Remember that our full year O&M guidance range is $40 million to $50 million higher than last year’s actual O&M results, and that includes as O&M, the pension and wildfire mitigation amortizations were now recovering in revenues. I think it’s also important to realize that mechanically, the revenues related to these increased costs are not collected at the same rate as the expenses are recorded in the interim periods throughout the year. There’s the disconnect in timing of recovery with an intended earnings impact. And that’s because collection on those elements of O&M is based largely on volumetric rates, meaning a disproportionate amount of revenue to cover the cost should show up in the third quarter, whereas we record the expenses straight line during the year.
For the last five years, on average, the first quarter of the year has only provided about 18% of our annual earnings due to seasonality. Higher labor costs is the other notable area I’d mentioned as a contributor to higher O&M expenses in the first quarter. Depreciation expense increased to $8.6 million, which was due primarily to an increase in plant and service. With the level of CapEx we had in 2023 and into this year, the magnitude of this increase is something we expected. Moving on in the table. Other net changes in operating revenues and expenses increased operating income by $5.9 million. This was primarily due to a decrease in net power supply expenses that were not deferred for future recovery and raised through power cost adjustment mechanisms.
Think of that as Idaho power’s 5% share of the power supply cost subject to PCA mechanism in Idaho turning out much more favorable this year than last year. More moderate wholesale natural gas and power market prices in the Western US and increased wholesale energy sales fortunately decreased Idaho Power’s net power supply expenses in the first quarter this year. That benefit along with continued collection on the existing PCA deferral had a notable cash flow benefit that I’ll get to you shortly. Non-operating expense on a net basis increased $1.8 million, not surprisingly, with last year’s debt issuances, interest expense on long-term debt was higher in the first quarter this year compared with last year’s first quarter. The increase was partially offset by an increase in AFUDC.
The average construction work-in-progress balance was higher from our elevated CapEx. Interest income also increased due to higher interest rates and higher average cash and cash equivalent balances. There’s regulatory lag and recovery on our interest expense to finance our CapEx and into recovery over higher depreciation expense. That lag results largely from historic averaging on rate base in our Idaho 2023 rate case. As Lisa noted, our upcoming limited issue rate case in Idaho is one where we intend to use year-end rate base to help mitigate that lag from both depreciation and interest expense. It’s the next iteration of our regulatory approach and our intent in the case is to better match resources that are in service with collection through rates on those resources.
The decrease in income tax expense was the result of lower income before income taxes and an $8.8 million increase in additional investment tax credit amortization. Remember, we report our additional investment tax credit amortization ratably per quarter based on our expectations for the year. So we reported $12.5 million of additional investment tax credit amortization on to the Idaho regulatory settlement stipulation during the first quarter. And last year, we recorded $3.8 million of additional amortization in the first quarter. As Lisa mentioned, we’re beginning to see the results of our 2026 to 2027 RFP process. We were hoping to have enough details to provide a new update on our CapEx forecast today both in terms of the timing of currently planned projects on the size of potential capital additions for new projects.
But at this point, we’re planning to get further into the RFP process before we provide that update. What I can say at this point, there’s a high potential for a considerable increase in our total five-year CapEx figure compared to what we forecasted in February of this year. That, of course, depends on RFP results, on the timing of projects, regulatory outcomes, all of which are moving targets, but they’re becoming more certain. So it’s potentially a sizable increase on an already large CapEx spend. We hope to have more details on a better quantification by our next quarterly call. Maintaining our capital structure and managing dilution to fund our accretive growth investments is top of mind and is paramount to our financial strength. We’re still planning to finance our CapEx with the blend of debt and equity issuances to stay at a 50-50 capital structure.
We’re fortunate that we don’t have any sizable debt maturity to address in the next few years. And in fact, nothing of magnitude in any given year until 2037, which helps on the credit side. Also as of today, we’ve yet to draw any of the funds from our November 2023 forward equity offering, but we expect to issue it all this year. As we’ve previously discussed, we also plan to put in place an ATM program to help with equity needs on a go-forward basis to support our ongoing capital plan. Timing wise, it will likely be at some point in the second quarter. We plan to incorporate a forward sell option on the ATM program like we did on our November secondary offering last year. Turning to Slide 10. As we expected, cash flow from operations improved pretty dramatically for the first quarter of 2024 compared to last year.
We actually saw a net $200 million comparative increase in operating cash flow. The June 2023 power supply cost rate change, along with the January 2024 general rate case change helped in that regard. So did a substantial moderation in power supply cost volatility compared to last year. On Slide 11, maybe most notable on the slide, we expect IDACORP’s diluted earnings per share this year to be squarely in the range of $5.25 to $5.45 for the full year and that’s underpinned by strong customer growth, operational efficiency and continued cost management, a thoughtful regulatory approach and the benefits of the ADITC mechanism. Our forecast ranges for additional investment tax credit amortization and O&M are unchanged. We do continue to anticipate spending between $925 million and $975 million on CapEx for 2024.
So as I noted earlier, looking out further, it’s a moving target and buy it upwards over the next five years. Finally, we raised our hydropower generation forecast. We now expect hydro power generation to be within the range of 6.5 million to 8 million-megawatt hours for the year, an increase of a tightening from our earlier estimate of $5.5 million to $7.5 million. We had solid carryover from the prior year, and we have a relatively strong snow pack this year. So good news on Hydro Power and for our irrigation customers this year. And with that, we’re happy to address questions.
Operator: [Operator Instructions] Your first questions come from the line of Alex Mortimer from Mizuho. Please go ahead.
Alex Mortimer: Hi, good afternoon. So you’ve been clear in the past about maybe your reluctance to issue an EPS CAGR, but is there any forms of additional guidance or disclosures just maybe a forward financing plan even in a range form that you’ll be open to initiating at some point to provide additional clarity?
Brian Buckham: Yeah, Alex. I think one thing that we’ll likely do going forward is when we update our capital plan, our CapEx forecast with results of the RFP and other changes that we have in terms of project timing, we’ll likely reissue a rate base CAGR on that as well. And this quarter, we also included QIP so you can see the changes in the QIP balance over time for the next five years. And you can use that with estimates of regulatory and structural lag in that order to come up with a forecast of potential growth over time. In terms of an actual EPS forecast, our plan is to execute well in the regulatory arena and see where that takes us.
Alex Mortimer: Understood. And then quickly just to tie out the CapEx updates. How should we think about the cadence of these updates? I know you mentioned in the second quarter call, should we expect that that’s sort of the entire update for the year? Or I know last year, you had the third quarter and then the fourth quarter update. Can you just provide sort of any clarity on what the timing of updates throughout the year might look like?
Lisa Grow: This is Lisa. I think it will depend on how the negotiations go from the RFPs that we’re currently involved with. So our hope is that it would be available — an update would be available in the second quarter, but I don’t know that we have a specific cadence that we’re getting ready to roll out a 2028 RFP that would be sometime probably not until early next year, I would imagine that we would be making announcements there. Anything that you would add, Adam?
Adam Richins: I think you covered it.
Brian Buckham: And Alex, I’d add that our typical cadence was to do it only on the fourth quarter update. We did a third quarter update last year because the amount had increased so substantially. Remember our CapEx adjustment, we increased our CapEx forecast by about 21% from our 2023 estimate to our 2024 estimate. So there was already a large increase. And so as we updated the 10-Q, we had a disclosure we made on the increase in CapEx there. So the update we would make in the second quarter was one we’d hope to make earlier. But just based on the timing of RFPs, I don’t feel comfortable doing that yet. So looking ahead, I would expect it on an annual basis on the fourth quarter call, generally, without interim update unless there’s material changes.
