic thus far, our combined liquidity along with expected regulatory support from our annual adjustment mechanisms is a substantial backstop to our expected capital and operating needs. As we did last year, Idaho Power could contribute up to $40,000,000 to its pension plan during 2021, which would be above its required contribution.
Slide 15 shows our initiated full year 2021 earnings guidance and our key financial and operating metrics estimates. We currently expect IDACORP's 2021 earnings to be in the range of $4.60 to $4.80 per diluted share. At or above the midpoint of this guidance range, IDACORP would achieve its 14th consecutive year of growth in earnings per share, which approaches a 5 percent cumulative average growth over the past 5 years. Our guidance assumes Idaho Power would use no additional tax credits and assumes normal weather conditions. Of course, our guidance could also be negatively impacted if the economy or the pandemic worsened significantly and such scenarios could require us to use additional tax credits.
Our strong, consistent financial results and sustained cost management efforts during the past decade have preserved the full $45,000,000 of tax credits available to support our current Idaho jurisdictional return on equity support level of 9.4% under our regulatory stipulation. And we plan to continue our efforts to preserve as many of those credits as we can going forward. Our full year O and M expense guidance is expected to be in the range of $345,000,000 to $355,000,000 This would be the 9th straight year of nearly flat O and M expense, which represents a sustained commendable effort of our entire team over those years. It's fair to say this goal is being impacted by the level of growth we are experiencing. And depending on how this year progresses, it could be challenging to me.
Our CapEx spending is expected to increase to the range of $320,000,000 to $330,000,000 and our expectation of hydropower generation is expected to be in the range of 6000000 to 8000000 megawatt hours, the upper end of which would be close to our normal annual generation over the past 30 years. On the subject of CapEx, turning to Slide 16, you'll note that the current 5 year capital plan reflects significant increases relative to our prior 5 year plan as a portion of the construction costs for some of the larger projects Lisa discussed like B2H have been folded into the outlook along with other anticipated capital improvements. We now expect our capital expenditures over the next 5 years to approach $2,000,000,000 and it shows roughly a 7% compound average growth over our previous 5 year
plan.
With that, Lisa and I and others on the call are happy to answer your questions.
We are now ready to begin the question and answer session. Julien Dumoulin Smith from Bank of America. Your line is open. [SPEAKER JULIEN
DUMOULIN SMITH:]
Hey, good afternoon team. Congratulations on the outcome there. Thank you.
Thank you, Julien.
Absolutely. It's a pleasure. I wanted to follow-up on the 'twenty one guidance here, right? Obviously, very successful 2020. Can you walk through a little bit more of the thought process on the flat outcome effectively?
And don't run, it's not entirely
lost on me, but I want
to hear it as you guys describe it, the factors here year over year that are keeping you there. If you can sort of give the quick positives and negatives
here? Sure. I'll start and then I'll have Steve jump in. So as we thought about this, you looked back over the last 13 years and we really do want to be able to achieve what we say we're going to do and that's been our history that we've done that and many times exceeded it. And it's really been our relentless pursuit of looking for those opportunities to increase our earnings.
And when you look back over 2020, honestly, nobody is more surprised than I am that we were able to achieve what we achieved when you look back at all the scary things that could have happened with the pandemic and social unrest and economic situation. And certainly, they have turned out better than we thought, although I certainly don't want to downplay any of the tragic impacts that have happened because of those. And we really feel like we're still facing a great deal of uncertainty as we go into 2021. All of those things are certainly not over. So we try to balance that against our compelling growth story.
As we've mentioned, people are still moving, we are still growing. And so it was we believe that it is up from last year's guidance. And so we thought it was a good place to initiate our guidance.
Yes. And Julian, I might just throw in. There's a lot of massive number of year over year items to think about. We did talk about last in our Q2, I think we brought it up, but we had about a $3,000,000 O and M savings last year that was really our partners at I think Jim Bridger plant, our coal plant. That was an unusual drop that we're not necessarily expecting a boomerang this year, but we do think this year goes back to a normal level.
So we're not expecting that particular item there. And I think I look at the impacts of COVID and you see our growth jumps. It was above where we were thinking initially when we headed into the year. We're not sure whether that holds at that level or if there's some other reaction. So I think you put the COVID spin on everything and you start to just have questions.
We're not pessimistic. We're just not sure how much more optimistic we should be. And so we set the numbers above what we had last year, pretty well above our opening plan last year. So it's clearly a step up in performance. And something we talked about with our Board is we're not working off of a reset.
