(The Center Square) - Arizona has reached an $7 million settlement with the Phoenix-based utility company known as Arizona Public Service.
State Attorney General Kris Mayes made the announcement Wednesday during a news conference at her office.
Mayes told reporters that “APS has not admitted or agreed to liability or fault through the settlement,” but Mayes said this helps hold the privately- and investor-owned utility accountable to its customers.
The Democratic attorney general noted the settlement delivers real change for families like Kate Korman’s in Sun City, located near Phoenix.
“Kate was an APS customer. She was behind on her electric bill as many people can be, with the ever-increasing cost of living,” Mayes told reporters. “On May 13 of 2024, Arizona Public Service Co. remotely disconnected Kate Corman's power. It was 99 degrees that day. Six days later, she was found dead in her home.”
As part of the settlement, Mayes said APS has agreed to fund a $1 million consumer assistance program with at least $800,000 going directly as bill credits to APS customers who are behind on their bills and at risk of having their power disconnected.
“That help starts right now, and it runs through September of this year,” said Mayes.
APS will also pay $2.75 million to Arizona's Consumer Protection Fund. According to Mayes, those funds come entirely from APS shareholders, not rate payers.
Meanwhile, APS will also spend an additional $3.4 million on reforms to how it communicates with and protects its customers. This will include better notifications, better outreach and better tools for people who are having difficulty paying their bills.
“The most important change, the one that could and I believe will save lives this summer and every summer going forward, is this: APS will no longer disconnect power based on the date on the calendar alone,” said Mayes. “If temperatures are dangerous, the power stays on.”
Mayes told reporters that APS had a voluntary policy of not disconnecting services when temperatures were forecast to reach 95 degrees or higher. However, that policy ended just days before Kate Korman’s power was disconnected.
Under this settlement, that protection is back, and Mayes said it is binding.
“APS must halt residential disconnections for nonpayment whenever the temperature at a customer's location is forecast to reach 95 degrees or above the following day,” said Mayes. “The same protection applies on the cold end of the spectrum. No disconnections when temperatures are forecast to drop to 32 degrees or below.”
APS serves throughout portions of Arizona, including northern Arizona.
Mayes added later that her office is also requiring APS to write to every other major utility in Arizona and encourage them to adopt the same protections.
As Mayes explained, this should not be just an APS policy.
“It should be the standard across our state,” said Mayes.
The Center Square reached out for comment from APS. In response, the utility referred to a statement on its website saying it “disagrees with the Arizona Attorney General’s statement regarding APS’s disconnection policies and customer communications.” APS added that its entire team “prioritizes customer safety and cares deeply about the well-being of our customers and communities.”
APS also lists the various changes to its policies moving forward.
“We remain committed to maintaining best-in-class customer support and education programs and are taking action to further strengthen our policies, assistance initiatives and communications,” said APS on its website. “Our focus is on helping customers stay informed, connected and supported, especially in times of need.”
APS is the principal subsidiary of Pinnacle West Capital Corp.
