Pinnacle West Capital Corporation · NYSE:PNW
Pinnacle West Capital — Investor Day (November 2008)
84 slides from Pinnacle West Capital's investor day presentation, Nov 7, 2008
Slide 1: Analyst Conference
Analyst Conference November 6-7, 2008
Slide 2: Forward-Looking Statements
Forward-Looking Statements These These presentations presentations contain contain forward-looking forward-looking statements statements based based on on current current expectations. expectations. Neither Neither Pinnacle Pinnacle West West nor nor APS APS assumes assumes any any obligation obliga
Slide 3: Operations Overview
Operations Overview Don Brandt Analyst Conference November 7, 2008 1
Slide 4: Strategic Objectives
Strategic Objectives Manage intrinsic growth in our markets Prudently increase our resource portfolio Maintain top-quartile operational performance and reliability Achieve constructive regulatory outcomes Manage costs aggressively Improve financial strength and shareholder value 2
Slide 5: Today's Agenda
Today’s Agenda Four-part plan to improve APS’ financial strength Growth update Resource planning and management Operations overview • Fossil generation • Customer service • EEI Award and other recognition SunCor 3
Slide 6: Plan to Improve APS' Financial Strength
Plan to Improve APS’ Financial Strength Cost reductions announced January 2008 • $200 million capital expenditures 2008 – 2012 • $14 million annual O&M Additional $700 million capital expenditure reductions 2009 – 2011 announced October 2008 Interim rate request General retail rate case 4
Slide 7: Growth and Resource Management
Growth and Resource Management 5
Slide 8: Attractive Intrinsic Growth Characteristics
Attractive Intrinsic Growth Characteristics Population Growth – Arizona vs. U.S. 6% 6% 5% 5% 4% 4% 3% 3% 2% 2% 1% 1% 0% 0% '87 '87 '88 '88 '89 '89 '90 '90 '91 '91 '92 '92 '93 '93 '94 '94 '95 '95 '96 '96 '97 '97 '98 '98 '99 '99 '00 '00 '01 '01 '02 '02 '03 '03 '04 '04 '05 '05 '06 '06 '07 '07 '08 '08 P
Slide 9: Population Growth Underpins APS Business Growth
Population Growth Underpins APS Business Growth 6% 6% 5% 5% 4% 4% 3% 3% 2% 2% 1% 1% 0% 0% '87 '87 '88 '88 '89 '89 '90 '90 '91 '91 '92 '92 '93 '93 '94 '94 '95 '95 '96 '96 '97 '97 '98 '98 '99 '99 '00 '00 '01 '01 '02 '02 '03 '03 '04 '04 '05 '05 '06 '06 '07 '07 '08 '08 Projected Projected Arizona Arizon
Slide 10: APS Growth Historically Rebounds After Recessions
APS Growth Historically Rebounds After Recessions 6% 6% 5% 5% 4% 4% 3% 3% 2% 2% 1% 1% 0% 0% '87 '87 '88 '88 '89 '89 '90 '90 '91 '91 '92 '92 '93 '93 '94 '94 '95 '95 '96 '96 '97 '97 '98 '98 '99 '99 '00 '00 '01 '01 '02 '02 '03 '03 '04 '04 '05 '05 '06 '06 '07 '07 '08 '08 Projected Projected Arizona Ariz
Slide 11: APS Resource Management Initiatives
APS Resource Management Initiatives Maintaining diversified energy mix Balancing needs and resources Addressing renewables, energy efficiency and climate change Hedging purchased power and gas prices 9
Slide 12: Diversified Energy Fuel Mix
Diversified Energy Fuel Mix Native Load 19% 17% 39% 25% Nuclear Coal Gas Purchased Power Twelve months ended September 30, 2008 10
Slide 13: Purchased Power and Gas Hedging Program
Purchased Power and Gas Hedging Program Percent of Requirements Hedged 100% 100% 75% 75% 50% 50% 25% 25% 0% 0% 2008 2008 2009 2009 2010 2010 2011 2011 As of September 30, 2008 11
Slide 14: Meeting Challenges of Peak Load Growth
