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Avista Calls for Additional Renewable Energy
New resources needed for expected growth

Spokane, Wash., Jan. 4 // -- Avista Utilities, an operating division of Avista Corp. (NYSE: AVA) is seeking proposals from suppliers of renewable energy to meet its projected need for additional cost-effective energy resources. The request for proposals (RFP) is based on future growth in demand for electricity as identified in Avista's 2005 Integrated Resource Plan (IRP).

Avista currently supplies about 54 percent of its electric needs through renewable hydropower. Other renewable resources utilized by Avista include wood waste and wind power. Avista is now seeking proposals to add approximately 35 average megawatts (aMW) of long-term renewable energy supplies to begin during the fourth quarter of 2007.

Avista's IRP identifies a preferred resource strategy consisting of a mix of five resource categories including conservation, upgrades to existing generation facilities, wind, other renewables and coal. In total, conservation, plant upgrades and renewables provide more than half of new load requirements over the IRP time frame.

"We are actively pursuing various elements of our resource strategy. In this RFP we are addressing the first of those components to help secure resources at the lowest reasonable costs for our customers," said Dick Storro, director of power supply for Avista Utilities. "Later this year we will also be looking for proposals to implement additional effective conservation programs and other elements of our preferred resource strategy."

According to projections, energy deficits on a quarterly basis will begin in 2007 and capacity deficits on a quarterly basis begin in 2009. Annual energy deficits are projected to begin in 2010, with loads exceeding resource capability by 40 aMW. Energy deficits rise to 360 aMW in 2016.

Responses to the renewables request for proposals are due on February 1, 2006. The full RFP is posted on the Avista Utilities web site at: www.avistautilities.com/resources/renewable_rfp.asp

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 330,000 electric and 285,000 natural gas customers in three western states. Avista's non-regulated subsidiaries include Avista Advantage and Avista Energy. Avista Corp.'s stock is traded under the ticker symbol "AVA." For more information about Avista, please visit www.avistacorp.com.

This news release contains forward-looking statements, including statements regarding projected energy deficits in future periods. Such statements are subject to a variety of risks, uncertainties and other factors, most of which are beyond the company's control, and many of which could have a significant impact on the company's operations, results of operations and financial condition, and could cause actual results to differ materially from those anticipated.

For a further discussion of these factors and other important factors, please refer to the company's Annual Report on Form 10-K for the year ended Dec. 31, 2004 and Quarterly Report on Form 10-Q for the quarter ended Sept. 30, 2005. The forward-looking statements contained in this news release speak only as of the date hereof. The company undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances that occur after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all of such factors, nor can it assess the impact of each such factor on the company's business or the extent to which any such factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.

Avista Corp. and the Avista Corp. logo are trademarks of Avista Corporation.

CONTACTS:

Media: Hugh Imhof

509-495-4264

hugh.Imhof@avistacorp.com

Investors: Jason Lang

509-495-2930

jason.lang@avistacorp.com

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