Pinnacle West Capital Corporation · NYSE:PNW

Pinnacle West Capital — Investor Day (October 2002)

161 slides from Pinnacle West Capital's investor day presentation, Oct 18, 2002

  1. Slide 1: Forward-Looking Statements

    Forward-Looking Statements This presentation contains forward-looking staternents based on current expectations and the company assumes no obligation to update these staternents, except as required by applicable laws. Because actual results may differ materially from expectations, the company cautio

  2. Slide 2: Financial Overview

    Financial Overview © 2002 Pinnade West Capital Corporation

  3. Slide 3: Pinnacle West Financial Focus

    Pinnacle West Financial Focus = Manage business strategies for superior long-term shareholder value creation = Continue superior long-term combined earnings and dividend growth = Improve balance sheet strength = Ensure adequate liquidity © 2002 Pinnade West Capital Corporation

  4. Slide 4: Economic Outlook

    Economic Outlook © 2002 Pinnade West Capital Corporation

  5. Slide 5: Arizona Vs. U.S. Population Growth

    Arizona Vs. U.S. Population Growth Percentage Change 4 ‘O7 "98 "99 ‘00 "01 02 03 04 Projected DArizona BU.S. © 2002 Pinnade West Capital Corporation

  6. Slide 6: Phoenix Single-Family Building Permits

    Phoenix Single-Family Building Permits Thousands 35 33 31 29 27 25 ‘97 ‘98 "99 ‘00 ‘01 ‘02 ‘03 ‘04 —— Projected ——— © 2002 Pinnade West Capital Corporation

  7. Slide 7: Maricopa County Real Non-Residential Investment Activity

    Maricopa County Real Non-Residential Investment Activity YIY Change 150% 100% 50% 0% ——_.—__f}-_—_— -50Y “ 50% 1998. 1999. 2000 2001 +++ Office Buildings —Total * Year-to-date March 2002 @ 2002 Pinnade West Capit

  8. Slide 8: Arizona vs. U.S. Wage and Salary Employment Growth

    Arizona vs. U.S. Wage and Salary Employment Growth Percentage Change 5 ‘97 ‘98 "99 ‘00 "01 "02 ‘03 ‘04 —— Projected ——— Arizona gU.S. @ 2002 Pinnade West Capit

  9. Slide 9: Superior APS Retail Customer Growth

    Superior APS Retail Customer Growth Percent 5.0 HE 1997 1998 1999 2000 2001 2002 2003 2004 Projected ° ° ° ° GAPS — Industry Average @ 2002 Pinnade West Capit illic

  10. Slide 10: Pinnacle West Earnings Drivers 2002 vs. 2001 (Regulated)

    Pinnacle West Earnings Drivers * 2002 vs. 2001 (After-tax) = Regulated « Customer sales growth (RNF) $32M « Fuel, purchased power, reliability and outages 80M « Off system sales (68M) « Severance costs (22M) « Pension/OPEB expense (6M) « Depreciation and other (10M) * Estimated change in income befo

  11. Slide 11: Pinnacle West Earnings Drivers 2002 vs. 2001 (Unregulated)

    Pinnacle West Earnings Drivers * 2002 vs. 2001 (After-tax) = Other Unregulated « Marketing and Trading $(62M) « Unregulated generation (11M) « Holding company costs (7M) « APS Energy Services 20M « SunCor/El Dorado (1M) “ Estimated © 2002 Pinnade West Capital Corporation

  12. Slide 12: Pinnacle West Earnings Drivers 2003 vs. 2002 (Regulated)

    Pinnacle West Earnings Drivers * 2003 vs. 2002 (After-tax) = Regulated « Customer sales growth (RNF) $44M « No severance costs 22M « O&M target reductions 18M « Pension/OPEB expense (13M) « Higher gas and power costs (59M) « Depreciation and other (13M) “ Estimated © 2002 Pinnade West Capital Corpor

  13. Slide 13: Pinnacle West Earnings Drivers 2003 vs. 2002 (Unregulated)

    Pinnacle West Earnings Drivers * 2003 vs. 2002 (After-tax) = Unregulated « Marketing and Trading - « Unregulated generation - « Holding company costs - « SunCor & El Dorado + Neutral “ Estimated © 2002 Pinnade West Capital Corporation

