Exhibit 4(a)(33)


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                               AVISTA CORPORATION

                                       TO

                                 CITIBANK, N.A.

                           AS SUCCESSOR TRUSTEE UNDER
                           MORTGAGE AND DEED OF TRUST,
                            DATED AS OF JUNE 1, 1939



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                       THIRTY-THIRD SUPPLEMENTAL INDENTURE

          PROVIDING AMONG OTHER THINGS FOR A SERIES OF BONDS DESIGNATED
               "FIRST MORTGAGE BONDS, COLLATERAL SERIES DUE 2005"
                                 DUE MAY 5, 2005



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                             Dated as of May 1, 2004

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                       THIRTY-THIRD SUPPLEMENTAL INDENTURE

                  THIS INDENTURE,  dated as of the 1st day of May 2004,  between
AVISTA  CORPORATION  (formerly known as The Washington  Water Power Company),  a
corporation of the State of  Washington,  whose post office address is 1411 East
Mission Avenue, Spokane,  Washington 99202 (the "Company"),  and CITIBANK, N.A.,
formerly  First  National City Bank  (successor by merger to First National City
Trust Company,  formerly City Bank Farmers Trust  Company),  a national  banking
association  incorporated  and existing  under the laws of the United  States of
America,  whose post office address is 111 Wall Street, New York, 10043 New York
(the  "Trustee"),  as Trustee under the Mortgage and Deed of Trust,  dated as of
June 1, 1939 (the "Original Mortgage"), executed and delivered by the Company to
secure the payment of bonds issued or to be issued under and in accordance  with
the  provisions   thereof,   this  indenture  (the  "Thirty-third   Supplemental
Indenture")  being  supplemental  to  the  Original   Mortgage,   as  heretofore
supplemented and amended.

                  WHEREAS  pursuant to a written  request of the Company made in
accordance  with  Section 103 of the  Original  Mortgage,  Francis M. Pitt (then
Individual Trustee under the Mortgage,  as supplemented)  ceased to be a trustee
thereunder on July 23, 1969,  and all of his powers as  Individual  Trustee have
devolved upon the Trustee and its successors alone; and

                  WHEREAS by the Original  Mortgage the Company  covenanted that
it would execute and deliver such further  instruments  and do such further acts
as might be  necessary or proper to carry out more  effectually  the purposes of
the Original  Mortgage and to make subject to the lien of the Original  Mortgage
any property thereafter acquired intended to be subject to the lien thereof; and

                  WHEREAS the Company has heretofore executed and delivered,  in
addition to the Original Mortgage, the indentures  supplemental thereto, and has
issued the  series of bonds,  set forth in Exhibit A hereto  (the  Mortgage,  as
supplemented  and  amended  by  the  First  through  Thirty-second  Supplemental
Indentures being herein sometimes called collectively, the "Mortgage"); and

                  WHEREAS  the   Original   Mortgage   and  the  First   through
Thirty-first  Supplemental  Indentures have been appropriately filed or recorded
in various  official  records in the States of  Washington,  California,  Idaho,
Montana and Oregon, as set forth in the First through Thirty-second Supplemental
Indentures  and the  Instrument of Further  Assurance,  dated December 15, 2001,
hereinafter referred to; and

                  WHEREAS the Thirty-second  Supplemental Indenture, dated as of
September  1, 2003,  has been  appropriately  filed or  recorded  in the various
official  records in the States of Washington,  California,  Idaho,  Montana and
Oregon set forth in Exhibit B hereto; and

                  WHEREAS for the purpose of confirming  or perfecting  the lien
of the  Mortgage  on certain  of its  properties,  the  Company  has  heretofore
executed and delivered a Short Form Mortgage and Security Agreement, in multiple
counterparts  dated as of various dates in 1992,  and such  instrument  has been
appropriately filed or recorded in the various official records in the States of
California, Montana and Oregon; and


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                  WHEREAS for the purpose of confirming  or perfecting  the lien
of the  Mortgage  on certain  of its  properties,  the  Company  has  heretofore
executed and delivered an Instrument of Further Assurance,  dated as of December
15, 2001, and such  instrument has been  appropriately  filed or recorded in the
various official records in the States of Washington, California, Idaho, Montana
and Oregon; and

                  WHEREAS in addition to the property  described in the Mortgage
the Company  has  acquired  certain  other  property,  rights and  interests  in
property; and

                  WHEREAS Section 8 of the Original  Mortgage  provides that the
form of each series of bonds (other than the First Series) issued thereunder and
of the  coupons  to be  attached  to  coupon  bonds  of  such  series  shall  be
established  by  Resolution  of the Board of Directors of the Company;  that the
form of such series,  as established  by said Board of Directors,  shall specify
the  descriptive  title of the bonds and various other terms  thereof;  and that
such  series  may  also  contain  such  provisions  not  inconsistent  with  the
provisions  of the  Mortgage as the Board of Directors  may, in its  discretion,
cause to be inserted therein expressing or referring to the terms and conditions
upon which such bonds are to be issued and/or secured under the Mortgage; and

                  WHEREAS Section 120 of the Original Mortgage  provides,  among
other things, that any power, privilege or right expressly or impliedly reserved
to or in any way  conferred  upon the Company by any  provision of the Mortgage,
whether  such  power,  privilege  or  right  is  in  any  way  restricted  or is
unrestricted,  may be in whole or in part waived or  surrendered or subjected to
any  restriction  if at the time  unrestricted  or to additional  restriction if
already  restricted,  and the  Company  may enter  into any  further  covenants,
limitations or  restrictions  for the benefit of any one or more series of bonds
issued thereunder,  or the Company may cure any ambiguity  contained therein, or
in  any  supplemental  indenture,  by an  instrument  in  writing  executed  and
acknowledged  by the Company in such manner as would be  necessary  to entitle a
conveyance  of real estate to record in all of the states in which any  property
at the time subject to the lien of the Mortgage shall be situated; and

                  WHEREAS  the  Company  now  desires  to create a new series of
bonds; and

                  WHEREAS  the  execution  and  delivery  by the Company of this
Thirty-third  Supplemental  Indenture,  and  the  terms  of  the  bonds  of  the
Thirty-first  Series,  hereinafter referred to, have been duly authorized by the
Board of Directors of the Company by  appropriate  Resolutions  of said Board of
Directors,  and all  things  necessary  to make this  Thirty-third  Supplemental
Indenture a valid, binding and legal instrument have been performed;

                  NOW, THEREFORE,  THIS INDENTURE WITNESSETH:  That the Company,
in consideration  of the premises and of other good and valuable  consideration,
the receipt and sufficiency whereof are hereby acknowledged, hereby confirms the
estate,  title and rights of the Trustee  (including without limitation the lien
of the Mortgage on the property of the Company  subjected  thereto,  whether now
owned or  hereafter  acquired)  held as  security  for the  payment  of both the
principal of and  interest  and premium,  if any, on the bonds from time to time
issued  under  the  Mortgage  according  to  their  tenor  and  effect  and  the
performance  of all the  provisions  of the  Mortgage  and of such  bonds,  and,
without  limiting the  generality of the foregoing,  hereby

