PNW · 8-K · 20260807PR000044

Operating Expense Trends

PINNACLE WEST CAPITAL CORP · 2026-08-07 · Importance 89 · Surprise 64

Core O&M was $978 million in 2025 compared with $955 million in 2024, while 2026 guidance is $970-$980 million. Planned-outage expense was $143 million in 2025 and is guided to $80-$90 million in 2026. Renewable energy and demand-side-management expenses totaled $143 million in 2025 and are expected to total $40 million in 2026, with the expenses substantially offset by adjustment mechanisms. Management’s stated target is declining O&M per MWh as the customer base grows.

Key facts

• Renewable Energy and Demand Side Management expenses in 2025: $143 million; in 2026: $40 million (expenses substantially offset by adjustment mechanisms) source
• Company states average annual percent change in CPI and APS rates 2018-2025 shows APS rates have remained well below rate of inflation (chart with CPI and APS rate values referenced) source