Adopted November 9, 1939 File No. 69-306
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM U-3A-2
STATEMENT BY HOLDING COMPANY
CLAIMING EXEMPTION UNDER RULE U-3A-2
FROM THE PROVISIONS OF THE
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
To Be Filed Annually Prior to March 1
Pinnacle West Capital Corporation
---------------------------------
(Name of Company)
hereby files with the Securities and Exchange Commission, pursuant to Rule 2,
its statement claiming exemption as a holding company from the provisions of the
Public Utility Holding Company Act of 1935, and submits the following
information:
1. NAME, STATE OF ORGANIZATION, LOCATION AND NATURE OF BUSINESS OF CLAIMANT
AND EVERY SUBSIDIARY THEREOF, OTHER THAN ANY EXEMPT WHOLESALE GENERATOR
(EWG) OR FOREIGN UTILITY COMPANY IN WHICH CLAIMANT DIRECTLY OR INDIRECTLY
HOLDS AN INTEREST.
Pinnacle West Capital Corporation ("Claimant"), having been incorporated on
February 20, 1985 under the laws of the State of Arizona, and having its
principal executive offices at 400 North Fifth Street, Phoenix, Arizona 85004,
was organized principally to acquire and hold securities of other corporations
for investment purposes. The following are the subsidiaries of the Claimant:
a. Arizona Public Service Company ("APS" or the "Company"), is engaged
principally in serving electricity in the State of Arizona. Incorporated in
1920 under the laws of the State of Arizona and having its principal
executive offices at 400 North Fifth Street, Phoenix, Arizona 85004, APS
became a subsidiary of the Claimant pursuant to a corporate restructuring
plan approved by the Company's shareholders on April 18, 1985.
b. APS Energy Services Company, Inc. ("APSES") -- an Arizona corporation
having been incorporated on November 6, 1998 and having its principal
executive offices at 400 East Van Buren, Phoenix, Arizona 85004, was
organized primarily to sell energy, products and services. APSES is a
wholly-owned subsidiary of the Claimant.
c. SunCor Development Company ("SunCor") - an Arizona corporation having
been incorporated on June 30, 1965 and having its principal executive
offices at 80 East Rio Salado Parkway, Tempe, Phoenix, Arizona 85281, is a
wholly-owned subsidiary of Claimant engaged primarily in the owning,
holding and development of real property.
d. El Dorado Investment Company -- an Arizona corporation having been
incorporated on July 27, 1983 and having its principal executive offices at
400 North Fifth Street, Phoenix, Arizona 85004, is a wholly-owned
subsidiary of Claimant engaged primarily in the acquisition and holding of
stocks and securities of other companies for investment purposes.
e. Pinnacle West Energy Corporation ("PWEC" or "Pinnacle West Energy") - an
Arizona corporation having been incorporated on September 27, 1999, and
having its principal executive offices at 400 North Fifth Street, Phoenix,
Arizona 85004, was organized primarily for the development, production and
sale of wholesale energy. PWEC is a wholly-owned subsidiary of the
Claimant.
2
2. A BRIEF DESCRIPTION OF THE PROPERTIES OF CLAIMANT AND EACH OF ITS
SUBSIDIARY PUBLIC UTILITY COMPANIES USED FOR THE GENERATION, TRANSMISSION
AND DISTRIBUTION OF ELECTRIC ENERGY FOR SALE, OR FOR THE PRODUCTION,
TRANSMISSION AND DISTRIBUTION OF NATURAL OR MANUFACTURED GAS, INDICATING
THE LOCATION OF PRINCIPAL GENERATING PLANTS, TRANSMISSION LINES, PRODUCING
FIELDS, GAS MANUFACTURING PLANTS AND ELECTRIC AND GAS DISTRIBUTION
FACILITIES, INCLUDING ALL SUCH PROPERTIES WHICH ARE OUTSIDE THE STATE IN
WHICH CLAIMANT AND ITS SUBSIDIARIES ARE ORGANIZED AND ALL TRANSMISSION OR
PIPELINES WHICH DELIVER OR RECEIVE ELECTRIC ENERGY OR GAS AT THE BORDERS OF
SUCH STATE.
Neither the Claimant nor any of its subsidiaries own property used for the
production, transmission and distribution of natural or manufactured gas at
retail. APS and PWEC, each a "public utility company" as that term is defined in
the Public Utility Holding Company Act of 1935, are the only two of Claimant's
subsidiaries that own property used for the generation, transmission and
distribution of electric energy for sale.