  14. Slide 14: Power Marketing and Trading Results

    Pinnacle West Power Marketing and Trading Results Estimated Gross Margin Realized MTM Gains* $317M $64M $28M $29M | 1 Ae es 98 99 0001 TME 02 03 04 058 6/30/02 thereafter Net change in mark-to-market * Based on accumulated mark-to- Realized gain market gains as of 6/30/02 © 2002 Pinnade West Capital

  15. Slide 15: Limited capital devoted to Power Marketing and Trading business

    Limited capital devoted to Power Marketing and Trading business © 2002 Pinnade West Capital Corporation 14

  16. Slide 16: Accounting Topics

    Accounting Topics Asset Retirement Obligation - FAS 143 Stock Options - FAS 123 @ 202 Fi a Effective 1/2003; Expect no material impact to earnings ua Elected to adopt July 1, 2002 = Applied ona prospective basis = Estimated earnings effect of under $0.5M in 2002; normalized level of $1.5M innsiiedie

  17. Slide 17: Final Accounting Guidance - Trading Contracts (EITF 02-3)

    Final Accounting Guidance - Trading Contracts (EITF 02-3) = Applies to previously recorded gross revenues and purchased power costs for electricity trading under EITF 98-10 m= New guidance adopted July 2002 requires trading contracts to be recorded on net basis in revenues = Gross margins are not im

  18. Slide 18: Pension Contributions

    Pension Contributions = Company contributions 3" in recent years were optional 60 = Cash contributions will likely be required in 2003 ° 20 "99 '00 «01 «©'02 ='03* * Estimated range 7

  19. Slide 19: Other Benefit Cost Impacts

    Other Benefit Cost Impacts = Pension Lower investment returns are expected to impact other comprehensive income with a $60 - $100 million charge to equity = Pension and OPEB expense Estimated incremental after-tax pension and OPEB effects of approximately $5 million in 2002 and between $10-$15 milli

  20. Slide 20: El Dorado Investment Company

    EI Dorado Investment Company Projected assets as of 12/31/02 $33 million Other High Tech Venture Investments Capital Partnership & Assets 19 @ 2002 Pinnade West Capit

  21. Slide 21: NAC International

    NAC International = Spent nuclear fuel storage and transportation business - Recapitalization and consolidation to PNW in 3Q 2002 « Recovery plan designed to mitigate ongoing financial support © 2002 Pinnade West Capital Corporation 20

  22. Slide 22: Current Financing Plans With Regulatory Shift

    Current Financing Plans With Regulatory Shift = Financing application - PWEC dedicated generation assets - APS balance sheet strength = Access capital markets within 90 days of approval of financing application ua Preserves flexibility to seek appropriate regulatory treatment an © 2002 Pinnade West

  23. Slide 23: Financial Benchmarks

    Financial Benchmarks © 2002 Pinnade West Capital Corporation

  24. Slide 24: Balancing Growth and Financial Strength

    Pinnacle West Balancing Growth and Financial Strength Capital Expenditures Consolidated Debt Ratio* $ Millions 9) 1,200 a 2005 Target of < 55% 900 —— 50% 600 | 300 | 40% o+ rt 1 30% 2001 2002 2003 2004 2000 2001 6/3002 2005 TME Other Generation Expansion * Includes Palo Verde salelleaseback CIExisti

  25. Slide 25: Pinnacle West versus Industry: Cash Flow Per Share

    Pinnacle West versus Industry Cash Flow Per Share $ per Share 10.00 8.00 6.00 4.00 2.00 0.00 1997 1998 1999 2000 2001 6/30/02 TME O Pinnacle West WS&P 500 Electric Index Average 24 © 2002 Pinnade West Capital Corporation

  26. Slide 26: Pinnacle West versus Industry: EBITDA Interest Coverage

    Pinnacle West versus Industry * EBITDA Interest Coverage Times 3 Pinnacle West

  27. Slide 27: Pinnacle West versus Industry: Total Debt to EBITDA

    Pinnacle West versus Industry * Total Debt to EBITDA Times Pinnacle West 26

  28. Slide 28: Pinnacle West versus Industry: Annual Dividend Growth

    Pinnacle West versus Industry Annual Dividend Growth Percent 15 9.8 8.9 10 8.2 15 76 5 3.8 0.2 0! -1.4 -1.2 (5) 1997 1998 1999 2000 2001 OPinnacle West WS&P 500 Electric Index Average @ 2002 Pinnade West Capit illic

  29. Slide 29: Pinnacle West versus Industry: Dividend Payout

    Pinnacle West versus Industry Dividend Payout Percent 146 1997 1998 1999 2000 2001 OPinnacle West wS&P 500 Electric Index Average 28 © 2002 Pinnade West Capital Corporation

