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Updated: Tuesday, 01 Jun 2010, 11:05 AM MDT
Published : Tuesday, 01 Jun 2010, 9:56 AM MDT
ALBUQUERQUE (AP) - New Mexico's largest electric utility filed a request with state regulators Tuesday to increase rates by an average of 21.2 percent beginning next year.
Public Service Company of New Mexico said the rate increase would be implemented over two years if approved by the Public Regulation Commission.
The company said the phase-in would help ease the impact on customers.
PNM has raised rates by 24 percent in the past three years.
The latest proposed increase would raise the average customer's bill by $10 a month in 2011 and a little over $4 more in 2012, PNM spokeswoman Susan Sponar said Tuesday.
"A rate request is unavoidable," PNM's president and chief executive officer, Pat Vincent-Collawn, said in a news release announcing the filing. "Knowing these are difficult times, we will stay focused on balancing the need for reliability and affordability, in part through programs to help customers manage energy bills."
PNM provides electricity to 497,000 customers in New Mexico. The utility is a subsidiary of PNM Resources, an Albuquerque-based energy holding company.
PNM, for the first time, is basing a rate request on the projected cost of service at the time the new rates would go into effect. In the past, rates have been based on figures that are two years old or older. The utility said that means by the time new rates go into effect, they're out of date.
Last month, Vincent-Collawn said PNM would seek a large increase, but she would not release the amount until it was filed. Sponar said the company had made significant investments that weren't being recovered by the current rates.
The utility said investments will have totaled more than $575 million through next year in improvements to assure the system's reliability, including expansion of substations and power lines in Rio Rancho, Santa Fe, Alamogordo and other areas.
Sponar also has said the 24 percent increase since 2007 came after 20 years without electricity rate hikes.
Tuesday's rate request does not include a renewable energy proposal currently pending before the commission to add more renewable energy sources. Those are required to meet New Mexico's renewable energy standards, which increase in 2011 to 10 percent from the current 6 percent.
Standard & Poors has given PNM Resources the worst credit rating of any utility, PNM officials have said. Such ratings determine how much companies pay for money they borrow for expansion and improvements.