Exhibit C attached hereto shows the location of (i) APS' major generating
plants (including those owned jointly with others), principal transmission lines
(including those operated for others) and interconnections of transmission lines
with out-of-state utilities at state lines; and (ii) PWEC's major generating
plants. All of such facilities, except the Four Corners Generating Station
("Four Corners"), and all of APS' distribution facilities, are located within
the State of Arizona. Four Corners is a mine-mouth power plant, located in the
northwest corner of New Mexico, near the city of Farmington, approximately 40
miles east of the Arizona-New Mexico border.
3
Claimant's present generating facilities have capacity as follows:
APS - NET ACCREDITED CAPACITY
APS' present generating facilities have an accredited capacity as follows:
Capacity(kW)
------------
Coal:
Units 1, 2, and 3 at Four Corners................................. 560,000
15% owned Units 4 and 5 at Four Corners........................... 222,000
Units 1, 2, and 3 at Cholla Plant................................. 615,000
14% owned Units 1, 2, and 3 at the Navajo Plant................... 315,000
-------------
1,712,000
-------------
Gas or Oil:
Two steam units at Ocotillo and two steam units at Saguaro........ 430,000(1)
Eleven combustion turbine units................................... 493,000
Three combined cycle units........................................ 255,000
-------------
1,178,000
-------------
Nuclear:
29.1% owned or leased Units 1, 2, and 3 at Palo Verde............. 1,086,300
-------------
Hydro and Solar........................................................ 7,600
-------------
Total APS facilities................................................... 3,983,900
=============
PINNACLE WEST ENERGY - PERMITTED CAPACITY
PWEC's present generating facilities have a permitted capacity as follows:
Gas or Oil:
Three combined cycle units........................................ 1,180,000
One combustion turbine unit....................................... 80,000
-------------
Total Pinnacle West Energy facilities 1,260,000
=============
----------
(1) Does not include West Phoenix steam units (108,300 kW), which were retired
in December 2002.
APS' transmission facilities consist of approximately 4,982 pole miles of
overhead lines and approximately 28 miles of underground lines, all of which are
located within the State of Arizona. APS' distribution facilities consist of
approximately 12,019 pole miles of overhead lines and approximately 12,352 miles
of underground lines, all of which are located within the State of Arizona.
4
3. THE FOLLOWING INFORMATION FOR THE LAST CALENDAR YEAR WITH RESPECT TO
CLAIMANT AND EACH OF ITS SUBSIDIARY PUBLIC UTILITY COMPANIES (EXCLUDING
MARKETING AND TRADING ACTIVITIES FOR NON-PUBLIC UTILITY COMPANIES,
INTERAFFILIATE TRANSFERS, AND FINANCIAL INSTRUMENTS):
(Data is not maintained in a format identifying the state in which the sales and
purchases are made or the amount of their associated revenues or expenses.)
a. NUMBER OF KWH OF ELECTRIC ENERGY SOLD (AT RETAIL OR WHOLESALE), AND
MCF. OF NATURAL OR MANUFACTURED GAS DISTRIBUTED AT RETAIL.
28,694,757,000 kwh of electric energy sold at wholesale or retail
0 Mcf. of natural or manufactured gas distributed at retail
b. NUMBER OF KWH OF ELECTRIC ENERGY AND MCF. OF NATURAL OR
MANUFACTURED GAS DISTRIBUTED AT RETAIL OUTSIDE THE STATE IN WHICH EACH SUCH
COMPANY IS ORGANIZED.
61,154,000 kwh of electric energy was distributed at retail
outside Arizona
0 Mcf. of natural or manufactured gas distributed at retail
outside Arizona
c. NUMBER OF KWH OF ELECTRIC ENERGY AND MCF. OF NATURAL OR
MANUFACTURED GAS SOLD AT WHOLESALE OUTSIDE THE STATE IN WHICH EACH SUCH
COMPANY IS ORGANIZED, OR AT THE STATE LINE.
1,665,095,000 kwh of electric energy was sold at wholesale
outside Arizona or at state line
18,444,816 Mcf. of natural or manufactured gas sold at wholesale
outside Arizona or at state line
d. NUMBER OF KWH OF ELECTRIC ENERGY AND MCF. OF NATURAL OR
MANUFACTURED GAS PURCHASED OUTSIDE THE STATE IN WHICH EACH SUCH COMPANY IS
ORGANIZED OR AT THE STATE LINE.