Meeting Challenges of Peak Load Growth 2007 - 2020 Average Annual Load Growth 2.3% MW MW 12,000 12,000 10,000 10,000 8,000 8,000 6,000 6,000 4,000 4,000 '07 '07 '08 '08 '09 '09 '10 '10 '11 '11 '12 '12 '13 '13 '14 '14 '15 '15 '16 '16 '17 '17 '18 '18 '19 '19 '20 '20 Projected Projected Long-Term Long-
Slide 15: Arizona Renewable Resource Requirements
Arizona Renewable Resource Requirements Arizona Renewable Energy Standard (RES) Sets minimum renewable energy amounts • 1.5% of energy for retail sales in 2007 • 5% of energy for retail sales by 2015 • 15% of energy for retail sales by 2025 Includes distributed energy component • 5% of total i
Slide 16: APS Major New Solar Resource: Solana Generating Station
APS Major New Solar Resource Solana Generating Station 280 MW concentrating solar plant 70 miles southwest of Phoenix Larger than any existing solar facility in the world APS 30-year purchase power agreement for all output (900 GWh/year) Thermal storage capability will allow summer on-peak c
Slide 17: Solana Generating Station Recent Milestones
Solana Generating Station Recent Milestones APS participation approved by ACC September 2008 Status of Certificate of Environmental Compatibility (CEC) • Siting committee approval October 2008 • ACC ruling expected December 2008 Renewables tax credit extension approved by Congress September 20
Slide 18: Resource Planning for the Future
Resource Planning for the Future Stakeholders actively involved Resource needs and options evaluated • Peaking capacity through next decade • Baseload capacity thereafter APS resource plan to be filed with ACC year-end 2008 ACC integrated resource planning rules being developed 16
Slide 19: Operational Excellence
Operational Excellence 17
Slide 20: Top-Tier Coal Generation Performance
Top-Tier Coal Generation Performance Capacity Factors 2007 2007 Highlights Highlights 100% 100% Record fleet capacity factors for fourth straight year 75% 75% Cholla 50% • Set new production 50% record 5.1 million MWh • Capacity factor 90% 25% 25% Four Corners • Capacity factor 86% 0% 0% '03 '
Slide 21: Fossil Generation Environmental Targets
Fossil Generation Environmental Targets Zero non-air related reportable environmental incidents Self assessments at each plant annually Environmental Management Systems (EMIS) to promote compliance at all levels 19
Slide 22: APS Customer Satisfaction High Among Western Electric IOU's
APS Customer Satisfaction High Among Western Electric IOU’s Residential Customers Commercial Customers Rating Rating Rating Rating 750 750 750 750 APS APS 700 700 700 700 650 650 650 650 600 600 600 600 550 550 550 550 500 500 500 500 J.D. Power 2008 Surveys 20
Slide 23: Top-Quartile Reliability Reducing Average Customer Outage Time
Top-Quartile Reliability Reducing Average Customer Outage Time System Average Interruption Duration Index (SAIDI) Minutes 140 140 Top-Quartile Top-Quartile Performance Performance 120 120 100 100 80 80 60 60 40 40 20 20 00 1998 1998 1999 1999 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 20
Slide 24: Labor Day Storm Response Exemplified Excellence
Labor Day Storm Response Exemplified Excellence Timeline August August 28 28 -- Thursday Thursday 10:00 10:00 p.m.– p.m.– First First Storm Storm -- 80,000 80,000 customers customers outout August August 29 29 -- Friday Friday 6:30 6:30 a.m. a.m. –– 32,000 32,000 out out 8:00 8:00 p.m. p.m.
