Energy Watch Update

The events of the last several weeks have provided opportunities for APS and our customers to work together to conserve energy during periods of peak demand. You have responded amazingly with your efforts. We want to thank you and let you know we sincerely appreciate everything you did to help get us through without having to resort to rolling outages. APS has recently restored the capabilities of the Valley's electrical distribution system to meet our current energy needs, and we now encourage everyone to get back to a more normal lifestyle.

Following is a review of the events that brought us together during this extraordinary time.

Westwing Fire
On July 4, a fire destroyed five transformers at the Westwing substation, located in the northwest Valley. The transformers operate in banks of three. One full transformer bank and one unit of a second bank were destroyed, as was a spare unit. We established a multi-phase plan to fully restore the substation. The initial steps focused on testing and re-engaging the remaining undamaged bank of transformers -- completed on July 8.

Simultaneously, we purchased a replacement transformer from Bonneville Power Association to enable making the second bank of transformers operational. The replacement started its journey in Covington, Washington. It was transported to Tacoma, Washington and placed on a barge to Southern California.

Fire at Deer Valley Substation
At about 2:30 a.m., July 20, a 230-kilovolt (kV) transformer at the Deer Valley substation caught fire. The transformer was one of three at the substation, located at 35th Avenue and N. Union Hills. The Phoenix Fire Department contained the fire by 5 a.m., using both water and suppression foam.

The fire caused many customers in the areas between 7th and 67th Avenues, Olive to Dynamite, and 67th to 115th Avenues, to be without service until 9 a.m. The loss of the Deer Valley transformer increased the difficulty to meet peak load requirements in the Valley.

After the Fire Department declared the area safe, releasing the switchyard to APS, employees began preparations to install a replacement transformer. The replacement was installed and made operational at about 3 a.m. on July 26, bringing the Deer Valley substation back to full capacity.

The Transformer Journey
The Westwing substation's replacement transformer arrived in southern California and began its slow journey to the Valley. On Saturday, July 24, the new transformer suffered a setback when it tilted while its hauler was navigating a curve and a slight grade near Victorville, California. The transformer was transferred to a special hydraulic trailer that allowed it to safely move out of the Victorville area. It was later transferred back to the original trailer after repairs to the hauler were completed.

The journey to the Westwing substation continued at a top speed of less than 10 miles per hour and safely arrived in the Valley on Saturday, July 31 -- 20 days after leaving Covington, Washington. APS, with the on-site help of representatives from Japan-based Fuji Electric Co., the manufacturer of the transformer, and Portland, Oregon-based Bonneville Power Administration, the utility from which APS procured it, worked around the clock and brought the new transformer online on Monday, August 9, ahead of schedule.

A Final Word
Over the next year, we will be ordering and installing new transformers to rebuild the Westwing substation, making it fully operational for the high summer demand of 2005.

Thank you from all of us at APS for making a difference this summer!