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confirms the grant, bargain, sale, release,  conveyance,  assignment,  transfer,
mortgage,  pledge, setting over and confirmation unto the Trustee,  contained in
the Mortgage, of all the following described properties of the Company,  whether
now owned or hereafter acquired, namely:

                  All of the  property,  real,  personal  and  mixed,  of  every
         character and  wheresoever  situated  (except any hereinafter or in the
         Mortgage expressly  excepted) which the Company now owns or, subject to
         the  provisions  of Section 87 of the Mortgage,  may hereafter  acquire
         prior to the satisfaction  and discharge of the Mortgage,  as fully and
         completely as if herein or in the Mortgage specifically described,  and
         including  (without in anywise limiting or impairing by the enumeration
         of the same the scope and  intent of the  foregoing  or of any  general
         description  contained in Mortgage) all lands, real estate,  easements,
         servitudes,  rights of way and  leasehold  and other  interests in real
         estate;  all  rights  to the use or  appropriation  of  water,  flowage
         rights,  water storage  rights,  flooding  rights,  and other rights in
         respect of or  relating  to water;  all plants  for the  generation  of
         electricity,   power  houses,  dams,  dam  sites,  reservoirs,  flumes,
         raceways,  diversion works, head works,  waterways,  water works, water
         systems,  gas  plants,  steam heat  plants,  hot water  plants,  ice or
         refrigeration plants,  stations,  substations,  offices,  buildings and
         other  works  and  structures   and  the  equipment   thereof  and  all
         improvements,   extensions  and  additions  thereto;   all  generators,
         machinery, engines, turbines, boilers, dynamos,  transformers,  motors,
         electric machines,  switchboards,  regulators,  meters,  electrical and
         mechanical appliances, conduits, cables, pipes and mains; all lines and
         systems for the transmission and distribution of electric current, gas,
         steam heat or water for any purpose;  all towers,  mains, pipes, poles,
         pole  lines,  conduits,   cables,  wires,  switch  racks,   insulators,
         compressors,   pumps,  fittings,  valves  and  connections;  all  motor
         vehicles and automobiles; all tools, implements,  apparatus, furniture,
         stores,  supplies and equipment;  all franchises  (except the Company's
         franchise to be a corporation),  licenses,  permits, rights, powers and
         privileges;  and (except as  hereinafter  or in the Mortgage  expressly
         excepted)  all the right,  title and  interest of the Company in and to
         all other property of any kind or nature.

The property so conveyed or intended to be so conveyed  under the Mortgage shall
include,  but shall not be  limited  to,  the  property  set forth in  Exhibit C
hereto,  the  particular  description  of which is  intended  only to aid in the
identification  thereof and shall not be construed as limiting the force, effect
and scope of the foregoing.

                  TOGETHER  WITH all and singular the  tenements,  hereditaments
and appurtenances belonging or in anywise appertaining to the aforesaid property
or any part thereof, with the reversion and reversions, remainder and remainders
and  (subject to the  provisions  of Section 57 of the  Original  Mortgage)  the
tolls, rents, revenues,  issues, earnings,  income, product and profits thereof,
and all the estate,  right,  title and interest and claim whatsoever,  at law as
well as in equity,  which the Company now has or may hereafter acquire in and to
the aforesaid property and franchises and every part and parcel thereof.

                  THE COMPANY HEREBY CONFIRMS that, subject to the provisions of
Section 87 of the Original  Mortgage,  all the property,  rights, and franchises
acquired by the

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Company after the date thereof (except any hereinbefore or hereinafter or in the
Mortgage expressly  excepted) are and shall be as fully embraced within the lien
of the Mortgage as if such property, rights and franchises had been owned by the
Company at the date of the Original Mortgage and had been specifically described
therein.

                  PROVIDED THAT the following  were not and were not intended to
be  then or now or  hereafter  granted,  bargained,  sold,  released,  conveyed,
assigned,  transferred,  mortgaged,  pledged,  set over or  confirmed  under the
Mortgage  and  were,  are and  shall  be  expressly  excepted  from the lien and
operation namely:  (l) cash,  shares of stock and obligations  (including bonds,
notes and other securities) not hereafter  specifically pledged, paid, deposited
or  delivered  under the  Mortgage  or  covenanted  so to be;  (2)  merchandise,
equipment,  materials  or  supplies  held for the  purpose  of sale in the usual
course of business or for  consumption in the operation of any properties of the
Company; (3) bills, notes and accounts receivable, and all contracts, leases and
operating  agreements not specifically  pledged under the Mortgage or covenanted
so to be;  (4)  electric  energy  and other  materials  or  products  generated,
manufactured, produced or purchased by the Company for sale, distribution or use
in the ordinary course of its business; and (5) any property heretofore released
pursuant to any provisions of the Mortgage and not heretofore disposed of by the
Company; provided, however, that the property and rights expressly excepted from
the lien and  operation  of the Mortgage in the above  subdivisions  (2) and (3)
shall (to the extent permitted by law) cease to be so excepted in the event that
the Trustee or a receiver or trustee shall enter upon and take possession of the
Mortgaged  and  Pledged  Property  in the manner  provided in Article XII of the
Original  Mortgage by reason of the occurrence of a Completed Default as defined
in said Article XII.

                  TO HAVE AND TO HOLD all such  properties,  real,  personal and
mixed, granted,  bargained,  sold, released,  conveyed,  assigned,  transferred,
mortgaged,  pledged,  set over or  confirmed  by the Company in the  Mortgage as
aforesaid, or intended so to be, unto the Trustee, and its successors, heirs and
assigns forever.

                  IN TRUST NEVERTHELESS, for the same purposes and upon the same
terms,  trusts and  conditions  and  subject to and with the same  provisos  and
covenants as set forth in the Mortgage, this Thirty-third Supplemental Indenture
being supplemental to the Mortgage.

                  AND IT IS HEREBY FURTHER CONFIRMED by the Company that all the
terms, conditions,  provisos, covenants and provisions contained in the Mortgage
shall affect and apply to the property in the Mortgage  described  and conveyed,
and to the  estates,  rights,  obligations  and  duties of the  Company  and the
Trustee and the beneficiaries of the trust with respect to said property, and to
the Trustee  and its  successors  in the trust,  in the same manner and with the
same effect as if the said property had been owned by the Company at the time of
the execution of the Original Mortgage,  and had been specifically and at length
described in and conveyed to said Trustee by the Original  Mortgage as a part of
the property therein stated to be conveyed.

