Txnm Energy, Inc. · NYSE:TXNM
Txnm Energy — PNM Resources — Evercore conference (January 2020)
20 slides from Txnm Energy's conference presentation, January 2020
Slide 1: Investor Meetings
November 1, 2019 Investor Meetings January 2020
Slide 2: Contact Information and Safe Harbor Statement
Contact Information and Safe Harbor Statement Investor Relations Contact Information Lisa Goodman Director, Investor Relations and Shareholder Services U.S. 1-505-241-2160 Lisa.Goodman@pnmresources.com Safe Harbor Statement Statements made in this presentation for PNM Resources, Inc. (“PNMR”), Publi
Slide 3: PNM Resources Overview
PNM Resources Overview PNM Resources is a regulated electric utility holding company focused on providing environmentally responsible, affordable and reliable electricity to customers and delivering earnings and dividend growth to shareholders at or above the industry average • Energy holding compan
Slide 4: PNM Resources Strategic Direction and Financial Goals
PNM Resources Strategic Direction and Financial Goals Vision: Create a clean and bright energy future Strategic Focus: • Transform PNM Generation Portfolio: • New Mexico Energy Policy (ETA): RPS and 2045 carbon-free mandate • PNM plans to be coal-free by 2031, emissions-free by 2040 • Enhance PNM tr
Slide 5: 100% Carbon-Free
Transform PNM Generation Portfolio: New Mexico Energy Policy Senate Bill 489 (Energy Transition Act): passed in 2019 legislative session and signed by New Mexico Governor Lujan Grisham; effective June 14, 2019 • Renewable Portfolio Standards and Carbon-Free Requirement 2045 100% Carbon-Free • Curren
Slide 6: Transform PNM Generation Portfolio: Executing the Energy Transition Act
Transform PNM Generation Portfolio: Executing the Energy Transition Act Our Goal: Transform PNM Generation to 100% Carbon-Free by 2040 Step 1: Exit Coal Generation by 2031 Reduction of MW Coal Capacity • San Juan Generating Station: 983 22% reduction • Retired Units 2 and 3 in 2017 (221 MWs); Retire
Slide 7: San Juan Abandonment, Securitization and Replacement Power
Transform PNM Generation Portfolio: San Juan Abandonment, Securitization and Replacement Power ● Requests ● $283M undepreciated ● Recommended Abandonment Replacement Power Securitization abandonment of San investment in San Juan, scenario balances Juan coal plant after proceeds available to environm
Slide 8: San Juan Recommended Replacement Power Scenario Details
Transform PNM Generation Portfolio: San Juan Recommended Replacement Power Scenario Details • Competitive RFP processes resulted in a cost-effective mix of resources owned by PNM and third-party providers • To manage the risks of integrating new battery storage technology, total storage capacity doe
Slide 9: Enhance PNM Transmission Grid: Integration of Renewable Generation and Battery Storage
Enhance PNM Transmission Grid: Integration of Renewable Generation and Battery Storage • Transmission service to portions of New Mexico’s grid is fully committed • The integration of new renewable generation and battery storage will require additional T&D investment Cumulative Capacity Additions 202
Slide 10: Transmission and Renewable Expansion in New Mexico
Enhance PNM Transmission Grid: Transmission and Renewable Expansion in New Mexico New Mexico has abundant solar and wind resources Third-party development increases demand for transmission capacity New Mexico added wind capacity at a higher growth rate than any other state in 2017 and currently has
Slide 11: TNMP Demand and Infrastructure Investment
TNMP Demand and Infrastructure Investment Texas growth drives infrastructure needs Q3 YTD • TNMP has seen consistent end-user (customer TNMP 2017 2018 2019 growth) driven by strong Texas economy across our service territory TNMP Avg. End Users 1.2% 1.3% 1.5% • Demand-based load growth in Commercial
Slide 12: PNM Resources 2019 – 2023 Investment Plan
PNM Resources 2019 – 2023 Investment Plan $3.9B investment plan results in 9.6% rate base growth Authorized returns: Equity ratio ROE $991 PNM Retail/Renewables 50% 9.575% $21 PNM FERC Transmission ~50% 10.0% TNMP 45% 9.65% $818 $177 $27 $27 $771 $25 $48 $694 $68 $22 $641 $109 $268 $21 $37 $72 $128
Slide 13: Earnings and Dividend Growth Profile
Earnings and Dividend Growth Profile 2014 – 2018 Ongoing EPS 2014 – 2019 Annual Dividend per Share CAGR ~7.6% CAGR ~9.4% $1.94 $2.00 $1.64 $1.65 $1.49 $1.06 $1.16 $0.88 $0.97 $0.74 $0.80 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2019 Ongoing Diluted EPS (1) Indicated Annual Dividends(2) • PN
Slide 14: Liquidity and Debt Maturity Outlook
Liquidity and Debt Maturity Outlook Long-term Debt Maturities Maintain appropriate (in millions) $658 credit metrics $450 $1,003 $140 $350 $346 $57 Remain a solid investment grade 2020 2021 2022 2023 and Beyond PNM TNMP Corporate rated company • New debt issuances projected at utilities to maintain
Slide 15: Appendix
Appendix
Slide 16: NMPRC Commissioners and Districts
NMPRC Commissioners and Districts Term District Name Party NMPRC Districts and Ends PNM Service Areas District 1 Cynthia Hall 2020(1) Democrat District 2 Jefferson Byrd 2022(1) Republican Valerie Espinoza, District 3 2020 Democrat Vice-Chairman Theresa Becenti-Aguilar, District 4 2022(1) Democrat Ch
Slide 17: PNM Regulatory Agenda
PNM Regulatory Agenda Filing Action Timing Docket No. PNM filed July 1, 2019; NMPRC bifurcated NMPRC decision on abandonment/ Consolidated Application for San application on July 10, 2019; securitization expected by April 1, 19-00018-UT Juan (Abandonment, Abandonment/Securitization hearings schedule
Slide 18: PNM Bills Remain Below National and Regional Averages
PNM Bills Remain Below National and Regional Averages Comparison of Average Residential Bills(1) Western Region Average Bills by Utility Arizona Public Service Co (AZ) $137.51 Customer bill impacts of LADWP (CA) Imperial Irrigation District (CA) increased investments are Salt River Project (AZ) Ente
Slide 19: PUCT Commissioners and TNMP Regulatory Agenda
PUCT Commissioners and TNMP Regulatory Agenda PUCT Commissioners Name Term Began Term Ends Party DeAnn Walker (Chair) Sept. 2017 Aug. 2021 Republican Arthur D’Andrea Nov. 2017 Aug. 2023 Republican Shelly Botkin June 2018 Sept. 2019 Republican Commissioners are appointed by the Governor of Texas and
Slide 20: TNMP Rates Comparable in Texas
TNMP Rates Comparable in Texas Rates expected to be comparable to other IOUs after pending rate filings Residential Total Wires Charge for 1,000 kWh Current $60 Current rate filing Current rate filing pending Current rate filing New pending $50 rate filing pending Rates(1) pending $40 $30 $20 $10 $-