We're 13 years of steady up. We don't have a bad year this year to jump up from and give you a high growth number off of or we don't have it in the last 2 or 3 years. So that doesn't make it hard. I would just say we're setting realistic looks and you know we'll aim to do as well as we can. If we can list it, we'll let you know about that as we move through the year.
Yes, absolutely. Understood.
And then obviously, great outcomes on the CapEx and rate base, frankly. Can I ask you guys, so please if you don't mind, you have this base rate base growth that you guys talk about for the next 5 years? Can you talk about that additional 1.2 that really jumps the rate base growth in the timeline? I know we've talked about these before more discreetly. But if you think about it, when do you find out as best you see it right now for HealthCanyon and BPH to make that higher trajectory or to materialize that higher trajectory if you will?
I just want to
put this together in terms of a timeline to finding out about that more elevated rate
base? Well, let me just start with what's in our numbers that we talked about with the step up there. It's a very normal not that it's 100% within our control, but things that really which we're driving and are part of our normal plan are what's contributing to this step up you're seeing in the current 5 years. It's our portion of the B2H line. It is probably a small reevaluation of things that might be coming.
As I said, we haven't really been looking at it through the lens of what things should we be adding in there versus the very minimum things we ought to be doing and this has a look at we've kind of recalibrated there and that's all contributing to kind of the midpoint of this range. If you look at the little the wider bands, that thing's going either not quite as good or better and there are some opportunities we think to lift that to the upside. Then you move beyond that as where the items you're talking about and that's really more it's not a lot different story than what we had before and I do think the timing on Health Canyon could be part of that. The timing of when we go into a rate case could impact some of that. So I don't know that we have a lot more clarity than what we have discussed.
In our chart, we'll be putting out, it really wasn't related to the 2020 year, so we didn't overload this chart with that. But those longer plans are still there in terms of what we see as opportunity. It's not like any of those are gone and they are moving closer and closer.
The I would add just that exactly that we do have we are none of this stuff happens in a step function. It sort of ramps up over time and we're just coming into that window when we're going to start seeing those expenses. Etcetera. So it still is very much the strategy that we've discussed with you before. And again, we're starting to move on it.
It's going to take a number of years to get there.
Final quick question. I apologize. Given the uptick in capital spending, at least on the base plan here, is there a designated year that you're thinking about for a subsequent eventual case? I'm just curious on the timeline there. Obviously, great job otherwise thus far.
Yes. I guess I would just say that I think there's a bit of a requirement when Health Canyon is done. I think it's highly likely there's a case that you wouldn't want to run long without that being certified and put in a rate base. Beyond and as you know, that number, that date has moved. Right now, we've got a possible 'twenty two, more likely 'twenty three and we've been saying words like that
for a decade.
So I'm not sure on that one. The way we do well or have done better than maybe what we would have is if we had taken the risks of that are incumbent in any rate case is that the growth has been paying for itself. And that one, it looks good now if you believe where people are projecting, it looks essentially paying for itself such that we don't have to pass costs on to anybody else. We don't have to go back to the other customers. But that can change.
And I think as we saw this year, there was definitely a bit of a response to what people were experiencing in their states around us that some just picked up the cane. They didn't really have a plan. They just showed up in Idaho and said, we're here. And does that keep going at the same rate? I have no expectation it would drop way down, but it could settle back to where it was last year and the year before.
We'll just have to keep an eye on but I think that's still the answer in the near term.
Excellent. Congrats guys again. Talk to you too.
Thank you.
Your next question comes from the line of Chris Ellinghausen with Seabort Wood. Your line is open.
Hey, everybody. Hi, Chris.
Lisa, what's the next important date for us to really look for on B2H?
I would say, getting that the permit finalized in 2022 is probably the next big date for that. Adam, Richland, anything you would add to that?
No, I agree. The FSAC permitting process is scheduled to be done in the second half of twenty twenty two. So that is kind of the big date. It doesn't mean we're not doing activities in between now and then. But I think as you know, Chris, the federal permitting is complete, the state permitting is set to be complete at the end of or kind of in the second half of twenty twenty two.
And we feel pretty good about the progress at this point.
Okay, great. Lisa, as far as your clean energy goal goes, What are your thoughts on other generation? I assume that includes things like new fuels and other generation types, but what's in the mix as far as your thinking in achieving your goal?
