PNW - Earnings call transcript Q2 2020 | Pinnacle West Capital Corporation

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Operator

Greetings, and welcome to the Pinnacle West Capital Corporation Second Quarter 2020 earnings. [Operator Instructions] As a reminder this conference is being recovered. It is now my pleasure to introduce your host, Stefanie Layton, Director of Investor Relations. Thank you.

You may begin.

Stefanie Layton

Christine. you, Thank to call like XXXX for in participating recent I webcast thank to conference performance. and and quarter review this developments would operating everyone our earnings, second

and us. speakers President, are CEO, Ted Our Public Jim Administrative and Policy APS’ Chief also Daniel Hatfield, be Lockwood, COO; will our and Geisler; Jeff and Barbara our today Guldner; CFO, Froetscher, President with Officer; here Chairman Senior Vice

will and may you. I using need along a on cover on non-GAAP slides Today’s and expectations Investor are slides be First, Note actual financial we our few details materially available based comments certain current and the our The with that differ with expectations. reconciliations our related to Relations from contain that slides of statements results information. contain website, earnings information. release forward-looking

was replay second and results XX, as cautionary those this now the XX this also in materially call filed morning. available Form Please will as statements, from to to sections well days. identify XXXX risk MD&A Our to forward-looking A cause language, actual document through that the shortly and of could website will disclosures. which quarter our for XX-Q available It call will next telephone by Jeff. be XXXX. on our I contained differ August that refer be uncertainties for factors risks over turn

Jeff Guldner

I'd joining expressing today. team. for Thank my our all to actually to you, appreciation begin Stefanie, thank and call immense us like today's by you

drive success culture that and navigating create continually customers, impressed others in compassion our us day very striving strengths their stand to our the is organization communities. adaptability. stakeholders All and to to serve key COVID-XX We're ongoing incredible best their for in and to each awe of their do our leadership challenges. engagement of their sheer The throughout the in by we're and our

summer. during with Our a impressive operating severe reliability plants Arizona are

lights demonstrated the and benefiting line that the Arizona kept being service end Our quarter, on, also are crews new our year. of the through an regulatory of of pleased report our by the I'm our served, have customers to COVID-XX are current from people. commitment overview customers I'll exceptional remain expectations then the status a updates. provide with some operational brief in we for and and second to in

last are we second typical, While quarter a an followed variations hot that weather of this unusually year. experienced mild second year quarter

and one regarding change impact So the to Ted other financial the then forecast. will offer performance a of given review extreme more weather, provide Ted of from us the our details will really year-over-year took future and our

you and from XXth, and order XXth see know, many XXth, Arizona connected the were May COVID-XX residents early stay in asked healthy businesses state closed to March an through May stay the increase and Ducey's home, As stay in to June, on expired began cases. Governor home. Governor state in

decreased cases, for dining COVID shared COVID-like months. indoor XXth. bars, As Governor are have that through the a over Arizona's water occupancy. The June less last the day August his from Governor's last On down. update, and school in-person operations trending and Governor movie theaters hospitalizations limits issued of on July symptoms the XX, than paused in And the executive result, to was first delayed nightclubs, Positive numbers of room July parks August XX% cases XXth, emergency gyms, which all latest order, Xth, to XXth. on visits

numbers an to on. the know the X.X he's infected Arizona number of reducing are infectious that that's and I of R this trend state to focused continuing than the people is by focused less the very person achieved an XX, with X. indicator By Importantly, on July goal down. nought

