News Release

May 22, 2008

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

PNM Allowed To Pass Rising Fuel Costs to Customers Without Profit

Albuquerque: PNM electric customers will see an additional increase in their bills starting as soon early June, as emergency fuel and purchased power cost relief granted today by the N.M. Public Regulation Commission goes into effect.

"We recognize this increase is an impact on customers. We wouldn't seek it unless it was absolutely necessary, but as costs continue to rise we must have adequate rates to cover the costs we are incurring," said Pat Vincent-Collawn, PNM Utilities President. "Rising energy costs underscore the importance of energy efficiency as a tool for managing bills, and we urge our customers to take advantage of the variety of energy efficiency programs we have available for them."

Fuel — such as coal, natural gas and uranium — is a major ingredient in producing electricity. The costs of these fuels are on the rise, as are the costs of purchasing power to serve customers. Today's decision from the PRC allows PNM the ability to pass those additional costs to customers at no profit. The costs will be reviewed by the PRC every six months to ensure they reflect actual, reasonable costs incurred by PNM.

The increase is in addition to a rate increase granted in late April following a 15-month electric rate case proceeding in which approximately 40 percent of PNM's requested increase was approved. Even with the April rate increase and today's emergency fuel and purchased power cost increase, PNM estimates its retail rates remain well below the regional and national averages.

For the average residential customer using 600 kilowatt-hours per month, the monthly bill increase – including both the April rate increase and the fuel clause approved today -- is estimated to be about $9.30 in the summer (June through August), and about $5.85 the rest of the year.

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.