Idaho Power is still pursuing its goal of being 100% powered by clean energy by 2045, but the utility’s latest plan shows more reliance on carbon-burning energy than before.

The latest Integrated Resource Plan released by Idaho Power shows the company is under pressure to power up to meet demands from a growing number of customers, as well as large users like data centers in the coming decades. The need to expand infrastructure to keep up with the boom in demand is behind both the company’s ask to increase rates and its rollback to needing more natural gas-powered plants in its portfolio long-term. This is a pivot from earlier plans that involved converting these plants to burning hydrogen in the later decades or powering them down completely.

Idaho Power estimates its customer base will grow from 648,000 at the end of December 2024 to 867,000 in 2045.

“We’re seeing eight to nine percent growth every year over the next five years,” Idaho Power Resource Planning Leader Jared Hansen said in an interview. “That’s over 40% of our energy sales. That’s significant for us in every industry, you have lulls and surges and we seem to be in a surge right now. We’re scrambling to meet that.”

In 2019, the utility first announced plans to go coal-free. To meet this goal, Idaho Power said it planned to use 40% of the state’s power coming from hydroelectricity, along with new development of wind, solar, and battery storage to meet demand and take over the 20% of the company’s portfolio powered by coal. Another cornerstone of the company’s strategy to meet this goal is the construction of transmission lines to move power back and forth between Idaho and abundant hydroelectricity in the Pacific Northwest during the summer and the surge of solar power in the American Southwest during the winter.

The Boardman-Hemingway transmission line linking the Treasure Valley with the Pacific Northwest began construction this year and is expected to come online by the end of 2027 after decades of planning.

Idaho Power’s long-range plans, released every two years, show the ebb and flow of how much the company plans to rely on renewable energy as it works to meet the 2045 benchmark.

This latest plan relies more on natural gas than previous plans. In 2021, the company’s integrated resource plan called for converting a 357-megawatt coal-burning power plant to gas in 2024 and closing another 175 megawatts of coal-burning power by 2028. Then, by 2034, the company planned to close the converted gas plant in favor of other renewable sources like wind, battery storage, and solar.

This changed in 2023 when Idaho Power’s plan for that year showed coal plants converted to burn natural gas in 2024, 2026, and 2030. Then, the utility forecasted shutting down 706 megawatts of natural gas-burning power plants in 2038 in favor of burning hydrogen instead.

The 2025 plan once again shakes up the company’s approach with plans to convert two units at Idaho Power’s Bridger power plant in Wyoming from burning coal to natural gas next year. The utility forecasts being done burning coal by 2030. But this plan involves building two new natural gas plants in 2029 and 2030, as well as tentative plans for additional natural gas-burning capacity by 2041 and 2043. There are no plans to scale back natural gas generation in this latest plan or to add hydrogen-powered plants to the mix.

Hansen said Idaho Power needs natural gas, which isn’t subject to the cycles of the weather or the sun, to meet the spike in demand on the state’s power grid. Natural gas is a non-renewable fossil fuel and emits greenhouse gases like carbon dioxide and methane, but it does burn less CO2 than coal.

“Going forward, we still need further innovations to get there,” Hansen said, noting Idaho Power could use new technologies like carbon capture or other processes to provide a steady, cleaner power supply than coal. “…To date and where we are today, meeting our loads reliably requires some firm resources that emit carbon dioxide, like natural gas. It’s not a simple answer, and it’s a complex issue, to keep our system affordable and reliable into the future.”

Environmental groups like the Sierra Club say Idaho Power should do more to convert to renewable energy sources. Lisa Young, director of the Idaho chapter of the Sierra Club, called Idaho Power’s plans to build new gas plants “really, really alarming” and said the company can meet its growing needs with renewable energy rather than natural gas. She said this new plan raises questions about Idaho Power’s commitment to its 2045 clean energy goal.

“This is the first time we’re seeing this in their latest plans and should sound alarm bells for a lot of folks,” Young said. “To be investing in these things in the next five years, of course, if they’re going to be building any new infrastructure, any new assets, they’re going to want to use those for as long as they can. It won’t make sense to build a new gas plant and shut it down two years from now. Our concern is they’re going to invest in this new infrastructure, and we’ll be stuck burning gas for another few decades.”

Like its fluctuating plans to burn natural gas, Idaho Power’s plans for how much renewable energy it will add have also changed. Its 2021 plan envisioned adding 3,790 megawatts of wind, solar, and battery storage capacity through 2040. This spiked in 2023’s plan to more than 6,500 megawatts of renewable energy added, including several years of back-to-back investment in solar in the 2040s.

The 2025 plan backs off the amount of renewable energy in the plan down to 3,030 megawatts added through 2045.

Artificial intelligence wasn’t on the general public’s radar six years ago, when Idaho Power first set out to meet its energy goals.

Data centers, particularly those built to support the extra computing power needed to power AI, are large users of electricity and water. Data centers across the country used 183 terawatt-hours of electricity last year, according to estimates from the International Energy Agency. Around the country, electricity prices are spiking in states like Virginia, where data centers to power the internet are plentiful.

Idaho is relatively new to the data center business. In 2020, the Idaho Legislature passed a tax break aiming to lure data centers to the state. So far, Meta and a 620-acre data center from Diode Ventures have set up shop in Kuna, but have not yet come online. These two projects have since sparked intense debate at the local and state level about their inclusion in urban renewal districts and their strain on the power grid or other resources, with relatively few high-paying jobs in return. Bills limiting the tax exemption for data centers and requiring companies to provide their own electricity were introduced in this year’s legislature session, but failed to get over the finish line.

Idaho Power is currently in the process of asking the Idaho Public Utilities Commission for a roughly 13% hike in rates. The utility also recently earned PUC approval to cut reimbursement rates to solar panel owners.

Hansen said many customers assume rates are going up due to new data centers coming into the state, but what is largely driving the need for the rate increase is the higher costs of steel, copper, transformers, and other materials needed to maintain and expand the power grid. He said that no data centers are currently online in Idaho, and the utility analyzes the needs of large users before they come online.

“We have in place a no-harm analysis and a study where we look and ensure those customers are paying for the resources they will need and other customers are not harmed,” Hansen said. “We want to make sure that all of our customers are not bearing the weight of those customers coming on, and we study those things with and without those customers to determine what the rates would look like and make sure those customers are bearing their own burdens and carrying the costs of services they’re encurring on the system.”