Well, we're right in just getting started actually for our next iteration of our IRP process. And that's really where we explore all of that. I would say just my own personal view, wind and solar tend to show up in those portfolios. Storage is another one. I'm also very intrigued with some of the development in hydrogen as well.
I think that's a really natural replacement for natural gas as we go forward. We certainly have a lot of infrastructure already built in the form of gas plants that we could put to work with the new fuel. So I just think that's interesting. I do think that small nuclear reactors, we're watching that carefully. We currently don't have any investment in those and but we are watching.
Still think if we're really going to get to 100% clean as a nation, more research and development of these kinds of resources is going to be necessary. So I think as the Biden administration launches their plan, we'll see more where the R and D dollars go, what kind of resources are explored there. And if you kind of look at what's happening down in Texas, for example, I think that's going to give everybody pause and should as how fast you go and what resources you go to, although I'm not suggesting it with clean resources that are the problem. It was all the resources that froze up in this circumstance, but we just have to be careful as we build those portfolios in the future. That's really why we did a 25 year plan, so we can let some of these resources be developed and we can make careful choices, so that we can do it in a very pragmatic way that doesn't harm reliability or affordability.
Okay.
Can you give us
a little more color on what you're seeing in the acceleration in customer growth? Is it exodus? Is it just the good economic climate? What are you seeing qualitatively there?
We're seeing a little bit of everything, to be honest. We're seeing people just because you can work anywhere, there's a lot of people that have decided to make Idaho their home. Some people had second homes and they just came here and stayed here. Others are buying up homes here faster. I mean that's it's mind boggling how the market has just gone kind of crazy.
But we do see some that I think they call themselves political refugees, they're sort of getting away from something and coming here. And so it's just really a mix. And then of course, there's businesses that have brought them here as well. So it's I think it's really the quality of life of Idaho that's drawing people in, people that like the outdoors, people that like a little less density, although the irony of that is when a bunch of people show up because they want not the population density and then they make the population dense is a little ironic. But people that I've talked to, there's a whole lot of new license plates from all over and their stories are all a little bit different.
Okay. One last thing. Relative to your slide with the list of the large new customers, Can you give us any color on what you might have in the backlog for next year's slide?
Well, a lot of those are very confidential. In fact, a lot of the time we don't even know who they are. But there is still a lot of interest in data centers, food processing and agricultural products continue to be strong, manufacturing as well. So it's kind of a nice balance. I like seeing a balance so that it isn't any one particular industry that is could be impacted and have a significant impact to the economy of Idaho.
But I'd say overall, is there any one any of the big sectors I've forgotten?
No, I think it's there's a story that I was thinking might add to this though is you heard us talk about Chobani when it first came to Idaho and they talked up certainly in a huge way how quickly they were able to start the process and end the process. It was faster than they ever dreamed in terms of start to finish. They were open and running. And that same story is kind of popping out of the Amazon facility that it went up really quickly. And I think those stories are migrating around such that people with expansion ideas like that.
They like that people here are going to help and move it along. So I think that contributes certainly on the business side. And on the housing, and residential side, while prices have risen significantly, I think we still look very affordable to a lot of the places that are looking at coming in. So on that side, it's a bargain.
Okay. Thanks for the details. I appreciate it.
Thank you.
Your next question comes from the line of Brian Russell from Stadi. Your line is open.
Hi, Brian.
Hi, good afternoon. Just following up on the guidance question, you tightened the guidance in October, which I think was a midpoint of 460 and you reported actual 469 which was above the high end of the updated guidance range. So what happened that you were able to exceed the end of the range? And are those drivers possible again in 2021 that's not captured in your initial guidance from today?
I think it's that's a good question, Brian. I do think there's some possibility for it to be better, but we were able to really hold the line on a lot of expenses. As you saw, our O and M came in really good. And I alluded to just briefly in my words that I put out earlier that growth is also a pressure and while we're setting on hard targets, we're feeling probably a little different pressure today than maybe we had at start of last year. And the pandemic certainly did allow some things to be less and maybe that will stay that way the whole year.
Maybe we won't resume travel, maybe we won't have all the expenses that you typically do in a year. We captured that and did our very best to make costs as low as we could. We'll aim at all of that again. We're just not sure how quickly we resume normal operations versus not. And I'm not sure the timing of expenses rise first and revenues follow later, do revenues kick in early and then the expenses come, Those are just enough variables that we've gone up kind of in a cautious way.
Our upper end is higher than it was. We're acknowledging that's what we're going to be aiming at is trying to hit our midpoint or higher as we always do. And we'll just have to see, Brian. I think it's our nature more that's showing up of not wanting to overstate in a year that there's this much uncertainty. It's certainly more than a normal year.
