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PNM Electricity Rate Increase Proposal: Why Your Electric Bill is About to Get More Expensive

pnm electricity rate increase
The PNM electricity rate increase case filing (15-00261-UT) has been the topic of discussion throughout New Mexico; specifically how it negatively affects New Mexico solar power customers, energy conscious customers, and low income households. The proposed PNM electricity rate increase takes less control out of the consumers hands by increasing fixed costs (the service charges you pay on your PNM electric bill regardless of how much electricity you use).

The PNM Electricity Rate Increase Case Filing States:

“This proposal will [increase] the customer charges for the retail classes with a two part tariff as follows: Rate 1A Residential from $5 to $13.14; Rate 2A – Small Power from $8.46 to $17.87.”

“For the following rates schedules, the proposed customer charges have been reduced to allow PNM recovery of customer-related costs only: [Large Power > 8,000 kW, Universities, Manufacturing]

What Does the PNM Electricity Rate Increase Mean to Me?

By increasing the fixed costs, there is a disproportionate amount of the PNM bill that is directly impacted by energy habits.

Before Change: If your average PNM bill is $50/month, 10% of your cost is currently fixed cost ($5 service charge)

After Change: You’re PNM bill will now be $58.14, 22% of your cost is now fixed cost that you have no control over ($13.14 service charge)

PNM electricity rate increase graph

What Should the Rate Structure be?

It makes more sense to increase the variable costs of electricity for the higher tiers (for non time of use rate payers) and during peak demands (for those on a time of use electricity rate). By doing this, those who use the most power and are frequently in the highest tier of electricity would be paying for a larger share of PNM’s infrastructure, as they are getting the most use out of it. This also creates incentives for the largest power users to become more energy efficient, in order to lower their consumption and reach the lower tiered pricing. This would make sense both economically and environmentally.

What Can I Do to Stop the PNM Electricity Rate Increase?

  • Sit In at Public Hearings About the Rate Case and Voice Your Opinion
  • Write ‘Letters to the Editor’ to Your Local Publication
  • Spread the Word (More People Need to Know How These Changes Will Effect Them)

How Would This Change Affect Solar Customers?

Because PNM no longer purchases REC’s, most solar customers are able to offset their variable costs (the per kWh cost of energy with PNM) but still have a bill for the access fee (currently $5); this is due to net metering which credits excess energy into an “energy bank” that can be used at a later time, instead of giving a monetary credit amount for the energy (trust us, this is a good thing). Increasing the access fees for solar customers in New Mexico means that their bills will go up as well, because there is no way to offset this cost.
But going solar would still make sense. It’s important to keep in mind that any amount of money you can save on your electric bills is a good thing, and solar will always be a positive impact on the environment. Want to find out how much you can save? Get a free solar assessment for your home or business.

OE Solar Commercial and Government Solar EPC
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