Position

The Greater Albuquerque Chamber of Commerce Board of Directors opposes the recommended decision (RD) by the PRC Hearing Examiner which would disallow recovery for the necessary investments PNM has made in the Palo Verde Nuclear Generating Station (GǣPalo VerdeGǥ and the San Juan Generating Station (GǣSan JuanGǥ) which are two of PNM's most important generation resources used to serve its customers. The Chamber urges the PRC to modify the RD so that it properly balances PNM's significant investments and lease commitments for these resources with the interests of PNM's customers. Charged with oversight of utilities in the state, the New Mexico Public Regulation Commission is statutorily required to responsibly balance the interests of electric customers and the utility.

The Chamber believes the recommended decision in the pending PNM rate filing does not meet that responsibility, and in fact does a disservice to both.

Regulators give PNM the ability and obligation to serve as the sole supplier of electricity to all customers in a specific territory. In return, we believe the utility has the right to recover prudent costs, including the opportunity to make a reasonable, regulated return on its investments. The company must provide reliable service, meet state and federal regulations, and work in the best interests of customers.

The Chamber believes the recommended decision by the Hearing Examiner in the PNM rate case does not fairly consider the facts or precedent and goes against prevailing regulatory policy.

We encourage PNM be allowed to recover: 1) $163.5 million for purchase of 64.1 megawatts of power from Palo Verde Unit 2); $20 million per year for the cost to renew five leases for power from Palo Verde Units 1 and 2; and 3) $52.3 million invested in emission control equipment and technology at San Juan that is required by law.

The RD recommends three critical investments be disallowed entirely and has essentially reduced PNM's rate request from $123.5 million to $41.3 million.

While no one likes to see an increase in electric rates, the Chamber acknowledges that to effectively serve customers, promote economic growth and prosperity and strengthen the energy grid, periodic rate increases are necessary.

A financially healthy utility, reliable and affordable sources of energy and constructive regulatory environment are all critically important for attracting and retaining businesses and jobs.

Background
PNM's current rate filing is the company's first request for a general rate increase since 2010. The filing includes more than $655 million dollars the company has invested since then to maintain its top quartile reliability, improve the energy grid and to responsibly serve its more than 531,000 customers.

The recommended decision by the Hearing Examiner recommends three critical investments be disallowed entirely. They are:

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