                  The  Company  further  covenants  and  agrees  to and with the
Trustee and its successor or  successors  in such trust under the  Mortgage,  as
follows:

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                                   ARTICLE I

                          THIRTY-FIRST SERIES OF BONDS

                  SECTION  1. (I) There  shall be a series  of bonds  designated
"Collateral  Series due 2005" (herein sometimes referred to as the "Thirty-first
Series"),  each of which shall also bear the  descriptive  title First  Mortgage
Bond,  and the form  thereof,  which has been  established  by Resolution of the
Board of Directors of the  Company,  is set forth on Exhibit D hereto.  Bonds of
the   Thirty-first   Series  shall  be  issued  as  fully  registered  bonds  in
denominations  of One Thousand  Dollars  and, at the option of the Company,  any
amount in excess  thereof  (the  exercise of such option to be  evidenced by the
execution  and  delivery  thereof)  and shall be dated as in  Section  10 of the
Mortgage provided.  Each bond of the Thirty-first  Series shall mature on May 5,
2005 and shall  bear  interest,  be  redeemable  and have such  other  terms and
provisions as set forth below.

                  (II)  The  Bonds of the  Thirty-first  Series  shall  have the
following terms and characteristics:

                  (a) the Bonds of the  Thirty-first  Series  shall be initially
         authenticated  and  delivered  under  the  Indenture  in the  aggregate
         principal amount of $350,000,000;

                  (b) the Bonds of the  Thirty-first  Series shall bear interest
         at the rate of eight per centum (8%) per annum;  interest on such bonds
         shall accrue from and including the date of the initial  authentication
         and delivery thereof,  except as otherwise provided in the form of bond
         attached  hereto as Exhibit D;  interest on such bonds shall be payable
         on each Interest Payment Date and at Maturity (as each of such terms is
         hereafter  defined);  and interest on such bonds during any period less
         than one year for which payment is made shall be computed in accordance
         with the Credit Agreement (as hereinafter defined);

                  (c) the principal of and premium, if any, and interest on each
         bond of the  Thirty-first  Series  payable at Maturity shall be payable
         upon presentation thereof at the office or agency of the Company in the
         Borough of Manhattan, The City of New York, in such coin or currency as
         at the time of payment is legal  tender for public and  private  debts.
         The  interest  on each  Bond of the  Thirty-first  Series  (other  than
         interest  payable  at  Maturity)  shall  be  payable  directly  to  the
         registered owners thereof;

                  (d)  the  Bonds  of  the  Thirty-first  Series  shall  not  be
         redeemable, in whole or in part, at the option of the Company;

                  (e) (i) the Bonds of the Thirty-first  Series are to be issued
         and delivered to the Administrative  Agent (as hereinafter  defined) in
         order to provide  the  benefit of the lien of the  Mortgage as security
         for the obligation of the Company under the Credit Agreement to pay the
         Obligations (as hereinafter  defined), to the extent and subject to the
         limitations set forth in clauses (iii) and (iv) of this subdivision;

                  (ii) upon the  earliest of (A) the  occurrence  of an Event of
         Default  under the Credit  Agreement,  and further  upon the  condition
         that,  in  accordance  with the  terms  of

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         the Credit  Agreement,  the Commitments (as hereinafter  defined) shall
         have  been or shall  have  terminated  and any  Loans  (as  hereinafter
         defined)  outstanding  shall  have been  declared  to be or shall  have
         otherwise  become due and payable  immediately  and the  Administrative
         Agent shall have delivered to the Company a notice demanding redemption
         of the Bonds of the Thirty-first  Series which notice states that it is
         being delivered  pursuant to Article VII of the Credit  Agreement,  (B)
         the  occurrence  of an  Event of  Default  under  clause  (g) or (h) of
         Article  VII of the Credit  Agreement,  and (C) May 5,  2005,  then all
         Bonds of the Thirty-first  Series shall be redeemed or paid immediately
         at the principal  amount  thereof plus accrued  interest to the date of
         redemption or payment;

                  (iii)  the  obligation  of  the  Company  to pay  the  accrued
         interest on Bonds of the  Thirty-first  Series on any Interest  Payment
         Date prior to Maturity (a) shall be deemed to have been  satisfied  and
         discharged in full in the event that all amounts then due in respect of
         the  Obligations  shall have been paid or (b) shall be deemed to remain
         unsatisfied  in an amount  equal to the  aggregate  amount  then due in
         respect  of the  Obligations  and  remaining  unpaid  (not  in  excess,
         however, of the amount otherwise then due in respect of interest on the
         Bonds of the Thirty-first Series);

                  (iv) the obligation of the Company to pay the principal of and
         accrued  interest  on  Bonds  of the  Thirty-first  Series  at or after
         Maturity (x) shall be deemed to have been  satisfied and  discharged in
         full  in  the  event  that  all  amounts  then  due in  respect  of the
         Obligations  shall  have  been  paid or (y)  shall be  deemed to remain
         unsatisfied  in an amount  equal to the  aggregate  amount  then due in
         respect  of the  Obligations  and  remaining  unpaid  (not  in  excess,
         however,  of the amount  otherwise  then due in respect of principal of
         and accrued interest on the Bonds of the Thirty-first Series).

                  (v)  the  Trustee  shall  be  entitled  to  presume  that  the
         obligation  of the Company to pay the  principal of and interest on the
         Bonds of the  Thirty-first  Series  as the same  shall  become  due and
         payable shall have been fully satisfied and discharged unless and until
         it shall have received a written notice from the Administrative  Agent,
         signed by an authorized officer thereof,  stating that the principal of
         and/or interest on the Bonds of the Thirty-first  Series has become due
         and payable and has not been fully paid,  and  specifying the amount of
         funds required to make such payment;

                  (f) no service  charge shall be made for the  registration  of
         transfer or exchange of Bonds of the Thirty-first Series;

                  (g) in the event of an application by the Administrative Agent
         for a substituted Bond of the  Thirty-first  Series pursuant to Section
         16 of the  Original  Mortgage,  the  Administrative  Agent shall not be
         required to provide  any  indemnity  or pay any  expenses or charges as
         contemplated in said Section 16; and

                  (h) the Bonds of the Thirty-first Series shall have such other
         terms as are set forth in the form of bond  attached  hereto as Exhibit
         D.

                  Anything in this Supplemental Indenture or in the Bonds of the
Thirty-first  Series  to the  contrary  notwithstanding,  if, at the time of the
Maturity of such Bonds, the stated

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aggregate  principal  amount of such Bonds  then  Outstanding  shall  exceed the
aggregate  Revolving  Credit Exposures (as hereinafter  defined),  the aggregate
principal  amount of such  Bonds  shall be deemed  to have been  reduced  by the
amount of such excess.

                  (III)  For  all  purposes  of this  Thirty-third  Supplemental
Indenture,  except  as  otherwise  expressly  provided  or  unless  the  context
otherwise requires, the terms defined below shall have the meanings specified:

                  "ADMINISTRATIVE  AGENT"  means  The Bank of New  York,  in its
         capacity as Administrative Agent under the Credit Agreement.

