APS CEO Don Brandt Will Retire In November

By Steve Goldstein, Mark Brodie
Howard Fischer, Capitol Media Services
Published: Thursday, August 22, 2019 - 8:31am
Updated: Thursday, August 22, 2019 - 10:41am

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The head of the state's largest electric company is stepping down, but not before utility regulators get a chance to grill him next month on company practices and policies.

In a formal announcement Wednesday, Pinnacle West Capital Corp. said that Don Brandt will retire as the president, chief executive officer and chairman of the board, effective Nov. 15. That follows 16 years with the parent company of Arizona Public Service, the last decade holding the three top slots.

But Pinnacle West spokesman Alan Bunnell said that Brandt intends to honor his commitment to testify at the Arizona Corporation Commission as scheduled on Sept. 4. Regulators already have prepared a list of 67 written questions they want him to answer and already are coming up with more.

Don Brandt APS
Pinnacle West Capital Corp.
Don Brandt

Commissioners already have some in mind based on Wednesday's announcement.

Some now appear aimed less at Brandt than at Jeff Guldner, current the president of the APS subsidiary, who will be taking the reins of Pinnacle West. And that goes to the question of what, if anything, will change under the new leadership.

Chairman Bob Burns, who has been battling with Pinnacle West now for years, including court battles over access to records of "dark money" spending on campaigns, called the company's behavior until now "unacceptable."

"I think we need to do everything we can to change that," said Burns, a Republican on the five-member panel. "Whoever's in charge, if they don't change their behavior, there's problems."

Democrat Sandra Kennedy, another member of the commission, said she has similar questions.

"I'm trying to give Guldner the benefit of the doubt," she said. "But he's going to have to change the culture of the company."

It was under Brandt's watch that Pinnacle West funneled $10.7 million through other organizations that, in turn, spent heavily in the 2014 commission race to elect a panel only of Republicans. The recipient groups refused to disclose the source of their cash, citing their status as "social welfare" organizations which exempts them form some of the same campaign finance laws that apply to others.

In 2016 the company openly spent $4.2 million to keep the commission an all-Republican affair.

It did not participate in the 2018 campaign but instead spent $32 million to quash an initiative that would have required regulated utilities like APS to get more of their energy from renewable sources.

More recently, APS has come under scrutiny following reports that several customers died after their power had been cut off. That led to commissioners seeking answers from Brandt about company policies, like notifying people in person before the plug is pulled.

Bunnell said Brandt will be at the commission on Sept. 4 as scheduled.

And the timing of his retirement?

"It has nothing to do with the disconnect issue and the current climate," Bunnell said.

aps building
Justin Stabley/KJZZ
APS Building in downtown Phoenix.

The change in leadership, however, could bring some peace to the battles between the commission and the utility, especially with regulators seeing the policies of the company being simply the policies instituted by Brandt.

"I couldn't be happier," Kennedy said of her reaction to Brandt's retirement.

"I'm hoping all of this is a problem with Brandt," she said, saying she is hoping for changes with new leadership. "And I guess only time will tell."

Burns was a bit more circumspect when asked how he believes Brandt has run the company.

"I guess that wouldn't be a very good thing for me to be very honest about," he said. But Burns said he does believe that it is Brandt who set the agenda for the activities of Pinnacle West, including the millions poured into electing certain commissioners.

"And I think their behavior was unacceptable and I think we need to do everything we can to change that," he said.

Republican Andy Tobin, the newest member of the commission, said that in many ways the announcement is not a surprise. Tobin, appointed to the panel by Gov. Doug Ducey, said he has long believed that Guldner was put in place as head of APS as part of a succession plan.

But Tobin said he's not convinced that the change will make a great deal of difference in the relationship between the utility and the regulators.

If there is a fault to Brandt's tenure, he said, it was the decision by the company to hide its spending.

"They should have just owned it from the beginning and said, 'We're defending our customers and our shareholders,' to make their case," Tobin said. "I think that would have been what would have made it easier."

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