Slide 25: Labor Day Storm Response Statistics
Labor Day Storm Response Statistics 51 51 distribution distribution feeders feeders –– 80,000 80,000 customers customers impacted impacted Call Call Center Center handled handled 47,609 47,609 customer customer calls calls on on August August 29 29 (single-day (single-day record) record) Ov
Slide 26: APS Receives Electric Industry's Most Prestigious Honor
APS Receives Electric Industry’s Most Prestigious Honor “APS’ new system for monitoring transformer performance is a remarkable achievement and could potentially benefit electric utilities everywhere…. This system represents a significant step forward in managing and monitoring the electric grid.” T
Slide 27: Other Recognition
Other Recognition Environmental, Sustainability and Technology Innovest’s Innovest’s highest highest rating rating (AAA) (AAA) and and ranked ranked #2 #2 electric electric utility utility Dow Dow Jones Jones Sustainability Sustainability Index Index Global Global 100 100 Most Most Sustaina
Slide 28: SunCor
SunCor 26
Slide 29: SunCor Overview
SunCor Overview Commercial and residential real estate developer in IDAHO Western U.S. Boise Total assets = $578 million Equity = $297 million Diverse geographic and UTAH business mix St. George • 6 master-planned communities • 2 major commercial projects Sedona Prescott Santa Fe Phoenix NEW
Slide 30: SunCor Near-Term Tactics
SunCor Near-Term Tactics Manage land, residential and commercial inventory Reduce costs / improve efficiency • Workforce reduced 50% from peak • Capital expenditure reduction/delay • General and administrative expenses being reduced more than 20% from peak 28
Slide 31: Strategic Summary
Strategic Summary Manage intrinsic growth in our markets Prudently increase our resource portfolio Maintain top-quartile operational performance and reliability Achieve constructive regulatory outcomes Manage costs aggressively Improve financial strength and shareholder value 29
Slide 32: Palo Verde Overview
Palo Verde Overview Randy Edington Analyst Conference November 7, 2008 1
Slide 33: Palo Verde's Business Plan
Palo Verde’s Business Plan We SAFELY and efficiently generate electricity for the long term 2
Slide 34: Improving Nuclear Generation Performance
Improving Nuclear Generation Performance Capacity Factors 100% 100% Top U.S. power producer past 15 years 75% 75% Goal to achieve consistent site capacity factor 50% 50% greater than 88% Performance 25% 25% improvement plan underway 0% 0% Strengthening '03 '03 '04 '04 '05 '05 '06 '06 '07 12
Slide 35: Net Generation
Net Generation Million MW 40 40 35 35 30.0 30.0 28.6 28.6 28.1 28.1 30 30 25.8 26.8 26.8 25.8 24.0 24.0 25 25 20 20 15 15 10 10 55 00 2003 2003 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 Projected Projected 4
Slide 36: O&M Cost Trends
O&M Cost Trends Expected Expected toto peak peak in in 2008 2008 -- 2009 2009 2003 2003 2013 2013 5
Slide 37: Refueling and Steam Generator Replacement Outages
Refueling and Steam Generator Replacement Outages Outage Outage Days Days 120 120 100 100 80 80 60 60 40 40 Projected 20 20 0 0 2003 2003 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 Unit 1 Unit 2 Unit 3 6
Slide 38: Regulatory Activities
Regulatory Activities Site Integrated Business Plan (SIBP) Site Integrated Improvement Plan (SIIP) Confirmatory Action Letter (CAL) • Expected to be cleared by end of 2009 NRC Reactor Oversight Action Matrix • Unit 3 expected to be out of Column 4 by end of 2009 License Renewal Request 7
Slide 39: License Renewal
License Renewal Plan to file application by end of 2008 Request to extend operating licenses by 20 years License extension process expected to take about two years 8
Slide 40: Major Capital Improvements
Major Capital Improvements Completed projects Steam generators Low-pressure turbines Future projects Reactor vessel heads Rapid refueling packages Cooling towers All projects in capital expenditure forecasts 9
Slide 41: Steam Generators and Low-Pressure Turbines
Steam Generators and Low-Pressure Turbines Completed at all units in 2003 – 2007 Increased production capability • 210 MW total site • 61 MW APS share 10
Slide 42: Reactor Vessel Head Replacements
Reactor Vessel Head Replacements Planned timing (during normal refueling outages): • Unit 2 – Fall 2009 • Unit 1 – Spring 2010 • Unit 3 – Fall 2010 Estimated outage duration • About 60 days/unit Projected site costs (all units) • $90-100 million total project • APS share 29.1% 11
Slide 43: Rapid Refueling Packages