                  "BOND DELIVERY  AGREEMENT" means the Bond Delivery  Agreement,
         dated May 6, 2004 between the Company and the Administrative Agent.

                  "CREDIT AGREEMENT" means the Credit Agreement, dated as of May
         21,  2002,  among the  Company,  the  banks  parties  thereto,  Keybank
         National  Association  and Washington  Mutual Bank, as Co-Agents,  U.S.
         Bank, National Association,  as Managing Agent, Fleet National Bank and
         Wells Fargo Bank, as  Documentation  Agents,  Union Bank of California,
         N.A., as Syndication  Agent, and The Bank of New York as Administrative
         Agent and Issuing Bank, as amended,  supplemented or otherwise modified
         from time to time,  including that certain Amendment No. 1, dated as of
         May 13, 2003, among the Company, the banks parties thereto,  Washington
         Mutual Bank, as Managing Agent,  Fleet National Bank,  Keybank National
         Association,  U.S. Bank, National  Association and Wells Fargo Bank, as
         Documentation  Agents,  Union Bank of California,  N.A., as Syndication
         Agent,  and The Bank of New York, as  Administrative  Agent and Issuing
         Bank, Amendment No. 2, dated as of November 25, 2003 among the Company,
         the banks party  thereto,  Washington  Mutual Bank, as Managing  Agent,
         Fleet National Bank, KeyBank National Association,  U.S. Bank, National
         Association and Wells Fargo Bank, as Documentation  Agents,  Union Bank
         of California,  N.A, as Syndication Agent, and The Bank of New York, as
         Administrative  Agent and issuing Bank and Amendment No. 3, dated as of
         May 6,  2004  among  the  Company,  the banks  party  thereto,  Bank of
         America, N.A. and Commerzbank AG, as Managing Agents,  KeyBank National
         Association  and U.S.  Bank,  National  Association,  as  Documentation
         Agents,  Wells Fargo Bank,  as  Documentation  Agent and Issuing  Bank,
         Union Bank of California,  N.A. as Syndication  Agent and Issuing Bank,
         and The Bank of New York, as Administrative Agent and Issuing Bank.

                  "INTEREST  PAYMENT  DATE" means June 30, 2004,  September  30,
2004, December 31, 2004 and March 31, 2005.

                  "MATURITY"  means the date on which the principal of the Bonds
         of the Thirty-first  Series becomes due and payable,  whether at stated
         maturity, upon redemption or acceleration, or otherwise.

                  "OBLIGATIONS"  shall have the  meaning  specified  in the Bond
Delivery Agreement.

                  "COMMITMENTS",  "LOANS" and "REVOLVING CREDIT EXPOSURES" shall
         have the meanings specified in the Credit Agreement:

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                  A copy of the Credit Agreement is on file at the office of the
Administrative  Agent at One Wall Street,  18th Floor, New York, NY 10286 and at
the office of the Company at 1411 East Mission Avenue, Spokane, WA 99202.

                  (IV)  Upon  the  delivery  of this  Thirty-third  Supplemental
Indenture, bonds of the Thirty-first Series in an aggregate principal amount not
to exceed $350,000,000 are to be issued and will be Outstanding,  in addition to
$343,500,000  aggregate principal amount of bonds of prior series Outstanding at
the date of delivery of this Thirty-third Supplemental Indenture.

                                   ARTICLE II

                            MISCELLANEOUS PROVISIONS

                  SECTION 1. The terms defined in the Original  Mortgage  shall,
for all purposes of this Thirty-third  Supplemental Indenture, have the meanings
specified in the Original Mortgage.

                  SECTION 2. The Trustee  hereby  confirms its acceptance of the
trusts in the Original Mortgage declared,  provided, created or supplemented and
agrees  to  perform  the same  upon the terms  and  conditions  in the  Original
Mortgage set forth, including the following:

                  The Trustee shall not be responsible in any manner  whatsoever
for  or  in  respect  of  the  validity  or  sufficiency  of  this  Thirty-third
Supplemental  Indenture or for or in respect of the recitals  contained  herein,
all of which  recitals are made by the Company  solely.  Each and every term and
condition contained in Article XVI of the Original Mortgage,  shall apply to and
form part of this  Thirty-third  Supplemental  Indenture with the same force and
effect  as if the same were  herein  set  forth in full,  with  such  omissions,
variations  and  insertions,  if any,  as may be  appropriate  to make  the same
conform to the provisions of this Thirty-third Supplemental Indenture.

                  SECTION  3.   Whenever  in  this   Thirty-third   Supplemental
Indenture  either of the  parties  hereto is named or  referred  to, this shall,
subject to the  provisions  of Articles XV and XVI of the  Original  Mortgage be
deemed  to  include  the  successors  and  assigns  of such  party,  and all the
covenants and agreements in this Thirty-third  Supplemental  Indenture contained
by or on behalf of the Company,  or by or on behalf of the Trustee, or either of
them, shall, subject as aforesaid,  bind and inure to the respective benefits of
the respective  successors and assigns of such parties,  whether so expressed or
not.

                  SECTION   4.   Nothing  in  this   Thirty-third   Supplemental
Indenture,  expressed or implied, is intended, or shall be construed,  to confer
upon,  or to give to, any person,  firm or  corporation,  other than the parties
hereto and the holders of the bonds and coupons  Outstanding under the Mortgage,
any right, remedy or claim under or by reason of this Thirty-third  Supplemental
Indenture or any covenant, condition,  stipulation, promise or agreement hereof,
and all the covenants, conditions, stipulations, promises and agreements in this
Thirty-third  Supplemental  Indenture  contained  by or on behalf of the Company
shall be for the sole and exclusive  benefit of the parties  hereto,  and of the
holders of the bonds and of the coupons Outstanding under the Mortgage.

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                  SECTION 5. This Thirty-third  Supplemental  Indenture shall be
executed in several counterparts,  each of which shall be an original and all of
which shall constitute but one and the same instrument.

                  SECTION  6.  The  titles  of  the  several  Articles  of  this
Thirty-third Supplemental Indenture shall not be deemed to be any part thereof.

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<PAGE>

                  IN  WITNESS  WHEREOF,  on the  6th day of  May,  2004,  AVISTA
CORPORATION  has caused its  corporate  name to be  hereunto  affixed,  and this
instrument  to be  signed  and  sealed  by its  President  or  one  of its  Vice
Presidents,  and its corporate seal to be attested by its Corporate Secretary or
one of its Assistant  Corporate  Secretaries  for and in its behalf,  all in The
City of Spokane,  Washington, as of the day and year first above written; and on
the 6th day of May,  2004,  CITIBANK,  N.A., has caused its corporate name to be
hereunto  affixed,  and this instrument to be signed and sealed by its President
or one of its Vice  Presidents or one of its Senior Trust Officers or one of its
Trust  Officers  and  its  corporate  seal  to be  attested  by one of its  Vice
Presidents or one of its Trust Officers,  all in The City of New York, New York,
as of the day and year first above written.

