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PNM to continue pressing for legislation to clean up its generation fleet

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PNM to continue pressing for legislation to clean up its generation fleet

The CEO of PNM Resources Inc. told financial analysts her company will continue to press to for legislation to ease financing for its coal plant retirements.

The measures did not pass before New Mexico's 30-day legislative session ended early this year. However, PNM Chairman, President and CEO Pat Vincent-Collawn said during the company's fourth-quarter 2017 earnings call on Feb. 28 that PNM will continue to back legislation in 2019 that would allow the state Public Regulation Commission to approve it issuing investment-grade bonds to finance retirements of the coal-fired San Juan and Four Corners plants so the company can build solar and wind facilities instead.

Vincent-Collawn said "unprecedented progress" was made in the short session to build trust among the legislators, environmental leaders and in the Farmington, N.M., community where San Juan is located. However, the legislature simply ran out of time to pass the measures, she said.

"So we will have something for the next session based on the great work that was done," Vincent-Collawn said.

She noted the company's resource plan analysis shows it is economically feasible to shut both plants, assuming PNM subsidiary Public Service Co. of New Mexico gets full recovery of its investments in them.

In opening remarks, Vincent-Collawn said the company is excited about transitioning from coal to solar and wind. New Mexico has the second-highest rating in the nation for utility-scale solar photovoltaic generation opportunities and ranks sixth in wind, she said. The two remaining units of San Juan are due to close in 2022 and Four Corners by 2032. After the second plant closes, PNM will be completely coal-free, she said.

In response to an analyst's questions about the Public Regulation Commission excluding a finding of prudency for the Four Corners investments in PNM's recent rate case, company Executive Vice President and CFO Chuck Eldred said prudency of those investments is not an issue for PNM. "We feel comfortable that we have the ability to recover those costs and to exit coal," he said.