  30. Slide 30: Pinnacle West versus Industry: Dividend Growth CAGR

    Pinnacle West versus Industry * Dividend Growth - 5 Year CAGR Percent " 10 Pinnacle West * Reflects S&P 500 Electric Index companies with positive CAGR from 1996 - 2001 @ 2002 Pinnade West Capit illic 29

  31. Slide 31: Pinnacle West versus Industry: Dividend Yield

    Pinnacle West versus Industry * Dividend Yield Percent 7 50) = Pinnacle West 40 30 20 10 * Reflects S&P 500 Electric Index companies with declared dividends 12 months ended 6/30/02; stock price as of 10/8/02 © 2002 Pinnade West Capital Corporation 30

  32. Slide 32: Financial Summary

    Financial Summary = Commitment to strong dividend growth policy = Solid cash flow results = Focused on core business = Maximize long-term asset values = Active management of financial and business risks un

  33. Slide 33: Financing Plans

    Financing Plans DQ, oop PINNACLEWEST @ 2002 Pimade West Capital Corporation tania € .

  34. Slide 34: PNW Consolidated Long-Term Debt at 9/30/02

    PNW Consolidated Long-Term Debt at 9/30/02 Type Amount % of Total FMB’s $ 251M T% Unsecured 2,232M 66% Tax-exempt* 656M 19% Total B/S Debt 3,139M 92% SLOB Debt 285M 8% Total LT Debt $3,424M 100% Weighted Average Interest Rate 5.6% Weighted Average Years to Maturity 9.6 * $179M of tax-exempt debt bac

  35. Slide 35: PNW Long-Term Debt by Subsidiary at 9/30/02

    PNW Long-Term Debt by Subsidiary at 9/30/02 Type APS PNW_ _ SunCor Total FMB’s $ 251M $ = $ - $ 251M Unsecured 1,301M 791M 140M 2,232M Tax-exempt* 656M - - 656M Total B/S Debt 2,208M 791M 140M 3,139M SLOB Debt 285M - : 285M Total LT Debt = $2,493M $791M $140M $3,424M Weighted Average Interest Rate 6

  36. Slide 36: Short-term Debt

    Short-term Debt Balance at 9/30/02 Capacity PNW Commercial Paper $206M Uncommitted Bank Lines $ 35M i S260M $300M Bank Loan $ 45M $300M APS Commercial Paper $ 25M $250M © 2002 Pinnade West Capital Corporation

  37. Slide 37: Pinnacle West - Bridge Debt

    Pinnacle West - Bridge Debt Size at Issued Issuance Rate Maturity 8/8/01 $ 250M Libor +98 8/1/03 2/8/02 $ 215M 4.5% 2/9/04 7/31/02 $ 300M Libor +85 7/30/03 Total $ 765M * Expect to draw entire $300M by July 2003 unless refinanced early © 2002 Pinnade West Capital Corporation

  38. Slide 38: Activity Since June 30, 02

    Pinnacle West Capital Corporation Activity Since June 30, 2002 Description | $300 million bank facility Term 364 day due 7/30/03 Rate Libor +85 Purpose Fund 2002 & 2003 generation expansion and general corporate purposes © 2002 Pinnade West Capital Corporation

  39. Slide 39: Pinnacle West Bridge Debt Repayment

    Pinnacle West Bridge Debt Repayment = ACC financing application + APS $500M inter-company loan and/or guarantee = SunCor dividends © 2002 Pinnade West Capital Corporation

  40. Slide 40: Maturity Profile of Long-Term Debt

    Maturity Profile of Long-Term Debt $ Millions 500 Weighted average life of 9.6 years 400 200 100 | 0 of, SP PS PK » Ws a &

  41. Slide 41: Long-Term Debt Mandatory Redemptions

    Long-Term Debt Mandatory Redemptions $ Millions 500 400 300 200 100 0 p Z 2003 2004 2005 2006 OAPS mPNW © 2002 Pinnade West Capital Corporation

  42. Slide 42: APS Mortgage

    APS Mortgage Security Amount Callable 8.0% FMB due 2025 $ 33M 2103 7.25% FMB due 2023 54M 8/03 5.5% Tax-exempt FMB 25M 8/03 5.875% Tax-exempt FMB 154M 8/03 6.625% FMB due 2004 80M Matures 3/04 6.75% Fall-away bonds due 2006 84M - Total $430M © 2002 Pinnade West Capital Corporation 10

