Arizona Public Service 8K Results of Operations and Financial Condition | SEC 1 Feb 06

Exhibit 99.3

Last Updated 2/1/2006

Pinnacle West Capital Corporation

Consolidated Statistics By Quarter

2005


																	Increase
																	(Decrease)
Line		1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year-To-Date			vs Prior YTD
	EARNINGS CONTRIBUTION BY SUBSIDIARY ($ Millions)

1	Arizona Public Service	$	27		$	64		$	61		$	18		$	170		$	(30	)
2	Pinnacle West Energy		(21	)		12			(71	)		(6	)		(85	)		(27	)
3	APS Energy Services		(3	)		1			—			(3	)		(6	)		(9	)
4	SunCor		9			11			6			13			39			(2	)
5	El Dorado		(1	)		—			—			—			(2	)		(35	)
6	Parent Company		19			(3	)		89			2			107			79


7	Income From Continuing Operations		30			85			85			24			223			(24	)

8	Loss From Discontinued Operations — Net of Tax		(6	)		(58	)		19			(3	)		(47	)		(43	)
9	Cumulative Effect of Change in Accounting — Net of Tax		—			—			—			—			—			—

10	Net Income	$	24		$	27		$	104		$	21		$	176		$	(67	)


	EARNINGS PER SHARE BY SUBSIDIARY — DILUTED

11	Arizona Public Service	$	0.30		$	0.66		$	0.62		$	0.19		$	1.77		$	(0.41	)
12	Pinnacle West Energy		(0.23	)		0.13			(0.72	)		(0.06	)		(0.89	)		(0.26	)
13	APS Energy Services		(0.04	)		0.01			—			(0.04	)		(0.06	)		(0.09	)
14	SunCor		0.09			0.11			0.07			0.13			0.40			(0.05	)
15	El Dorado		(0.01	)		—			(0.01	)		(0.01	)		(0.02	)		(0.38	)
16	Parent Company		0.21			(0.03	)		0.90			0.03			1.11			0.81


17	Income From Continuing Operations		0.32			0.88			0.86			0.24			2.31			(0.38	)

18	Loss From Discontinued Operations — Net of Tax		(0.05	)		(0.60	)		0.19			(0.02	)		(0.49	)		(0.46	)
19	Cumulative Effect of Change in Accounting — Net of Tax		—			—			—			—			—			—

20	Net Income	$	0.27		$	0.28		$	1.05		$	0.22		$	1.82		$	(0.84	)


21	BOOK VALUE PER SHARE	$	32.50		$	32.89		$	35.81		$	34.80	*	$	34.80	*	$	2.66

	COMMON SHARES OUTSTANDING (Thousands)
22	Average — Diluted		92,045			96,299			98,816			99,050			96,590			5,058
23	End of Period		92,103			98,442			98,881			99,057			99,057			7,264


*		Estimate


See Glossary of Terms.		Page 8 of 31

Last Updated 2/1/2006

Pinnacle West Capital Corporation

Consolidated Statistics By Quarter

2005


												Increase
												(Decrease)
Line		1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Year-To-Date		vs Prior YTD
	ELECTRIC OPERATING REVENUES (Dollars in Millions)

	REGULATED ELECTRICITY SEGMENT
	Retail
24	Residential	$	190	$	268	$	414	$	208	$	1,080	$	96
25	Business		209		281		308		242		1,040		61

26	Total retail		399		549		722		450		2,120		157
	Wholesale revenue on delivered electricity
27	Traditional contracts		3		5		9		6		23		7
28	Off-system sales		—		12		8		20		40		40
29	Transmission for others		7		7		7		5		26		(6	)
30	Other miscellaneous services		7		7		7		7		28		4

31	Total regulated electricity		416		580		753		488		2,237		202

	MARKETING AND TRADING SEGMENT
32	Electricity and other commodity sales		89		71		107		84		352		(49	)

33	Total operating electric revenues	$	505	$	651	$	860	$	572	$	2,589	$	153


	ELECTRIC SALES (GWH)

	REGULATED ELECTRICITY SEGMENT
	Retail sales
34	Residential		2,367		2,889		4,449		2,519		12,224		696
35	Business		3,042		3,684		4,100		3,427		14,254		428

36	Total retail		5,409		6,573		8,549		5,946		26,478		1,124
	Wholesale electricity delivered
37	Traditional contracts		155		200		269		227		850		140
38	Off-system sales		—		598		212		526		1,336		1,336
39	Retail load hedge management		750		702		1,026		532		3,010		278

