RATECASE TO LOCK-IN RATEPAYERS FOR COSTS AND LIABILITIES AT THE FOUR CORNERS COAL PLANT:
On May 23, 2017 PNM and a dozen other parties signed a Revised Stipulation (settlement) that seeks an increase in rates another 9% for residential customers. New Energy Economy lodged the sole Opposition to the Stipulation, claiming first and foremost that PNM’s re-investment in the Four Corners coal plant was “imprudent” and was a ratepayer subsidy of PNM losses at the 50-year old plant. PNM argued that its investment was prudent. But the Hearing Examiners disagreed.
The Hearing Examiners found that with respect to PNM’s participation in the Four Corners coal plant “there is a substantial record on which to make a finding of imprudence.” (Order, Recommended Decision, 10/31/17, p. 69) “The Hearing Examiners find that the appropriate remedy for PNM’s imprudence in extending its participation in Four Corners and pursuing the $90.1 million of the SCR investment and the $58 million of the additional life-extending capital improvements is the disallowance of all costs associated with the investment and improvements.” p. 68
Merrill Lynch issued a November 2017 report regarding this case. “We see it as an increasing strategic imperative for PNM to find a convenient exit to its coal portfolio given the inconsistent recovery of associated investments.”
Yet, the Hearing Examiner did not disallow the costs. Other parties claimed New Energy Economy was crazy to challenge the investment at Four Corners. But, in fact, the evidence of the case, and the Hearing Examiner supported New Energy Economy's position - the enormous cost of PNM's Four Corners reinvestment -- financially, environmentally, and socially could have and should have been avoided.
Now we need the Commission to hold the ratepayers harmless for their poor management decisions.
See Our Fact Sheet HERE