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El Dorado Equity Investments | 6 Months Ended
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Jun. 30, 2026
Equity Method Investments and Joint Ventures [Abstract] |
El Dorado Equity Investments | El Dorado Equity Investments Equity Method Investments El Dorado holds investments in equity securities accounted for under the equity method. The equity method of accounting is applied when we have the ability to exercise significant influence over the operating and financial policies of an investee. The equity method has been applied to El Dorado’s equity investment holdings in SAI and Copper Sky. SAI — SAI is a private corporation that manufactures electrical switchgear equipment used by data centers. El Dorado holds common stock in SAI and maintains a seat on SAI’s board of directors. El Dorado’s ownership increased to 17.99% in the second quarter of 2026 as a result of SAI’s Phase 1 repurchases, which reduced the number of outstanding shares. Copper Sky — Copper Sky, previously AZ-VC, is a limited liability company fund focused on analyzing, investing, managing, and otherwise dealing with investments in privately-held early stage and emerging growth technology companies and businesses primarily based in Arizona, or based in other jurisdictions and having existing or potential strategic or economic ties to companies or other interests in Arizona. El Dorado holds Class A Membership interests in the fund. These equity method investments are included in the other assets line item on Pinnacle West’s Condensed Consolidated Balance Sheets. The following table presents El Dorado’s ownership percentages and carrying value of investments accounted for under the equity method (dollars in millions):
Investee | Pinnacle West Ownership Percentage as of June 30, 2026 |  | June 30, 2026 |  | December 31, 2025
SAI (a) | 18 | % |  | $ | 34 |  |  | $ | 21 |
Copper Sky (b) | 23 | % |  | 18 |  |  | 15 |
Total equity method investments |  |  | $ | 52 |  |  | $ | 36 |
(a)El Dorado has no further funding commitments to SAI. (b)El Dorado has a $25.0 million funding commitment to Copper Sky, previously AZ-VC, of which approximately $18.8 million has been funded as of June 30, 2026. Our share of the investees’ earnings or losses are recognized in other income and other expense, respectively on Pinnacle West’s Condensed Consolidated Statements of Income. For the six months ended June 30, 2026, the net equity method earnings relating to these investments was $13.5 million. For the six months ended June 30, 2025, the net equity method earnings relating to these investments was $18.7 million. Other Investments El Dorado holds investments in other equity securities to which the equity method of accounting does not apply due to lack of significant influence over the investees’ operating and financial policies. These equity investments do not have readily determinable fair values, and we have elected the measurement alternative for these investments. Investments accounted for under the measurement alternative are carried at cost adjusted for impairments or observable price changes. The Pinnacle West Condensed Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025 include $25.7 million and $25.1 million, respectively, relating to these other El Dorado equity investments. These investments are carried at cost, as no impairments or observable price changes have occurred as of June 30, 2026.

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/recommendedDisclosureRef -Topic 740 -SubTopic 323 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478156/740-323-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (a)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481687/323-10-50-3 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481687/323-10-50-3 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 323 -Publisher FASB -URI https://asc.fasb.org/323/tableOfContent + Details
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