Utilities Vow to Seek Restoration of Customers' Federal Power Benefits

Business Wire, May 21, 2007

* "It is clearly against the intent of federal law to have our customers completely shut out of any benefits from the federal power system, when those benefits were intended to be shared throughout the Northwest. We will be aggressively working with others in the region to resolve this and restore benefits to our Idaho customers as quickly as possible." - Rich Walje, president, Rocky Mountain Power

* "This decision is patently unfair to our customers. The federal hydro system belongs to every citizen in our region, and Congress decreed that everyone would share in its benefits. We will fight to have our customers' benefits restored, whether it's though a challenge of the court's decision, working closely with the Bonneville Power Administration, or ultimately, by a legislative change in the Northwest Power Act." - Scott Morris, president and chief operating officer, Avista Corp.

* "Lawyers can argue over the Northwest Power Act's finer points, but at the end of the day, this is a simple question of fairness. All Northwest citizens share ownership of our federal hydro system. It makes no more sense to deny a majority of them a fair share of the region's federal power benefits than it would to deny them the benefits of our public roads or schools." - Steve Reynolds, chairman, president and CEO, Puget SoundEnergy

* "We are very disappointed in the decision by the court and will work to restore our customer's previous share of benefits that were being passed through from BPA. We believe that residential and small farm customers served by the Northwest's Investor Owned Utilities are entitled to a fair share of the benefits of the Federal Columbia Power System and hope that we will be able to work with BPA and other customer groups to achieve this." - LaMont Keen, president and chief executive officer, Idaho Power Company

About Avista Corp.

Avista Corp. is an energy company involved in the production, transmission and distribution of energy as well as other energy-related businesses. Avista Utilities is a company operating division that provides service to 346,000 electric and 306,000 natural gas customers in three western states. Avista's non-regulated subsidiaries include Advantage IQ and Avista Energy. Avista Corp.'s stock is traded under the ticker symbol "AVA." For more information about Avista, please visit www.avistacorp.com. Avista Corp. and the Avista Corp. logo are trademarks of Avista Corporation. All other trademarks mentioned in this document are the property of their respective owners. This news release contains forward-looking statements regarding the company's current expectations. Forward-looking statements are all statements other than historical facts. Such statements speak only as of the date of the news release and are subject to a variety of risks and uncertainties, many of which are beyond the company's control, which could cause actual results to differ materially from the expectations. These risks and uncertainties include, in addition to those discussed herein, all of the factors discussed in the company's Annual Report on Form 10-K for the year ended Dec. 31, 2006, and the Quarterly Report on Form 10-Q for the quarter ended March 31, 2007.