Four of quarter. Unit Those and one a impact Palo we extreme be; the Corners from to a ultimate X X operations completed As customer information preparatory us perspective, refueling increased this however, to peak what an pandemic relevant outage remain work COVID we've committed we as We From stated previously, COVID-XX season, Unit X which major Verde and continue providing timely evolves. we prepared and outages, activities summer well will execute temperatures brings the planned predict and both protocols. at for other new cannot demand. under

and us the extinguishers, keep reach on experiencing went hydration the shovel, where firefighters communities activity the a in above-average this helping fire using pack well spreading side and over mitigation fire to at serve hesitation, from he saw planning the right his to pulled our fire severe smart least to one the about job training of wildfire preparation demonstrated from personal on doing for our a servicemen, help our want thing to one a was to car we Ron minutes from neighbors. quick, fire in until could driving later. scene freeway. Ron's and safe Ron Flagstaff, fire and serving Sedona the his the Without While for and share helped commitment season, actions XX we're that situation becoming beyond the keep some dedication and home power APS' his robust on instance infrastructure. who of our In customer story efforts, I protect is in our to customers. mitigation keeping a Walker,

storage to a we expect towards XXXX, and approximately clean needs. and another demand be of our our commitment. make Turning preparation. planning energy XXXX megawatts needed integrated into filed On X,XXX progress resource our energy forward resource energy, of look we efficiency Between providing kind energy plan, to will XX, renewable XX-year response, June

source include the with energy procurement exact renewable determined additions all and will the through RFP mix solar expect generation processes. wind We

finalizing RFPs negotiations for the In we soon. resources, fact, results expect plan, we new we're and to XXXX our executing already on are currently clean our from energy contract announce

territory encouraging XXXX population growth, clean and longer-term goals. growth and changing RFP are growth growth, state's reliability the from center to economic another generation. will key also expect electric data We to The service drivers Arizona to our vehicles by outsource trends energy focus issue look that distributed related this driven and there. and and projects development technology businesses XXXX economic offers year The on customer positive environment later support through customer

that with to requirements growth, XXXX the X,XXX resource to to to our anticipated resource being coal megawatts gas be approximately X,XXX contract another IRP of in supports purchase addition need in are needs of additional the anticipated decade. paths meet outlined demand to roll-offs, scheduled megawatts and next committed of In growth, scheduled the of by agreements We're to coupled by are These objective. expire and over capacity capacity goal this XXXX. needs meet peak our megawatts the approximately our X,XXX result for and retired carbon-free

a the occurred McMicken released recently We on battery that also last event report year.

our of integrating conclusion to investigation, on additional event. way of storage underway are the move procurement the effective including the With already energy now we positioned at that most were McMicken storage activities forward, the evaluate refreshing and to safest system, time the that

in the rate front, extension the Residential law testimony granted the Commission XX-day pending The administrative request On file the to with XXXX, X, and to staff Office's on scheduled XX, the October judge file hearing and Utility December joint begin Corporation regulatory a new testimony Consumer design is X, our interveners date for rate case. staff due testimony now to XXXX. be will for and October

affordability through remainder providing our continuing remain top XXXX, focused also the emphasizing service and relationship regulatory of reliable the mind our and customer key peak case and rate of the to performance through summer and cleaner we're cost energy financial management both While to our a initiatives priorities transition mix. season, on support

the COVID-XX while are has thought there to to many achievements Lastly, we made created previously that not I have that significant learned want and lessons mention challenges, may possible pandemic.

means from your And it a I'm the Ted. over doing. challenges you and focused growth that, mindset, time today, are is transformation I'll seeking exactly pleased improvement. learning what and Thank culture to team for we which Our on that's turn and continuous

Ted Geisler

Thank Jeff the want Power to value a receipt advance you, for behalf Jeff's Alliance West to team's Player number recognized recognized our award leadership. our thank again, On I'd Jeff's Pinnacle you, customers. and of Jeff, leadership as also Power the by and of and Year clean mentioning Jeff to energy award. appreciation of us like our congratulations his the meet entire to of that resource Individual accomplishments, a to This add Smart Electric joining today. express I team, needs for innovation the demonstrated help for future of and its and everyone,

Jeff Guldner

Ted. Thanks,

Ted Geisler

This support, clean Jeff, recognition well plan our is for your deserved. energy of

activity, cover I'll now second to initiative economic in savings earnings our expectations. update. and our results, forward-looking cost successes our quarter Turning

