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PNM Resourcesa? New Mexico Utility Requests Electric Rate Increase

^{Published on 2010-06-01 23:20:05 - Market Wire}
 

ALBUQUERQUE, N.M.--([ BUSINESS WIRE ])--PNM Resourcesa™ (NYSE: PNM) New Mexico utility, PNM, today filed for an increase in electric rates for its northern and southern operations of $165.2 million, or 21.2 percent.

"Asking for an increase in rates is never an easy decision, especially during these challenging economic times we all are experiencing"

The filing includes a phase-in to mitigate the impact on customers and a future test period instead of a historical test period, based on a bill passed unanimously by state legislators in 2009. If ultimately approved by the N.M. Public Regulation Commission, the increase in rates would be only PNMa™s third in nearly 25 years.

aAsking for an increase in rates is never an easy decision, especially during these challenging economic times we all are experiencing,a said Pat Vincent-Collawn, PNM Resources president and CEO. aPNM is obligated to provide reliable electric service, and this rate proposal is designed to capture approximately $237 million of investment wea™ve made to improve the system. In addition, we plan to make infrastructure investments of approximately $338 million by the end of 2011. Those investments were and are necessary to maintain and improve the integrity of our electric system.a

PNMa™s filing requests:

• A $152.9 million increase in annual revenue for PNMa™s northern operations and a $12.3 million increase in annual revenue for PNMa™s southern operations, which covers the service territory formerly served by Texas-New Mexico Power prior to 2007.
• A two-phase implementation to mitigate customer impact if regulators grant the proposed increases. The first phase would go into effect April 1, 2011, and the second would go into effect Jan. 1, 2012.
• A three-year decoupling pilot program for PNM northern residential and small commercial customers to recover fixed costs that are not recovered as a result of energy efficiency.

Excluded from the rate proposal are costs associated with the expansion of PNMa™s renewable resources. Regulators separately are considering a plan to add 80 megawatts of solar power to PNMa™s system to help fulfill state-mandated renewable energy standards.

PNM proposes to delay recovery of costs associated with renewable generation until April 1, 2012. PNM will seek approval from the Commission for implementation of a rate rider to collect these costs. Until the rate rider is in place, PNM would defer the costs associated with the renewable resources as regulatory assets on its balance sheet.

PROPOSED PHASED-IN RATE INCREASE

The following table sets forth the rate increase PNM has proposed, separated for the northern and southern operations, and also separated for each phased-in date.

Additional information about the PNM filing, selected testimony,supporting materialand certain related information are available on PNM Resourcesa™ Web site at http://pnm.client.shareholder.com/investors/regulatory.cfm and http://www.pnmresources.com/investors/gaap.cfm.The contents ofPNM Resources' Web site, or the contents of the PNM rate case filing, selected testimony and supporting material,are not incorporated into this news release.

Background:

PNM Resources (NYSE: PNM) is an energy holding company based in Albuquerque, N.M., with 2009 consolidated operating revenues from continuing operations of $1.6 billion. Through its utility and energy subsidiaries, PNM Resources has more than 2,710 megawatts of generation resources and serves electricity to more than 875,300 homes and businesses in New Mexico and Texas. The company also has a 50-percent ownership of Optim Energy, which owns nearly 1,200 megawatts of generation resources. For more information, visit the companya™s Web site at [ www.PNMResources.com ].