PNW · 10-Q · 2026Q2 · Full report
Rate Case Outcomes
PINNACLE WEST CAPITAL CORP · 2026-08-04 · Importance 78 · Surprise 58 · In source text
APS filed its 2025 Rate Case seeking a $579.5 million net base-rate increase, representing a 13.99% increase and addressing a $662.4 million base-revenue deficiency. In its May 2026 rejoinder testimony, APS reduced the requested total revenue-requirement increase to $691.6 million, or $608.7 million net of adjustor transfers, while maintaining a 10.7% requested return on equity. ACC Staff’s latest recommendation was a $506.5 million total base-revenue increase, while RUCO recommended a $200.2 million to $278.1 million increase. The hearing concluded on July 7, 2026, and the case is anticipated to be resolved before year-end, with APS having requested effectiveness in the second half of 2026.
Key facts
- On June 13, 2025 APS filed the 2025 Rate Case seeking a net base rate increase of $579.5 million, representing a 13.99% net increase, addressing a total base revenue deficiency of $662.4 million. source
- APS requested the 2025 Rate Case increase become effective in the second half of 2026; the hearing concluded on July 7, 2026 and the Administrative Law Judge noted the case is anticipated to be resolved before the end of this year. source
- ACC Staff’s initial testimony (March 2026) included a $525.2 million total base revenue increase recommendation and a return on equity of 9.55% to 9.80%. source
- RUCO’s initial testimony (March 2026) recommended a $200.2 to $278.1 million total base revenue increase and a 9.00% to 9.20% return on equity. source
- APS filed rebuttal testimony on April 3, 2026 seeking a total revenue requirement increase of $694.2 million, or a net revenue requirement increase of $611.3 million after adjustor transfers, and maintained a requested ROE of 10.7%. source
- On May 1, 2026 ACC Staff adjusted its recommendation to a $506.5 million total base revenue increase and continued recommending an earnings test deadband of +/- 50 basis points. source
- APS filed rejoinder testimony on May 11, 2026 reducing the total revenue requirement increase to $691.6 million, representing a revenue requirement increase net of adjustor transfers of $608.7 million, and maintained other major rebuttal provisions. source
- Under the ACC order APS would be prohibited from paying dividends if such payment would reduce its total shareholder equity below approximately $7.1 billion, assuming APS's total capitalization remains the same. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| revenue | positive | probable | +21.0% | APS filed rebuttal testimony on April 3, 2026 seeking a total revenue requirement increase of $694.2 million, or a net revenue requirement… |
| revenue | positive | probable | +19.9% | On June 13, 2025 APS filed the 2025 Rate Case seeking a net base rate increase of $579.5 million, representing a 13.99% net increase,… |
| revenue | positive | probable | +18.0% | ACC Staff’s initial testimony (March 2026) included a $525.2 million total base revenue increase recommendation and a return on equity of… |
| revenue | positive | probable | +17.4% | On May 1, 2026 ACC Staff adjusted its recommendation to a $506.5 million total base revenue increase and continued recommending an… |
| revenue | positive | probable | +8.2% | RUCO’s initial testimony (March 2026) recommended a $200.2 to $278.1 million total base revenue increase and a 9.00% to 9.20% return on… |
| cash | positive | contingent | — | Under the ACC order APS would be prohibited from paying dividends if such payment would reduce its total shareholder equity below… |
| operating_income | positive | contingent | — | 2025 Rate Case proposed a 1% return on the increment of fair value rate base above APS’s original cost rate base. |
| operating_income | negative | contingent | — | APS’s rebuttal testimony reduced the return on the increment of fair value from 1.0% to 0.9% and maintained 12 months of post-test year… |
| operating_income | unclear | contingent | — | APS’s rebuttal testimony proposed FRAM modifications including an earnings test deadband of +/- 40 basis points and limiting projected… |