OPEB and in cost increase credits Above-average second of to Our strong quarter in the management earning second $X.XX COVID per in XXXX. share impacts per compared continued despite to contributed temperatures, $X.XX higher earnings. the and remained pension of performance share the quarter non-service

a The quarter, be annual we've second $X.XX $X.XX pretax factor or As above-average gross can highlighted share. the quarter Compared in temperatures combined $XX with significant to margin year-over-year. the below-average to in weather normal, added our last temperatures year added weather earnings million this of before, from earnings. per

sales flat period in second X.X% offset started from in XXXX positive From period through the XX, by for year. partially drivers essentially businesses quarter the reopening, the last We also sales a were the XX, weather-normalized experienced X.X% to same July impacts quarter, COVID. customer to same were reduction last weather-normalized May growth These compared the including when year. compared

commercial improvement our weather-normalized industrial sales economy growth growth growth, in in We X% experienced quarter. of continue this June, and weather-normalized customer reduction in reflecting following full X.X% see our COVID X.X% in the by we period of increase earlier and continued sales an In X%. weather-normalized closure to sales a territory offset the service residential and

our has XXX energy XX, In high and between in been of XXXX exceeded nearly July addition by to X,XXX peak customers demand customer megawatts. all-time X on year, required weather peak This this a the X impactful notably, prior p.m., set growth, megawatts. new

cool again performed across record team with state reliable service year's important thank order to company planning our our efforts who operations our exceptionally become. keep and extreme conditions. during Our how the to communities This to resource is example delivered an I entire customers and comfortable. to demand want in reliable customers power our serve have of these stepped once up peak well

Although customers weather-normalized usage, summer reliably sales means, the relatively programs serve peak growth, summertime plan full for the new have in peak resources a resource This informs requires reflects energy our sales our of customer which demand which customer regardless through order be we period. and growing may that procurement needs. day to demand, flat,

plan integrated well. Our outlines recently this resource point filed very

XXXX homebuilders Scottsdale confident heat the While territory. Phoenix Corp. of however, has during we month COVID-XX. growth business term, this weather-normalized Home near-term as The extreme service Long the the to been lag had remain According sales to the Morrison June U.S. year-over-year year, best our journal, Case–Shiller Phoenix may in company year-over-year history. by among of representing continue its in monthly driver business XX% in sales finished a a result strength our journal reported the had Taylor X% sales during of growth XX with an the gains community. Further and high demonstrating per cities all-time pace QX, the highest net in a increase growth measured Index. price average home in the market,

in On each In the announced industrial the and are side, announced plans Metro And recently square create developed growth jobs the to commercial constructed recently facility construction is purchase territory Merit part. acres XX in park. to Red Below center developments of in with to XX in solid XXX,XXX expected will XXX developer X expect new our White to Five Partners, to jobs being years. continue an land a be retailer with Claw develop XXX a XXX-acre purchased we initially acres facilities Bull The month. XXXX. next service foot Buckeye, parcel industrial to it with grow Amazon of to completed plans build Phoenix, as expected another in new

was impacted construction was shutdown. labor work service and an essential deemed the throughout Arizona in continued While market the by COVID,

construction employment our however, customer Metro XXXX employment For economic reinforced as X.X%; entire construction X.X% commercial local in continue. compared end to quarter. May, Phoenix growth through this and X.X% past Manufacturing that Phoenix X.X% the above discussed by residential X.X% increased saw highlights Metro U.S. projects in employment of The decreased we the decreased for

Turning management. to cost

to negotiating means share We focus commitment. affordable. contracts. procurement These lower prices competitive our gains driving operations in with with negotiating contributed through of approximately a customer the maximizing like delivered few the quarter. I'd continue bidding to efficiency and savings and $X vendor The on by along process million through paid discounts, the examples, as rates savings new team's demonstrating team to eliminating waste efficiencies achieving a recent keep vendors with certain second efforts, end early

customer external our in team for planned saving implemented approximately that and savings addition, eliminated with XXXX, XXXX. new service need resources automation, certain revised In additional $XXX,XXX training the process for modifications,

