Tracking our 2030 target. During 2021, the share of APS’s energy supply from clean resources was 50%, which includes energy from nuclear, renewables and demand side management (DSM). We are on track to reach our goal of 65% clean resource mix by 2030. In addition, by 2030, 45% of our generation portfolio will be from renewable energy. Renewable energy is measured in accordance with the Arizona Corporation Commission’s Renewable Energy Standard as a percentage of retail sales. In 2021,15% of sales were from renewable energy.

 

 

Learn more about our plans in our Integrated Resource Plan and an article that explains the  meaning of carbon-free energy.

Opportunities for coal reduction. In 2021, we announced plans for seasonal operations of Four Corners Power Plant beginning in 2023. Seasonal operations will result in up to 25% reduction in annual CO2 emissions at the plant.

Planning a responsible transition from coal. To facilitate the shift from coal, APS proposed a coal communities transition plan to support the areas that are home to coal-fired power stations. We remain committed to providing financial support and resources to coal communities in our region (including the Navajo Nation, the communities around the Cholla Power Plant in Navajo County and the Hopi Tribe) as they transition from fossil fuels to clean energy. While the Arizona Corporation Commission did not adopt our proposal for more than $140 million in support to these communities, we have already taken the first steps on delivering our company share of $6.1 million and will continue to advocate for a just transition with our regulator.

Adding clean resources to meet customers’ growing energy needs. Since our initial announcement in 2020, we’ve procured nearly 1,400 megawatts of clean energy and storage – all of which are expected to be in service for APS customers no later than 2024. All 1,400 megawatts were procured through competitive solicitations, ensuring competitive pricing for new resources as we plan to serve our growing economy.

Linking our commitment to executive compensation. In February of 2022, the Human Resources Committee revised the metrics for our performance share grants and added a clean megawatt installed metric to reflect our commitment to our clean energy commitment.

Steady production of carbon-free nuclear power from Palo Verde Generating Station. The station continued to do its part, producing clean nuclear power with a 91.7% capacity factor (an important measure of efficiency) for 2021.

Providing tools and programs to empower customers. APS’s demand-response programs use a virtual network of smart home products, like thermostats, water heaters and pool pumps, to reduce energy use on Arizona’s hottest summer days and shift energy demand to when more solar power is available. This shift is just one of the strategies and innovative solutions for our customers to use to help us reduce carbon emissions to meet our clean energy goals.

Going beyond the generation mix to help reduce emissions in other sectors. To help achieve a cleaner environment and encourage more drivers to adopt electric vehicles (EVs), APS is providing business customers with free EV-charging equipment, installation and maintenance through the Take Charge AZ program. As of February 2022, APS has installed more than 400 Level 2 charging plugs at businesses, schools and government buildings across Arizona. Last year, APS announced a partnership with Electrify America to install DC Fast Chargers in Globe, Payson, Prescott, Sedona and Show Low.

Learn more about customer tools and programs and the role of customers in designing Arizona’s clean energy future .

In 2021, we announced plans for seasonal operations at Four Corners Power Plant beginning in 2023. Compared to current conditions, the shift to seasonal operations will reduce annual carbon emissions from the plant by an estimated 20-25%, furthering APS’s commitment to exit coal by 2031 and the individual sustainability goals of the plant’s other owners.

Learn more about  seasonal operations.

In addition, we have committed to end the use of coal at our remaining Cholla units by 2025 and made an overall commitment to exit coal by 2031, which means we will close the Four Corners Power Plant seven years earlier than our original plan. We have retired more than 1,000 megawatts of coal-fired electric generating capacity. These closures, in addition to other measures taken by APS, have resulted in a reduction of carbon emissions of 32% since 2005, which is equivalent to removing more than 1.2 million passenger vehicles from the roads.

With plant closures, we work closely with impacted employees and local communities to ease the transition and support long–term economic planning for a future beyond coal.

Learn more about our  coal communities transition plan.

Nuclear. Palo Verde Generating Station has been the nation’s largest power producer of any kind for 30 years – all of it clean and carbon-free. As the heart of the APS generation fleet, it provides the foundation for the reliable service our customers count on.

