El Paso Electric Files 2015 New Mexico Rate Case
May 11 2015 - 10:00PM
Business Wire
On May 11, 2015, El Paso Electric (NYSE: EE) filed with the New
Mexico Regulation Commission for an increase in non-fuel base rates
of approximately $8.6 million or 7.1 percent. These proposed rates
will increase, on average, residential bills by 9.0 percent.
“Several years ago, we began planning and investing to replace
our less efficient plant and equipment while providing additional
resources for our growing service territory,” said Tom Shockley, El
Paso Electric CEO. “This rate case is about recovering these
cost-effective investments and ensuring that we continue to provide
safe and reliable service at a reasonable cost. We continue to see
significant growth in our service territory and with that growth we
must continue to make improvements and upgrades to El Paso
Electric’s infrastructure and equipment to continue to have the
most reliable and safest grid possible.”
EE last filed for a non-fuel base rate increase in New Mexico in
2009. Since that 2009 Rate Case, EE has spent approximately $1.3
billion (total company) on utility plant in service. EE has managed
its operating costs and has provided safe and reliable service
without revised rates for over five years. EE’s rates proposed in
this filing are just and reasonable and necessary to continued
provision of safe and reliable service.
The requested rate change is depicted below:
Description (000’s)
RevenueChange
Test
YearRevenues
PercentChange
Non-fuel base rate deficiency 8,592
120,317 7.1 % Base fuel factor revenues
* (15,393 ) 71,458 -21.5 %
* Base fuel decrease is currently flowing through to customers
via the fuel adjustment clause
The forecasted reduction in fuel and purchased power costs is
recovered in base rates through a fixed factor that applies a
uniform per kilowatt-hour (kWh) charge to all customer classes. The
Fuel and Purchased Power Cost Adjustment Clause ("FPPCAC"),
recently continued in 2014, ensures that only the actual costs of
fuel and purchased power expenses are recovered from customers, and
is adjusted monthly to account for any under-collection or
over-collection of EE’s actual costs on a timely basis. The
reduction in the cost of fuel and purchased power costs reflects
reduced fuel prices and improvements in system heat rates due to
new generating unit additions.
The fuel and purchased power costs recovered through the base
rate fixed factor and FPPCAC do not otherwise impact EE’s design of
non-fuel base rates. EE is proposing changes to its non-fuel base
rate design to reduce subsidies between classes or within classes
and move towards unity of classes paying their fair share of costs,
promote cost recovery that corresponds to cost causation, and
proposes to create a separate class for residential distributed
generation customers while proposing those customers receive the
same rate structure and monthly charges as other residential
customers.
Conference Call
A conference call to discuss the 2015 New Mexico Rate Case with
investors and analysts is scheduled for 10:30 A.M. Eastern
Time, on May 12, 2015. The dial-in number is 888-299-7209 with a
conference ID number of 9581572. The international dial-in number
is 719-325-2454. The conference leader will be Lisa Budtke,
Assistant Treasurer. A replay will run through May 26, 2015 with a
dial-in number of 888-203-1112 and a conference ID number of
9581572. The replay international dial-in number is 719-457-0820.
The conference call and presentation slides will be webcast live on
the Company's website found at http://www.epelectric.com. A replay
of the webcast will be available shortly after the call.
Safe Harbor
This news release includes statements that may constitute
forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
This information may involve risks and uncertainties that could
cause actual results to differ materially from such forward-looking
statements. Factors that could cause or contribute to such
differences include, but are not limited to: (i) increased prices
for fuel and purchased power and the possibility that regulators
may not permit EE to pass through all such increased costs to
customers or to recover previously incurred fuel costs in rates;
(ii) recovery of capital investments and operating costs
through rates in Texas and New Mexico; (iii) uncertainties and
instability in the general economy and the resulting impact on EE's
sales and profitability; (iv) changes in customers' demand for
electricity as a result of energy efficiency initiatives and
emerging competing services and technologies; (v) unanticipated
increased costs associated with scheduled and unscheduled outages
of generating plant; (vi) the size of our construction program and
our ability to complete construction on budget; (vii) potential
delays in our construction schedule due to legal challenges or
other reasons; (viii) costs at Palo Verde;
(ix) deregulation and competition in the electric utility
industry; (x) possible increased costs of compliance with
environmental or other laws, regulations and policies;
(xi) possible income tax and interest payments as a result of
audit adjustments proposed by the IRS or state taxing authorities;
(xii) uncertainties and instability in the financial markets
and the resulting impact on EE's ability to access the capital and
credit markets; (xiii) possible physical or cyber attacks,
intrusions or other catastrophic events; and (xiv) other
factors detailed by EE in its public filings with the Securities
and Exchange Commission. EE's filings are available from the
Securities and Exchange Commission or may be obtained through EE's
website, http://www.epelectric.com.
Any such forward-looking statement is qualified by reference to
these risks and factors. EE cautions that these risks and factors
are not exclusive. EE does not undertake to update any
forward-looking statement that may be made from time to time by or
on behalf of EE except as required by law.
Photos/Multimedia Gallery Available:
http://www.businesswire.com/multimedia/home/20150511006695/en/
El Paso ElectricPublic RelationsEddie Gutierrez,
915-497-3495eduardo.gutierrez@epelectric.comorInvestor
RelationsLisa Budtke,
915-543-5947lisa.budtke@epelectric.com
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