and savings donations for other to assistance point cost lean improve savings as during on such this the ways expenses also with are to employees a and support Some where side. efficiencies additional we're But our PPE. initiatives are customers company the culture, and to helped and These our developing They customers. and some charitable large, is smaller service testing continuously allowed offset bill our communities time. unprecedented COVID-XX look

turning our XXXX needed as our we The filed with recently capital consistent the depicted Now on CapEx in program. is investments the to to through Slide billion IRP. of XX resource $X.X support projected additions,

utilizing resources. a process clean As to of procure resources, competitive we additional and continue expect owned and Jeff mentioned, standard purchased to mix we'll generation use RFP our

guidance, far, will impacts XXXX expect earnings West for range the to in be the and continue $X.XX Pinnacle expectations per to share. despite experience earnings future we COVID-XX our of $X.XX XXXX thus from consolidated For

Given COVID, X%. expectations the sales XXXX from our impacts weather-normalized reduced of year-over-year to we to flat negative growth growth to X% X%

With reduced estimated to expense, X.X%. X% in net X.X% XXXX complete these O&M a income an decrease X% in also XXXX and other to an decrease this so is power. of issue hitting remain our focused X. expect additional we Offsetting rate. debt of in far can an and we be adjusted APS weather-normalized metrics circumstances increase the a and the our to effective to AFUDC, and list assumptions term serving $XXX year, and equity with in our sales sales decreases XXXX reliable not decrease and X factors to XXXX underlying to in expectations customers interest of of financing guidance We A a up to for expense, on Despite plans issue Slides affordable in tax of clean, increase respect unexpected from remainder to XXXX. the our year, increase on million found do expect of our at

summer ways reliable a has COVID industry-leading conditions. extreme Embracing financial of done team care Our remarkable customers our taking of through and with to service support. working job working and due new

look continue to taking goals to and in long-term remain plan. forward intact, clean Our our we steps implementing the energy near-term

while We I'll customers and forward. are and now delivering call mindset learnings to growth from our to first upon our shareholders a this to concludes to value our the the honoring back turn build going embracing This of remarks. commitments the our the half year, questions. prepared stakeholders over operator for

Operator

Our with Instructions] first Weinstein comes question from of [Operator line Suisse. Michael Credit the

Michael Weinstein

financial For gross dynamic is May. some the, that's I where, in that lower Is there? than bit COVID-related? noticed the back other little there Or on margin outlook, it's all a happening

Ted Geisler

weather-normalized right. you're sales given No, year of simply the That's absolutely in reflecting the Michael, the for adjustment our expected impacts COVID. just

Michael Weinstein

numbers Got it. And that? other the intending then offset are to all

Ted Geisler

correct. That's

Michael Weinstein

before, Are not although there any if it than on we expectation be factors bit little may it and overall you that that positive to maintaining be think page offsetting? you're that the up, would -- Is other it, I add a comes lower out all guidance.

Ted Geisler

sales conservative our nothing ranges We've No, the Michael. of for there, listed. else being expectations got the with We're year. balance weather-normalized

range we of said of to As $X.XX. gave our $X.XX but other confident offset, X%. in negative, at we we're year-end June, X.X% but a should really But adjustments through guidance negative are range the we to flat

Michael Weinstein

in should year procedural for And that schedule case, the a for Got pushed year. any partial to think before mean talking the delay place -- looks that looks maybe take it like little me, the right kind were a Does with you. next after we this about it will into but it to to in into rate settlement there? maybe way election. think about probably after like Jeff, start out further of process all wait September, the I settlement it? the hearings until next the we bit Is

Jeff Guldner

point a settlement testimony the of and you it the the last the flagged see window there between the schedule kind intervenor said they Michael, puts the ranges. mean, for from in a filed, -- you you you when really out, process is typically, was I'd Yes, they that pushes staff intervenor staff of begin that the We've case. settlement. which an And were looking real testimonies. I otherwise, and bench too, commission book out, and the can't that one were before pretty in response indication before, if they're down proceeding procedural clear staff issues, litigated