40	Total regulated electricity		6,314		8,073		10,056		7,231		31,674		2,878

	MARKETING AND TRADING SEGMENT
41	Wholesale sales of electricity		6,060		5,009		7,263		5,239		23,571		(6,611	)

42	Total electric sales		12,374		13,082		17,319		12,470		55,245		(3,733	)


See Glossary of Terms.		Page 9 of 31

Last Updated 2/1/2006

Pinnacle West Capital Corporation

Consolidated Statistics By Quarter

2005


																	Increase
																	(Decrease)
Line		1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year-To-Date			vs Prior YTD
	POWER SUPPLY ADJUSTOR (“PSA”) —REGULATED ELECTRICITY SEGMENT (Dollars in Millions)

43	Deferred fuel and purchased power regulatory asset — beginning balance	$	—		$	—		$	38			143		$	—		$	—
44	Deferred fuel and purchased power costs — current period		—			38			104			29			171			171
45	Interest on deferred fuel		—			—			1			1			2			2
46	Amounts recovered through revenues		—			—			—			—			—			—

47	Deferred fuel and purchased power regulatory asset — ending balance	$	—		$	38		$	143		$	173		$	173		$	173


	MARKETING AND TRADING SEGMENT PRETAX GROSS MARGIN ANALYSIS (Dollars in Millions)

	Realized and Mark-To-Market Components
48	Electricity and other commodity sales, realized (a)	$	12		$	18		$	3		$	22		$	56		$	(7	)
49	Mark-to-market reversals on realized sales (b)		(3	)		(8	)		3			(17	)		(16	)		(10	)
50	Change in mark-to-market value of forward sales		10			3			14			1			19			(4	)

51	Total gross margin	$	19		$	13		$	20		$	6		$	59		$	(21	)


	By Pinnacle West Entity

52	Parent company marketing and trading division	$	21		$	6		$	26		$	5		$	59		$	15
53	APS		(4	)		3			(8	)		3			(6	)		(1	)
54	Pinnacle West Energy		5			—			—			—			5			(22	)
55	APS Energy Services		(3	)		4			2			(2	)		1			(13	)

56	Total gross margin	$	19		$	13		$	20		$	6		$	59		$	(21	)

Future Marketing and Trading Mark-to-Market Realization

As of December 31, 2005, Pinnacle West had accumulated net mark-to-market gains of $45 million related to our power marketing and trading activities. We estimate that these gains will be reclassified to realized gains as the underlying commodities are delivered, as follows: 2006, $14 million; 2007, $20 million; and thereafter, $11 million.


(a)		Net effect on pretax gross margin from realization of prior-period mark-to-market included in line 48 and in line 49 is zero. Realization of prior-period mark-to-market relates to cash flow recognition, not earnings recognition. The arithmetic opposites of amounts included in line 48 are included in line 49. For example, line 49 shows that a prior-period mark-to-market gain of $17 million was transferred to “realized” for the fourth quarter of 2005. A $17 million realized gain is included in the $22 million on line 48 for the fourth quarter of 2005.

(b)		Quarterly amounts do not total to annual amounts because of intra-year mark-to-market eliminations.



See Glossary of Terms.		Page 10 of 31

Last Updated 2/1/2006

Pinnacle West Capital Corporation

Consolidated Statistics By Quarter

2005


																		Increase
																		(Decrease)
Line			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year-To-Date			vs Prior YTD
		AVERAGE ELECTRIC CUSTOMERS

		Retail customers
	57	Residential		889,967			888,509			895,789			911,623			896,472			37,403
	58	Business		109,772			110,658			111,648			112,569			111,168			4,053

	59	Total		999,739			999,167			1,007,437			1,024,192			1,007,640			41,456
	60	Wholesale customers		81			76			78			77			78			(3	)

	61	Total customers		999,820			999,243			1,007,515			1,024,269			1,007,718			41,453


	62	Customer growth (% over prior year)		4.0	%		4.2	%		4.5	%		4.5	%		4.3	%		0.6	%

		RETAIL SALES (GWH) — WEATHER NORMALIZED

	63	Residential		2,430			2,903			4,445			2,525			12,304			600
	64	Business		3,058			3,693			4,119			3,414			14,285			415

	65	Total		5,488			6,596			8,564			5,939			26,589			1,015


		RETAIL USAGE (KWh/Average Customer)

	66	Residential		2,660			3,252			4,967			2,763			13,636			218
	67	Business		27,712			33,292			36,723			30,444			128,212			(1,180	)

