EXHIBIT 99.4

ARIZONA PUBLIC SERVICE COMPANY
NON-GAAP MEASURE RECONCILIATION — OPERATING INCOME (GAAP MEASURE) TO GROSS MARGIN (NON-GAAP MEASURE)
(in thousands)

	THREE MONTHS ENDED				Pretax			After Tax
	MARCH 31,				Increase			Increase
	2005		2004		(Decrease)			(Decrease)
RECONCILIATION OF GROSS MARGIN
Operating Income (closest GAAP measure)	$	58,743	$	67,050	$	(8,307	)	$	(5,037	)
Plus:
Operations and maintenance		142,294		125,912		16,382			9,932
Depreciation and amortization		82,214		88,848		(6,634	)		(4,022	)
Income taxes		16,380		17,362		(982	)		(595	)
Other taxes		31,445		27,580		3,865			2,343
Gross margin	$	331,076	$	326,752	$	4,324		$	2,621