And an so got that change. you've added bench complexity now may

take issues. potentially table. we're to So with the wants off still could anybody discussions you There's still that about issues for that ways talk open

comprehensive think to And hearings. case be year. the a settlement it's happen, coming the if traditional settlement that going see process I rate about But you're now. harder would later probably probably to it -- middle then happen right again, next in a to in were in of

we'll that So and see to have develops. just how watch

Operator

Our from proceed Guggenheim. next Pourreza of question. Please with Shahriar the your question comes line with

Shahriar Pourreza

on previously thinking just case, sort raise of traction turn, of forming, you the right does and delay to just here. of discussions your of mean, it sort 'XX push Let Michael's plans schedule or a early having me next on rate discussions timing in question the are I settlement is then And -- bit shifted said your about in 'XX? follow-up the later right? equity And sort the that the here? in are you how little you've gaining of now? Are

Jeff Guldner

can you the a and -- new customer, interested any settlement who the in mean in I'm example, have at the -- of those this to conversations I we're process. question, point would have kind for program, Shahriar, in say, come extent Yes, to you on you talk

commission. discussions don't to with happening. get of streamlined. I that, wants a to more talk And of be the I we're working happen, hearing aspects. think about issues staff you those settlement taking through and the to comprehensive would looking open anybody if less And aren't do through issues notion different likely make for helps table But this again, think, And who from kind to the think so the or off traditional settlement, work a and signal now the I talking continue to it you even comprehensive bench begin -- we to that's

have timing You kind the goes in of see have what to case. would to how process see the hearing that next effects order on

don't watch but how right change proceeds, no case to this I think. now, we really in So need plans -- I

Shahriar Pourreza

And the don't addressed equity? if case then just, about think sorry, the I you but rate how know and in delay the case next rate to in

Ted Geisler

that Yes, about really is the in. Shar, Ted. The I of on depends case and current outcome think we're is this way it the timing

concludes, we'll outcome, the case really and case inform this of as timing needs. next as once So well of will evaluate that equity timing the the

Shahriar Pourreza

years, in just the the energy then takes of already guys most clean the so staffs things thinking the there any about five to status every recent ACC the docket, is proposals And solar don't writer the we endpoint, straightforward and stakeholders storage, continues Or and just Are i.e., of that for quo? be i.e., target i.e., renewable interim kind to seems puts dialogue targets to you a Kennedys out. have as has rules Burns should the step follow you or neutral filer? any i.e., preference put And goals with and with conversations about alternative there than more serial and mechanisms been less a have desirable be keep be XXXX? a

Ted Geisler

do the think are with look didn't lot to what's we there's would Obviously, alignment we're of you I then terms that we comments directionally, details in you set make have a some direction and goals? sure And going. of nothing just parties think, the at, and think make feels of target I important. how other about wanted until we is Shar, it like Yes, encouraging do ours that XXXX make interim to is So the a XXXX.

goal it as you more some put XXXX had on procurement, flexibility. granular place. it gets so is lose the in And harder The a we just challenge get so

harder year, procurement the you technologies every goals have and it's to to every then can were that. you get years, the try a if do little two to different that flexibility around bit So with

And an so conversation. evolving it's

a and there'll case I to don't those, to you're because the that exactly you pretty comments current kind that that, just right come a expect tracking case some about rate into I mechanism stream. the docket. be some or it that on watch tracking sort of of filings mechanism, then think respect With some pushes conversation just mechanisms, in if impact of rate into the regulatory filing that continuous do you the

we've there's part we that's be in in heard think, case But expect value, file And right be that will of now. what so rate that the will evidence again, that. on the I got

Operator

Durgesh question the Chopra next Evercore. Our with comes from of line

Durgesh Chopra

On expense, the front, higher reduction you in now by rates driving updated is guidance just And partly the the AFUDC, are assuming that? what driven it's interest in lower assumption?

