Double recovery? No.

As reported recently in the SF New Mexican, when PNM decided to delay issuing bonds upon abandonment of San Juan, unjustly collecting more than $125M from ratepayers for non-existent operating costs and potentially double charging for those same costs, they hired a marketing firm for $7500 to help them figure out the correct messaging to make their greed palatable to the public. (You may recall getting a PNM survey to that effect a few months back.) Documents received in discovery illuminate the risks that the marketing firm identified as they decided how to spin PNM's new plan:

  • "This runs the risk of looking like a corporate shell game, eroding our credibility for future proposals and planning.This could make next year's rate case a taller hurdle."

  • "Impression of the company could have long-­term implications for their (PNM's) reputation, brand and trustworthiness here -­ not only for customers but also for regulation."

  • "PNM is trying to avoid paying the bonds and savings to customers, this may be viewed as a corporation that is breaking promises that we made."

  • "Risk that customers believe PNM is holding $80M savings intentionally. Customers may not understand the argument that there are greater offsetting costs of ­$120M spent over the past four years that aren't being paid for by customers. Parties may use tactics to argue those offsetting cost increases are "speculative" and "inflated." Parties will argue the notion of corporate greed as the decision to hold off."

  • "PNM stated savings to customers in closing SJGS. People expect to see some reward, somewhere. May be viewed as PNM leadership breaking promises made to New Mexico."

  • "May cause backlash that ETA is not effective or did not protect customers or is flawed ­-- delayed economic funds to impacted areas even though SJ closed, and jobs are lost ­- if economic funds are advanced early, then what is the argument to provide those funds, but not the savings and issue the bonds."

  • "Can begin to erode trust in the ETA, impacting future arguments and potential viability of the ETA if reviewed by future lawmakers and state leaders. Could potentially undo the progress and hard work put into the ETA."

  • "Could make future utility related legislative initiatives harder to pass."

  • "There is already a perception that rates are constantly going up, especially among customers. This would inflate that perception."

  • " Parties may request Commission to act on current financing order (vacating or modifying order)." (By "parties" they mean US!)

Among several potential messages the marketing firm proposed that PNM float to survey and focus group respondents:

Got lights? At PNM, the answer is always yes. Reliable power requires a reliable electric grid, and our New Mexico work force is committed to building and operating a grid that serves you. The electric grid costs money to manage and enhance, but we know that our customers deserve a utility that balances services, reliability, our environment and affordability. That's why PNM has developed a plan that keeps the power running and delays a rate increase for the next year. By using funds from its retired coal plant, PNM can successfully mitigate its expenses on the grid and delay a needed rate increases, making it 5 - almost 7 - years before they see another rate increase. PNM, keeping your power reliable and affordable.

Can you spot the fear mongering about reliability? They are using that fear to cover for their nefarious plan to deny a downward rate adjustment even though San Juan is closed.

New Energy Economy and Retake Our Democracy got our own special mention in their PR plan - "STEP FOUR: CONTINUE TO MAINTAIN CONTROL OF THE MESSAGE; MITIGATE RISK" -> "REDLINE NEE and RETAKE OUR DEMOCRACY newsletters/press." (emphasis in the original). PNM is afraid that truth-telling from New Energy Economy and Retake Our Democracy will undermine their PR spin; for example they feared New Energy Economy would accuse of theft from customers and the PR firm suggested countering that narrative by how altruistic they are for investments on behalf of customers.

Focus group respondents saw right through their smoke and mirrors. Respondents stated, quote:

"It's crap that they are doing something nice for you." "Phrases that are supposed to make us feel like we should say, 'thank you' to PNM. But I'm not sure of the details." "Just come out and say it's going to be a rate increase." "It's a business. They need to make money. They are trying to fool the customer while they are lining their pockets."

Accurate.

PNM is hurting customers and they think that their harm can be glossed over with nice words. What about the real risks that ratepayers face? PNM couldn't wait to begin disconnecting people as soon as the moratorium was lifted. PNM's callous greed cannot be tolerated.



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