PNM files application for new resources in 2028

Rhea-AI Summary

PNM, a subsidiary of TXNM Energy (NYSE: TXNM), has filed an application with the New Mexico Public Regulation Commission for new energy resources to be implemented by summer 2028. The proposal includes extending a 167 MW Valencia PPA through 2039, adding 300 MW of battery storage capacity, and installing a 130 MW solar and battery storage facility. The proposed portfolio represents a $220 million capital investment from PNM, potentially increasing to $252 million with an additional 20 MW storage option. The new resources aim to meet forecasted peak load requirements and advance New Mexico's zero-carbon goals under the Energy Transition Act.

Positive

• Expanding renewable energy capacity with 430 MW of new solar and battery storage
• Strategic $220-252 million capital investment in clean energy infrastructure
• Progress towards zero-carbon requirements compliance
• Extension of existing Valencia PPA securing 167 MW through 2039

Negative

• Significant capital expenditure requiring regulatory approval
• Nine-month approval timeline creates execution uncertainty

Insights

Energy Infrastructure Analyst

This filing represents a significant $220-252 million capital investment in New Mexico's clean energy transition. The proposed 430 MW portfolio strategically combines solar generation with battery storage, addressing both capacity needs and regulatory compliance. The Valencia PPA extension through 2039 provides important baseload stability, while the new battery facilities offer essential grid flexibility.

The project's location in the Central Consolidated School District, where San Juan Generating Station was retired, demonstrates smart infrastructure planning by utilizing existing transmission infrastructure and supporting local economic development. The nine-month approval timeline is relatively aggressive but feasible, suggesting confidence in the proposal's alignment with regulatory requirements.

The investment strengthens PNM's position in meeting New Mexico's Energy Transition Act requirements while maintaining grid reliability. This balanced approach to resource diversification should provide stable returns and regulatory recovery opportunities.

Environmental Policy Analyst

This filing marks a strategic alignment with New Mexico's zero-carbon mandate, showcasing a well-structured transition from retired coal assets to renewable infrastructure. The 300 MW of standalone battery storage represents a significant grid modernization effort, while the solar-plus-storage facility demonstrates an integrated approach to renewable deployment.

The proposal's emphasis on battery storage (350 MW total potential) indicates a sophisticated understanding of grid reliability needs in a renewable-heavy future. This positions PNM favorably for future regulatory proceedings and helps derisk the company's generation portfolio against potential carbon regulations.

ALBUQUERQUE, N.M., Nov. 25, 2024 /PRNewswire/ -- PNM, a wholly-owned subsidiary of TXNM Energy (NYSE: TXNM), filed an application with the New Mexico Public Regulation Commission (NMPRC) for new energy resources to be added by summer 2028.

The proposed resource portfolio extends existing resources and adds 430 megawatts (MWs) of new solar and battery storage to meet PNM's forecasted peak load requirements in 2028 to serve its customers and to continue progress towards the zero-carbon requirements of New Mexico's Energy Transition Act.

The filing requests approval for:

• extension of a Valencia Purchase Power Agreement (PPA) for 167 MW through 2039 (current agreement expires in 2028),
• addition of 300 MW capacity through Energy Storage Agreements (ESAs) for two, 150 MW battery stand-alone storage facilities, and
• addition of 130 MW solar and battery storage facility (100 MW solar, 30 MW battery storage), with an option for an additional 20 MW of battery storage, to be owned and operated by PNM.

The proposed placement of the 130-MW / 150-MW facility is in New Mexico's Central Consolidated School District, where the San Juan Generating Station was retired in 2022. The proposed portfolio reflects $220 million of capital investment from PNM, or $252 million if the option for the additional 20 MW of storage is selected.

The filing is subject to approval by the NMPRC and PNM has requested approval of the resources within nine months.

The application is available at https://www.txnmenergy.com/investors/rates-and-filings/pnm-nmprc-filings.aspx.

Background:
TXNM Energy (NYSE: TXNM), an energy holding company based in Albuquerque, New Mexico, delivers energy to more than 800,000 homes and businesses across Texas and New Mexico through its regulated utilities, TNMP and PNM. For more information, visit the company's website at www.TXNMEnergy.com.

Contacts:
Analysts	Media
Lisa Goodman	Corporate Communications
(505) 241-2160	(505) 241-2743

 

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements made in this news release for TXNM Energy, Inc. ("TXNM"), 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 the 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. TXNM, 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, TXNM, PNM, and TNMP caution readers not to place undue reliance on these statements. TXNM'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 TXNM Energy, Inc.

FAQ

What new energy resources is PNM adding in 2028?

PNM is adding 300 MW of battery storage capacity through two 150 MW facilities, a 130 MW solar and battery storage facility (100 MW solar, 30 MW battery), and extending a 167 MW Valencia PPA through 2039.

How much is PNM investing in the 2028 energy resources project?

PNM is investing $220 million, with potential increase to $252 million if the additional 20 MW storage option is selected.

Where will PNM's new 130-MW solar and battery facility be located?

The facility will be located in New Mexico's Central Consolidated School District, where the San Juan Generating Station was retired in 2022.

When does PNM expect regulatory approval for the new energy resources?

PNM has requested approval from the New Mexico Public Regulation Commission within nine months of the filing.