Got it. And then just to follow-up on the O and M expense line, you mentioned a wildfire capital cost and operating cost deferral filing. Are there any wildfire costs embedded in your O and M 2021 guidance assumption?
Not substantially different. I mean the normal amounts are there, but not a big step up in this O and M side for this year. Okay. All right.
And then to follow-up quickly on the trailing 12 months customer growth is 2.7% and that was basically during the entire pandemic of 2020. And you mentioned 2 new big business facilities opening up like Amazon, Xtura. Are you forecasting 2.7% customer growth in 2021? And is there a possibility for that to accelerate, especially given Moody's GDP's forecast of 6 plus percent growth year over year?
Yes, our outlook for the year is sort of a starting a bit more modest and ending with a little more robust look. So it kind of transitions as we go through the year. So that's what and I guess from the COVID perspective is we would be expecting continual improvement as we get through the year and be back to maybe not 100% normal, but closer to normal by the time we close the year out. As the categories that got hit, of course, commercial and industrial, we're just not sure how quickly that translates for all of them, because it is different reasons that maybe those 2 had their issues. So it's a question of how quickly they come back up.
Residential in a way got a boost from everybody being home all the time. That could swing the other direction. But as you say, we've had a lot of people coming in. So I think the growth side of residential is still going to be there in terms of number of people. But it is a little different equation than we typically face and that probably is factored into a little bit of that caution of not being overly bold on the upside.
Okay, great. And then you mentioned part of the 2021 guidance is the pre customer growth should I should say, should fall back to pre COVID levels. Is there any way you could quantify what or isolate what the impact of COVID-nineteen was on usage in 2020?
The usage lags a little in terms of particularly the commercial and industrial. They show up and as you take a few months to site and get them in and construct and all that. Where we really saw it was I think the residential side had a growth impact, no question. And it's shown up in new housing starts and lack of inventory and everything. So I think we did see that.
Some of that residential uptick is it's a blend of the people that stay home and the new homes that came online and started using more power. But it's a little harder to define in the other categories, I would tell you. A banner irrigation year, it was just a more normal irrigation year where we didn't have a super wet spring that allowed them to not have to irrigate.
Committed to prior to the pandemic settling in, so the farmers were already in. So they continued on. So that was good. And this is a fun fact. Idaho had a record agricultural net income.
And surprisingly, even though prices really flattened early in the year, then they recovered and they did very well even when you don't consider the federal support. So it turned out to be a really interesting year.
Okay. And then last question just on the balance sheet and how it correlates with the increasing CapEx over the 5 year period with the $275,000,000 of cash that you have in the books at year end and below 50% debt to cap, it's you can finance your CapEx without incremental equity. I know you said no equity plan for this year, but maybe you could think about longer term because after the next 2 years of $300,000,000 of CapEx, it looks like 20 45 or 23 through 25 on average are going to be north of $400,000,000 in CapEx. Just thoughts on the balance sheet?
No, you're pointing out a really good point, Brian, that I think that's an opportunity we have is that the near term CapEx and maybe for quite some time, we will go to debt first. I don't know that we're going to need to our success has shown up with higher equity Ahead last year, our approach we got such good rates with what we actually issued. We were looking some we had some refinance opportunities that showed up that we could put a little more we just grab a little extra capital with and then we had a planned financing that we upsized a little. Really is going into the pandemic, we just wanted to be sure we didn't get in 'eight and 'nine. But that really has us ahead of the game coming into 2021.
So I think it's a good place to be and we got such good rates on it. It didn't overburden us in terms of it didn't layer that much more expense on And we were able to get rid of a couple of higher cost debt instruments, refinance them at low rates as well. So that's really that's what happened last year that set up this year well. And those bigger those other projects that have been talked about whether at Bell Canyon or B2H, those will be the things that we'll have to keep our eye on. But we'll try to do that with low cost debt as much as we can as well.
There are no further questions. So that concludes the question and answer session for today. Ms. Roe, I will turn the conference back over to you.
Thank you on this call today. We appreciate your continued interest in IDACOR and we look forward to seeing and speaking with many of you over the next few weeks as we participate in a few investor conferences. I wish you all continued great health. Remember to keep your masks on, keep washing your hands, keep socially distant, and I wish you all my best. Have a great evening.
Thank you everybody for joining today. That concludes today's conference call. You may now disconnect.