News Release

Aug. 1, 2008

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PNM Requests Approval for Large Solar PV Program

Albuquerque: PNM has filed with the N. M. Public Regulation Commission for approval to establish a large solar photovoltaic program. The proposed program will be available to any PNM net-metered customer who installs and interconnects a solar system greater than 10 kilowatts in size, but no larger than 1 megawatt.

The proposed program is similar to PNM’s existing small solar photovoltaic PV program, which was established in 2006. Under the small solar PV program, residential and business customers install rooftop solar PV systems no larger than 10 kW. The large PV program is aimed at commercial, industrial and governmental customers with sufficient roof space and solar orientation to install large systems, said Jerry Neal, manager of large customer support for PNM. While residential customers may participate in the large PV program, the average home can meet most of its daytime electrical needs with a 2 kW system, so the large systems produce far more electricity than most homes need.

By generating their own electricity, customers are able to offset some of the costs associated with installing systems by: eliminating or reducing their monthly electric bill; selling excess electricity they generate to PNM; and selling renewable energy certificates associated with the electricity they generate and consume to PNM.

RECs are credits based on the state’s renewable portfolio standard, which requires utilities to meet a certain portion of customers’ energy needs with renewable energy. Under the terms of the renewable portfolio standard, PNM acquires RECs for each kilowatt-hour of electricity that it generates or buys from clean, renewable energy sources such as solar and wind.

In its request to the Commission, PNM asked for approval to purchase the RECs associated with the energy produced by the customer’s PV system and consumed by the customer for 13 cents per kWh, the same rate paid in the small PV program. When PNM purchases electricity generated but not consumed by customers, the RECs associated with that excess power are included in the purchase.

“While the REC purchase program and tax incentives make these systems more economically attractive, the customers who apply for this program will need to have other motivation,” said Neal. He expects to see government entities with renewable energy mandates and businesses with similar corporate mandates apply for the program, as well as companies that are environmentally motivated.

Neal said that interest in the small PV program—which now has nearly 300 participants—was greatly underestimated, so it is difficult to predict how many customers will be interested in the large program. “A number of companies and government agencies have already expressed interest,” he said.

PNM is required by state mandate to produce energy from renewable distributed generation technologies equal to 1.5 percent of retail sales by 2011 and 3 percent by 2015. Renewable distributed generation technologies, such as the solar PV programs, are customer- or utility-owned generators that are located at the site where the energy is consumed. The RPS also requires PNM to achieve a fully diversified renewable energy portfolio, including wind and solar. “This new program, combined with the existing small solar PV program, will help us meet the RPS,” said Neal.

If approved, PNM hopes to implement the program in early 2009.