                                            AVISTA CORPORATION


                                            By  /s/ MALYN K. MALQUIST
                                              ----------------------------------
                                                    Senior Vice President

Attest:


    /s/ SUSAN Y. MINER
------------------------------------
     Assistant Corporate Secretary

Executed, sealed and delivered
 by AVISTA CORPORATION
 in the presence of:


    /s/ DIANE C. THOREN
------------------------------------


    /s/ MARJORIE N. BJORNBERG
------------------------------------





                                       11
<PAGE>

                                            CITIBANK, N.A., AS TRUSTEE


                                            By  /s/ WAFAA ORFY
                                              ----------------------------------
                                                Wafaa Orfy, Vice President

Attest:

    /s/ NANCY FORTE
------------------------------------
 Nancy Forte, Assistant Vice President

Executed, sealed and delivered
  by CITIBANK, N.A.,
  as trustee. in the presence of:



    /s/ R.T. KIRCHNER
------------------------------------
        R. T. Kirchner
        Vice President



    /s/ JOHN J. BYRNES
------------------------------------
        John J. Byrnes
        Vice President







                                       12
<PAGE>


STATE OF WASHINGTON                 )
                                    ) ss.:
COUNTY OF SPOKANE                   )

                  On the 6th day of May  2004,  before  me  personally  appeared
Malyn Malquist, to me known to be a Senior Vice President of AVISTA CORPORATION,
one of the corporations that executed the within and foregoing  instrument,  and
acknowledged  said  instrument to be the free and voluntary act and deed of said
Corporation for the uses and purposes therein  mentioned and on oath stated that
he was  authorized to execute said  instrument  and that the seal affixed is the
corporate seal of said Corporation.

                  On the 6th day of May 2004,  before me,  Sue  Miner,  a Notary
Public in and for the State and  County  aforesaid,  personally  appeared  Malyn
Malquist,  known to me to be a Senior Vice President of AVISTA CORPORATION,  one
of the  corporations  that  executed  the within and  foregoing  instrument  and
acknowledged to me that such Corporation executed the same.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year first above written.

                                              /s/ SUE MINER
                                              --------------------------------
                                                  Notary Public



                                              Sue Miner
                                              Notary Public
                                              Commission Expires August 20, 2007
                                              State of Washington







                                       13
<PAGE>

STATE OF NEW YORK                   )
                                    ) ss.:
COUNTY OF NEW YORK                  )

                  On the 6th day of May  2004,  before  me  personally  appeared
Wafaa Orfy,  to me known to be a Vice  President of CITIBANK,  N.A.,  one of the
corporations that executed the within and foregoing instrument, and acknowledged
said  instrument to be the free and  voluntary act and deed of said  Corporation
for the uses and  purposes  therein  mentioned  and on oath  stated  that he was
authorized to execute said instrument and that the seal affixed is the corporate
seal of said Corporation.

                  On the 6th day of May 2004,  before me, a Notary Public in and
for the State and County aforesaid,  personally appeared Wafaa Orfy, known to me
to be an Vice President of CITIBANK, N.A., one of the corporations that executed
the within and foregoing instrument and acknowledged to me that such Corporation
executed the same.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year first above written.


                                             /s/ NANETTE MURPHY
                                            ------------------------------------
                                                     Notary Public


                                             Nanette Murphy
                                             Notary Public, State of New York
                                             No. 01MU6086415
                                             Qualified in Kings County
                                             Commission Expires 1/21/07





                                       14
<PAGE>

                                                                       EXHIBIT A

                        MORTGAGE, SUPPLEMENTAL INDENTURES
                               AND SERIES OF BONDS

<TABLE>
<CAPTION>
  ----------------------------------------------------------------------------------------------------------
        MORTGAGE OR         DATED AS OF               SERIES               PRINCIPAL          PRINCIPAL
       SUPPLEMENTAL         -----------               ------                AMOUNT             AMOUNT
        INDENTURE                           NO.       DESIGNATION           ISSUED           OUTSTANDING
  -------------------                       ---       -----------         ----------    ------------------
  ------------------------------------------------------------------------------------------------------------
<S>                       <C>                <C>  <C>                      <C>                      <C>
  Original                June 1, 1939       1    3-1/2% Series due 1964   $22,000,000              None
  ------------------------------------------------------------------------------------------------------------
  First                   October 1, 1952    2    3-3/4% Series due 1982    30,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Second                  May 1, 1953        3    3-7/8% Series due 1983    10,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Third                   December 1, 1955                 None
  ------------------------------------------------------------------------------------------------------------
  Fourth                  March 15, 1957                   None
  ------------------------------------------------------------------------------------------------------------
  Fifth                   July 1, 1957       4    4-7/8% Series due 1987    30,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Sixth                   January 1, 1958    5    4-1/8% Series due 1988    20,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Seventh                 August 1, 1958     6    4-3/8% Series due 1988    15,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Eighth                  January 1, 1959    7    4-3/4% Series due 1989    15,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Ninth                   January 1, 1960    8    5-3/8% Series due 1990    10,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Tenth                   April 1, 1964      9    4-5/8% Series due 1994    30,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Eleventh                March 1,1965       10   4-5/8% Series due 1995    10,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Twelfth                 May 1, 1966                      None
  ------------------------------------------------------------------------------------------------------------
  Thirteenth              August 1, 1966     11   6    % Series due 1996    20,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Fourteenth              April 1, 1970      12   9-1/4% Series due 2000    20,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Fifteenth               May 1, 1973        13   7-7/8% Series due 2003    20,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Sixteenth               February 1, 1975   14   9-3/8% Series due 2005    25,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Seventeenth             November 1, 1976   15   8-3/4% Series due 2006    30,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Eighteenth              June 1, 1980                     None
  ------------------------------------------------------------------------------------------------------------
  Nineteenth              January 1, 1981    16     14-1/8% Series due      40,000,000              None
                                                           1991
  ------------------------------------------------------------------------------------------------------------
  Twentieth               August 1, 1982     17     15-3/4% Series due      60,000,000              None
                                                        1990-1992
  ------------------------------------------------------------------------------------------------------------
  Twenty-First            September 1,       18     13-1/2% Series due      60,000,000              None
                          1983                             2013
  ------------------------------------------------------------------------------------------------------------
  Twenty-Second           March 1, 1984      19     13-1/4% Series due      60,000,000              None
                                                           1994
  ------------------------------------------------------------------------------------------------------------
  Twenty-Third            December 1, 1986   20   9-1/4% Series due 2016    80,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Twenty-Fourth           January 1, 1988    21     10-3/8% Series due      50,000,000              None
                                                            2018
  ------------------------------------------------------------------------------------------------------------
  Twenty-Fifth            October 1, 1989    22   7-1/8% Series due 2013    66,700,000              None
  ------------------------------------------------------------------------------------------------------------
                                             23   7-2/5% Series due 2016    17,000,000              None
  ------------------------------------------------------------------------------------------------------------
  Twenty-Sixth            April 1, 1993      24    Secured Medium-Term     250,000,000           89,500,000
                                                         Notes,
                                                        Series A
                                                      ($250,000,000
                                                        authorized)
  ------------------------------------------------------------------------------------------------------------
  Twenty-Seventh          January 1, 1994    25    Secured Medium-Term     161,000,000           59,000,000
                                                          Notes,
                                                         Series B
                                                      ($250,000,000
                                                        authorized)
  ------------------------------------------------------------------------------------------------------------
  Twenty-Eighth           September 1,       26   Collateral Series due    220,000,000              None
                          2001                             2002
  ------------------------------------------------------------------------------------------------------------
  Twenty-Ninth            December 1, 2001   27   7.75% Series due 2007    150,000,000          150,000,000
  ------------------------------------------------------------------------------------------------------------
  Thirtieth               May 1, 2002        28   Collateral Series due    225,000,000              None
                                                           2003
  ------------------------------------------------------------------------------------------------------------
  Thirty-First            May 1, 2003        29   Collateral Series due    245,000,000          245,000,000*
                                                           2004
  ------------------------------------------------------------------------------------------------------------
  Thirty-Second           September 1,       30   6.125% Series due 2013   45,000,000            45,000,000
                          2003
  ------------------------------------------------------------------------------------------------------------
</TABLE>