The plant is a critical asset to the Southwest, generating more than 32 million megawatt-hours annually – enough power for roughly 3.4 million households or 8.5 million people. In addition, Palo Verde provided much needed support during the recent Texas power crisis by delaying the start of equipment reliability repairs enabling full-power output when it was most needed.

Nuclear energy works with renewable generation to create a more reliable, diverse clean-energy portfolio. Palo Verde produces clean energy at all hours supporting the basic electrical needs of our customers when solar and wind are not available. Without nuclear energy, carbon emissions would increase due to a greater reliance on carbon-emitting fossil fuels to fill the inevitable energy void during periods of low renewable generations, such as after sunset. Nuclear energy can facilitate increased adoption of EVs and improve the environment by supplying zero-emission energy to charge EVs and large-scale batteries.

While Palo Verde has seven owners in four states, nearly half of its output is dedicated to serving Arizona consumers. Electricity generated by the plant annually displaces more than 13.2 million metric tons of greenhouse gas (GHG) emissions that otherwise would have been produced. It is estimated that Arizona’s energy-related emissions would be about 14% higher without the displaced carbon emissions from Palo Verde.

Additionally, as the nation’s only nuclear plant not located on a body of water, Palo Verde recycles more than 20 billion gallons of wastewater annually from surrounding municipalities to cool the plant. This represents more than 20% of all effluent used in Arizona.

Learn more about Palo Verde Generating Station .

Renewables. With nearly 300 sunny days each year in Arizona, APS and its customers are transforming sunshine into a renewable energy source that powers an increasing number of homes and businesses across the state. APS supports customers interested in protecting the environment and reducing their energy bills by installing renewable energy technologies like rooftop solar systems at their homes, schools and businesses. Nearly 141,000 solar systems on customer rooftops and parking structures are already connected to the APS smart grid, providing almost 1,300 megawatts of robust solar capacity. In 2021 the amount of residential solar generating capacity installed in APS service territory was 20% higher than 2020. Nationally, only Hawaii and California have more residential solar capacity per capita than Arizona. As the largest electricity provider in the state, APS and its customers have been a big part of that achievement:

• APS ranks fourth nationally for the percentage of residential customers with rooftop solar systems
• APS customers installed a record amount of residential solar capacity in 2021
• 15% of all single-family homes in APS territory have a solar system, and that number continues to grow

Learn more about our solar path for a cleaner, greener Arizona.

Renewable Energy Portfolio. In 2006, the Arizona Corporate Commission (ACC) adopted the Renewable Energy Standard (RES). Under the RES, electric utilities that are regulated by the ACC must supply an increasing percentage of their retail electric energy sales from eligible renewable resources, including solar, wind, biomass, biogas and geothermal technologies. The renewable energy requirement is 12% of retail electric sales in 2022 and increases annually until it reaches 15% in 2025.

At the end of 2021, APS had a diverse portfolio of existing and planned renewable resources totaling 2,758 megawatts, including solar, wind, geothermal, biomass and biogas. Of this portfolio, 2,218 megawatts are currently in operation and 540 megawatts are under contract for development or are under construction. Renewable resources in operation include 247 megawatts of facilities owned by APS, 736 megawatts of long-term purchased power agreements, and an estimated 1,235 megawatts of customer-sited, third-party owned distributed energy resources.

Learn more about our Renewable Portfolio.

APS’s strategy to achieve its RES requirements includes executing purchased power contracts for new facilities, ongoing development of distributed energy resources and procurement of new facilities to be owned by APS. In December 2020, APS issued two Request for Proposals (RFP): a battery storage RFP for projects to be located at two AZ Sun sites; and an all-source RFP that solicited resources to meet our clean energy needs and capacity to maintain system reliability and was later amended to include a request for 150 megawatts of solar resources to be developed on APS property and owned by APS (collectively, the “December 2020 RFPs”). As a result of the all-source RFP, APS executed a PPA in October of 2021 for a 238 megawatt wind resource to be in service by June 2023, and also executed an engineering, procurement and construction contract in November of 2021 for a 150- megawatt solar resource to be owned by APS and in service in early 2023. APS continues to negotiate contracts for additional resources to be in service in 2024 in connection with the all-source RFP. Once it secures those important resources and closes out the December 2020 RFPs, APS intends to issue its next all- source RFP to address resource needs for 2025 and beyond.