Rapid Refueling Packages Planned timing • Concurrent with reactor vessel head replacements Projected site costs (all units) • $100-110 million total project • APS share 29.1% 12
Slide 44: Cooling Tower Replacements
Cooling Tower Replacements Currently in design stage Projected completion: 2015 Preliminary site project cost estimate (all units) • $400 million total project • APS share 29.1% 13
Slide 45: The Road to Excellence – 2013 Goals
The Road to Excellence – 2013 Goals ISAR ISAR top top quartile quartile No No NRC NRC Findings Findings greater greater than than GREEN GREEN Production Production cost cost less less INPO INPO 11 than or equal to than or equal to $20 $20 per per megawatt-hour megawatt-hour (2 (2 cents c
Slide 46: Regulatory Overview
Regulatory Overview Steve Wheeler Analyst Conference November 7, 2008 1
Slide 47: Today's Agenda
Today’s Agenda Regulatory goals Significant developments in recent years Retail rate cases pending • Interim base rate request • General rate case Transmission rate settlement ACC election results Focusing on regulatory improvements 2
Slide 48: APS' Primary Regulatory Goals
APS’ Primary Regulatory Goals Timely cost recovery and return on investment Financial strength and stability APS integrated resource plan approval Improved regulatory processes Establishment of prudent, comprehensive state energy policy Support for beneficial customer programs 3
Slide 49: Significant Developments Since 2005
Significant Developments Since 2005 Unification of PWEC assets Retail cost recovery mechanisms • Fuel and purchased power adjustor (PSA) • Transmission cost adjustor (TCA) • Renewables surcharge (RES) • Demand-side management adjustor (DSM) • Environmental improvement surcharge (EIS) Retail li
Slide 50: APS Interim Base Rate Request Details
APS Interim Base Rate Request Details Application filed with ACC June 6, 2008 Base rate surcharge to be effective until general rate case decision • $0.004 per kWh (approximately 4%) • $115 million annual pretax retail revenues Subject to refund pending outcome of general rate case Hearings
Slide 51: Interim Rate Request Themes
Interim Rate Request Themes Address APS’ financial condition pending general rate case proceedings • Preserve investment-grade credit ratings • Provide cash flow • Strengthen credit metrics and earnings Protect customers against higher future costs Reduce rate volatility for customers Recogn
Slide 52: Summary of Staff and Intervenor Positions on Interim Relief Request
Summary of Staff and Intervenor Positions on Interim Relief Request ACC Staff Arizonans for Electric Choice Does not support and Competition (AECC) interim increase Supports $42.4 million If Commission grants request annual revenue increase • $65 million annual effective January 1, 2009 revenu
Slide 53: APS Retail Rate Case Elements
APS Retail Rate Case Elements Adjusted 2007 test year Recognize $1.7 billion of capital expenditures since last rate case Address earnings attrition Implement new growth impact fee Encourage energy efficiency programs New conservation rates 8
Slide 54: Composition of $278 Million APS Rate Increase
Composition of $278 Million APS Rate Increase Traditional Traditional rate rate base base $72M Cost Cost of of capital capital $48M Net Net fuel fuel increase increase $14M Other–net Other–net $6M 9
Slide 55: Composition of $278 Million APS Rate Increase
Composition of $278 Million APS Rate Increase Post Post test-year test-year large large projects projects $25M in-service in-service Other Other post post $34M test-year test-year plant plant in-service in-service $79M Attrition Attrition adjustment adjustment 10
Slide 56: Proposals to Mitigate Earnings Attrition
Proposals to Mitigate Earnings Attrition Post test-year plant additions • Consistent with ACC historic test-year methodology • $174 million large projects in service by mid-2008 • $245 million other plant in service by time rates go into effect $79 million attrition adjustment to capture revenue
Slide 57: Growth Impact Fee Proposal
Growth Impact Fee Proposal Helps “growth pay for itself” Reduces increase for existing customers Supplements line extension payments approved in early 2008 Captures additional growth-related costs • Carrying costs of tax asset related to line extension payments • Incremental operating costs
Slide 58: APS Retail Rate Case Schedule
APS Retail Rate Case Schedule Staff Staff && Intervenor Intervenor APS APS APS APS APS APS Initial Initial Testimony Testimony Rebuttal Rebuttal Rejoinder Rejoinder Rate Rate Filing Filing Part Part 11 ** Testimony Testimony Testimony Testimony Mar. 24, Jun. 2, Dec. 19, Jan. 9, Feb. 6, Mar. 6, Mar.