Jeff Guldner

Yes. AFUDC That's higher, exactly projected. higher right. our of the current It's current net updated then and rate than financing, with originally

Durgesh Chopra

CapEx the modestly is rate And and one the and What The the change, out did one. it's the much and change. at driving then where company slide plan didn't but I'm into put into small plan higher, modestly and be higher, may this actually looking base break you but is FERC, just rate too it base your not that? reads. CapEx

Jeff Guldner

Yes.

given updated But quarter. the can well reflect to most So COVID our rate we CapEx projections both of forecast any be see line issued you in update update previously the forward-looking released. not we that's just CapEx recently of to base rate the time, with that an We did impacts base as this the change simply forecast. projection last in as in as

getting in just X it's sync. So those

Durgesh Chopra

it. get I

most with ties and recent forecast? So your this is CapEx basically up-to-date

Jeff Guldner

correct. That's

Durgesh Chopra

then Okay. just one question. last And Understood.

of in the the the end you year, the what In you're trends, in pretty back saw high range? trends that put you're the conservative as assuming and half guidance for are the saying COVID trends demand you of of would terms QX, in, to that

Jeff Guldner

the be situation and is residential, the year. in is But the for still The reopening it in that us. too to other pleased since evenly I it's the think for think the on continue I by that, the just things increase way But fairly important of we'll mid-May, early than commercial how COVID of metric seen to to we're see decline we've normalize sales focus balance offset project. about that's uncertain. Well, an

Operator

line question comes from next the Sachs. of Kim Goldman Insoo Our with

Insoo Kim

My that of Correct first in staff the the filings question, rate changed, wrong, And opened the case. it regarding it process? I'm And a correct? delayed the that seems make Is possibility get the is with if associated that it if case, testimony were day a this me change what it commission's by if up that. and the is like but happen? be still at to would test year certain for the to decision

Ted Geisler

not change the test No, in It's think I Insoo. a don't year.

mean, in other again, change make filed. formas. year look was may And case. year we that at test test of some we'd test But You and have that's we something for I plan year. things adjustments the to post pro the rebuttal to the year the test

Insoo Kim

is post time terms way extend Right. test year with the in And a you year to post it allow would the adjustments, adjustments? test line of for

Ted Geisler

mean, that's guess I possible. I

think the case how would see have I to evolve. you'd

Insoo Kim

terms up in the kind a then, And questions. of the on of it. couple process, renewable Got of following other

acknowledgment it's for IRP. of an or point this in more an not file when at process you Arizona, think acknowledgment I

trying commission acknowledgment of have of the over any more the type those As you weighed years, that there renewables few investments? for further you're establish to conversations with soft are of capacity next a into storage approval all to and or in the investments

Ted Geisler

be and process what Yes, some different, debate. some there, probably you an would additional plants, of be process, that say approval don't. gets And could a could nuanced approval because about I there do a little aren't energy they're be you siting require cases, there discussions lot got going a thermal things new commission chime things individual In and these committee discussion guess, through there But the happen come there, into goes acknowledgment state there's the wouldn't something of because down the Barbara as a that I'll we'll evolve new be that to energy itself Act. the up anything, information. the get rules. rules Siting or When how in Do That's as subject RFPs, it I think with watch the ask to right? going in add that But you is, rules could under more a approval want topic I'd if not process to this Barbara? IRP to she's it's for. to is so

Barbara Lockwood

through the Insoo, well with I to in with Barbara Lockwood. about that as commission this best that. as conversation to Nothing way process is about RFP and with yet. way engagement through discussion stakeholders. think the Yes, on is more more the with processes in and or the well the to engage approval is it say the acknowledgment But now the discussion those all it various the evolving definitive would components associated really, think commission stakeholders right process is regard the is both to IRP as is how as

Operator

of Associates. line Our question. Please Paul next question comes from with the with your proceed Patterson Glenrock

Paul Patterson

sales change caused I to you over what growth Paul, but that? the this, change term, the long I if apologize missed

Ted Geisler

the growth just we sales expected in that's see Paul, really reflecting weather negative normalized flat XXXX. to

result including So as given impacts COVID. XXXX it's of the we make a X-year XXXX, updated and we just to reflect period, want a results sure period that to expected that