		RETAIL USAGE — WEATHER NORMALIZED (KWh/Average Customer)

	68	Residential		2,730			3,268			4,963			2,770			13,724			100
	69	Business		27,860			33,374			36,897			30,328			128,498			(997	)

		ELECTRICITY DEMAND (MW)

	70	System peak demand		3,997			6,458			7,000			5,169			7,000			598



See Glossary of Terms.		Page 11 of 31

Last Updated 2/1/2006

Pinnacle West Capital Corporation

Consolidated Statistics By Quarter

2005


																		Increase
																		(Decrease)
Line			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year-To-Date			vs Prior YTD
		ENERGY SOURCES (GWH)

		Generation production
	71	Nuclear		2,247			1,619			2,147			1,496			7,509			(675	)
	72	Coal		2,940			3,088			3,574			3,459			13,061			395
	73	Gas, oil and other		1,127			2,074			3,018			1,483			7,702			2,375

	74	Total generation production		6,314			6,781			8,739			6,438			28,272			2,095

		Purchased power
	75	Firm load		586			880			1,589			402			3,474			(851	)
	76	Marketing and trading		5,832			5,984			7,795			6,102			25,713			(4,479	)

	77	Total purchased power		6,418			6,864			9,384			6,504			29,187			(5,330	)

	78	Total energy sources		12,732			13,645			18,123			12,942			57,459			(3,235	)


		POWER PLANT PERFORMANCE

		Capacity Factors
	79	Nuclear		94	%		67	%		88	%		61	%		77	%		(7	)%
	80	Coal		80	%		83	%		95	%		92	%		87	%		3	%
	81	Gas, oil and other		17	%		27	%		40	%		19	%		26	%		8	%
	82	System average		49	%		49	%		63	%		46	%		52	%		1	%

		Generation Capacity Out of Service and Replaced for Native Load (average MW/day)
	83	Nuclear		52			329			107			419			227			66
	84	Coal		195			244			57			103			150			43
	85	Gas		212			164			140			226			186			144

	86	Total		459			737			304			748			563			253



See Glossary of Terms.		Page 12 of 31

Last Updated 2/1/2006

Pinnacle West Capital Corporation

Consolidated Statistics By Quarter

2005


																		Increase
																		(Decrease)
Line			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			Year-To-Date			vs Prior YTD
		ENERGY MARKET INDICATORS (a)

		Electricity Average Daily Spot Prices ($/MWh)
		On-Peak
	87	Palo Verde	$	49.74		$	53.33		$	78.94		$	83.58		$	66.40		$	17.10
	88	SP15	$	55.70		$	55.19		$	83.21		$	97.65		$	72.94		$	17.74
		Off-Peak
	89	Palo Verde	$	37.04		$	33.03		$	52.35		$	67.79		$	47.55		$	12.81
	90	SP15	$	40.96		$	34.73		$	56.08		$	76.45		$	52.06		$	13.44

		WEATHER INDICATORS

		Actual
	91	Cooling degree-days		34			1,538			2,583			508			4,663			(31	)
	92	Heating degree-days		457			1			—			308			766			(219	)
	93	Average humidity		56	%		20	%		29	%		30	%		34	%		2	%
		10-Year Averages
	94	Cooling degree-days		80			1,491			2,540			420			4,531			—
	95	Heating degree-days		521			36			—			415			972			—
	96	Average humidity		43	%		24	%		33	%		40	%		35	%		0	%

		ECONOMIC INDICATORS

		Building Permits — Metro Phoenix (b) (d)
	97	Single-family		10,356			12,013			11,577			6,131			40,077			(4,545	)
	98	Multi-family		1,741			1,645			2,360			1,398			7,144			919

	99	Total		12,097			13,658			13,937			7,529			47,221			(3,626	)


		Arizona Job Growth (c) (d)
	100	Payroll job growth (% over prior year)		4.1	%		3.9	%		4.8	%		4.1	%		4.1	%		0.8	%
	101	Unemployment rate (%, seasonally adjusted)		4.4	%		4.7	%		4.2	%		4.9	%		4.7	%		(0.3	)%

Sources:


(a)		Average of daily prices obtained and used with permission from Dow Jones & Company, Inc.

(b)		Arizona Real Estate Center, Arizona State University W.P. Carey College of Business

(c)		Arizona Department of Economic Security

(d)		Economic indicators reflect latest available data through periods ended November 30, 2005.



See Glossary of Terms.		Page 13 of 31

Arizona Public Service 8-KResults of Operations and Financial Condition