PNM Seeks Fee For Renewables

Public Service Company of New Mexico is asking state regulators to OK a new annually adjusted charge to meet the state’s renewable energy mandates, initially increasing an average residential bill by about 2.1 percent, or $1.38, a month.

The fee, which would go into effect in August, is proposed to recover the cost of Public Regulation Commission-approved renewable energy projects implemented since January 2011. Those projects include five large PNM solar generation installations, its customer-owned solar program, a solar battery storage project and the purchase of wind energy from the Red Mesa wind farm west of Albuquerque.

Renewable energy costs through 2010 are recovered in general rates, according to PNM spokeswoman Susan Sponar. A settlement agreement in 2003 prevented PNM from recovering costs any other way until a year after the conclusion of its most recent rate case, which was approved last August.

The measure would enable the company to recover procurement costs closer to when they happened instead of waiting to add them to general rates, which can’t be increased until at least 2013 under a stipulation in the last rate case.

The effect would be to lower overall program costs due to avoided finance charges, and to avoid hitting customers with multiyear costs all at once, Sponar said. “We think in the end, it is really a better deal for customers,” she said.

The rate for 2012 is based on a procurement cost for 2012 of $18 million, the cost cap agreed to in the rate case, Sponar said. Total collections for 2012, if they begin in August, would be $7.9 million, with remaining costs to be recovered in subsequent years. There would be about a 2.7 percent adjustment Jan. 1 for 2013 when the total renewable energy cost is estimated to be $23.4 million.
— This article appeared on page B1 of the Albuquerque Journal