         *To be retired in connection  with the  authentication  and delivery of
the bonds of the Thirty-first series.


                                      A-1
<PAGE>

                                                                       EXHIBIT B

                             FILING AND RECORDING OF
                      THIRTY-SECOND SUPPLEMENTAL INDENTURE

                             FILING IN STATE OFFICES

<TABLE>
<CAPTION>
  -------------------------------------------------------------------------------------------------------
            STATE                   OFFICE OF                    DATE             FINANCING STATEMENT
                                                                                     DOCUMENT NUMBER
  -------------------------------------------------------------------------------------------------------
<S>                             <C>                             <C>                 <C>
          Washington            Secretary of State              12/3/03              2003-337-0875-2
  -------------------------------------------------------------------------------------------------------
            Idaho               Secretary of State              12/3/03             B-2003-0955960-8
  -------------------------------------------------------------------------------------------------------
           Montana              Secretary of State              12/3/03                 75787579
  -------------------------------------------------------------------------------------------------------
            Oregon              Secretary of State              12/4/03                  6412661
  -------------------------------------------------------------------------------------------------------
          California            Secretary of State              12/4/03                 334461026
  -------------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>
  ---------------------------------------------------------------------------------------------------------------
                                           RECORDING IN COUNTY OFFICES
  ---------------------------------------------------------------------------------------------------------------
       COUNTY            OFFICE OF                                                                  FINANCING
                                                      REAL ESTATE MORTGAGE RECORDS                  STATEMENT
                                                                                                    DOCUMENT
                                         --------------------------------------------------------    NUMBER
                                            DATE        DOCUMENT NUMBER        BOOK       PAGE
  ---------------------------------------------------------------------------------------------------------------
<S>                  <C>                   <C>            <C>                 <C>         <C>          <C>
  WASHINGTON         Auditor               12/2/03           271879            N/A        N/A          N/A
  Adams
  ---------------------------------------------------------------------------------------------------------------
  Asotin             Auditor               12/3/03           272936            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Benton             Auditor               12/2/03        2003-058985          N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Douglas            Auditor               12/2/03          3068589            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Ferry              Auditor               12/2/03           257712            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Franklin           Auditor               12/2/03          1636649            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Garfield           Auditor               12/2/03            8317             N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Grant              Auditor               12/2/03          1139243            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Klickitat          Auditor               12/3/03          1042654            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Lewis              Auditor               12/3/03          3184912            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Lincoln            Auditor               12/2/03        20030431377           83        4201         N/A
  ---------------------------------------------------------------------------------------------------------------
  Pend Oreille       Auditor              12/12/03        2003-0272789         N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Skamania           Auditor               12/5/03           151375            255        173          N/A
  ---------------------------------------------------------------------------------------------------------------
  Spokane            Auditor               12/3/03          5008190            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Stevens            Auditor               12/2/03        2003-0016731         304        328          N/A
  ---------------------------------------------------------------------------------------------------------------
  Thurston           Auditor               12/5/03          3601539            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Whitman            Auditor               12/2/03           651354            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------

  ---------------------------------------------------------------------------------------------------------------
  IDAHO              Recorder              12/2/03           232558            N/A        N/A          N/A
  Benewah
  ---------------------------------------------------------------------------------------------------------------
  Bonner             Recorder              12/3/03           639856            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Boundary           Recorder              12/2/03           213391            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Clearwater         Recorder              12/4/03           194596            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Idaho              Recorder              12/2/03           432896            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
</TABLE>



<PAGE>

<TABLE>
<CAPTION>
  ---------------------------------------------------------------------------------------------------------------
                                           RECORDING IN COUNTY OFFICES
  ---------------------------------------------------------------------------------------------------------------
       COUNTY            OFFICE OF                                                                  FINANCING
                                                      REAL ESTATE MORTGAGE RECORDS                  STATEMENT
                                                                                                    DOCUMENT
                                         --------------------------------------------------------    NUMBER
                                            DATE        DOCUMENT NUMBER        BOOK       PAGE
  ---------------------------------------------------------------------------------------------------------------
<S>                  <C>                   <C>            <C>                 <C>         <C>          <C>
  Kootenai           Recorder              12/2/03          1846100            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Latah              Recorder              12/2/03           483092            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Lewis              Recorder              12/2/03           130286            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Nez Perce          Recorder              12/2/03           699272            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Shoshone           Recorder              12/2/03           413689            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------

  ---------------------------------------------------------------------------------------------------------------
  MONTANA
  Big Horn           Clerk & Recorder      12/3/03           330379             73        503          N/A
  ---------------------------------------------------------------------------------------------------------------
  Broadwater         Clerk & Recorder      12/3/03           147052             73        462          N/A
  ---------------------------------------------------------------------------------------------------------------
  Golden Valley      Clerk & Recorder      12/3/03           76130              M        10893         N/A
  ---------------------------------------------------------------------------------------------------------------
  Meagher            Clerk & Recorder      12/3/03           113115            F57        792          N/A
  ---------------------------------------------------------------------------------------------------------------
  Mineral            Clerk & Recorder      12/3/03           94870                                     N/A
  ---------------------------------------------------------------------------------------------------------------
  Rosebud            Clerk & Recorder      12/3/03           95410             107        171          N/A
  ---------------------------------------------------------------------------------------------------------------
  Sanders            Clerk & Recorder      12/3/03           43743             N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Stillwater         Clerk & Recorder      12/3/03           315691            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Treasure           Clerk & Recorder      12/3/03           78585                                     N/A
  ---------------------------------------------------------------------------------------------------------------
  Wheatland          Clerk & Recorder      12/3/03           102318                                    N/A
  ---------------------------------------------------------------------------------------------------------------
  Yellowstone        Clerk & Recorder      12/3/03          3266239            N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------

