PNM Resources' (NYSE: PNM) New Mexico utility, PNM, has signed a six-year agreement to sell Renewable Energy Certificates to El Paso Electric Co.
New Mexico's renewable portfolio standard requires investor-owned electric utilities to produce or buy renewable energy or equivalent certificates. According to the law, renewable energy must make up 5 percent of the utilities' sales by 2006 and 10 percent by the year 2011. New Mexico, like many other states, allows utilities to either provide renewable energy to customers or purchase RECs, which encourage the development of renewable energy. The seller of RECs must provide evidence that the energy has been generated by a renewable resource. PNM receives the full output of renewable energy from the 200-megawatt New Mexico Wind Energy Facility, near House, N.M.
According to the PNM-El Paso agreement, the price of each certificate will be adjusted annually based on inflation from 2007 through 2011. One certificate represents one megawatt-hour of electricity generated by a renewable source.
Background: PNM Resources is an energy holding company based in Albuquerque, N.M., with consolidated operating revenues of $2.3 billion. Through its utility and energy service subsidiaries, PNM Resources supplies electricity to 725,000 homes and businesses in New Mexico and Texas and natural gas to 471,000 customers in New Mexico. Its utility subsidiaries are PNM and Texas-New Mexico Power. Other subsidiaries include First Choice Power, a deregulated competitive retail electric provider in Texas, and Avistar, an energy research and development company. PNM Resources and its subsidiaries also sell power on the wholesale market in the West. For more information, visit PNMResources.com.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
Statements made in this release and documents PNM Resources files
with the SEC that relate to future events or PNM Resources'
expectations, projections, estimates, intentions, goals, targets and
strategies are made pursuant to the Private Securities Litigation Reform
Act of 1995. You are cautioned that all forward-looking statements are
based upon current expectations and estimates and PNM Resources assumes
no obligation to update this information. Because actual results may
differ materially from those expressed or implied by the forward-looking
statements, PNM Resources cautions you not to place undue reliance on
these statements. Many factors could cause actual results to differ, and
will affect PNM Resources' future financial condition, cash flow and
operating results. These factors include the availability of cash from
TNP Enterprises Inc. and its subsidiaries, the risks that the businesses
will not be integrated successfully, the risk that the benefits of the
acquisition will not be fully realized or will take longer to realize
than expected, disruption from the acquisition making it more difficult
to maintain relationships with customers, employees, suppliers or other
third parties, conditions in the financial markets relevant to the
acquisition, the outcome of any appeals of the Public Utility Commission
of Texas order in the stranded cost true-up proceeding or the
acquisition proceeding, the ability of First Choice Power to attract and
retain customers, changes in Electric Reliability Council of Texas
protocols, changes in the cost of power acquired by First Choice Power,
collections experience, insurance coverage available for claims made in
litigation, interest rates, weather, water supply, fuel costs,
availability of fuel supplies, risk management and commodity risk
transactions, seasonality and other changes in supply and demand in the
market for electric power, wholesale power prices, market liquidity, the
competitive environment in the electric and natural gas industries, the
performance of generating units and transmission system, the ability of
PNM Resources to secure long-term power sales, the risks associated with
completion of the construction of Luna Energy Facility, including
construction delays and unanticipated cost overruns, state and federal
regulatory and legislative decisions and actions, the outcome of legal
proceedings, changes in applicable accounting principles and the
performance of state, regional and national economies. For a detailed
discussion of the important factors that affect PNM Resources and that
could cause actual results to differ from those expressed or implied by
PNM Resources' forward-looking statements, please see "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" in PNM Resources' current and future Annual Reports on Form
10-K and Quarterly Reports on Form 10-Q and PNM Resources' current and
future Current Reports on Form 8-K, filed with the SEC.