1,302,659,000 kwh of electric energy was purchased outside
Arizona or at state line
42,506,404 Mcf. of natural or manufactured gas purchased outside
Arizona or at state line
5
4. THE FOLLOWING INFORMATION FOR THE REPORTING PERIOD WITH RESPECT TO CLAIMANT
AND EACH INTEREST IT HOLDS DIRECTLY OR INDIRECTLY IN AN EWG OR A FOREIGN
UTILITY COMPANY, STATING MONETARY AMOUNTS IN UNITED STATES DOLLARS:
a. NAME, LOCATION, BUSINESS ADDRESS AND DESCRIPTION OF THE FACILITIES
USED BY THE EWG OR FOREIGN UTILITY COMPANY FOR THE GENERATION, TRANSMISSION
AND DISTRIBUTION OF ELECTRIC ENERGY FOR SALE OR FOR THE DISTRIBUTION AT
RETAIL OF NATURAL OR MANUFACTURED GAS.
GenWest, LLC is in the process of developing the Silverhawk Power
Plant Project, which is a 570 MW combined-cycle plant located 20 miles
north of Las Vegas, Nevada. The plant is currently under construction. The
business address for the Silverhawk Power Plant is as follows:
GenWest, LLC
400 North Fifth Street, Mail Station 8983
Phoenix, Arizona 85004
Attention: Warren Kotzmann
b. NAME OF EACH SYSTEM COMPANY THAT HOLDS AN INTEREST IN SUCH EWG OR
FOREIGN UTILITY COMPANY; AND DESCRIPTION OF THE INTEREST HELD.
GenWest, LLC is an EWG. It is wholly owned by Pinnacle West Energy
Corporation, which in turn is a wholly owned subsidiary of the Claimant.
c. TYPE AND AMOUNT OF CAPITAL INVESTED, DIRECTLY OR INDIRECTLY, BY THE
HOLDING COMPANY CLAIMING EXEMPTION; ANY DIRECT OR INDIRECT GUARANTEE OF THE
SECURITY OF THE EWG OR FOREIGN UTILITY COMPANY BY THE HOLDING COMPANY
CLAIMING EXEMPTION; AND ANY DEBT OR OTHER FINANCIAL OBLIGATION FOR WHICH
THERE IS RECOURSE, DIRECTLY OR INDIRECTLY, TO THE HOLDING COMPANY CLAIMING
EXEMPTION OR ANOTHER SYSTEM COMPANY, OTHER THAN THE EWG OR FOREIGN UTILITY
COMPANY.
(1) type and amount of capital invested, directly or indirectly, by the
holding company claiming exemption:
$154,521,000 short-term debt (financed at Pinnacle West Capital
Corporation)
4,830,000 intercompany payables
(1,443,000) paid in capital (equity)
------------
$157,908,000
============
6
(2) any direct or indirect guarantee of the security of the EWG or foreign
utility company by the holding company claiming exemption:
none
(3) any debt or other financial obligation for which there is recourse,
directly or indirectly, to the holding company claiming exemption or
another system company, other than the EWG or foreign utility company:
(a) Pinnacle West Energy guarantee up to $50,000,000 of GenWest
performance under The Engineering Procurement and Construction
Agreement for building the Silverhawk Power Plant.
(b) Pinnacle West Capital Corporation guarantee of Pinnacle West
Energy payment of $18,568,620 for the purchase of Construction
Turbines.
(c) Pinnacle West Capital Corporation guarantee of GenWest's
obligations under a contract for the purchase of a steam turbine,
in the amount of $6,046,358.
(d) Pinnacle West Energy guarantee of GenWest's obligations under a
contract for the purchase of the heat recovery steam generator
and associated equipment, in the amount of $14,345,450.
(e) Pinnacle West Energy, as assignor, remains liable for GenWest's
obligations under a Program Parts, Shop Repairs and Scheduled
Outage Services Agreement for Combustion Turbines in the amount
of $65,880,902.
d. CAPITALIZATION AND EARNINGS OF THE EWG OR FOREIGN UTILITY COMPANY
DURING THE REPORTING PERIOD.
(1) capitalization:
$154,521,000 short-term debt (financed at Pinnacle West Capital
Corporation)
(1,443,000) intercompany payables
------------
$153,078,000
============
(2) earnings:
$3,000 interest earnings
7
e. IDENTIFY ANY SERVICE, SALES OR CONSTRUCTION CONTRACT(S) BETWEEN THE
EWG OR FOREIGN UTILITY COMPANY AND A SYSTEM COMPANY, AND DESCRIBE THE
SERVICES TO BE RENDERED OR GOODS SOLD AND FEES OR REVENUES UNDER SUCH
AGREEMENT(S).