Slide 59: Timely Transmission Rate Updates
Timely Transmission Rate Updates Annual formula-based rate adjustments (based on prior-year FERC Form 1 data) Retail transmission cost adjustor Key implementation dates • APS FERC request filing July 10, 2007 • Initial increases (wholesale and retail adjustor) March 1, 2008 • Second increase
Slide 60: Transmission Revenue Increases
Transmission Revenue Increases 1st Increase 2nd Increase Annual Revenue Effective Annual Effective Request Settlement Date Revenue Date Retail Portion (TCA) $30M $27M 3/1/2008 $13M 7/3/2008 Wholesale Portion $ 7M $ 1M 3/1/2008 $ 2M 6/1/2008 Total Increase $37M $28M $15M 15
Slide 61: Arizona Corporation Commissioners
Arizona Corporation Commissioners Terms Expire January 2009 Mike Mike Gleason Gleason Jeff Jeff Hatch-Miller Hatch-Miller William William Mundell Mundell Republican Republican Republican Republican Republican Republican Terms Expire January 2011 Kristin Kristin Mayes Mayes Gary Gary Pierce Pierce Re
Slide 62: Focusing on Regulatory Improvements
Focusing on Regulatory Improvements Substantial APS Partner with ACC capital expenditures and stakeholders to: driven by growth and reliability Assure financial strength Address regulatory lag APS commodity prices increases Improve alignment of goals Historic test year Implement integr
Slide 63: Financial Overview
Financial Overview Jim Hatfield Analyst Conference November 7, 2008 1
Slide 64: Today's Agenda
Today’s Agenda Financial objectives Third quarter earnings Capital expenditures Liquidity and debt profile O&M cost management initiatives Credit ratings and financial metrics Value proposition 2
Slide 65: Long-Term Financial Objectives
Long-Term Financial Objectives Retain APS investment-grade credit ratings Improve financial strength and agility Emphasize capital and O&M budgeting disciplines Maintain ample liquidity and access to capital Constructively address earnings attrition Improve total return to above industry
Slide 66: 3rd Quarter September Earnings Summary
3rd Quarter September Earnings Summary $ Millions, Millions, Except Except EPS EPS 2008 2007 Change APS $ 160 $ 204 $ (44) SunCor (6) 6 (12) Other (2) (1) (1) Net income $ 152 $ 209 $ (57) Earnings per share $ 1.50 $ 2.07 $ (0.57) 4
Slide 67: Major EPS Variances
Major EPS Variances 3rd rd Quarter September 2008 vs 3rd rd Quarter September 2007 Rate Rate 2007 2007 Growth Growth increases increases O&M* O&M* $2.07 $2.07 $0.06 $0.06 $0.07 $0.07 $(0.17) $(0.17) Hedge Hedge mark-to- mark-to- Weather Weather market market $(0.14) $(0.14) SunCor SunCor $(0.17) $(0
Slide 68: 2008 Earnings Guidance
2008 Earnings Guidance As of November 4, 2008 Consolidated on-going earnings expected to be within reasonable range around $2.50 per share • Excludes $0.30 per share of prior-year tax credits recorded second quarter 2008 • APS will contribute substantially all of the earnings • SunCor’s contributi
Slide 69: Primary Future Earnings Drivers
Primary Future Earnings Drivers Customer growth O&M Rate increases Capital expenditures - Transmission - Depreciation - Interim - Property taxes - Base - Interest Inflation Economy Weather 7
Slide 70: Significant APS Capital Expenditures to Support Long-Term Growth
Significant APS Capital Expenditures to Support Long-Term Growth $ Millions 1,200 1,200 1,000 1,000 APS APS Distribution Distribution 800 800 APS APS Transmission Transmission 600 600 APS APS Generation Generation 400 400 Other Other 200 200 Deferrals Deferrals & & Cancellations Cancellations 00 200
Slide 71: APS Capital Expenditure Reduction Details Announced October 2008
APS Capital Expenditure Reduction Details Announced October 2008 ($ ($ Millions) Millions) 2009 2010 2011 Total Transmission $ 60 $ 190 $ 180 $ 430 Distribution 100 80 30 210 Generation 60 60 (40) 80 Total 220 330 170 720 Line extension effects (30) (50) (120) (200) Net reductions $ 190 $ 280 $ 50 $
Slide 72: APS Capital Expenditure Reductions
