PNM proposes rate hike to help finance overhaul of power grid

Public Service Company of New Mexico described its first rate hike request in six years as “modest” and pitched it as necessary to help the utility overhaul its power grid and initiate new renewable energy projects.

Ron Darnell, senior vice president for public policy for the utility, said the new rates, if approved by the state Public Regulation Commission, would not go into effect until January 2024.

In an October filing with the Public Regulation Commission, PNM asked for the authority to begin a six-year grid modernization project with $344 million in upgrades to its distribution system. The filing estimated a first-year billing increase of 1.74 percent, or an average of about $1.20 per month for residential customers.

But in a news conference Monday, Darnell said the total average impact for residential customers will be lower than 1 percent, or about 75 cents a month. However, when commercial and industrial rates are added in, the overall increase would be about 9 percent.

Darnell said the lower cost for residential customers is based on the average number of those who use about 600 kilowatts of electricity every month. He said 56 percent of the more than half-million people PNM serves fall into that average range.

The rate hike request comes amid controversy over the utility’s closing of the San Juan Generating Station. In the spring, several advocacy groups charged PNM with trying to double-bill customers for costs associated with the closing. The utility had pro