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Pricing Supplement No. 2 Filing under Rule 424(b)(3) Dated June 19, 1998 Registration No. 333-39551 (To Prospectus dated April 22, 1998 as supplemented by the Prospectus Supplement dated April 24, 1998) THE WASHINGTON WATER POWER COMPANY Medium-Term Notes, Series C ------------------ Principal amount: $25,000,000 Redeemable: Yes No X --- --- Original Interest Accrual Date: June 19, 1998 Initial Redemption Date: Stated Maturity: June 19, 2028 Initial Redemption Price: Interest Rate: 6.37% Reduction Percentage: Interest Payment Dates: April 1 and October 1 Redemption Limitation Date: Regular Record Dates: March 15 and September 15 Redeemable at Holder's Option: Yes X No --- --- Holder's Option Redemption Date(s): June 19, 2008 Redemption Price: 100% OID: Yes No X --- --- Total Amount of OID (%): Yield to Maturity (%): Initial Accrual Period OID (%): (Constant - Yield Method) ----------------------------------- Use of Proceeds: To reduce short-term debt. Other Provisions: See Attachment 1 to this Pricing Supplement ----------------------------------- As used herein, "N/A" means "Not Applicable". ----------------------------------- MORGAN STANLEY DEAN WITTER MERRILL LYNCH & CO. SALOMON SMITH BARNEY ATTACHMENT 1 The Notes to which this Pricing Supplement pertains (all capitalized terms used herein and not otherwise defined having the meanings given them in the Prospectus Supplement attached hereto) will be redeemable by the Company at the option of the Holders thereof prior to the Stated Maturity date. Such Notes will be subject to redemption at the option of the Holders thereof on any Holder's Option Redemption Date specified above, in whole or from time to time in part in increments of $1,000, at a redemption price equal to 100% of the unpaid principal amount to be redeemed, together with accrued interest to the date of redemption. For such Notes to be redeemed, such Notes must be received, together with the form thereon entitled "Option to Elect Redemption" duly completed, by the Trustee at its office maintained for such purpose in The City of New York, currently the Corporate Trust Office of the Trustee located at 450 West 33rd Street, New York, New York 10001, not more than 60 nor less than 30 days prior to the date of redemption. Exercise of such redemption option by the Holder will be irrevocable. Only the DTC (or a successor depositary), as the registered Holder of the Notes to which this Pricing Supplement pertains, may exercise the redemption option in respect of such Notes. Accordingly, Beneficial Owners of interests in such Notes that desire to have all or any portion of such interests redeemed must instruct the Participant through which they own their interest to direct DTC (or any successor depositary) to exercise the redemption option on their behalf by delivering the related Global Note and duly completed election form to the Trustee as aforesaid. In order to ensure that such Global Note and election form are received by the Trustee on a particular day, the Beneficial Owner must so instruct the Participant through which it owns its interest before such Participant's deadline for accepting instruction for that day. Different firms may have different deadlines for accepting instructions from their customers. Accordingly, Beneficial Owners should consult the Participants through which they own their interests for the respective deadlines for such Participants. All instructions given to Participants from Beneficial Owners relating to the option to elect redemption will be irrevocable. See "--Book-Entry Only Issuance - The Depositary Trust Company" in the Prospectus Supplement attached hereto.