Learn more about our Integrated Resource Plan and RFP expansion for APS- owned solar.

Demand Side Management. Technologies such as rooftop solar, LED lighting and smart thermostats have given customers more power to control their energy usage and potentially reduce their costs. As more emerging technologies such as energy storage devices become commercially viable, they will continue to change how customers interact with us. By being proactive and working with our customers to identify and respond to their changing needs, we remain well positioned to deliver value. And by providing customers the opportunity to manage their energy and peak demand, we can expand the use and understanding of load-management technologies, encourage customers to reduce CO2 emissions, use energy during off-peak hours and better align with solar production and system peak conditions. Taking these innovations to scale will help us achieve our bold clean energy commitment.

Learn more about our evolving residential energy management to be a clean peak resource.

APS’s demand-response programs use a virtual network of smart home products, like thermostats, water heaters and pool pumps, to reduce energy use on Arizona’s hottest summer days and shift energy demand to when more solar power is available. Chief among the programs connected to the APS virtual power plant is the company’s signature residential thermostat program, APS Cool Rewards. With more than 57,000 residential smart thermostats enrolled, customers benefit from incentives, discounts and energy-savings options for voluntarily conserving energy. APS Cool Rewards boasts a capability of shedding more than 80MW of energy from APS’s smart grid. This energy avoidance saves customers money, helps the environment and builds a more robust electrical grid. APS Cool Rewards is recognized as one of the five largest Bring Your Own Thermostat (BYOT) programs in the country and one of the largest utility-managed thermostat virtual power plants. APS has a 2022 goal of reaching 110,000 thermostats to provide over 130 megawatts of summer capacity.

Learn more about the role of our customers, virtual power plant and customer programs.

Hydrogen. One of the more promising emerging opportunities is the use of hydrogen. A substantial majority of the world’s industrially produced hydrogen creates carbon dioxide as a byproduct.

However, when hydrogen is produced by electrolysis using clean electricity (such as nuclear, solar or wind energy), the resulting hydrogen is carbon-free. Producing hydrogen when there is an excess of carbon-free electricity creates an energy vector that can be used as another clean energy storage technology for meeting peak demand. The clean hydrogen can also be used as an energy carrier for evolving hydrogen transportation technologies, and as a feedstock to produce synthetic hydrocarbons that introduce no new carbon into the environment.

APS is one of three utilities chosen by the Department of Energy's Office of Nuclear Energy and Office of Energy Efficiency & Renewable Energy to participate in a hydrogen production project in partnership with Idaho National Laboratory. The goal is to improve the long-term economic competitiveness of the nuclear power industry through the integration of hybrid energy systems such as hydrogen production. The multi-phase project will examine how hydrogen can be produced by clean nuclear power. Experience from the pilot project will offer insights into methods for flexible transitions between electricity and hydrogen generation missions in solar-dominated electricity markets and demonstrate how hydrogen may be used as energy storage to provide electricity during operating periods when solar is not available.

Learn more about the Palo Verde & Idaho National Lab hydrogen partnership.

Energy Storage. APS deploys several advanced technologies on its system, including energy storage. Storage can provide capacity, improve power quality, be utilized for system regulation, integrate renewable generation, and, in certain circumstances, be used to defer certain traditional infrastructure investments.

Energy storage can also aid in integrating higher levels of renewables by storing excess energy when system demand is low and renewable production is high and then releasing the stored energy during peak demand hours later in the day and after sunset. APS is utilizing grid-scale energy-storage projects to benefit customers, to increase renewable utilization, and to further our understanding of how storage works with other advanced technologies and the grid. We are preparing for additional energy storage.

In 2018, APS issued a request for proposal (RFP) for approximately 106 megawatts of energy storage to be located at up to five of its AZ Sun sites. Based upon its evaluation of the RFP responses, APS decided to expand the initial phase of battery deployment to 141 megawatts by adding a sixth AZ Sun site. These battery storage facilities are expected to be in service during the summer of 2022. On August 2, 2021, APS executed a contract for an additional 60 megawatts of utility-owned energy storage to be located on APS’s AZ Sun sites. This contract, with a 2023 in-service date, will complete the addition of storage on all current APS-owned utility-scale solar facilities.

