TNMP Files $2.8B Rate Settlement in Texas

Texas-New Mexico Power (TNMP), a subsidiary of TXNM Energy, has filed a comprehensive settlement for its base rate review with the Public Utility Commission of Texas (PUCT) [1]. The agreement proposes recovering a $2.8 billion rate base and maintaining current equity returns while addressing costs associated with Hurricane Beryl [1]. The filing is intended to support the utility's continued ability to power growth in Texas with a reliable and resilient grid [1].

Key takeaways

• TNMP seeks to recover a $2.8 billion rate base as of June 30, 2025 [1].
• The settlement maintains a 9.65% return on equity and a 45% equity ratio [1].
• A $20.5 million rider will recover Hurricane Beryl restoration costs over five years [1].
• The settlement includes support from the PUCT Staff, Walmart, and data center groups [1].

Rate Base and Storm Cost Recovery

Under the terms of the settlement filed on May 29, 2026, TNMP would recover its filed rate base of $2.8 billion [1]. The utility would continue its currently authorized return on equity of 9.65% and maintain a 45% equity ratio [1]. While the agreement addresses increased operations and maintenance costs not recovered through interim capital recovery mechanisms, as well as changes in deferred federal income tax amortizations, these increases are partially offset by adjustments to depreciation rates [1].

Separate from the base rate request, the settlement outlines a provision for TNMP to implement $20.5 million in rate rider recovery [1]. These funds are specifically associated with restoration costs from Hurricane Beryl and would be recovered over a five-year period [1]. If the settlement is approved, the rates established in the final order will relate back to May 22, 2026, under interim rates [1].

Regulatory Support and Approval Process

The settlement has garnered support from a wide array of parties, including the Staff of the Public Utility Commission of Texas, the Office of Public Utility Counsel, and the Alliance of Texas-New Mexico Power Municipalities [1]. Major industrial and commercial stakeholders, such as the Texas Industrial Energy Consumers, the Data Center Coalition, and Walmart, have also joined the agreement [1]. Additionally, Amazon Data Systems and the Texas Energy Association for Marketers stated they do not oppose the stipulation [1].

Why it matters

This filing represents a significant step in TNMP's regulatory process to secure funding for infrastructure and operational expenses. TXNM Energy, the parent company, delivers energy to more than 800,000 homes and businesses across Texas and New Mexico through its regulated utilities, TNMP and PNM [1]. The settlement is currently subject to approval by the PUCT before the terms can be finalized [1].