Equity Issuance Plans
Q: What is your preference and plan for future equity issuances, including ATMs and hybrids?
A: We need up to $500 million in equity, plus an additional $100 million to $200 million to maintain a strong utility equity ratio of 51.9%. " We're flexible and considering options like ATM programs or equity-like securities to align equity issuances with our capital needs over time. "

Growth Guidance Including BCE Sale
Q: Are you confident in achieving 5% to 7% earnings growth, including the impact of the BCE sale?
A: Yes, our guidance includes the expected gain of $0.10 from the sale of Bright Canyon Energy this year. " We're confident in achieving 5% to 7% earnings growth on this rebased level, including that $0.10. "

Regulatory Lag and Next Rate Case Timing
Q: How do you plan to address under-earning due to regulatory lag, and when is the next rate case expected?
A: We're addressing regulatory lag by engaging in a docket starting on March 19 to explore mechanisms to mitigate it. " We haven't set a timing for our next rate case but may wait to see the outcome of this docket, potentially filing in 2025. " "

Sales Growth from Large Customers
Q: How should we think about sales growth in 2025 and 2026 with large customers?
A: Significant growth is expected from customers like Taiwan Semiconductor, which plans full ramp-up in the first half of 2025. " This contributes to forecasted sales growth of 4% to 6% through 2026, compared to 2% to 4% this year. "

FFO to Debt Metrics and Credit Ratings
Q: Where do you anticipate landing on FFO to debt metrics, and will the recent rate case improve credit ratings?
A: We've reset our FFO to debt target to 14% to 16%. " " While agencies haven't provided official calculations yet, we're engaging with them and believe the constructive rate case outcome supports maintaining solid investment-grade credit ratings. "

SRB Deployment Timing
Q: When will we first see Self Reserve Balancing (SRB) deployed?
A: The earliest SRB projects will be in service before summer 2026, assuming they clear the RFP. " SRB will increase tracked capital and contribute to smoother cost recovery over the medium term. "

O&M Management and Inflationary Pressures
Q: How are you managing inflationary pressures to keep core O&M declining?
A: We leveraged favorable weather to pull some O&M from 2024 into 2023. " We're committed to customer affordability and maintaining a lean culture, with savings from closing Cholla and shifting to assets with lighter O&M. "

Growth Rate Expectations and Regulatory Lag
Q: How are you thinking about the 5% to 7% growth rate given regulatory lag?
A: We have the investment profile to achieve 5% to 7% growth over the long term. " By addressing regulatory lag and increasing tracked capital through SRB, we expect smoother cost recovery and sustained growth. "

Equity Ratio Target
Q: Are you targeting a 52% equity ratio at APS to match the rate case outcome?
A: We aim for a balanced capital structure with slightly over 50% equity at the utility. " The recent 51.9% equity ratio is appropriate, and we're balancing our capital needs to maintain this. "

Regulatory Lag Impact on Earnings
Q: How would you characterize under-earning this year due to regulatory lag?
A: Regulatory lag is driven by factors like higher interest costs, with recent debt issuances in the mid-5% to low-6% range compared to an embedded cost of debt of 3.85%. " O&M increases and pension impacts also contribute, which we'll address in the next rate case and the regulatory lag docket. "