NMPRC Approves New PNM Energy Resources for 2026

Rhea-AI Summary

The New Mexico Public Regulation Commission (NMPRC) has approved Public Service Company of New Mexico's (PNM) application for new energy resources, adding 410 megawatts of solar and battery storage capacity by summer 2026. This move aims to meet growing retail demand, with PNM's peak demand hitting record highs in the summers of 2022 and 2023.

PNM's approved resources include 100 megawatts of solar and 310 megawatts of battery storage. This integration will help PNM achieve 75% carbon-free resource capacity by 2026. PNM Resources reported consolidated operating revenues of $1.9 billion in 2023 and serves over 800,000 customers in New Mexico and Texas.

The initiative aligns with PNM's pledge to reach 100% carbon-free energy by 2040. Additional details and materials are available on the PNM Resources website.

Positive

• NMPRC approval for 410 megawatts of new energy resources.
• Integration will bring PNM's resource capacity to 75% carbon-free by 2026.
• PNM's peak demand reached new highs in summers of 2022 and 2023, indicating robust growth.
• PNM Resources reported consolidated operating revenues of $1.9 billion in 2023.
• PNM's goal to achieve 100% emissions-free energy by 2040 remains on track.
• The addition includes 100 megawatts of solar and 310 megawatts of battery storage, enhancing clean energy portfolio.

Negative

• Significant investment required for the addition of 410 megawatts of new resources.
• Potential financial risks associated with large-scale infrastructure projects.
• Any delays or cost overruns could negatively impact future earnings and stock performance.

Insights

Energy Market Analyst

From an energy market perspective, the approval of 410 megawatts of new solar and battery storage capacity for PNM is a significant development. The decision responds to increased electricity demand, as evidenced by record highs during the summers of 2022 and 2023. This move aligns with the broader industry trend towards renewable energy and storage solutions, which are essential for grid stability and meeting peak demand without relying on fossil fuels.

By integrating these resources, PNM will enhance its capacity to manage peak loads and improve grid reliability while advancing towards its goal of being 75% carbon-free by 2026. This is important as utilities across the nation face pressure to reduce carbon footprints and comply with environmental regulations. The strategic addition of battery storage also highlights a shift towards more flexible and responsive energy systems that can store excess generation and deploy it when needed.

Financial Analyst

From a financial standpoint, PNM Resources' strategic investment in solar and battery storage is likely to have a positive impact. The approval of these resources is expected to support the company's revenue growth by addressing the increasing energy demand of its customer base. The shift towards renewable energy also positions PNM favorably for accessing potential future subsidies and incentives related to clean energy initiatives.

Moreover, the integration of 100 megawatts of solar and 310 megawatts of battery storage could potentially improve PNM's operational efficiency and reduce costs associated with peak demand management. However, investors should also consider the capital expenditure involved in such projects and monitor the company's balance sheet for any signs of financial strain. The long-term commitment to achieving 100% emissions-free energy by 2040 is an ambitious goal and while it provides a clear strategic direction, it also introduces execution risk.

Environmental Policy Expert

For stakeholders concerned with environmental policy, PNM's initiative to add significant solar and battery storage capacity represents a proactive step towards reducing greenhouse gas emissions. This move is consistent with the company's pledge to attain 100% emissions-free energy by 2040. It supports state and national goals aimed at mitigating climate change by reducing reliance on fossil fuels.

Additionally, the approval by the New Mexico Public Regulation Commission signals regulatory support for such clean energy transitions, which can encourage other utilities to follow suit. However, it's worth noting that the actual environmental impact will depend on the effective deployment and integration of these resources into the grid, as well as the continued support from regulatory bodies.

In the short term, this project might slightly increase operational costs due to the implementation of new technologies, but the long-term benefits, including reduced carbon emissions and possibly lower energy costs, are significant. Investors should thus view this development as a positive step towards sustainable and responsible business practices.

ALBUQUERQUE, N.M., May 31, 2024 /PRNewswire/ -- The New Mexico Public Regulation Commission (NMPRC) approved an application by Public Service Company of New Mexico (PNM), a wholly-owned subsidiary of PNM Resources (NYSE: PNM), for new energy resources to be added by summer 2026.

The new resources, totaling 410 megawatts of solar and battery storage capacity, are planned to serve growing demand from PNM's retail customers. PNM system peak demand reached new record highs in the summers of 2022 and 2023.

"PNM's system needs are growing, and we are pleased the Commission approved our application to meet these growing needs with additional clean energy resources," said Pat Vincent-Collawn, PNM Resources Chairman and CEO. "We are continuing to fulfill our pledge to reach carbon-free energy in New Mexico while ensuring we can reliably meet our customers' growing energy demands."

PNM filed its application in October 2023 after issuing a request for proposals in late 2022 to identify potential new resources available to serve customers in 2026. The approved resources consist of 100 megawatts of solar and 310 megawatts of battery storage, including a 60-megawatt battery storage facility to be owned by PNM.

Integration of these resources, along with other renewable and battery storage resources previously approved, will bring PNM's resource capacity to 75% carbon-free in 2026.

The application and related materials are available at https://www.pnmresources.com/investors/rates-and-filings.aspx. The Commission order will be added once available.

Background:

PNM Resources (NYSE: PNM) is an energy holding company based in Albuquerque, N.M., with 2023 consolidated operating revenues of $1.9 billion. Through its regulated utilities, PNM and TNMP, PNM Resources provides electricity to more than 800,000 homes and businesses in New Mexico and Texas. PNM serves its customers with a diverse mix of generation and purchased power resources totaling 3.3 gigawatts of installed capacity, with a goal to achieve 100% emissions-free energy by 2040. For more information, visit the company's website at www.PNMResources.com.

Contacts:

Analysts	Media
Lisa Goodman	Corporate Communications
(505) 241-2160	(505) 241-2783

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements made in this news release for PNM Resources, Inc. ("PNMR"), Public Service Company of New Mexico ("PNM"), or Texas-New Mexico Power Company ("TNMP") (collectively, the "Company") that relate to future events or expectations, projections, estimates, intentions, goals, targets, and strategies, including any unaudited financial results and earnings guidance, are made pursuant to the Private Securities Litigation Reform Act of 1995. Readers are cautioned that all forward-looking statements are based upon current expectations and estimates and apply only as of the date of this report. PNMR, PNM, and TNMP assume no obligation to update this information. Because actual results may differ materially from those expressed or implied by these forward-looking statements, PNMR, PNM, and TNMP caution readers not to place undue reliance on these statements. PNMR's, PNM's, and TNMP's business, financial condition, cash flow, and operating results are influenced by many factors, which are often beyond their control, that can cause actual results to differ from those expressed or implied by the forward-looking statements. For a discussion of risk factors and other important factors affecting forward-looking statements, please see the Company's Form 10-K, Form 10-Q filings and the information included in the Company's Forms 8-K with the Securities and Exchange Commission, which factors are specifically incorporated by reference herein.

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SOURCE PNM Resources, Inc.

FAQ

What new energy resources did PNM get approved for?

PNM received approval for 410 megawatts of new energy resources, including 100 megawatts of solar and 310 megawatts of battery storage.

When will PNM's new energy resources be added?

The new energy resources are planned to be added by summer 2026.

What is the significance of PNM's new energy resources?

The new resources aim to meet growing demand and help PNM achieve 75% carbon-free resource capacity by 2026.

How much was PNM's operating revenue in 2023?

PNM Resources reported consolidated operating revenues of $1.9 billion in 2023.

What is PNM's long-term goal for carbon-free energy?

PNM aims to achieve 100% emissions-free energy by 2040.