Avista Cuts Gas Rates, Raises Electric Bills

Avista Corporation (AVA) shares declined 1.41% to $40.45 on August 1, 2026, as the utility provider navigated a complex landscape of regulatory filings, operational risks, and upcoming financial disclosures. The stock is currently trading below key short- and medium-term moving averages, including the 20-day and 50-day marks, while holding marginally above the long-term 200-day support level at $40.47. This technical positioning reflects persistent seller pressure despite the company’s reaffirmation of its full-year guidance.

Regulatory Adjustments in Idaho

Avista has submitted annual price adjustment filings to the Idaho Public Utilities Commission (IPUC), proposing changes to both natural gas and electric rates effective in the fall of 2026. These adjustments aim to align customer rates with actual incurred costs. If approved, natural gas rates would decrease starting November 1, 2026. The Purchased Gas Cost Adjustment (PGA) reflects a $2.5 million decrease due to lower wholesale prices observed during the previous winter. Conversely, electric rates are set to increase by approximately 6.5% for residential customers starting October 1, 2026. This hike is primarily driven by the expiration of a rate credit associated with the 2025 Power Cost Adjustment (PCA) and higher power costs experienced during the current period.

The filings also detail adjustments to Fixed Cost Adjustments (FCA) and energy efficiency programs. Avista intends to set natural gas energy efficiency collection rates to $0.00 per therm effective November 1, 2026, aligning with a recent request to suspend these programs temporarily. The company stated this pause ensures programs deliver maximum value, with plans to reinstate them once cost-effectiveness standards are met. Electric FCA adjustments are driven by variations in customer usage related to weather and efficiency savings.

Operational Risks and Public Safety

Beyond regulatory matters, Avista issued a warning regarding potential Public Safety Power Shutoffs (PSPS) in parts of its Idaho and Washington service territory starting August 1. The National Weather Service forecasts critical to extreme fire weather conditions, prompting Avista to prepare for targeted outages to mitigate wildfire risks. While no shutoffs have been implemented as of the report date, the company emphasized that restoration of power would depend on successful inspections of infrastructure using drones and ground crews. Customers in affected areas were advised to prepare for potential outages lasting longer than 24 hours, particularly if equipment repairs are necessary.

Financial Outlook and Earnings Expectations

Investors are closely watching the upcoming second-quarter earnings report, scheduled for release on August 3, before market open. Analysts project earnings per share (EPS) of $0.23 for the quarter, with revenue estimates standing at $426.93 million. This follows a first quarter where Avista reported EPS of $1.11, beating forecasts of $1.05 by 4.76%, although revenue of $555 million missed expectations of $657.61 million. Despite the revenue shortfall, the company reaffirmed its full-year earnings guidance of $2.52 to $2.72 per share, projecting 4-6% growth.

Market analysts maintain a cautious stance on the stock. Barclays continues to hold a "Hold" rating with a price target of $40, while BofA Securities maintains a "Sell" rating with a target of $37. Technical indicators suggest oversold conditions, with the Relative Strength Index (RSI) at 41.036 and the Commodity Channel Index (CCI) at -252.0272. The stock’s 52-week range spans from $35.50 to $43.50, and current consolidation suggests limited upside probability in the near term, with resistance clustered around the $41.50 to $41.73 levels.