News Release

July 6, 2007

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

PNM Natural Gas Customers To
See Slight Bill Increase

Albuquerque: PNM natural gas customers may notice a slight increase in their monthly natural gas bills as new rates approved by the New Mexico Public Regulation Commission come into effect starting this weekend.

PNM estimates the new rates will increase average monthly residential bills by 2.1 percent, from $66.51 to $67.90. Average monthly bills for most businesses would rise 1.4 percent, from $298.07 to $302.10.

The increase was necessary to meet the rising cost of delivering natural gas to customers, driven chiefly by a growing customer base and an increase in peak demand as well as increased costs of key materials such as steel, plastic and cement needed to maintain and expand the natural gas system, officials say.

The new rates apply only to delivery charges the utility applies to recover the cost of providing natural gas service. The cost of natural gas, which in the winter represents about 70 percent of a customer’s bill, is passed through to customers with no profit to PNM. Delivery fees include a fixed monthly access fee and a per therm transmission and distribution fee, which are listed on the customer’s monthly bill.

The new natural gas rates will be applied to all PNM natural gas bills rendered beginning today.

PNM is a subsidiary of PNM Resources, an energy holding company based in Albuquerque, N.M. PNM provides electric utility service to more than 487,000 customers and natural gas service to 492,000 customers in New Mexico. The company also sells power on the wholesale market in the West. 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.