Arizona Public Service Co. has filed a lawsuit in the Superior Court of Maricopa County to challenge rules adopted by the Arizona Corporation Commission in December 1996 to open the state's electric industry to competition over a four-year period starting in 1999. In addition, APS has appealed the commission's decision in the Arizona Appellate Court, as has Tucson Electric Power Co.
In the lawsuit, (as distinguished from the appeal) Arizona Public Service has challenged the authority of the commission, claiming that absent legislation, neither federal nor state law authorized the commission "to make its facilities available to competitors upon demand." Also, APS argued that other electric service providers would compete for its more profitable customers by undercutting its regulated rates. APS added that the rules enacted by the commission failed to address critical restructuring issues such as reliability, market structure, and compensation for vested certificate rights.