UNS Energy Corporation (NYSE: UNS) today reported second quarter 2013 net income of $34.6 million, or $0.83 per diluted share of common stock, compared with net income of $26.3 million, or $0.64 per diluted share in the same period last year. "Our second quarter results mark the end of a four and a half year base rate freeze at TEP. The rate freeze, coupled with little to no economic growth, created significant challenges during this period," said Paul Bonavia, UNS Energy's Chairman and Chief Executive Officer. "Our employees responded by consistently controlling costs while improving safety and reliability." In June, the Arizona Corporation Commission (ACC) approved new rates for TEP that became effective on July 1. The new rates include TEP's first base rate increase since 2008. "TEP's new retail rates promote rate stability and strengthen TEP's financial position, bolstering our ability to make long-term investments that are in the best interests of our customers," Bonavia said. Tucson Electric PowerRetail kWh Sales and Revenues TEP’s retail kWh sales decreased by 1.3 percent in the second quarter, due in part to fewer cooling degree days during the months of April and May compared with last year. The decrease in retail sales volumes led to a $1.1 million, or 0.8 percent, decrease in TEP’s retail margin revenues compared with the second quarter of 2012. Other Expenses TEP’s Base operations and maintenance (O&M) expense was $61.2 million in the second quarter of 2013 compared with $59.5 million in the second quarter of 2012. The increase was due in part to unplanned generating plant maintenance. Base O&M excludes costs directly offset by customer surcharges and third-party reimbursements. TEP's total interest expense declined by $1.4 million in the second quarter of 2013 primarily due to the expected decline in the balance of capital lease obligations compared with the second quarter of 2012.