  ---------------------------------------------------------------------------------------------------------------
  OREGON             Recorder                                                                          N/A
  Douglas                                  12/3/03        2003-032540
  ---------------------------------------------------------------------------------------------------------------
  Jackson            Recorder              12/8/03          03-82751           N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Josephine          Recorder              12/4/03        2003-030037          N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Klamath            Recorder              12/9/03            N/A              M03       89770         N/A
  ---------------------------------------------------------------------------------------------------------------
  Union              Recorder              12/3/03          20038068           N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
  Wallowa            Recorder              12/3/03           49615             N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------

  ---------------------------------------------------------------------------------------------------------------
  CALIFORNIA
  El Dorado          Recorder              12/9/03       2003-012342200        N/A        N/A          N/A
  ---------------------------------------------------------------------------------------------------------------
</TABLE>



                                      B-2


<PAGE>

                                                                       EXHIBIT C

                               PROPERTY ADDITIONS

          (A)  Miscellaneous  Fee-Owned  Real Estate in the States of Washington
and Idaho:

               1. Cabinet Gorge Mitigation  properties; Bonner County,  State of
Idaho:

                  (a) Lots 8 and 9, Block 10, Unit 2 of Granite Creek Properties
                  in Sec. 25, T. 55 N., R. 1 West B.M.;

                  (b) Lot 17, Block 10, Unit 2 of Granite  Creek  Properties  in
                  Sec. 25, T. 55 N., R. 1 West B.M.;

                  (c) Lot 18,  Block 1, Unit 2 of Granite  Creek  Properties  in
                  Sec. 25, T. 55 N., R. 1 West B.M.;

                  (d) Lot 11, Block 10, Unit 2 of Granite  Creek  Properties  in
                  Sec. 25, T. 55 N., R. 1 West B.M.;

                  (e) Lot 5, Block 10,  Unit 2 of Granite  Creek  Properties  in
                  Sec. 25, T. 55 N., R. 1 West B.M.;

                  (f) Lots 19, 20 and 21,  Block  10,  Unit 2 of  Granite  Creek
                  Properties in Section 25, T. 55 N., R. 1 West B.M.

              2.  Boulder  transmission  corridor;   Spokane  County,  State  of
Washington:

                  Tract W of Amended Survey filed in Book 92, Page 15E,  Auditor
                  No.  5032496,  situate in the N/2 of Sec.  5, GT. 25 N., R. 45
                  East, W.M.





<PAGE>

                                                                       EXHIBIT D

                                 (FORM OF BOND)

              THIS BOND IS NON-TRANSFERABLE, EXCEPT TO A SUCCESSOR
       ADMINISTRATIVE AGENT UNDER THE CREDIT AGREEMENT REFERRED TO HEREIN.


                               AVISTA CORPORATION

                              First Mortgage Bond,
                           Collateral Series due 2005

REGISTERED                                                            REGISTERED

NO. _________________                                       $___________________



                  AVISTA  CORPORATION,  a corporation of the State of Washington
(hereinafter called the Company), for value received, hereby promises to pay to


, as Administrative Agent under the Credit Agreement  hereinafter referred to or
registered assigns, on May 5, 2005,


                                                                         DOLLARS

and to pay the  registered  owner  hereof  interest  thereon from May 6, 2004 in
arrears on June 30, 2004,  September  30, 2004,  December 31, 2004 and March 31,
2005 (each such date being hereinafter called an "Interest Payment Date") and at
Maturity  (as  hereinafter  defined),  at the rate of eight per centum  (8%) per
annum  computed  as  provided  in  the   Thirty-third   Supplemental   Indenture
hereinafter  referred to,  until the  Company's  obligation  with respect to the
payment of such  principal  shall have been  discharged.  The  principal  of and
premium,  if any, and interest on this bond payable at Maturity shall be payable
upon  presentation  hereof at the office or agency of the Company in the Borough
of  Manhattan,  The City of New York,  in such coin or  currency  of the  United
States of  America  as at the time of  payment  is legal  tender  for public and
private  debts.  The  interest  on this bond  (other  than  interest  payable at
Maturity)  shall be paid  directly  to the  registered  owner  hereof.  Interest
payable at Maturity shall be paid to the person to whom principal shall be paid.
As used herein,  the term "Maturity"  shall mean the date on which the principal
of  this  bond  becomes  due and  payable,  whether  at  stated  maturity,  upon
redemption or acceleration, or otherwise.

                  This bond is one of an issue of bonds of the Company  issuable
in series and is one of a series known as its First Mortgage  Bonds,  Collateral
Series due 2005, all bonds of all such issue of series being issued and issuable
under  and  equally  secured  (except  insofar  as any  sinking



<PAGE>

or other fund,  established  in accordance  with the  provisions of the Mortgage
hereinafter  mentioned,  may  afford  additional  security  for the bonds of any
particular  series) by a Mortgage  and Deed of Trust,  dated as of June 1, 1939,
executed by the Company  (formerly known as The Washington  Water Power Company)
to City Bank Farmers Trust Company and Ralph E. Morton,  as Trustees  (Citibank,
N.A., successor Trustee to both said Trustees).  Such mortgage and deed of trust
has been amended and supplemented by various supplemental indentures,  including
the  Thirty-third  Supplemental  Indenture,   dated  as  of  May  1,  2004  (the
"Thirty-third  Supplemental Indenture") and, as so amended and supplemented,  is
herein  called  the  "Mortgage".  Reference  is  made  to  the  Mortgage  for  a
description of the property mortgaged and pledged,  the nature and extent of the
security,  the rights of the  holders of the bonds and of the Trustee in respect
thereof,  the duties and  immunities of the Trustee and the terms and conditions
upon which the bonds are and are to be secured and the circumstances under which
additional  bonds may be issued.  By its  acceptance  of this  bond,  the holder
hereof is deemed to have consented and agreed to all of the terms and provisions
of the Mortgage.  The Mortgage may be modified or altered by affirmative vote of
the holders of at least 60% in principal amount of the bonds  outstanding  under
the  Mortgage,  considered as one class,  or, if the rights of one or more,  but
less than all, series of bonds then  outstanding  are to be affected,  then such
modification or alteration may be effected with the affirmative vote only of 60%
in principal  amount of the bonds  outstanding  of the series so to be affected,
considered as one class, and,  furthermore,  for limited purposes,  the Mortgage
may be modified or altered without any consent or other action of holders of any
series of  bonds.  No  modification  or  alteration  shall,  however,  permit an
extension  of the Maturity of the  principal  of, or interest on, this bond or a
reduction  in  such  principal  or the  rate of  interest  hereon  or any  other
modification  in the terms of  payment  of such  principal  or  interest  or the
creation  of any lien equal or prior to the lien of the  Mortgage or deprive the
holder of a lien on the  mortgaged and pledged  property  without the consent of
the holder hereof.