(1) Engineering, Procurement and Construction Agreement between
GenWest, LLC and Arizona Public Service Company ("APS") for
construction of the Silverhawk Switchyard, pursuant to which, APS will
construct the switchyard for the Silverhawk Power Plant. The contract
price is $5,800,000.
(2) Limited Liability Company Agreement of GenWest, LLC by and among
Pinnacle West Energy Corporation as sole Member and Pinnacle West
Energy Corporation in its capacity as the initial Manager of GenWest,
LLC, dated February 27, 2001. PWEC made an initial capital
contribution of $1,000. No other fees have been paid to date.
8
EXHIBIT A
A CONSOLIDATING STATEMENT OF INCOME AND SURPLUS OF THE CLAIMANT AND ITS
SUBSIDIARY COMPANIES FOR THE LAST CALENDAR YEAR, TOGETHER WITH A CONSOLIDATING
BALANCE SHEET OF CLAIMANT AND ITS SUBSIDIARY COMPANIES AS OF THE CLOSE OF SUCH
CALENDAR YEAR.
Exhibit A hereto includes consolidating statements of income and
consolidating balance sheets for the Claimant and the following of its
subsidiaries: Arizona Public Service Company, SunCor Development Company, El
Dorado Investment Company, APS Energy Services Company, Inc. and Pinnacle West
Energy Corporation. Subsidiaries have been consolidated for financial reporting
purposes in accordance with Statement of Financial Accounting Standards No. 94,
CONSOLIDATION OF ALL MAJORITY-OWNED SUBSIDIARIES.
9
EXHIBIT B
AN ORGANIZATIONAL CHART SHOWING THE RELATIONSHIP OF EACH EWG OR FOREIGN
UTILITY COMPANY TO ASSOCIATE COMPANIES IN THE HOLDING-COMPANY SYSTEM.
Exhibit B hereto includes an organizational chart of the holding-company
system, including each EWG.
10
The above-named Claimant has caused this statement to be duly executed on
its behalf by its authorized officer on this 28th day of February, 2003.
Pinnacle West Capital Corporation
(Name of Claimant)
By Barbara M. Gomez
-------------------------------------
Barbara M. Gomez
Treasurer
[CORPORATE SEAL]
Attest:
Betsy A. Pregulman
-----------------------------
Betsy A. Pregulman
Associate Secretary
Name, title and address of officer to whom notices and correspondence concerning
this statement should be addressed:
Barbara M. Gomez Treasurer
---------------- ---------
(Name) (Title)
400 North Fifth Street, Station 9996, Phoenix, Arizona 85004
------------------------------------------------------------
(Address)
11
Exhibit A
PINNACLE WEST CAPITAL CORPORATION
CONSOLIDATING INCOME STATEMENT (dollars in thousands)
(Unaudited)
PINNACLE WEST MARKETING AND PINNACLE WEST
year ended December 31, 2002 PARENT TRADING * APS ENERGY SUNCOR
------------------------------------------------------------------------------------------------------------------------
OPERATING REVENUES
Regulated electricity segment $ -- $ 99,953 $ 2,059,339 $ 89,043 $ --
Marketing and trading segment 208,669 34,054 21,448
Real estate segment 236,388
Other revenues
------------------------------------------------------------------------------------------------------------------------
Total -- 308,622 2,093,393 110,491 236,388
------------------------------------------------------------------------------------------------------------------------
OPERATING EXPENSES
Regulated electricity segment
purchased power and fuel 89,430 595,368 49,245
Marketing and trading segment
purchased power and fuel 118,218 32,662 17,259
Operations and maintenance (3,480) 22,304 495,845 59,405
Real estate operations segment 205,066
Depreciation and amortization 2,840 655 399,640 13,874 4,784
Taxes other than Income taxes 107,925
Other expenses
------------------------------------------------------------------------------------------------------------------------
Total (640) 230,607 1,631,440 139,783 209,850
------------------------------------------------------------------------------------------------------------------------
OPERATING INCOME 640 78,015 461,953 (29,292) 26,538
------------------------------------------------------------------------------------------------------------------------
OTHER
Other income 180,744 5,149 204 7,606
Other expenses (5,307) (19,338) (77)
------------------------------------------------------------------------------------------------------------------------
