PHOENIX - 10/31/08

The end of October marks the two-year anniversary of the Arizona Corporation Commission’s (ACC) passage of the state’s Renewable Energy Standard (RES). Since that landmark occasion, APS has increased its renewable portfolio by 650 percent.

“Renewable energy is a key component to APS’ commitment to a sustainable energy future and a better tomorrow for Arizona,” said Barbara Lockwood, APS Manager of Renewable Energy.

When the ACC approved the plan requiring the state's regulated utilities to provide at least 15 percent of their total electricity from renewable energy sources by 2025, APS had 20 megawatts (MW) of renewable energy available for its customers. Today, APS has 150 MW, enough renewable energy to power 38,000 homes. With several new projects scheduled to become operational in the next few years, APS’ ability to provide homes with renewable energy will continue to increase.

In 2009, APS will add 100 MW of wind from the High Lonesome Wind Farm. This new project will increase APS’ wind capacity to 190 MW. Then, in 2012, all the power from the Solana Generating Station, a 280-MW concentrating solar power plant, will be acquired for APS customers. Not only will Solana generate more electricity than any solar power plant currently in operation, it will allow APS to supply more solar electricity per customer than any utility in the U.S. Both Solana and High Lonesome are being built by third parties with APS signing long-term purchase agreements for the electricity.

When the electricity from these clean, renewable energy sources enters the power grid, APS will have available more than 500 megawatts of renewable energy, enough to serve at least 125,000 Arizona homes. In 2012, these renewable resources will serve 6.5 percent of APS customers' energy needs, well over the regulatory requirement of 3.5 percent.

In helping to drive renewable energy in Arizona, Lockwood explained that because of today’s geopolitical environment and APS’ desire to create a sustainable energy future for Arizona, adding renewable energy is a good strategic business decision. She also complimented the ACC for its leadership in helping spark the renewable revolution in the state.

“When the need to find new electric generation to meet APS’ growth is combined with volatile natural gas markets and the prospect of national carbon regulation, renewable energy becomes increasingly important,” Lockwood said.

Efforts also are under way to increase the number of customers who have their own renewable energy system. The RES requires that by 2012, 30 percent of APS’ renewable energy portfolio come from distributed sources, such as roof-top solar or small wind turbines. In the last two years, the RES has provided $12 million to APS customers to help make these systems more affordable.

All told, since APS’ Renewable Energy Incentive Program’s inception in 2002, six MW of renewable energy is generated from 2,200 customers. APS expects this number to continue to grow now that the federal government has eliminated the cap on the 30 percent tax credit for adding solar.

APS continues to issue Request for Proposals (RFP) for new sources of renewable energy. The company has issued four RFP’s in the last two years. Two have been for general, utility-scale projects, one specifically for a concentrating solar project and one for power aggregators who can deliver distributed generation.

“Through a strategic and transparent process, APS is looking to find the most reliable and affordable renewable energy for our customers,” said Lockwood.

APS, Arizona’s largest and longest-serving electricity utility, serves about 1.1 million customers in 11 of the state’s 15 counties. In 2008, APS won its second Edison Award in recognition of innovative leadership and operational excellence in the electric industry. Given annually by the Edison Electric Institute, the Edison Award is considered the industry’s most prestigious honor. With headquarters in Phoenix, APS is the principal subsidiary of Pinnacle West Capital Corp. (NYSE: PNW)