PHOENIX — Arizona secured a $7 million settlement with Arizona Public Service over the utility's disconnection practices during extreme heat.
Attorney General Kris Mayes announced the settlement Wednesday, resolving allegations that APS violated the Arizona Consumer Fraud Act.
The attorney general's office began investigating APS following the death of 82-year-old Katherine Korman. Her electricity was remotely disconnected for nonpayment on May 13, 2024.
The attorney general's office said APS discontinued its voluntary 95-degree hold practice three days before Korman's service was cut off. Mayes noted the cause of Korman’s death was not determined as part of this action.
"No Arizonan should be put at risk because they cannot afford their electric bill," Mayes said.
"This settlement ensures that APS will no longer disconnect power based on the date on the calendar alone — if temperatures are dangerous, the power stays on," Mayes said.
Under the consent judgment, APS will pay $2.75 million into the state's Consumer Protection–Consumer Fraud Revolving Fund, plus up to $250,000 in attorneys' fees.
The utility will also fund $1 million for the Arizona Consumer Assistance and Education Program. At least $800,000 of that will be applied directly as bill credits to eligible customers facing service termination before Sept. 1, 2026.
APS will spend an additional $3.4 million on programmatic improvements and consumer outreach.
The settlement forces APS to reinstate its voluntary 95-degree hold on residential power disconnections for nonpayment outside the existing June 1 to Oct. 15 moratorium period. The utility must also maintain its 32-degree cold-weather hold.
Other requirements include adding text message alerts for past-due notices, enhancing the Safety Net Program to allow designated third parties to receive critical alerts, and sending annual letters to customers on the Saver Choice Plus frozen rate plan to compare costs.
The settlement also encourages SRP, Tucson Electric Power, and rural cooperatives to adopt similar extreme-weather hold practices.
APS announced the program enhancements today but denied any wrongdoing, stating it strongly disagrees with the attorney general's characterizations.
The utility said its existing disconnection policies and customer communications already meet or exceed state laws. APS also noted the settlement contributions will not be recovered in customer rates.
APS highlighted several existing customer support programs, including the Guest Role program, which allows designated friends and family to manage a customer's online account. More than 13,800 customers are currently enrolled.
The utility offers a Monthly Plan Comparison tool and Budget Billing to help customers manage costs. The APS Energy Support program offers tiered monthly discounts of up to 25% or 60% based on household income. More than 85,000 customers were enrolled in 2025, receiving approximately $56 million in discounts.
For emergencies, Crisis Bill Assistance provides up to $1,000 per year for qualified customers. APS CARE, in partnership with the Salvation Army, offers up to $500 in support with no age or income criteria. Customers can call 602-371-7171 or 800-253-9405 for assistance.
APS serves 1.4 million homes and businesses across 11 Arizona counties. The utility, a subsidiary of Pinnacle West Capital Corp., utilizes an energy mix that is about 58% clean.
