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Utility Pinnacle West suffers a quarterly loss due to higher costs

Pinnacle West Capital, a U.S. utility company, reported a loss for the first quarter of this year due to higher interest and operating costs.

New power plants and other intangible assets have increased the operating and maintenance costs of Phoenix-based company.

Interest rates that are higher for longer hurt utilities as well, since they need more capital to build and maintain grids.

The company reported that its total operating costs rose to $975.1 millions during the first reporting quarter from $884.9 during the same period last year.

The total cost of interest rose to $94.8 millions during the third quarter from $86.6million a year earlier.

The shares of the company are down slightly in morning trading.

Utility said, however, that the number of retail clients grew by 2.3% in Arizona. Electricity demand there is increasing, largely due to multi-billion dollar semiconductor plants that are coming online.

The company stated in February that Pinnacle West, whose main subsidiary serves 1.4 millions customers in Arizona, plans to add 9,805 MW of renewable energy, battery storage, and natural gas from 2025 to 2028. Over 90% is expected to be carbon free.

The company posted a loss of $4.6m, or 4c per share, in the third quarter that ended on March 31. This compares to a profit of $16.9m, or 15c per share, a year ago. Reporting by Arunima Kumra and Khusbu Jeena in Bengaluru, Editing by Sahal Muhammad

(source: Reuters)