  43. Slide 43: 2003 & 2004 Financing Needs - Capital Markets

    2003 & 2004 Financing Needs - Capital Markets = PNW « Bridge debt refinancing + $550M around August 1, 2003 + $215M in February 2004 + $25M private placement note in December 2003 - Current debt shelf capacity - $200M = APS « $125M unsecured note mandatory redemption in February 2004 « $80M FMB mand

  44. Slide 44: 2003 & 2004 Financing Needs - Bank Markets

    2003 & 2004 Financing Needs - Bank Markets = PNW commercial paper backup + $125M 364-day revolver renewal each November + $125M 3-year revolver renewal in November 2004 = APS « $250M revolver renewal in June 2003 (commercial paper backup) + Tax-exempt PC Bonds + $208M LOC renewals in 2003 « $127M an

  45. Slide 45: PNW Bank Group

    PNW Bank Group = Financially sound = Adiverse group of lenders + Size + Type « Services provided + Countries of origin = Strong bank relationships © 2002 Pinnade West Capital Corporation 13

  46. Slide 46: Bank Agreements - Other Terms & Conditions

    Bank Agreements - Other Terms & Conditions = Covenants + Debt to capital test + Cash interest coverage test = Material adverse change (MAC) clauses = Noratings triggers = Off-balance sheet financing limited to 1986 Palo Verde 2 sale/leaseback © 2002 Pinnade West Capital Corporation 14

  47. Slide 47: Financing Focus

    Financing Focus = Investment grade ratings = Continued access to capital and bank markets = Strong cash flow and coverages 15

  48. Slide 48: Western Market Overview & Regulated Retail Business Update

    Western Market Overview & Regulated Retail Business Update Jack Davis Analyst Conference October 18, 2002 & ¥3> PINNACLE WEST

  49. Slide 49: Western Market Overview

    Western Market Overview Transmission Paths & Constraints Market Manipulation Investigations Contract Restructuring Renegotiations Delays Federal Wholesale Regulatory Risks Developments. Power Plant Construction © 2002 Pinnade West Capital Corporation

  50. Slide 50: Wholesale Electricity Prices

    Wholesale Electricity Prices Palo Verde On-Peak & Off-Peak simwh 300 FERG Price Caps 250 4 Implemente: 200 150 FERC Price Caps to Increase 0+7c77 TT 2001 2002 2003 2004 — On-Peak Actuals - - - On-Peak Forwards Off-Peak Actual Off-Peak Forwards © 2002 Pinnade West Capital Corporation

  51. Slide 51: Wholesale Gas Prices

    Wholesale Gas Prices Permian Basin $immBTU 10 8 6 2001 2002 2003 2004 — Actuals - - - Forwards © 2002 Pinnade West Capital Corporation

  52. Slide 52: Western Power Markets Spark Spreads

    Western Power Markets Spark Spreads SiMWh 250 200 150 100 50 2001 2002 2003 2004 — On-Peak Actual - + - On-Peak Forwards Assumptions: Palo Verde electricity, Permian Basis natural gas, 7000 BTUIMWh heat rate © 2002 Pinnade West Capital Corporation

  53. Slide 53: Major WECC Trading Hubs

    Major WECC Trading Hubs

  54. Slide 54: APS Load

    APS Load Navajo Mead ATC Palo Verde Desert Basin Saguaro ATC = Available Transfer Capability (MW) © 2002 Pinnade West Capital Corporation

  55. Slide 55: Market Manipulation Issues

    Market Manipulation Issues a Pinnacle West/APS + Did not participate in manipulative practices + $5 million in net refunds due to PNW/APS in California as calculated by ISO and PX m= Pending issues + FERC gas methodology change vis-a-vis electricity prices + FERC judge’s order regarding El Paso’s ma

  56. Slide 56: Western Market Overview

    Western Market Overview Transmission Paths & Constraints Market Manipulation Investigations Contract Restructuring Renegotiations Delays Federal Wholesale Regulatory Risks Developments. Power Plant Construction © 2002 Pinnade West Capital Corporation

  57. Slide 57: Regulated Retail Business Objectives

    Regulated Retail Business Objectives Capitalize on Superior Customer Growth 10

  58. Slide 58: Superior APS Retail Customer Growth

    Superior APS Retail Customer Growth Percent 5.0 4.0 3.0 2.0 1.0 ALL 1997 1998 1999 2000 2001 2002 2003 2004 Projected 0.0 + G@j_APS — Industry Average @ 2002 Pinnade West Capit illic

