Agency fines APS $4M
Utility faulted for not paying for transmissions

East Valley Tribune
By ANABELLE GARAY
THE ASSOCIATED PRESS
December 16, 2004

Regulators found Arizona Public Service Co. and Tucson Electric Power Co. broke federal rules that govern power transmission services and ordered APS to pay $4 million.

Audits conducted between Jan. 1, 2002, and Oct. 31, 2003, found the utilities made energy sales without properly paying for their transmission or received access to power lines before their competitors, said Barbara Connors, a spokeswoman for the Federal Energy Regulatory Commission.

The commission, which tries to ensure fair competition between utilities so that consumers get lower prices for energy, also faulted the companies on Wednesday for other violations. Both utilities said they are working to comply with the commission and have taken steps to correct the problems, including training employees and reviewing internal procedures.

One of the problems auditors found was that APS' merchant division, which buys and sells power, should have paid APS' transmission section for transactions. To remedy the problem, APS must pay $4 million - of which $1.25 million will go to energy assistance programs for low income Arizonans. The commission also barred APS - one of Arizona's largest utility companies - from recovering the money by raising rates.