U.S. Probing Power Rates of Arizona Public Service, Fortis Units

Power rates charged by Arizona Public Service Co. and units of Fortis Inc. are under investigation by U.S. energy regulators who will decide whether the prices are just and reasonable.

In opening the probes, the Federal Energy Regulatory Commission said the companies had failed to prove that they weren’t capable of unfairly raising prices using their market power in the Tucson, Arizona, region. The agency ordered the companies on Monday to explain within 60 days why it shouldn’t revoke their market-based rate authority, propose how they can mitigate their ability to exercise market power or say they’ll use cost-based rates instead of market ones.

The investigations come just two weeks after the commission said it was looking into the rates charged by Talen Energy Corp. for power in Pennsylvania.

The units of St. John’s, Newfoundland-based Fortis subject to investigation are Central Hudson Gas & Electric Corp., Tucson Electric Power Co., UNS Electric Inc. and UniSource Energy Development Co.

Steven Gotfried, a spokesman for Arizona Public Service, had no immediate comment. Fortis didn’t immediately respond to requests for comment.