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Investments in Nuclear Decommissioning Trusts and Other Special Use Funds | 12 Months Ended
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Dec. 31, 2024
Investments, Debt and Equity Securities [Abstract] |
Investments in Nuclear Decommissioning Trusts and Other Special Use Funds | Investments in Nuclear Decommissioning Trusts and Other Special Use Funds We have investments in debt and equity securities held in Nuclear Decommissioning Trusts and Other Special Use funds. Investments in debt securities are classified as available-for-sale securities. We record both debt and equity security investments at their fair value on our Consolidated Balance Sheets. See Note 12 for a discussion of how fair value is determined and the classification of the investments within the fair value hierarchy. The investments in each trust or account are restricted for use and are intended to fund specified costs and activities as further described for each fund below. Nuclear Decommissioning Trusts — APS established external decommissioning trusts in accordance with NRC regulations to fund the future costs APS expects to incur to decommission Palo Verde. Third-party investment managers are authorized to buy and sell securities per stated investment guidelines. The trust funds are invested in fixed income securities and equity securities. Earnings and proceeds from sales and maturities of securities are reinvested in the trusts. Because of the ability of APS to recover decommissioning costs in rates, and in accordance with the regulatory treatment, APS has deferred realized and unrealized gains and losses (including credit losses) in other regulatory liabilities. Coal Reclamation Escrow Account — APS has investments restricted for the future coal mine reclamation funding related to Four Corners. This escrow account is primarily invested in fixed income securities. Earnings and proceeds from sales of securities are reinvested in the escrow account. Because of the ability of APS to recover coal reclamation costs in rates, and in accordance with the regulatory treatment, APS has deferred realized and unrealized gains and losses (including credit losses) in other regulatory liabilities. Activities relating to APS coal mine reclamation escrow account investments are included within the other special use funds in the table below. Active Union Employee Medical Account — APS has investments restricted for paying active union employee medical costs. These investments may be used to pay active union employee medical costs incurred in the current and future periods. In 2024 and 2023, APS was reimbursed $14 million for each year, for prior year active union employee medical claims from the active union employee medical account. The account is invested primarily in fixed income securities. In accordance with the ratemaking treatment, APS has deferred the unrealized gains and losses (including credit losses) in other regulatory assets and liabilities. Activities relating to active union employee medical account investments are included within the other special use funds in the table below. Captive Insurance Cell — Pinnacle West has investments in the Captive that may be used to pay insurance losses in the event of certain insured loss events. The Captive may hold investment assets in cash, cash equivalents, and equity and fixed income instruments. These investments are restricted for insured loss events. Pinnacle West Consolidated investment holdings reflected in the tables below primarily relate to APS, with the exception of the Captive’s investments included within Other Special Use Funds. The following tables present the unrealized gains and losses based on the original cost of the investment and summarizes the fair value of the nuclear decommissioning trusts and other special use fund assets (dollars in thousands):
| December 31, 2024
| Fair Value |  | Total Unrealized Gains |  | Total Unrealized Losses
Investment Type: | Nuclear Decommissioning Trusts |  | Other Special Use Funds |  | Total |  |
Equity securities | $ | 435,470 |  |  | $ | 24,962 |  |  | $ | 460,432 |  |  | $ | 359,127 |  |  | $ | (176) |
Available for sale-fixed income securities | 844,040 |  |  | 355,544 |  |  | 1,199,584 |  | (a) | 7,717 |  |  | (31,960) |
Other | 3,335 |  |  | 27,851 |  |  | 31,186 |  | (b) | — |  |  | — |
Total | $ | 1,282,845 |  |  | $ | 408,357 |  |  | $ | 1,691,202 |  | (c) | $ | 366,844 |  |  | $ | (32,136) |
(a)As of December 31, 2024, the amortized cost basis of these available-for-sale investments is $1,224 million. (b)Represents net pending securities sales and purchases. (c)All amounts pertain to APS, with the exception of $34 million of Other Special Use Fund investments in equity securities relating to the Captive.
| December 31, 2023
| Fair Value |  | Total Unrealized Gains |  | Total Unrealized Losses
Investment Type: | Nuclear Decommissioning Trusts |  | Other Special Use Funds |  | Total |  |
Equity securities | $ | 420,680 |  |  | $ | 40,991 |  |  | $ | 461,671 |  |  | $ | 336,555 |  |  | $ | — |
Available for sale-fixed income securities | 781,333 |  |  | 319,594 |  |  | 1,100,927 |  | (a) | 21,518 |  |  | (40,868) |
Other | (767) |  |  | 2,196 |  |  | 1,429 |  | (b) | 39 |  |  | — |
Total | $ | 1,201,246 |  |  | $ | 362,781 |  |  | $ | 1,564,027 |  | (c) | $ | 358,112 |  |  | $ | (40,868) |
(a)As of December 31, 2023, the amortized cost basis of these available-for-sale investments is $1,120 million. (b)Represents net pending securities sales and purchases. (c)All amounts pertain to APS.
| Year Ended December 31,
| Nuclear Decommissioning Trusts |  | Other Special Use Funds |  | Total
2024 |  |  |  |  |
Realized gains | $ | 75,690 |  |  | $ | 372 |  |  | $ | 76,062 |
Realized losses | $ | (21,966) |  |  | $ | — |  |  | $ | (21,966) |
Proceeds from the sale of securities (a) | $ | 1,330,940 |  |  | $ | 355,154 |  |  | $ | 1,686,094 |
2023 |  |  |  |  |
Realized gains | $ | 111,922 |  |  | $ | 172 |  |  | $ | 112,094 |
Realized losses | $ | (41,212) |  |  | $ | (568) |  |  | $ | (41,780) |
Proceeds from the sale of securities (a) | $ | 1,324,978 |  |  | $ | 354,744 |  |  | $ | 1,679,722 |
2022 |  |  |  |  |
Realized gains | $ | 9,017 |  |  | $ | 420 |  |  | $ | 9,437 |
Realized losses | $ | (40,239) |  |  | $ | — |  |  | $ | (40,239) |
Proceeds from the sale of securities (a) | $ | 979,639 |  |  | $ | 227,558 |  |  | $ | 1,207,197 |
(a)Proceeds are reinvested in the nuclear decommissioning trusts and other special use funds, excluding amounts reimbursed to the Company for active union employee medical claims from the active union employee medical account. Fixed Income Securities Contractual Maturities The fair value of APS’s fixed income securities, summarized by contractual maturities, at December 31, 2024, is as follows (dollars in thousands):
| Nuclear Decommissioning Trusts |  | Coal Reclamation Escrow Account |  | Active Union Employee Medical Account |  | Total
Less than one year | $ | 19,868 |  |  | $ | 87,424 |  |  | $ | 39,090 |  |  | $ | 146,382 |
1 year – 5 years | 268,974 |  |  | 58,598 |  |  | 154,768 |  |  | 482,340 |
5 years – 10 years | 198,464 |  |  | — |  |  | 15,664 |  |  | 214,128 |
Greater than 10 years | 356,734 |  |  | — |  |  | — |  |  | 356,734 |
Total | $ | 844,040 |  |  | $ | 146,022 |  |  | $ | 209,522 |  |  | $ | 1,199,584 |

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