Additionally, in February of 2019, APS signed two 20-year Purchase Power Agreements (PPAs) for energy storage totaling 150 megawatts. These PPAs were subject to ACC approval in order to allow for cost recovery through the PSA. APS received the requested ACC approval on January 12, 2021, and service under the agreements is expected to begin in 2022 with respect to 100 megawatts and in 2023 with respect to 50 megawatts.

As a result of its December 2020 RFPs, APS executed four 20-year PPAs for resources that include energy storage: two PPAs for standalone energy storage resources totaling 300 megawatts; and two PPAs totaling 275 megawatts solar plus storage resource. The PPAs were also subject to ACC approval to enable cost recovery through the PSA. APS received the requested ACC approval on December 16, 2021. Service under the agreements is expected to begin in 2023 and 2024.

APS plans to install more than 900 megawatts of energy storage by 2025, including the energy storage projects under PPAs and AZ Sun retrofits described above. The remaining energy storage is expected to be made up of resources solicited through current and future RFPs.

Learn more about our energy storage strategy.

Overall Air Emissions. In 2021, APS’s carbon dioxide emissions were about 11.2 million metric tons. This represents a 32% decrease in annual carbon dioxide emissions since 2005.

We also track emissions of other traditional air pollutants. Since 2005, as a direct result of our commitments to reduce air pollution and institute operational efficiency enhancements, we have achieved reductions in annual emissions of Nitrogen Oxides (NOx) of 84% and annual emissions of Sulfur Dioxide (SO2) of 86% from our overall fleet.

Learn more about air emissions data.

Carbon Intensity. For internal tracking to our Clean Energy Commitment, we monitor carbon intensity which we define as the measure of total carbon emissions, measured in metric tons per megawatt hour of energy delivered by APS to our customers. It includes total emissions from APS-owned generation and power purchase agreements, as well as megawatt hours from distributed generation and megawatt hours saved from demand side management.

Learn more about carbon intensity data.

Greenhouse Gas Reporting. To track our progress toward our Clean Energy Commitment, we report our Scope 1 and Scope 2 carbon emissions. Scope 1 emissions include all direct emissions arising from the sources we own and control (e.g., emissions associated with fuel combustion in boilers, furnaces and vehicles). These direct emissions result from activities that physically release greenhouse gases into the atmosphere. In 2021, our Scope 1 emissions remained relatively flat from the prior year and were about 11.3 million metric tons.

Scope 2 emissions include all indirect emissions associated with electricity, steam, heat or cooling purchased for use in our owned and controlled operations. These indirect emissions occur outside of our reporting boundary and are emitted by power- generation sources owned or controlled by another party. Scope 2 also includes indirect emissions associated with Transmission and Distribution (T&D) line losses from electricity that is not generated by the company transmitting or distributing the power. In 2020, our Scope 2 emissions reporting boundary changed to include of T&D line losses from purchased power. In 2021, our market-based Scope 2 emissions were about 112,000 metric metric tons.

Learn more about greenhouse gas emissions data.

CDP Recognition. Through significant demonstrable action on climate-change risk, Pinnacle West is leading corporate environmental ambition, action and transparency worldwide. Pinnacle West has been recognized for leadership in corporate sustainability by global environmental nonprofit CDP, recognized with a prestigious A- score for Climate Change and Water Security. CDP collects and analyzes environmental data and benchmarks companies for investors to use in financial decisions.

Pinnacle West is one of only two North American electric utility companies to achieve Leadership scores in climate change and water security out of the 140-plus electric utilities that were scored through CDP’s questionnaires in 2021, with nearly 12,000 companies being scored in total. We were recognized for our actions to cut emissions, mitigate climate risks and contribute to a low-carbon economy. Our scope 1, 2 and some of scope 3 GHG emissions reported to CDP are third-party verified.

Read our news story and learn more about our CDP responses and documents.

Agency reporting. We submit a comprehensive annual report of our GHG emissions to the Environmental Protection Agency (EPA) as required by federal law. Additionally, we are required to report releases of chemicals listed in the federal Toxic Release Inventory (TRI) program to the EPA. Our reportable releases under the TRI program primarily include air emissions from power plants and coal ash disposal. Reports for Four Corners Power Plant and the Cholla Power Plant can be found on the EPA TRI web site.