APS Capital Expenditure Reductions Announced January 2008 Announced October 2008 More More than than $200 $200 million million in in 2008 2008 -- 2012 2012 More More than than $700 $700 million million in in 2009 2009 -- 2011 2011 Slower Slower customer customer growth growth Improved Improved plann
Slide 73: Ample Liquidity Resources
Ample Liquidity Resources $1.15 $1.15 Billion Billion PNW (parent) $300 million revolver expires December 2010 APS $400 million revolver expires December 2010 Revolving Credit APS $500 million revolver Facilities expires September 2011 $442 $442 Million Million $51 million capacity l
Slide 74: Solid Revolver Bank Groups
Solid Revolver Bank Groups ($ Millions) APS APS PNW PNW Total Total % % of of Total Total BNY BNY Mellon Mellon $$ 80 80 $$ 30 30 $$ 110 110 9.2 9.2 Bank Bank of of America America 93 93 17 17 110 110 9.2 9.2 Citigroup Citigroup 77 77 29 29 106 106 8.8 8.8 JPMorgan JPMorgan Chase Chase 77 77 29 29 1
Slide 75: Solid Revolver Bank Groups - Continued
Solid Revolver Bank Groups - Continued ($ Millions) APS APS PNW PNW Total Total % % of of Total Total Sun Sun Trust Trust $$ 36 36 $$ -- $$ 36 36 3.0 3.0 Wachovia Wachovia 36 36 -- 36 36 3.0 3.0 US US Bank Bank 17 17 13 13 30 30 2.5 2.5 KBC KBC Bank Bank 24 24 -- 24 24 2.0 2.0 Dresdner Dresdner 24 2
Slide 76: Debt and Cash Balances
Debt and Cash Balances September 30, 2008 $$ Millions Millions APS APS** Parent Parent SunCor SunCor Total Total Long-term Long-term debt debt including including current current maturities maturities $$ 2,851 2,851 $$ 175 175 $$ 177 177 $$ 3,203 3,203 Short-term Short-term debt debt 270 270 167 167
Slide 77: Tax-Exempt Debt Profile
Tax-Exempt Debt Profile September 30, 2008 $656 $656 Million Million Auction Auction Rate Rate -- Ambac Ambac Variable Variable Rate Rate -- LOC LOC Fixed Fixed rate rate Variable Variable Rate Rate -- Unenhanced Unenhanced 15
Slide 78: Manageable Long-Term Debt Maturity Profile
Manageable Long-Term Debt Maturity Profile $ Millions 600 600 500 500 400 400 300 300 200 200 100 100 00 2008 2008 2009 2009 2010 2010 2011 2011 2012 2012 2013 2013 2014 2014 2015 2015 2016 2016 2017 2017 2018 2018 2019 2019 APS APS PNW PNW SunCor SunCor 16
Slide 79: O&M Cost Management Initiatives
O&M Cost Management Initiatives Control costs to manage increases and related risks 17
Slide 80: Pension Update
Pension Update $$ Millions Millions 40 40 Prudent funding of pension obligation 30 30 94% cash funded 20 20 at 2007 plan year-end 10 10 Annual actuarial valuations based on 00 year-end status 2006 2006 2007 2007 2008 2008 Projected Projected Required Required cash cash contributions cont
Slide 81: Long-Term Focus on Improving APS Credit Metrics
Long-Term Focus on Improving APS Credit Metrics Funds Funds From From Operations Operations // Debt Debt Adjusted Adjusted Debt Debt // Total Total Capitalization* Capitalization* 25% 25% 60% 60% 50% 50% 20% 20% 40% 40% 15% 15% 30% 30% 10% 10% 20% 20% 5% 5% 10% 10% 0% 0% 0% 0% '04 '04 '05 '05 '06 '0
Slide 82: APS Net Cash Flow as Percent of Capital Expenditures
APS Net Cash Flow as Percent of Capital Expenditures 100% 100% 75% 75% 50% 50% 25% 25% 0% 0% 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 Projected Projected Based on 2008 earnings guidance 20
Slide 83: Attractive Common Stock Dividend
Attractive Common Stock Dividend Pinnacle West Annual Dividend Yield $2.10 Per Share 8% 8% PNW PNW 6.1% 6.1% 6% 6% Industry Industry Average Average 4.4% 4.4% 4% 4% 2% 2% 0% 0% Pinnacle Pinnacle West West Electric Electric Utilities Utilities As As of of September September 30, 30, 2008 2008 21
Slide 84: Value Proposition
Value Proposition Integrated, regulated electric utility • Attractive long-term economic fundamentals • Operational excellence • Experienced management and workforce • Focus on regulatory improvements Financial performance focus Valuation • $2.10 per share annual dividend • Investment-grade cr