APS Wins Prestigious Edison Award

June 16, 2008

APS received the electric utility industry’s highest honor this morning for developing a landmark system that monitors major transformers in near-real-time.

The Edison Electric Institute (EEI) presented APS with its Edison Award, which honors U.S. and international electric companies for outstanding contributions to the advancement of the power industry. The announcement was made at the EEI’s annual conference in Toronto. The Edison Award, in its 81st year, usually acknowledges one U.S. and one international electric utility.

APS was recognized for its Transformer Oil Analysis and Notification (TOAN) system. This project allows APS to automatically monitor transformer oil data, receive notification of abnormalities nearly in real time, and take necessary preventive actions. The net result is that catastrophic transformer fires may one day be a thing of the past – not only for APS, but for the entire electric industry. APS has filed two patents and received inquiries from other electric utilities about TOAN.

“The implications of this project are enormous – from both a cost and a reliability standpoint,” said APS President and CEO Don Brandt, who received the award on behalf of the company. “This technology has the potential to forever change the way electric utilities maintain critical infrastructure. We’re extremely proud to have a team of employees focused on utilizing technology to better serve our customers. The entire industry is sure to benefit from their work.

“The Arizona Corporation Commission and our executives have made transformer maintenance and reliability a high priority, which has helped spur development in this technology. I know I speak for all of our employees when I say we are honored to be recognized by EEI for this effort.”

Through TOAN, APS monitors transformer oil samples – which indicate the health of a transformer – every four hours. Through the use of artificial intelligence, TOAN is able to notify maintenance personnel of transformer problems by recognizing patterns of dissolved gases in the transformer’s insulating oil, similar to a doctor recognizing patterns in a human’s blood test.

In the past, APS – and other electric utilities – would have to travel to the locations of transformers to retrieve oil samples, then wait several days for the results before recognizing a problem may exist. Now, the monitoring is performed remotely, saving precious time and the costs associated with employee trips to substation locations, many in remote areas of the state.

“APS’ new system for monitoring transformer performance is a remarkable achievement and could potentially benefit electric utilities everywhere,” said Tom Kuhn, President of EEI. “Electric transformers are a key component in the transmission and delivery of electricity, and by providing real-time monitoring of their performance the TOAN system greatly increases system reliability and saves money in replacement and repair costs. This system represents a significant step forward in managing and monitoring the electric grid.”

APS previously won the Edison Award in 1992 for a corporate-culture restructuring process that transformed the company from a traditional, rate-driven utility to a competitive, strategically guided, customer-driven utility that encourages innovation and achievement among its employees. As a result of the program, APS cut the cost of producing a kilowatt-hour by 10 percent, and employees saved $44 million from the operating and fuel budget.

APS, Arizona’s largest and longest-serving electricity utility, serves about 1.1 million customers in 11 of the state’s 15 counties. With headquarters in Phoenix, APS is the principal subsidiary of Pinnacle West Capital Corp. (NYSE: PNW)

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