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Table of Contents
We are currently evaluating the impacts of adopting new revenue recognition guidance and financial instrument recognition and
measurement guidance. These two new accounting standards will be effective for us on January 1, 2018.
See Note 2 for additional information related to accounting matters.
MARKET AND CREDIT RISKS
Market Risks
Our operations include managing market risks related to changes in interest rates, commodity prices and investments held by
our nuclear decommissioning trust fund and benefit plan assets.
Interest Rate and Equity Risk
We have exposure to changing interest rates. Changing interest rates will affect interest paid on variable-rate debt and the
market value of fixed income securities held by our nuclear decommissioning trust fund (see Note 13 and Note 19) and benefit plan
assets. The nuclear decommissioning trust fund and benefit plan assets also have risks associated with the changing market value of
their equity and other non-fixed income investments. Nuclear decommissioning and benefit plan costs are recovered in regulated
electricity prices.
The tables below present contractual balances of our consolidated long-term and short-term debt at the expected maturity dates,
as well as the fair value of those instruments on December 31, 2015 and 2014. The interest rates presented in the tables below
represent the weighted-average interest rates as of December 31, 2015 and 2014 (dollars in millions):
Pinnacle West – Consolidated
Variable-Rate
Long-Term Debt
Fixed-Rate
Long-Term Debt
Interest
Interest
2015
Rates
Amount
Rates
Amount
2016
0.01%
$ 44
6.15%
$ 314
2017
1.17%
125
—
—
2018
1.02%
50
1.75%
32
2019
—
—
8.75%
500
2020
—
—
2.20%
250
Years thereafter
0.23%
49
4.64%
2,490
Total
$ 268
$ 3,586
Fair value
$ 268
$ 3,839
69