Paul Patterson

a as COVID lost this of of rate that So your whenever that think like there is will to were rebound speak, you -- same, much you'll back where sort opposed just of me catch-up. it? but not be of lost right to as in be follow some see pretty growth guys progressing big the you if before. to but to to that about it's year the think see year. when kind year, of And off Is a way for were before, then then terms get you cause will catch-up, that you way expect over, won't really to Is decrease COVID right the basically so sort a of they things don't So is, it? --

Ted Geisler

think it. for fair think way data you. a of I that's points couple about A to

virtually remains As it. the at I measure economy you in every mentioned, look robust

expect If had had weather-normalized COVID in X.X% the to we month the consider you be look upside future, period. well. exclude so still do But the I sure look growth. as to course. X.X% at numbers most that June, of impacts updated to We XXXX. provides sales from customer years make we'd over this course, That would X we period, said, include we're did and reflected recent want to guidance a that's We seeing and predict, that we the difficult during what contributions in of data growth next those centers,

Paul Patterson

Okay. you distracted. I -- And a but and think if been apologize changed, also it, or I again, but peak I get mentioned, didn't I little about you it something I growth completely, I Could slightly heard elaborate apologize guess, on got I sales bit your hasn't CapEx mentioned still by growth? meant less you guess, then at growth it that but peak it's the you is more your by the and driving South, by affected, words, the peak other I what -- -- how growth in -- more your doesn't just

Ted Geisler

Yes, right, that's exactly Paul.

long-term customers that's regardless sure which by needs demand reserves significant. is and pieces hottest is really that day. to on a the driving demand of This And to long-term that's for during all-time forward-looking day capacity plus we're our our for and plan basis. demand on the XXX increased service when resource that plan integrated we've the the resource ensure got over day the maintain sales there last annual of us demand is making to One the year, the procurement what's the resource growth, megawatts high, peak reliable that year we of peak peak most need the key compared

Paul Patterson

Okay. hasn't And think of And really the really rest changed asked that -- that okay. and questions my hasn't answered. -- I been have

currently, on Just probably rules, be at in an seem to sort changing there least I the be will I I of energy does mean, and some the commission know November. guess, impasse,

does that, on have is of Or think? thoughts you sort wait-and-see of that? other a takeaway from -- situation? So sort any it there do it is just Or any any

Barbara Lockwood

Lockwood. Barbara Yes. Paul, is this

philosophical for a through parts and procedure again rules, at wait is be a the point, a today getting many But a policy can move if see making right get to see it seems procedural a it's perspective, There's vote true. and a energy just wait now. the on that's to discussing complicated, alignment can of see but think and the to if and really they it to process and from forward. process this They're just I find anywhere. they

Operator

question Charles Fishman next line of Morningstar. the from Our with comes

Charles Fishman

the needle. I growth potentially guess seeing consistently work-at-home center you certainly benefiting trend growth, I have data going specific my makes area and data can center the is, center Phoenix the data that of on which your out You are that respect to general color forecast, this moves with And sense left just to because, anything with guess, question you on? provide growth

Jeff Guldner

systems the potential is, I'd say demand. can specific recognize Charles, we this that's demand, The Yes. data if have nothing which home, can question. increase we keep a an to to. and trends certainly and point that data that up and at making, corporate we expected in at at parallel, center that's time. point answer when But But hypothesis point specific insightful and short by we running, network you're look technology to you then both nothing the there's many and is

center are that we're it's interconnecting, that the focus is customers out know building we growth that Our really for that early still we and for, the in process. capacity data

actually they data uncertain what imagine, out for As the plan start peak fill of but is shell use they until the you their center. can probably we capacity, to

exclude we why some up they fall which that to demand. on demand, but in term, because just strong that's it's the very so unclear it fill long it's trajectory got And

Operator

Merrill question of comes Julien from next of Dumoulin-Smith Bank America with line the Lynch. Our