                  The bonds of this  series are not  redeemable,  in whole or in
part, at the option of the Company.

                  The bonds of this series have been issued and delivered to The
Bank of New York, as  Administrative  Agent under the Credit  Agreement (as such
terms  are  defined  in the  Thirty-third  Supplemental  Indenture)  in order to
provide the benefit of the lien of the Mortgage as security  for the  obligation
of the  Company  under  the  Credit  Agreement  to pay  the  Obligations  (as so
defined), to the extent and subject to the limitations set forth below.

                  Upon the earliest of (A) the occurrence of an Event of Default
under the Credit  Agreement,  and further upon the condition that, in accordance
with the terms of the  Credit  Agreement,  the  Commitments  (as  defined in the
Thirty-third  Supplemental  Indenture)  shall have been or shall have terminated
and any Loans (as so  defined)  outstanding  shall have been  declared  to be or
shall have otherwise become due and payable  immediately and the  Administrative
Agent shall have delivered to the Company a notice  demanding  redemption of the
bonds of this series which notice states that it is being delivered  pursuant to
Article VII of the Credit  Agreement,  (B) the occurrence of an Event of Default
under clause (g) or (h) of Article VII of the Credit  Agreement,  and (C) May 5,
2005, then all bonds of this series shall be redeemed or paid

                                      D-2
<PAGE>

immediately at the principal amount thereof plus accrued interest to the date of
redemption or payment.

                  The  obligation of the Company to pay the accrued  interest on
bonds of this series on any Interest Payment Date prior to Maturity (a) shall be
deemed to have  been  satisfied  and  discharged  in full in the event  that all
amounts then due in respect of the Obligations shall have been paid or (b) shall
be deemed to remain  unsatisfied in an amount equal to the aggregate amount then
due in respect of the Obligations and remaining unpaid (not in excess,  however,
of the amount  otherwise  then due in respect of  interest  on the bonds of this
series).

                  The  obligation  of the  Company to pay the  principal  of and
accrued  interest  on bonds of this  series  at or after  Maturity  (x) shall be
deemed to have  been  satisfied  and  discharged  in full in the event  that all
amounts then due in respect of the Obligations shall have been paid or (y) shall
be deemed to remain  unsatisfied in an amount equal to the aggregate amount then
due in respect of the Obligations and remaining unpaid (not in excess,  however,
of the amount otherwise then due in respect of principal of and accrued interest
on the bonds of this series).

                  Anything in this bond to the contrary notwithstanding,  if, at
the time of the  Maturity  of the bonds of this  series,  the  stated  aggregate
principal  amount of such  bonds then  outstanding  shall  exceed the  aggregate
Revolving  Credit  Exposures  (as  defined  in  the  Thirty-third   Supplemental
Indenture), the aggregate principal amount of such bonds shall be deemed to have
been reduced by the amount of such excess.

                  The  principal  hereof may be declared or may become due prior
to the stated maturity date on the conditions, in the manner and at the time set
forth in the  Mortgage,  upon the  occurrence  of a Completed  Default as in the
Mortgage provided.

                  This bond is  non-transferable  except as  required  to effect
transfer to any successor  administrative agent under the Credit Agreement,  any
such  transfer  to be made at the office or agency of the Company in the Borough
of Manhattan,  The City of New York,  upon  surrender and  cancellation  of this
bond,  together with a written  instrument of transfer  whenever required by the
Company  duly  executed  by  the  registered  owner  or by its  duly  authorized
attorney,  and, thereupon,  a new fully registered bond of the same series for a
like principal  amount will be issued to the  transferee in exchange  herefor as
provided  in the  Mortgage.  The  Company and the Trustee may deem and treat the
person in whose name this bond is  registered  as the absolute  owner hereof for
the purpose of receiving payment and for all other purposes.

                  In the manner  prescribed in the  Mortgage,  any bonds of this
series,  upon surrender  thereof for cancellation at the office or agency of the
Company in the Borough of Manhattan,  The City of New York, are exchangeable for
a like  aggregate  principal  amount  of  bonds  of the  same  series  of  other
authorized denominations.

                  No recourse  shall be had for the payment of the  principal of
or interest on this bond against any incorporator or any past, present or future
subscriber to the capital stock, stockholder, officer or director of the Company
or of any  predecessor or successor  corporation,  as such,  either  directly or
through the Company or any predecessor or successor corporation,

                                      D-3
<PAGE>

under any rule of law,  statute or  constitution  or by the  enforcement  of any
assessment  or  otherwise,  all such  liability of  incorporators,  subscribers,
stockholders,  officers  and  directors  being  released  by the holder or owner
hereof by the acceptance of this bond and being likewise  waived and released by
the terms of the Mortgage.

                  This bond shall not become  obligatory  until Citibank,  N.A.,
the Trustee under the Mortgage, or its successor  thereunder,  shall have signed
the form of certificate endorsed hereon.

         IN WITNESS  WHEREOF,  AVISTA  CORPORATION  has  caused  this bond to be
signed in its corporate  name by its President or one of its Vice  Presidents by
his signature or a facsimile thereof,  and its corporate seal to be impressed or
imprinted hereon and attested by its Corporate Secretary or one of its Assistant
Corporate Secretaries by his signature or a facsimile thereof.

Dated:                                       AVISTA CORPORATION



                                             By:
                                                --------------------------------


ATTEST:
       -------------------------------------







                                      D-4
<PAGE>

                              TRUSTEE'S CERTIFICATE

                  This  bond  is  one  of  the  bonds,   of  the  series  herein
designated, described or provided for in the within-mentioned Mortgage.

                                            CITIBANK, N.A.
                                            Trustee



                                            By
                                               ---------------------------------
                                                       Authorized Officer













                                      D-5
<PAGE>


                  FOR VALUE RECEIVED the undersigned  hereby sells,  assigns and
transfers unto


-------------------------------------------------------
     [please insert social security or other identifying number of assignee]



-------------------------------------------------------
            [please print or typewrite name and address of assignee]


-------------------------------------------

the within bond of AVISTA CORPORATION and does hereby irrevocably constitute and
appoint  ________________________,  Attorney, to transfer said bond on the books
of  the  within-mentioned  Company,  will  full  power  of  substitution  in the
premises.

Dated:
        ---------------

        -----------------------------

                                    Notice:  The  signature  to this  assignment
                                    must  correspond  with the  name as  written
                                    upon   the   face  of  the   bond  in  every
                                    particular without alteration or enlargement
                                    or any change whatsoever.











                                      D-6