Total 175,437 -- (14,189) 127 7,606
------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest charges 43,538 251 136,766 26,083 7,686
Capitalized interest (104) (207) (15,150) (23,152) (5,081)
------------------------------------------------------------------------------------------------------------------------
Total 43,434 44 121,616 2,931 2,605
------------------------------------------------------------------------------------------------------------------------
INCOME BEFORE INCOME TAXES 132,643 77,971 326,148 (32,096) 31,539
INCOME TAXES (16,765) 30,884 126,805 (12,785) 12,685
------------------------------------------------------------------------------------------------------------------------
INCOME BEFORE ACCOUNTING CHANGE 149,408 47,087 199,343 (19,311) 18,854
Cumulative effect of a change in
accounting for trading activities -
net of income taxes of $43,123 (65,745)
------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) $ 149,408 $ (18,658) $ 199,343 $ (19,311) $ 18,854
========================================================================================================================
ELIMINATIONS &
year ended December 31, 2002 EL DORADO APS ES ADJUSTMENTS TOTAL
---------------------------------------------------------------------------------------------------------
OPERATING REVENUES
Regulated electricity segment $ -- $ -- $ (235,312)(a) $ 2,013,023
Marketing and trading segment 128,621 (66,861)(a) 325,931
Real estate segment 236,388
Other revenues 35,038 26,899 61,937
---------------------------------------------------------------------------------------------------------
Total 35,038 155,520 (302,173) 2,637,279
---------------------------------------------------------------------------------------------------------
OPERATING EXPENSES
Regulated electricity segment
purchased power and fuel (234,500)(a) 499,543
Marketing and trading segment
purchased power and fuel 92,761 (66,861)(a) 194,039
Operations and maintenance 11,276 (812)(b) 584,538
Real estate operations segment 249 (b) 205,315
Depreciation and amortization 1,783 1,310 424,886
Taxes other than Income taxes 27 (b) 107,952
Other expenses 83,064 21,895 104,959
---------------------------------------------------------------------------------------------------------
Total 84,847 127,242 (301,897) 2,121,232
---------------------------------------------------------------------------------------------------------
OPERATING INCOME (49,809) 28,278 (276) 516,047
---------------------------------------------------------------------------------------------------------
OTHER
Other income 1,479 (180,078)(c,d) 15,104
Other expenses (8,960) 27 (c) (33,655)
---------------------------------------------------------------------------------------------------------
Total (7,481) -- (180,051) (18,551)
---------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest charges 607 177 (26,755)(c) 188,353
Capitalized interest (167) (249)(c) (44,110)
---------------------------------------------------------------------------------------------------------
Total 607 10 (27,004) 144,243
---------------------------------------------------------------------------------------------------------
INCOME BEFORE INCOME TAXES (57,897) 28,268 (153,323) 353,253
INCOME TAXES (2,724) 138,100
---------------------------------------------------------------------------------------------------------
INCOME BEFORE ACCOUNTING CHANGE (55,173) 28,268 (153,323) 215,153
Cumulative effect of a change in
accounting for trading activities -
net of income taxes of $43,123 (65,745)
---------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) $ (55,173) $ 28,268 $ (153,323) $ 149,408
=========================================================================================================
* Marketing and Trading is a division of the parent company.
EXPLANATIONS OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of inter-company sales of electricity.
(b) Reclassification of certain expenses.
(c) Elimination of inter-company interest expense and income.
(d) Elimination of parent company equity in earnings of subsidiaries.