Julien Dumoulin-Smith

I want to revisit bit I a the wanted little but subject more directly. to it address here,

in pretty you sort the do do anticipate tracking type operationally but spend suggest have for a subsequent you capital the for investments will play? understand of what the and clean ready current extent broadly recovery. I avoid do those for energy a cetera? et make at secondly, ahead of case. rate do recovery for perhaps And the more And to move and to of writers writers, you which your then you're specific made without probably lined into up about the that Can to mechanism So [indiscernible] context of case, spend it, and next could the having year you would sort certainty In some specific you about year ideal be you've without projects recovery? you pathway after. talked that, have the energy outlook directly, defined, case the at avenue the call protracted organizationally least you've 'XX and of allusion the a of in this is or the an clean and potential confidence substantive any course have

Jeff Guldner

you're of a muffled couple little Julien, there. a times Yes, at

gist your the got question. of I think I

And mechanisms the work a we about are. plan in talk yes, case mechanism and the how do existing to so could tracking what

a which of to think was I it clean got to the that We've combination don't discussion. commitment. cases. the of raised pace happens is, of energy a you just have the a be topic tracking earlier, a point rate you that's lot have going if of increases to And file mechanism, what

general is think, we in state have and where from going my different energy what that clean lot need. I a heard parties growing also is the comments in a you alignment capacity on of

And that the out batteries so to have going to to meet we're needs to we're building solar be wind, and the capacity going have.

See tracking well. RES like needs make mechanism of discussion we'd as have of like the the mechanisms and we around have reliability that if other in a we amount a are to going it that's some case. a yes, discussion and rate to the drive there good tie existing that fair going so that. But could spending to And or things use are sure to expect potentially

Julien Dumoulin-Smith

those just be pursuing? anticipate the teed of you projects, spending if projects speak Just, what's the know XXXX maybe competitive don't you up these you the for operationally, XXXX? you can have nature 'XX, nature there's And that been them? to necessarily it? projects, to I of But anticipate sort Right. if do clear historically, you you I you recovery the have but more mechanism specifically, already processes identified specific for what's about have in projects this, can of do know, to larger-scale what for speak

Daniel Froetscher

number integrating teed Froetscher. to dusting solar, Daniel And them be had now of Prior and up and to post solar event, we'll occurring customer alluded moving a McMicken design and for roll-offs few has Jeff has an event resource plus the Julien, progression learnings them projects over Ted our storage our to engineering this significant we McMicken, 'XX. next off safety from years. McMicken from growth. forward, is through standpoint. the 'XX 'XX, alluded

every are remarks, with the be that battery out there. design storage spaces service our that got still those McMicken of McMicken we RFPs tracker, sun and and wind, or photovoltaic we got we reliability number and And relates Arizona suppliers wind, since been the to a as again improvements couple safety, any needed absent in of have working plan teed to tranches his accompany have to current incorporate built either the obligations we've that benefit customers. of that our to a doing engineering been we'll of placed RFPs. so, in it combination up, those shortly have So installations mentioned our within through a the ago. shelf decisions of PPAs were both years course of of meet and We've that which Jeff making the a on couple throughout learnings couple of opening have to solar we We've that battery intention solar

there So real is play. work in

Ted Geisler

we just on be to that plan, Yes. And capital summarize that have executing whether be Julien, we're will XXXX Daniel we going plan. that projects or it Daniel. the I'd on by execute Thanks, saying RFPs, mentioned, up, coming

Julien Dumoulin-Smith

it. Got

of confident it of you're regardless pretty the construct recovery? So like sounds

Ted Geisler

correct. That's

what Although clean certainly, be have we've in necessary to is don't made rate rate plan ensure long the serial gradualism able execute filings. promote recovery and term, is clear you to that case

Operator

reached now session. turn the back floor of I have to over end comments. question-and-answer to management like for would the closing We the

Stefanie Layton

Thank for concludes joining This today. our call. us you

Operator

Ladies this and conclude gentlemen, today's teleconference. does

and at lines your Thank for wonderful disconnect day. time. this have may participation, you You a your

Pinnacle West Capital (PNW) 8 Aug 202020 Q2 Earnings call transcript