Pinnacle West Capital Corporation, the parent company of monopoly utility Arizona Public Service, spent over $11 million from August 12 through September 30 to fight Prop 127, the renewable energy ballot initiative.

Pinnacle West gave the new contributions to Arizonans for Affordable Electricity, the political action committee (PAC) that the utility set up to fight the initiative, according to documents that the PAC filed with the Secretary of State’s office. The new contributions bring the total that Pinnacle West has contributed directly to fight the ballot initiative to just over $22,213,714. That spending represents 4.5 percent of the $488 million in profits that Pinnacle West earned in 2017.

APS spending to oppose Prop 127 Clean Energy for a Healthy Arizona

 

Prop 127 would require APS to source 50% of its electricity from renewable sources by 2030. The current requirement is 15% by 2025.

Arizonans for Affordable Electricity spent far less than it received during the seven-week period, burning only $2 million. The largest expenses went to the law firm Snell & Wilmer and to other attorneys, and the PAC spent $200,000 on Briefit, LLC, which describes itself as “artificial intelligence for lawyers, writers and researchers.”

Mark Cardenas, Democrat who came out against Prop 127, got $8,000 in “consulting” fees from APS-backed PAC

The PAC also offered $8,000 in exchange for “consulting” to Mark Cardenas, a Democratic member of Arizona’s House of Representatives who is not running for reelection in November and one of very few Democrats in the state to advocate against Prop 127.

The Arizona Republic and Phoenix New Times reported that APS also gave $50,000 to a political action committee set up to elect another Democratic state legislator who backed Prop 127, Robert Meza, but that money was spent on campaigning to get Meza elected. The $8,000 in consulting fees from Arizonans for Affordable Electricity went to pay Cardenas personally.

Arizonans for Affordable Electricity reported having about $400,000 on hand as of Sept. 30.

No APS spending on Corporation Commission candidates, but independent expenditures likely to come

In addition to casting a ballot on Prop 127, Arizona voters will choose two candidates to serve on the Arizona Corporation Commission (ACC), the five-member body which regulates APS and other Arizona utilities. The ACC determines how much APS and other utilities like Tucson Electric Power can raise customers’ rates, sets their allowable rates of profits, and determines much of the state’s energy policy.

None of the four candidates for the ACC have received money directly from APS during this cycle. That shouldn’t come as a surprise, as the utility has never given money directly to ACC candidates’ campaign committees, though it has spent millions trying to influence the election of its regulators.

Dark money groups spent more than $3 million on independent expenditures in 2014 to help current ACC commissioner Tom Forese and former commissioner Doug Little get elected; it is widely assumed that APS was the origin of that money, an allegation the company has never confirmed nor denied. APS did spend openly on the ACC races in 2016 by giving $4 million to a PAC which made independent expenditures to benefit current commissioners Bob Burns, Andy Tobin, and Dunn, further fueling accusations from customers that the ACC could not be trusted to regulate in the public interest.

Republican ACC candidate Justin Olson did receive $1,000 from the President of the Arizona Tax Research Association, to which Pinnacle West gave $8,550 in 2017 and $10,617 in 2016. Olson also received $500 from Russell Smoldon, who runs B3 Strategies, a lobbying firm which lobbies for the Arizona utility Salt River Project in the past. SRP, a quasi-governmental utility with its own elected board, is not itself regulated by the ACC.

Pinnacle West stashed $3.2 million in the end of 2017 into yet another PAC, Arizonans for Sustainable Energy Policy, which a spokesperson said “will be used for independent expenditures, focused solely on candidates.”

Arizonans for Sustainable Energy Policy also reported its campaign filings yesterday, and as of Sept. 30 it had not yet made any independent expenditures around the ACC or any other office. That spending may be around the corner though: the similar venture which APS set up in 2016, “Arizona Coalition for Reliable Energy,” waited until October 24 to spend over $4 million on the ACC races in that year.

The last campaign finance filing deadline before the Nov. 6 election this year is Oct. 29, but that deadline only covers spending through Oct. 20, which means that voters may not learn about any late independent expenditures done by the APS-financed PAC to elect or defeat candidates for the ACC until after the election.

Arizonans for Sustainable Energy Policy did report giving $300,000 to the Arizona Republican Party PAC during the most recent filing period. That’s in addition to the $100,000 that Pinnacle West gave directly to the Arizona Republican Party in March via its own PAC.

APS continues to reward legislators that oppose renewable energy

Pinnacle West also spent $109,000 during the filing period through its own political action committee, which has now spent just shy of $1 million this cycle on politicians running for state and federal office.

The Pinnacle West PAC gave $500 during the reporting period to each of the legislators who made arguments against Prop 127 in the ballot booklet that voters received, as well as to a host of other legislators. The legislators who made arguments against Prop 127 include Sen. John Kavanagh, Rep. César Chávez, Sen. Kate Brophy-McGee, Sen, Sylvia Allen, Sen. Rick Gray, Rep. Jeff Weninger, Rep. David Cook, and Rep. Travis Grantham.

The Pinnacle West PAC also spent on federal candidates and local candidates.

Posted by Charlotte Grubb

Charlotte was a Research and Communications Manager at the Energy and Policy Institute. Prior to EPI, she was the staff economist for three years at Oceana, where she provided economic analysis for marine habitat and fisheries policy and mentored staff on campaign strategies. She has published work in newspapers, academic journals and technical reports. Charlotte earned a Master’s in Ecological Economics from the University of Edinburgh and a B.A. in International Affairs from The George Washington University.

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