PINNACLE WEST CAPITAL CORPORATION
CONSOLIDATING BALANCE SHEETS (dollars in thousands)
(Unaudited)
PINNACLE PINNACLE
WEST MARKETING AND WEST
December 31, 2002 PARENT TRADING * APS ENERGY SUNCOR
----------------------------------------------------------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 946 $ (1,395) $ 42,549 $ 5,326 $ 25,235
Customer and other receivables - net 542,809 330,650 338,201 27,743 14,481
Accrued utility revenues 72,915
Materials and supplies (at average cost) 79,985 11,667
Fossil fuel (at average cost) 28,185
Deferred income taxes 4,094 14,946
Assets from risk management and trading activities 19,546 39,616
Other current assets 4,684 45,361 461 38,247
----------------------------------------------------------------------------------------------------------------------------------
Total current assets 548,439 348,801 650,906 45,197 92,909
----------------------------------------------------------------------------------------------------------------------------------
INVESTMENTS AND OTHER ASSETS
Real estate investments - net 435,752
Assets from risk management and trading
activities - long term 90,714 31,622
Other assets 3,215,297 214,404
----------------------------------------------------------------------------------------------------------------------------------
Total investments and other 3,215,297 90,714 246,026 -- 435,752
----------------------------------------------------------------------------------------------------------------------------------
PROPERTY, PLANT AND EQUIPMENT
Plant in service and held for future use 7,770 8,299,131 703,071
Less accumulated depreciation and amortization 3,442,571 15,935
----------------------------------------------------------------------------------------------------------------------------------
Total 7,770 -- 4,856,560 687,136 --
Construction work in progress 18,867 9,584 329,089 414,384
Intangible Asset, net of accumulated amortization 8,503 6,005 93,259
Nuclear fuel, net of accumulated amortization 7,466
----------------------------------------------------------------------------------------------------------------------------------
Net property, plant and equipment 35,140 15,589 5,286,374 1,101,520 --
----------------------------------------------------------------------------------------------------------------------------------
DEFERRED DEBITS
Regulatory assets 241,045
Other deferred debits 2,747 97,456 7,190 5,046
----------------------------------------------------------------------------------------------------------------------------------
Total deferred debits -- 2,747 338,501 7,190 5,046
----------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS $ 3,798,876 $ 457,851 $ 6,521,807 $ 1,153,907 $ 533,707
==================================================================================================================================
ELIMINATIONS &
December 31, 2002 EL DORADO APS ES ADJUSTMENTS TOTAL
--------------------------------------------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 2,480 $ 2,566 $ -- $ 77,707
Customer and other receivables - net 19,993 51,879 (950,761)(a) 374,995
Accrued utility revenues 72,915
Materials and supplies (at average cost) 91,652
Fossil fuel (at average cost) 28,185
Deferred income taxes (14,946)(b) 4,094
Assets from risk management and trading activities 59,162
Other current assets 689 4,117 10,419 (e) 103,978
--------------------------------------------------------------------------------------------------------------------
Total current assets 23,162 58,562 (955,288) 812,688
--------------------------------------------------------------------------------------------------------------------
INVESTMENTS AND OTHER ASSETS
Real estate investments - net (10,421)(b,c) 425,331
Assets from risk management and trading
activities - long term 122,336
Other assets 2,804 373 (3,202,987)(b,d) 229,891
--------------------------------------------------------------------------------------------------------------------
Total investments and other 2,804 373 (3,213,408) 777,558
--------------------------------------------------------------------------------------------------------------------
PROPERTY, PLANT AND EQUIPMENT
Plant in service and held for future use 24,718 24,210 9,058,900
Less accumulated depreciation and amortization 14,592 1,227 3,474,325
--------------------------------------------------------------------------------------------------------------------
Total 10,126 22,983 -- 5,584,575
Construction work in progress 5,618 777,542
Intangible Asset, net of accumulated amortization 2,048 109,815
Nuclear fuel, net of accumulated amortization 7,466
--------------------------------------------------------------------------------------------------------------------
Net property, plant and equipment 10,126 30,649 -- 6,479,398
--------------------------------------------------------------------------------------------------------------------
DEFERRED DEBITS
Regulatory assets 241,045
Other deferred debits 2,678 (b) 115,117
--------------------------------------------------------------------------------------------------------------------
Total deferred debits -- -- 2,678 356,162
--------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS $ 36,092 $ 89,584 $(4,166,018) $ 8,425,806
====================================================================================================================
* Marketing and Trading is a division of the parent company.
EXPLANATIONS OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of inter-company receivables and payables.
(b) Miscellaneous reclassifications.
(c) Elimination of minority interests of SunCor joint venture partners.
(d) Elimination of parent company investments in subsidiaries.
