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
	JUNE 30,				Increase			Increase
	2005		2004		(Decrease)			(Decrease)
RECONCILIATION OF GROSS MARGIN
Operating Income (closest GAAP measure)	$	95,321	$	83,604	$	11,717		$	7,104
Plus:
Operations and maintenance		138,314		126,871		11,443			6,938
Depreciation and amortization		76,808		88,385		(11,577	)		(7,019	)
Income taxes		41,772		32,371		9,401			5,700
Other taxes		31,322		29,874		1,448			878
Gross margin	$	383,537	$	361,105	$	22,432		$	13,601

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

	SIX MONTHS ENDED				Pretax			After Tax
	JUNE 30,				Increase			Increase
	2005		2004		(Decrease)			(Decrease)
RECONCILIATION OF GROSS MARGIN
Operating Income (closest GAAP measure)	$	154,064	$	150,654	$	3,410		$	2,067
Plus:
Operations and maintenance		280,608		252,783		27,825			16,870
Depreciation and amortization		159,022		177,233		(18,211	)		(11,041	)
Income taxes		58,152		49,733		8,419			5,104
Other taxes		62,767		57,454		5,313			3,221
Gross margin	$	714,613	$	687,857	$	26,756		$	16,221