  59. Slide 59: Regulated Retail Business Objectives

    Regulated Retail Business Objectives Capitalize on Superior Customer Growth Maintain High, Customer Satisfaction @ 2002 Pinnade West Capit

  60. Slide 60: Top-Tier Retail Customer Satisfaction

    Top-Tier Retail Customer Satisfaction a! £2 =3 a4 a5 56 é 7 8 29 40 Overall Power Company Price Billing Customer Customer Quality & Image & & Service Satisfaction Reliability Value Payment Based on J.D. Power comparisons © 2002 Pinnade West Capital Corporation

  61. Slide 61: Regulated Retail Business Objectives

    Regulated Retail Business Objectives Capitalize on Superior Customer Growth Maintain High Customer Satisfaction @ 2002 Pinnade West Capit

  62. Slide 62: Delivery Capital Expenditures

    Delivery Capital Expenditures Support Reliability and Growth $ Millions 400 wii 1997 1998 1999 2000 2001 2002 2003 2004 ——Projected—— 15 © 2002 Pinnade West Capital Corporation

  63. Slide 63: Regulated Retail Business Objectives

    Regulated Retail Business Objectives Capitalize on Superior Customer Growth Maintain High Customer Satisfaction Achieve Constructive Regulatory Structure © 2002 Pinnade West Capital Corporation

  64. Slide 64: Western Markets & Regulated Business - Overview Summary

    Western Markets & Regulated Business - Overview Summary m= Superior retail customer growth continues m= Western market conditions provide challenges and opportunities = Achieving constructive regulatory structure remains a top priority 7 © 2002 Pinnade West Capital Corporation

  65. Slide 65: Generation Strategies & Expansion

    Generation Strategies & Expansion A Long Term View © 2002 Pinnade West Capital Corporation

  66. Slide 66: Agenda

    Agenda = Power plant development in the West = Generation strategies - along term view «+ Redhawk + Silverhawk = Pinnacle West competitiveness © 2002 Pinnade West Capital Corporation

  67. Slide 67: New Generation Outlook

    New Generation Outlook Mw [_JAnnouncea: 112,000 120,000 Hj pnw estimated Actual: 33,000 100,000 80,000 60,000 40,000 20,000 oO AZ S.Nevada S. West N. West Total WECC © 2002 Pinnade West Capital Corporation _

  68. Slide 68: Superior Growth in SW Continues

    Superior Growth in SW Continues Peak Load Growth 2002 Per Year Arizona 14,180 MW 610 MW Southern Nevada 5,200 MW 180 MW Southwest 53,500 MW 1,720 MW Northwest 77,100 MW 1,760 MW WECC 130,600 MW 3,480 MW © 2002 Pinnade West Capital Corporation

  69. Slide 69: Arizona & Nevada Plants

    Arizona & Nevada Plants On Hold or Delayed Planned Construction On Hold Arizona 5,900 MW 2,800 MW Nevada 2,900 MW 1,200 MW © 2002 Pinnade West Capital Corporation

  70. Slide 70: Declining Southwest Reserve Margin

    Declining Southwest Reserve Margin No Build After 2004 25% 20% 15% | 10% _ ! 0%+ — 2 2002 2004 2006 2008 2010

  71. Slide 71: Lows & Highs of Wholesale Market Price

    Lows & Highs of Wholesale Market Price S/MWh Dry Hydro & Under Supply Wet Hydro & Pe Over Su| _-—— = ee Conservation =. — — upely. 1 LRMC Effect of Delaying 1,000 - 2,000 MW 2002 Year 2007 @ 2002 Pinnade West Capit

  72. Slide 72: Market Conditions Favor More Upside Potential

    Market Conditions Favor More Upside Potential Baseline - Normal Condition Assumptions Hot summer Load Gas Price High Gas Volatility One year in 10 Construction Hydro Growth Plan Lifetime IRR © 2002 Pinnade West Capital Corporation

  73. Slide 73: Pinnacle West Generation Strategic Initiatives

    Pinnacle West Generation Strategic Initiatives = Preserve construction flexibility consistent with market conditions = Maintain balanced fuel mix = Sustain operation and construction excellence = Manage risk presented by changing regulatory environment and dynamic market © 2002 Pinnade West Capital