(e) Reclassification of accrued taxes receivable
PINNACLE WEST CAPITAL CORPORATION
CONSOLIDATING BALANCE SHEETS (dollars in thousands)
(Unaudited)
PINNACLE MARKETING PINNACLE
WEST AND WEST
December 31, 2002 PARENT TRADING * APS ENERGY SUNCOR
---------------------------------------------------------------------------------------------------------------------------
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable $ 32,908 $ 77,691 $ 118,133 $ 56,654 $ 21,019
Accrued taxes (10,913) 615 82,557 (15,941) 2,798
Accrued interest 10,036 42,608 374
Short-term borrowings 96,200 5,983
Current maturities of long-term debt 275,822 3,503 435
Customer deposits 39,865 15,973
Liabilities from risk management
and trading activities 10,894 59,773
Other current liabilities 104,376 300,972 51,820 505,103 8,154
---------------------------------------------------------------------------------------------------------------------------
Total current liabilities 508,429 390,172 398,259 545,816 54,736
---------------------------------------------------------------------------------------------------------------------------
NON-CURRENT LIABILITIES
Long-term debt less current maturities 515,647 2,217,340 146,600
---------------------------------------------------------------------------------------------------------------------------
Total 515,647 -- 2,217,340 -- 146,600
---------------------------------------------------------------------------------------------------------------------------
DEFERRED CREDITS AND OTHER
Liabilities from risk management and trading
activities - long-term 38,964 36,678
Deferred income taxes (17,270) 12,004 1,225,552 3,734
Unamortized gain-sale of utility plant 59,484
Pension liability 23,592 (1,089) 156,442 (533) 6,037
Other 818 (63) 268,740 (43)
---------------------------------------------------------------------------------------------------------------------------
Total deferred credits 7,140 49,816 1,746,896 3,158 6,037
---------------------------------------------------------------------------------------------------------------------------
MINORITY INTERESTS
Joint ventures of SunCor 14,925
---------------------------------------------------------------------------------------------------------------------------
COMMON STOCK EQUITY
---------------------------------------------------------------------------------------------------------------------------
Common stock 2,206,001 1,424,966 608,709 343,053
---------------------------------------------------------------------------------------------------------------------------
Accumulated other comprehensive income
Minimum pension liability adjustment (9,777) (61,487)
Derivative instruments 3,779 (23,799)
---------------------------------------------------------------------------------------------------------------------------
Total accumulated other comprehensive loss (9,777) 3,779 (85,286) -- --
---------------------------------------------------------------------------------------------------------------------------
Retained earnings 571,436 14,084 819,632 (3,776) (31,644)
---------------------------------------------------------------------------------------------------------------------------
Total common stock equity 2,767,660 17,863 2,159,312 604,933 311,409
---------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND EQUITY $ 3,798,876 $ 457,851 $ 6,521,807 $ 1,153,907 $ 533,707
===========================================================================================================================
ELIMINATIONS &
December 31, 2002 EL DORADO APS ES ADJUSTMENTS TOTAL
-----------------------------------------------------------------------------------------------------------------
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable $ 37,842 $ 12,058 $ -- $ 356,305
Accrued taxes 1,316 258 10,419 (e) 71,109
Accrued interest 53,018
Short-term borrowings 23,456 3,882 (27,338)(a) 102,183
Current maturities of long-term debt 1,263 281,023
Customer deposits 55,838
Liabilities from risk management
and trading activities 70,667
Other current liabilities 8,706 14,605 (928,764)(a,b) 64,972
-----------------------------------------------------------------------------------------------------------------
Total current liabilities 72,583 30,803 (945,683) 1,055,115
-----------------------------------------------------------------------------------------------------------------
NON-CURRENT LIABILITIES
Long-term debt less current maturities 2,108 2,881,695
-----------------------------------------------------------------------------------------------------------------
Total 2,108 -- -- 2,881,695
-----------------------------------------------------------------------------------------------------------------
DEFERRED CREDITS AND OTHER
Liabilities from risk management and trading
activities - long-term 75,642
Deferred income taxes -- (14,946)(b) 1,209,074
Unamortized gain-sale of utility plant 59,484
Pension liability (569) 183,880
Other (30) 5,341 (b) 274,763
-----------------------------------------------------------------------------------------------------------------
Total deferred credits -- (599) (9,605) 1,802,843
-----------------------------------------------------------------------------------------------------------------
MINORITY INTERESTS
Joint ventures of SunCor (14,925)(c) --
-----------------------------------------------------------------------------------------------------------------
COMMON STOCK EQUITY
-----------------------------------------------------------------------------------------------------------------
Common stock 14,046 63,440 (2,927,315)(d) 1,732,900
-----------------------------------------------------------------------------------------------------------------
Accumulated other comprehensive income
Minimum pension liability adjustment (71,264)
Derivative instruments (20,020)
-----------------------------------------------------------------------------------------------------------------
Total accumulated other comprehensive loss -- -- -- (91,284)
-----------------------------------------------------------------------------------------------------------------
Retained earnings (52,645) (4,060) (268,490)(d) 1,044,537
-----------------------------------------------------------------------------------------------------------------
Total common stock equity (38,599) 59,380 (3,195,805) 2,686,153
-----------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND EQUITY $ 36,092 $ 89,584 $(4,166,018) $ 8,425,806
=================================================================================================================
* Marketing and Trading is a division of the parent company.
EXPLANATIONS OF ELIMINATIONS AND ADJUSTMENTS
(a) Elimination of inter-company receivables and payables.
(b) Miscellaneous reclassifications.
(c) Elimination of minority interests of SunCor joint venture partners.
