Pinnacle West Capital Corp. Announces Cholla Power Plant Conversion to Natural Gas

Pinnacle West Capital Corp. Announces Cholla Power Plant Conversion to Natural Gas

PHOENIX, July 2, 2026 – Arizona Public Service (APS), a subsidiary of Pinnacle West Capital Corp. (NYSE: PNW), has announced plans to convert two units at its Cholla Power Plant in Joseph City, Navajo County, Arizona, from coal to natural gas. This strategic move aims to meet the state’s growing energy demand while maintaining reliable and affordable electric service for customers. The repurposed units are expected to commence operations in 2029.

Historical Significance of Cholla Power Plant

Commissioned in 1962, the Cholla Power Plant has been a cornerstone in Arizona’s energy infrastructure, providing critical power supply for decades. However, federal environmental mandates led to the phased retirement of the plant’s coal units, culminating in March 2025. The planned conversion to natural gas seeks to preserve the plant’s legacy while adapting to modern energy needs.

Strategic Benefits of the Conversion

The decision to convert the Cholla units to natural gas offers several advantages:

• Utilization of Existing Infrastructure: Leveraging the plant’s current transmission lines and facilities will facilitate a smoother transition and reduce capital expenditures.
• Enhanced Reliability: Natural gas-fired units can provide more consistent and flexible power generation, essential for balancing the grid as renewable energy sources are integrated.
• Environmental Compliance: Transitioning to natural gas is expected to result in lower emissions compared to coal, aligning with environmental regulations and sustainability goals.

Financial Implications and Market Response

As of July 10, 2026, Pinnacle West Capital Corp.’s stock (NYSE: PNW) was trading at $108.12, reflecting a 1.14% increase from the previous close. This uptick suggests a positive market response to the company’s strategic initiatives, including the Cholla conversion.

Community and Economic Impact

The Cholla Power Plant has been integral to the communities of Joseph City, Holbrook, Navajo County, and northeastern Arizona. APS President Ted Geisler emphasized the plant’s significance, stating, “Cholla has been an important part of the communities… for decades and has been…” The conversion project is anticipated to sustain local employment and contribute to the regional economy.

Future Outlook

APS’s plan to convert the Cholla Power Plant to natural gas underscores its commitment to adapting to evolving energy landscapes while ensuring reliable service. This initiative is part of a broader strategy to balance energy generation sources, integrate renewable energy, and comply with environmental standards. Stakeholders will be closely monitoring the project’s progress and its impact on the company’s financial performance and community relations.

For more information, visit Pinnacle West’s official website.