PHOENIX- Pinnacle West Capital Corporation’s (NYSE: PNW) board of directors today declared a quarterly dividend of 40 cents per share of common stock, payable on March 1, 2002, to shareholders of record on February 1, 2002.

Pinnacle West’s board in October 2001, increased the dividend by approximately 6.7 percent or ten cents per share annually. The board’s action resulted in an indicated annual dividend of $1.60 per share or 40 cents per share quarterly and represented the eighth consecutive annual increase.

For the five-year period 1997-2001, Pinnacle West grew its dividend at an average annual rate of 7.8 percent, ranking first among U.S. electric utilities.

Conference Call
Pinnacle West invites interested parties to listen to the live webcast of management’s conference call to discuss the Company’s 2001 earnings at 11 a.m. (ET) on Monday, January 28, 2002. The conference call will be available online live at www.pinnaclewest.com/investor/presentations and will be available for replay on the website through February 28, 2002. To access the live conference call, dial (212) 896-6105.

Pinnacle West is a Phoenix-based company with consolidated assets of approximately $8 billion. Through its subsidiaries, the company generates, sells and delivers electricity and sells electricity and energy-related products and services to retail and wholesale customers in the western United States. It also develops residential, commercial, and industrial real estate projects.

Contacts

Media:
Paul Reynolds, (602) 250-5656
Alan Bunnell, (602) 250-3376

Analyst:
Rebecca Hickman, (602) 250-5668
Lisa Malagon, (602) 250-5671

This press release contains forward-looking statements that involve risks and uncertainties, which include, but are not limited to, the ongoing restructuring of the electric industry; the outcome of the regulatory proceedings relating to the restructuring; regional economic and market conditions, which could affect customer growth and the cost of power supplies; the cost of debt and equity capital; weather variations affecting customer usage; and the strength of the real estate market. These factors and the other matters discussed above may cause future results to differ materially from historical results, or from results or outcomes currently expected or sought by the Company.