Palo Verde Units 2 and 3 Return to Service.

PHOENIX -- Operators at the nation's largest nuclear power plant began making preparations Monday to return two of its three units to service after questions were resolved regarding the capability of an important safety system to perform as designed. Jim Levine, Executive Vice President-Generation for plant operator Arizona Public Service, said that Units 2 and 3 at the Palo Verde Nuclear Generating Station would begin the start-up process Monday night and reach full power later this week.

Unit 1 is in the midst of a previously scheduled outage to refuel, replace steam generators and low-pressure turbines and perform routine maintenance.

Units 2 and 3 were operating at full power when they were shut down Oct. 11 after the Company could not immediately validate a calculation from the 1970s upon which operation of certain aspects of the plant's Emergency Core Cooling System (ECCS) is based. Additional analysis performed over the past six days proves conclusively that the ECCS would perform as intended under all possible scenarios. The system would flood the reactor with water in the highly unlikely event of a loss-of-coolant accident. The U.S. Nuclear Regulatory Commission estimates that such an event might occur once every 2,000 years of reactor operation.

"The decision to take the units off line was the right one and demonstrates our full commitment to safe operation," said Levine. "Moreover, the work done by our engineers and outside experts further validates the tough standards under which we operate and serves to confirm the high degree of confidence we all can have in this plant. We have operated to the highest standards of safety for the past two decades and will continue to do so."

The first two units at Palo Verde began operation in 1986. Unit 3 followed in 1988. The plant has a total capacity of just over 4,000 megawatts and provides electricity to states across the Southwest.

Power supplies for the Company during the Palo Verde outages were more than adequate to meet the needs of customers.

Palo Verde is jointly owned by APS, Salt River Project, Southern California Edison Co., El Paso Electric, Public Service Co. of New Mexico, Southern California Public Power Authority and the Los Angeles Department of Water & Power.

APS, which operates Palo Verde on behalf of the station's six other owners, is Arizona's largest and longest-serving electric utility and serves more than 1 million customers in 11 of the state's 15 counties. With headquarters in Phoenix, APS is the largest subsidiary of Pinnacle West Capital Corporation (NYSE: PNW).