SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 23, 2002
ARIZONA PUBLIC SERVICE COMPANY
(Exact name of registrant as specified in its charter)
Arizona 1-4473 86-0011170
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification Number)
400 North Fifth Street, P.O. Box 53999, Phoenix, Arizona 85004
(Address of principal executive offices) (Zip Code)
(602) 250-1000
(Registrant's telephone number, including area code)
NONE
(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS.
ARIZONA ELECTRIC INDUSTRY RESTRUCTURING
As previously reported, the Arizona Corporation Commission (the "ACC")
issued a procedural order stating that hearings in a consolidated ACC docket
would begin on June 17, 2002 on various issues ("Track A Issues"), including
Arizona Public Service Company's (the "Company") planned divestiture of
generation assets to Pinnacle West Energy Corporation (Pinnacle West Energy) and
associated market and affiliate issues.
See Note 5 of Notes to Condensed Financial Statements in the Company's
Report on Form 10-Q for the fiscal quarter ended March 31, 2002 for additional
information about the consolidated docket, a comprehensive 1999 Settlement
Agreement approved by the ACC among the Company and various parties related to
the implementation of retail electric competition in Arizona, and the retail
electric competition rules adopted by the ACC.
On July 23, 2002 an ACC Administrative Law Judge ("ALJ") issued a
recommendation on Track A Issues in the consolidated docket. Among other things,
the ALJ recommends that:
* the ability of the Company to transfer its generation assets be stayed
until the ACC determines that the wholesale market is "workably
competitive," and until at least July 1, 2004, at which time the ACC
would reassess the appropriateness and timing of divestiture;
* the requirement that 100 percent of power purchased for standard offer
service be acquired from the competitive market, with at least 50
percent through a competitive bid process, be stayed indefinitely;
and,
* upon implementation of the outcome of the competitive bidding process
("Track B Issues"), the Company would acquire, at a minimum, any
required power not produced by its owned generation through the
competitive procurement process developed in the Track B proceeding.
The ALJ also recommended that if the Company wishes to acquire certain
generation assets from Pinnacle West Energy, as discussed in the Company's July
11, 2002 letter to the ACC, the Company should file appropriate applications on
this matter for ACC consideration. See the Company's Current Report on Form 8-K
dated July 11, 2002.
The ALJ also recommended that the ACC Staff open a rulemaking to review the
Retail Electric Competition Rules in light of the other decisions in the
recommendation and that an Electric Competition Advisory Group be formed to
facilitate communication among the ACC staff, stakeholders and market
participants.
The Company expects to file exceptions to the recommendations by August 1,
2002. It has not been determined when the ACC may consider and rule on this
recommendation.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ARIZONA PUBLIC SERVICE COMPANY
(Registrant)
Dated: July 24, 2002 By: Barbara M. Gomez
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Barbara M. Gomez
Treasurer
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