If you pay enough attention to what’s been going on as of late, you’d figure that PNM is about to be swimming in money. Not money from profits based on their energy production (in fact, PNM posted losing quarters all of last year), but in “help” from state and federal sources.
First off, PNM has been given free rein when it comes to rate increases. Last year the state Public Regulation Commission approved PNM for a 4.4% ($24 million) rate increase. That was big, but not quite the $82 million PNM originally wanted. PNM also requested a fuel clause, which would have given them the ability to adjust their rates to adjust to fuel costs. Many spoke out against this rate clause, saying it was simply a thinly-veiled rate hike designed to help PNM make up some of the $58 million that they didn’t get in the rate increase. It was determined that there wasn’t a need for the fuel clause and PNM’s request was rejected.
Now there’s word of another rate increase at the beginning of this year. PNM recently announced they will impose a 9.7% or $77 million rate increase starting in July. According to PNM’s CEO Jeff Sterba, the increase “is the latest step in our ongoing efforts to ensure adequate recovery of PNM’s costs and restoring shareholder value.”
Funny, I thought the reason PNM sold their gas holdings and got a credit line increase (increased to $300 million) last spring from the PRC was to improve PNM’s profits (and thus decrease how much they pass on to consumers) and help improve PNM’s credit rating.
One has to wonder whether last year’s profit losses, the large costs paid out to upgrade PNM’s San Juan Generating Plant, and the recent $7 million fine for emissions from the San Juan plant have anything to do with PNM’s recent request for a rate increase.
But now PNM is taking it to the federal level.