  74. Slide 74: Pinnacle West Profile - Regulated

    Pinnacle West Profile - Regulated = APS Generation « Coal 1,712 MW « Gas / Oil 1,189 MW « Nuclear 1,087 MW © 2002 Pinnade West Capital Corporation 10

  75. Slide 75: Pinnacle West Profile - Unregulated

    Pinnacle West Profile - Unregulated West Phoenix 4 Redhawk 1 & 2 Saguaro CT3 West Phoenix 5 Silverhawk Redhawk 3 & 4 Capacity In-Service MW. 06/01 112 07/02 1,060 07/02 80 06/03 530 05/04 570 2006-07 600+ © 2002 Pinnade West Capital Corporation “

  76. Slide 76: Power Agreements

    Power Agreements a West Phoenix 4, Saguaro 3, Redhawk 1 & 2 contracted to APS through end of year 2002 = Expect to extend APS agreement to middle of 2003 = Silverhawk- 25% output to SNWA = Bid to Nevada loads a Will bid to APS and California loads 12 © 2002 Pinnade West Capital Corporation

  77. Slide 77: Redhawk Cost Competitive with Area Merchants

    Redhawk 1 & 2 Cost Competitive with Area Merchants Redhawk I @ Fuel O Other Cash Costs © 2002 Pinnade West Capital Corporation 13

  78. Slide 78: West Phoenix CC5 (530 MW)

    West Phoenix CC5 (530 Mw) = Inservice - June 2003 = Ideally located in Phoenix metro area = Improves system reliability 14 © 2002 Pinnade West Capital Corporation

  79. Slide 79: Silverhawk (570 MW)

    Silverhawk (570 Mw) | = Inservice - May 2004 = Strategic timing « Southern Nevada needs 3,700 MW’s « Area new build 2,000 MW’s by 2004 = High growth sub-region = Superior transmission * 16

  80. Slide 80: Silverhawk (cont.)

    Silverhawk (cont.) a Growing market = Diverse fuel supply = Available gas line capacity = Transmission access to multiple markets © 2002 Pinnade West Capital Corporation 16

  81. Slide 81: Silverhawk Cost Competitive with Area Merchants

  82. Slide 82: Redhawk 3 & 4 - Gas Turbines

  83. Slide 83: Redhawk 3 & 4 Options

  84. Slide 84: Reduced Capital Expenditures for Generation Expansion

  85. Slide 85: Summary

  86. Slide 86: Pinnacle West Marketing & Trading

  87. Slide 87: Overall Objectives

  88. Slide 88: Department Profile

  89. Slide 89: Power Marketing & Trading Realized Pretax Gross Margin

  90. Slide 90: Infrastructure and Control

  91. Slide 91: Positive MTM Exposure to Thirteen Troubled Energy Counterparties

  92. Slide 92: Market Landscape

  93. Slide 93: Performance Assessment - Managing Fuel & Purchase Power Cost for APS Retail Load

  94. Slide 94: Performance Assessment: Marketing & Trading Pretax Gross Margin

  95. Slide 95: Looking Forward External Drivers

  96. Slide 96: Looking Forward Native Load Hedging Activities

  97. Slide 97: Looking Forward Wholesale Marketing & Trading

  98. Slide 98: Western Power Markets Spark Spreads

  99. Slide 99: Pinnacle West Marketing & Trading Conclusion

  100. Slide 100: APS Energy Services

  101. Slide 101: Overview

  102. Slide 102: APS Energy Services Business Objective

  103. Slide 103: Strategies To Sustain Profitability

  104. Slide 104: Strategies to Maintain Key Arizona Relationships

  105. Slide 105: Strategies to Influence Competitive Market Rules

  106. Slide 106: Increasing Market Opportunities

  107. Slide 107: Challenges

  108. Slide 108: Business Line Highlights

  109. Slide 109: Future Sustainable Earnings Drivers

  110. Slide 110: SunCor Review

  111. Slide 111: SunCor's Approach

  112. Slide 112: Market and SunCor Status 2002

  113. Slide 113: Market & SunCor Status: 2002 SunCor Investment

  114. Slide 114: Market & SunCor Status: Residential Market

  115. Slide 115: 1999 Palm Valley Area

  116. Slide 116: 2002 Palm Valley Area

  117. Slide 117: Market & SunCor Status: Commercial / Retail

  118. Slide 118: Market & SunCor Status: Golf Courses

  119. Slide 119: Market & SunCor Status

  120. Slide 120: SunCor 2003-2006

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Pinnacle West Capital — Investor Day (October 2002) on 6ix