News Release

March 6, 2009

Additional Information Residential Customers Fact sheet (.pdf) PNM Putting Energy Efficiency to Work Fact sheet (.pdf) Bill and Energy Management Assistance for Low Income and Other PNM Electric Customers Fact sheet (.pdf)

Public Hearings on Agreement Albuquerque: March 25, 2-6 p.m. African American Performing Arts Center at Expo New Mexico Deming: March 25, 2-5:30 p.m. Mimbres Valley Learning Center, room 146, 2300 E. Pine Santa Fe: April 3, 10 a.m. Boys & Girls Club, 730 Alto

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PNM, Key Parties Agree on New Electric Rates

Albuquerque: PNM and key parties have signed an agreement that would change the company’s base electric rates while easing the impact of rising costs on customers. The agreement also would strengthen the company’s ability to make investments to meet the growing electric needs of its customers.

“This agreement maintains reasonable prices for customers and allows us to continue to invest in those resources needed to meet growing electric demand,” said Pat Vincent-Collawn, PNM president and CEO. ”New Mexico’s need for affordable, reliable electricity will be well served by this agreement, which is supported by a diverse group of individuals and organizations.”

Among other items, the proposed base electric rates include costs associated with three existing, natural-gas fired power plants needed to meet growing electric demand. Those plants are in Valencia, Hidalgo and Luna counties.

If approved by the N.M. Public Regulation Commission, after a hearing set to begin April 8, the agreement would:

• Limit an increase in base electric rates to about 9.7 percent annually for residential and small business customers. Once the new base rates are fully in place, a typical residential customer using 600 kilowatt hours per month would pay about $4.89 more per month. The increase would be somewhat lower during non-summer months and somewhat higher during summer months.
• Mitigate the impact of the increase for customers by increasing rates in two phases, with 65 percent of the increase effective July 1 and the remaining 35 percent effective March 31, 2010.
• Allow PNM continued use of a fuel clause that, with some modifications, would allow it to pass along to customers changes in fuel costs. The fuel clause would be set at zero for the first year of the new base rates and would be reset in July 2010 based on actual fuel costs for the preceding year and expected costs for the subsequent year.
• Over 21 months, credit customers with prior PNM sales of sulfur dioxide emission allowances.  Because the amount of money to be credited to customers is larger in the first year of the credits, beginning July 1, customers may see a slight increase in their monthly bills beginning July 1, 2010.  This would be in addition to any costs or credits flowed to customers through the company’s fuel clause.

Among the parties signing the agreement, filed today with the PRC, are: PNM, PRC staff, the Albuquerque Bernalillo County Water Utility Authority, the Coalition for Clean Affordable Energy, Community Action of New Mexico, Kroger Co., the New Mexico Industrial Energy Consumers, the University of New Mexico, Wal-Mart Stores and Western Resource Advocates.