EPA Stay Extended 45 Days For San Juan Generating Station

PNM Resources’ (NYSE: PNM) New Mexico utility, PNM, today said the U.S. Environmental Protection Agency (EPA) extended for an additional 45 days the administrative stay regarding the federal implementation plan to address regional haze under the Clean Air Act at the San Juan Generating Station (SJGS). The stay will expire on Nov. 29, 2012.

The administrative stay is intended to provide additional time to consider an alternative between the N.M. Environment Department (NMED) and the EPA plans, but does not extend the current September 2016 compliance date of the federal implementation plan.

“We are encouraged to hear that the EPA is interested in considering the recently proposed state alternative,” said Pat Collawn, PNM Resources chairman, president and CEO. “We have supported efforts over the past 90 days to explore alternatives that could provide environmental benefits, while also reducing costs for customers. We think the proposed state alternative offers a potential way forward to achieving this goal.”

The federally mandated plan includes a tight timeline requiring installation of Selective Catalytic Reduction (SCR) technology on all four units of SJGS. In light of the existing compliance deadline, PNM is finalizing the agreement with an engineering, procurement and construction contractor to install SCR technology. The contract will include termination provisions in the event that SCR technology is determined in the future to be unnecessary.

Oral arguments before the 10 th Circuit Court of Appeals are scheduled for Oct. 23. PNM will continue pursuing its appeal of the federal implementation plan. There is no deadline for a decision from the court following the arguments. N.M. Gov. Susana Martinez and the NMED also have appealed the federal plan. A statement issued Oct. 12, 2012, by the NMED indicated their appeals will continue.

Background

Two different plans were developed for N.M. to meet regional haze requirements of the Clean Air Act: one by the state and the other by the EPA. Compliance with the EPA’s plan related to SJGS is estimated to cost significantly more than the state’s plan, with almost no discernible difference in visibility. PNM supported the state plan, which it and the state believe meets the requirements of the Clean Air Act.

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