Regulatory Matters (Tables)

12 Months Ended

Dec. 31, 2015

Regulated Operations [Abstract]

Schedule of changes in the deferred fuel and purchased power regulatory asset

The following table shows the changes in the deferred fuel and purchased power regulatory asset (liability) for 2015 and 2014 (dollars in thousands):

	Year Ended December 31,
	2015			2014
Beginning balance	$	6,926		$	20,755
Deferred fuel and purchased power costs - current period	(14,997		)	26,927
Amounts charged to customers	(1,617		)	(40,756		)
Ending balance	$	(9,688	)	$	6,926

Schedule of regulatory assets

The detail of regulatory assets is as follows (dollars in thousands):

	Amortization Through	December 31, 2015				December 31, 2014
		Current		Non-Current		Current		Non-Current
Pension	(a)	$	—	$	619,223	$	—	$	485,037
Retired power plant costs	2033	9,913		127,518		9,913		136,182
Income taxes - AFUDC equity	2045	5,495		133,712		4,813		118,396
Deferred fuel and purchased power — mark-to-market (Note 16)	2018	71,852		69,697		51,209		46,233
Four Corners cost deferral	2024	6,689		63,582		6,689		70,565
Income taxes — investment tax credit basis adjustment	2045	1,766		48,462		1,716		46,200
Lost fixed cost recovery	2016	45,507		—		37,612		—
Palo Verde VIEs (Note 18)	2046	—		18,143		—		34,440
Deferred compensation	2036	—		34,751		—		34,162
Deferred property taxes	(d)	—		50,453		—		30,283
Loss on reacquired debt	2034	1,515		16,375		1,435		16,410
Tax expense of Medicare subsidy	2024	1,520		12,163		1,528		13,756
Transmission vegetation management	2016	4,543		—		9,086		4,543
Mead-Phoenix transmission line CIAC	2050	332		11,040		332		11,372
Deferred fuel and purchased power (b) (c)	2015	—		—		6,926		—
Coal reclamation	2026	418		6,085		418		6,503
Pension and other postretirement benefits deferral	2015	—		—		4,238		—
Other	Various	5		2,942		819		5
Total regulatory assets (e)		$	149,555	$	1,214,146	$	136,734	$	1,054,087

(a) This asset represents the future recovery of pension benefit obligations through retail rates.  If these costs are disallowed by the ACC, this regulatory asset would be charged to OCI and result in lower future revenues.  See Note 7 for further discussion.

(b) See “Cost Recovery Mechanisms” discussion above.

(c) Subject to a carrying charge.

(d) Per the provision of the 2012 Settlement Agreement.

(e) There are no regulatory assets for which the ACC has allowed recovery of costs, but not allowed a return by exclusion from rate base.  FERC rates are set using a formula rate as described in “Transmission Rates, Transmission Cost Adjustor and Other Transmission Matters.”

Schedule of regulatory liabilities

The detail of regulatory liabilities is as follows (dollars in thousands):

	Amortization Through	December 31, 2015				December 31, 2014
		Current		Non-Current		Current		Non-Current
Asset retirement obligations	2057	$	—	$	277,554	$	—	$	295,546
Removal costs	(a)	39,746		240,367		31,033		272,825
Other postretirement benefits	(d)	34,100		179,521		32,317		198,599
Income taxes — deferred investment tax credit	2045	3,604		97,175		3,505		92,727
Income taxes - change in rates	2045	1,113		72,454		371		72,423
Spent nuclear fuel	2047	3,051		67,437		4,396		65,594
Renewable energy standard (b)	2017	43,773		4,365		24,596		22,677
Demand side management (b)	2017	6,079		19,115		31,335		—
Sundance maintenance	2030	—		13,678		—		12,069
Deferred fuel and purchased power (b) (c)	2016	9,688		—		—		—
Deferred gains on utility property	2019	2,062		6,001		2,062		8,001
Four Corners coal reclamation	2031	—		8,920		—		1,200
Other	Various	2,550		7,565		934		9,535
Total regulatory liabilities		$	145,766	$	994,152	$	130,549	$	1,051,196

(a) In accordance with regulatory accounting guidance, APS accrues for removal costs for its regulated assets, even if there is no legal obligation for removal (see Note 11).

(b) See “Cost Recovery Mechanisms” discussion above.

(c) Subject to a carrying charge.

(d) See Note 7.