Organization

At Pinnacle West, teamwork is at the heart of our environmental, health and safety efforts.

Ed Fox, vice president of communications, environment and safety, leads a team of experienced professionals responsible for implementing the company’s EHS programs. He also provides information about the company’s EHS goals and activities to executive management and the Board of Directors.

The cornerstones of Mr. Fox’s EHS management team are two committees: The Environmental Advisory Team and the Safety and Health Advisory Team. These committees develop strategies and manage and implement environmental, health and safety programs and projects.

A frontline team of EHS professionals handles issues that arise in the field and at company facilities. These professionals work diligently to provide daily, on the spot, attention to EHS issues as they arise and are the backbone of the company’s EHS program.

At the corporate level, the EHS Department handles environmental, health and safety issues. These experts serve as consultants on technical and regulatory matters, develop strategies, and monitor market and technological trends.

Pinnacle West’s EHS professionals — including a team of nurses — not only strive to keep the company in compliance with regulations, they work to keep the company on the leading edge of the best environmental, health and safety practices.

Industry Participation

As a company, we maintain membership in the Edison Electric Institute and the Electric Power Research Institute. In addition, we are active in regional, state and local organizations such as the Western Regional Air Partnership. Most of our employees also maintain memberships in numerous professional and business associations that cover every function of our business, including accounting, purchasing, environmental, health and safety, human resources, public relations, engineering and electrical trades.

Pinnacle West strongly believes in furthering our base of technical knowledge and that of the various industries with which we work. We support and sponsor a variety of research activities devoted to leading-edge technologies at educational institutions and company facilities.

That philosophy of sharing and growing knowledge is most evident at the APS Solar Test and Research Center (STAR), which houses much of the world’s leading-edge solar technologies. At STAR, APS tests and evaluates the effectiveness of new technologies, while fine-tuning and developing its own proprietary designs. By actively supporting industry efforts, APS aims to help develop technology that can make a mainstream impact in the future. We also partner with Arizona State University and Northern Arizona University to collect performance data from our solar generating facilities.

In 2002, APS entered into talks with Israel’s Weizmann Institute to investigate and possibly develop a new high-concentration solar turbine generation technology, using both U.S. and Israeli technology.

Recognizing the benefits of using hydrogen as fuel in combustion engines, in 2002 the company installed a hydrogen and compressed natural gas fueling station at one of its facilities in downtown Phoenix. The facility, used by employees and contract companies, offers hydrogen, compressed natural gas and a compressed natural gas-hydrogen blend. Tests of the Compressed Natural Gas/Hydrogen (CNG/H) fuel have shown improved vehicle performance with lower air emissions.

No company can thrive without a well-trained and motivated workforce. We continue to develop and retain the best employees. We offer school-to-work and scholarship opportunities as well as an extensive internship program that introduces students to virtually every part of our business, while specific programs target students seeking education in finance, accounting, engineering, mathematics and electrical trades.

Outstanding individual environmental, health and safety performance and initiatives are recognized through the Environmental, Heath and Safety Excellence Awards program. This program is designed to reward employees who contribute significantly to improving overall environmental, health and safety performance. In 2002, 45 employees received EHS Excellence Awards and were recognized in our company communications.

Employee training is an important part of our successful EHS management. We have an active EHS training program that employs a variety of training media, including internal class, pre-job safety meetings, external seminars and certification, computer-based instruction, hands-on training and video presentations.

In 2002, our employees completed training sessions on nearly 300 EHS-related topics. Each employee completed an average of nine training courses during the year. To ensure all employees are properly trained, the corporate EHS department maintains a computer-based training tracking system called TrainKing. Notices are sent to employees and supervisors when training is due. The system helps facilities throughout the company track and report on required EHS training. We introduce all new employees to our EHS vision and beyond-compliance commitment through an environmental awareness video.

In addition to environmental, health and safety training, we encourage employee continuing education through external course offerings and our internal Pinnacle West University. The Pinnacle West University uses e-learning and has a library of more than 100 self-paced courses covering popular business topics. This training is available to employees with Internet access from the office or home.

We also sponsor luncheon seminars on environmental, health, safety and new technology issues to educate and motivate employees. The lunch seminars are open to all employees, and those in remote areas may participate via videoconference. In 2002, 182 employees attended the five seminars offered.