APS 2011 Annual Report Download - page 80

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(a) Includes effects of 2011 settlement of certain prior-period transmission rights-of-way related
to Four Corners, which did not affect net income, but increased both electric operating
revenues and operations and maintenance expenses by $28 million. Costs related to the
settlement were offset by related revenues from SCE, which leases the related transmission
line from APS.
(b) Operating revenues less fuel and purchased power expenses includes amounts related to
demand-side management, renewable energy and similar regulatory surcharges, which were
substantially offset in operations and maintenance.
(c) Includes activities related to APSES and SunCor.
Regulated electricity segment
This section includes a discussion of major variances in income and expense amounts for the
regulated electricity segment.
Operating revenues less fuel and purchased power expenses Regulated electricity segment
operating revenues less fuel and purchased power expenses were $94 million higher for the year ended
December 31, 2011 compared with the prior year. The following table describes the major components
of this change:
Increase (Decrease)
Operating
revenues
Fuel and
purchased
power
expenses Net change
(dollars in millions)
Higher demand-side management, renewable
energy and similar regulatory surcharges $ 29 $ 1 $ 28
Settlement of certain prior-period transmission
rights-of-way 28 - 28
Effects of weather on usage per customer 33 13 20
Higher retail transmission charges 10 10
Higher line extension revenues (Note 3) 7 7
Higher usage per customer 8 6 2
Refund of PSA deferrals (33) (40) 7
Higher fuel and purchased power costs, net of
off-system sales (27) (24) (3)
Miscellaneous items, net 2 7 (5)
Total $ 57 $ (37) $ 94
Operations and maintenance Operations and maintenance expenses increased $34 million for
the year ended December 31, 2011 compared with the prior year primarily because of:
 An increase of $28 million for settlement of certain transmission rights-of-way, which
was offset in operating revenues;
 An increase of $27 million related to costs for demand-side management, renewable
energy, and similar regulatory programs, which were offset in operating revenues;