(d) Elimination of parent company equity interest in subsidiaries.
(e) Reclassification of accrued taxes receivable
Exhibit B
Pinnacle West
Capital
Corporation
|
+-----------------------+---------------------+--+----------------------------------------+------------------------+
| 100% | 100% | 100% | 100% | 100%
APS Energy Arizona Public SunCor 99% 1% Pinnacle West El Dorado
Services Service Development .......... APACS, ........ Energy Investment
Company Inc. Company Company LLC Corporation Company
. | | . . .
........ +-------+ +....... . . .............
.. | | . . . .
...... 100% +---- 100% | . 50% 100% ..... 50%
.. Tucson | PWENewco, | . COPPER GEN . Underground
.. District(1) | Inc. | . EAGLE GAS WEST, . Imaging
.. LLC | | . STORAGE, LLC LLC (EWG) . Technologies
.. +---- 100% | . . LLC
....... 50% | Axiom Power | . .
Northwind | Solutions | . ..... 22.0%
Phoenix | | . . Phoenix
LLC +---- 100% | . . Suns
| Bixco, Inc. | . . Limited
| | . . Partnership
+---- 100% | . .
APS | . ..... 1.7474%
Foundation, | . . AZ PB
Inc. | . . Partnership
| . .
+---------------------------------------+ . ..... 24.4%
| . . EL
| . . Dorado
+--------------+ ...................................... . Ventures
| . . . III
+---- 100% 100% .... 100% 50% .... .
| Rancho Ranchland . Golf De Sedona . ..... 80.1%
| Viejo de ---- Utility . Mexico, Golf . . NAC HOLDING,
| Santa Fe, Company . S.A. de C.V. Resort LLC . . INC.
| Inc. . . .
| .... 30% 70% .... ..... 6.9%
+---- 100% . Type Kabuto . . Dodge
| SunCor Realty . Two Inc. SunCor JV . . Theatre
| & Mgmt . . .
| Company .... 50% 50% .... ..... 2.0%
| . Stoneridge - Centerpoint . Nxt
+---- 100% 50% . Prescott Associated . Phase
| SunCor West World . Valley LLC .
| Golf, .... Gold Course . LLC .
| Inc. LLC . .
| .... 50% 100% ....
+---- 100% 50% . Hayden Hidden Hills .
| Golden Heritage . Ferry of Scottsdale .
| Heritage .... Financial . Lakeside LLC .
| Homes Inc. Services, LLC . LLC .
| \ . .
| \ 100% .... 68% 50% ....
| \ Golden . Club Kyrene .
| \ Heritage . West Golf Associates .
| Construction . Course LLC .
| Inc. . LLC .
| . .
+---- 100% .... 65% 50% ....
| Palm Valley . Scottsdale Talavi
| Golf Club . Mountain Associates
| . LLP LLC
+---- 100% (Variable) .
| SCM, Inc. ---- Wigwam .... 50%
Outlet SunRidge
Stores, Canyon
LLC LLC
EXHIBIT C
In accordance with Item 304 of Regulation S-T of the Securities Exchange
Act of 1934, APS' Service Territory map contained as Exhibit C to this Form
U-3A-2 is a map of the State of Arizona showing APS' service area, the location
of its major power plants and principal transmission lines, the location of
Pinnacle West Energy's power plants and the location of transmission lines
operated by APS for others. APS' major power plants shown on such map are the
Navajo Generating Station located in Coconino County, Arizona; the Four Corners
Power Plant located near Farmington, New Mexico; the Cholla Power Plant, located
in Navajo County, Arizona; the Yucca Power Plant, located near Yuma, Arizona;
the Palo Verde Nuclear Generating Station, located about 55 miles west of
Phoenix, Arizona; the West Phoenix Power Plant, located near Phoenix, Arizona;
and the Saguaro Power Plant, located near Tucson, Arizona (each of which plants
is reflected on such map as being jointly owned with other utilities), as well
as the Ocotillo Power Plant located near Phoenix, Arizona. PWEC's power plants
shown on such map are the West Phoenix Power Plant located near Phoenix,
Arizona, and the Saguaro Power Plant, located near Tucson, Arizona (both of
which plants are reflected on such map as being jointly owned with APS), as well
as the Redhawk Power Plant, located near Phoenix, Arizona. APS' major
transmission lines shown on such map are reflected as running between the power
plants named above and certain major cities in the State of Arizona. The
transmission lines operated for others shown on such map are reflected as
running from the Four Corners Plant through a portion of northern Arizona to the
California border and from the Phoenix area.