News Release

Oct. 12 , 2005

PNM Seeks To Decommission Las Vegas Generating Station

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NEWS MEDIA CONTACT Susan Sponar Telephone: (505) 241-2768

Las Vegas, N.M.: PNM yesterday began the regulatory process that will lead to the removal of a 20 megawatt diesel-fired turbine by filing with the New Mexico Public Regulation Commission for decommissioning and abandonment of the Las Vegas Generating Station.

The Las Vegas Generating Station has been in service since the early 1970s, providing transmission support for the Las Vegas and Santa Fe areas and backup power for the Las Vegas community. The turbine has run only infrequently in recent years – typically less than 1 percent of the time. The plant also has served as a "black-start" facility, providing PNM a way to restart other generating facilities in the event of a widespread power outage.

PNM no longer relies on the turbine for black-start capability, having agreed to an operating procedure with the City of Farmington to use hydroelectric power and other resources for black-start purposes.

In recent years, PNM has completed several improvements within the Las Vegas distribution system. PNM also recently began construction on a transmission project, called "Project Power," that will provide transmission support to Las Vegas and, together with the other recent system improvements, make the Las Vegas Generating Station unnecessary for transmission support and as a backup power source for the community. PNM expects to have Project Power in service by July 2006 following a three-month test period. After Project Power is in service and fully tested, PNM intends to decommission the turbine as soon as possible, and place the turbine components on the market for sale.

"PNM committed to removing this turbine by August 2007. We are pleased to announce that we are well ahead of schedule," said John Myers, PNM vice president for power production. "With Project Power construction in full swing and an alternate black-start source secured, our reliance on the Las Vegas Generating Station is nearing its end."

The transmission and distribution substation equipment located next to the turbine will remain in place because it continues to be a vital part of the Las Vegas electrical distribution system.

PNM is the principal subsidiary of PNM Resources, an energy holding company based in Albuquerque, N.M. PNM provides electric utility service to 413,000 customers and natural gas service to 471,000 customers in New Mexico. The company also sells power on the wholesale market in the Western U.S. PNM Resources stock is traded primarily on the NYSE under the symbol PNM. For more information, see the company's Web site at PNM.com.