PNM electric IRP
Monday July 2, 2007


A Crude Awakening: The Oil Crash — link posted Saturday February 2, 2008

COAL focusing on PNM as of Friday April 25, 2008


First posted
Monday July 2, 2007 18:30
Monday January 2, 2012 07:36

Incandescent bulb production decreases, energy efficient lights more widespread

PNM 2010-11 Electric IRP:

Sep. 10, 2008 There have been two cold winters in Russia out of the last seven, Chubais notes, and another one can be expected in 2010. Fuel oil reserves will be insufficient by that time, which could lead to a shortage of 7 billion kilowatt-hours of electricity. Electricity and heat can be generated, Chubais reasons, but technical limitations, such as the capacity of electricity generating stations and transportation complexities for fuel oil, hinder it.

ABSTRACT complete on Monday September 8, 2008.

PNM has given a deadline of Monday.

Some PNM employees prepared really-informative foils for its electric irp.

Incompetent [1 7/8 pound report] writers of the report did not include these. So

Electric Integrated Resource Plan for the Period 2008-2027 Alternate Report

Monday September 8, 2008 07:31

Below disappeared from web on Monday September 8, 2008.

-----Original Message-----
From: Brown, Don [mailto:Don.Brown]
Sent: Friday, September 05, 2008 12:38 PM
To:;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;; Gary@Nakarado.Com;;;;;;;
Cc: O'Connell, Pat
Subject: Reminder for feedback on PNM electric IRP

Just a reminder, per the conversation at last week's IRP meeting, that we are asking for comments on the latest draft of the IRP report ( by Monday, Sept. 8. Please email them to Pat O'Connell. Also, please let Pat know if you would like a hard copy of the final report, which will be filed with the PRC 9/15. db

Tuesday September 2, 2008 09:10

Draft report weighed-in at 1 7/8 pounds!

We need to write our report which will be critical of the above report and the below article by Fleck in many ways.

First, of course, we will write the abstract.

PNM Plans Energy Future

Renewables Fill In For Coal, Nuclear

By John Fleck
Journal Staff Writer

Coal and nuclear power will provide less of the power coming out of Albuquerque light sockets in the future than it does today, according to a road map of the region's electricity future.

Natural gas and renewable energy will take up much of the slack, according to the plan being developed by utility company PNM with the help of renewable energy advocates. In addition, conservation can be used to cut power demand, substituting for power plants that would otherwise need to be built to meet the needs of a growing population, according to the study.

"Energy efficiency makes a lot of sense," said Evelin Wheeler, director of PNM's planning effort.

PNM analysts unveiled a final draft of the road map Friday in a meeting with consumer and renewable energy ·advocates who helped draft the plan.

Advocates generally endorsed the plan, saying it marks a middle-ground approach to keeping costs to consumers down while also. increasing New Mexico's use of nonpolluting fuel sources.

"We're happy with it, or most parts of it," said Steve Michel of Western Resource Advocates, an environmental policy group.

The report, which will go to the New Mexico Public Regulation Commission next month, marks the most detailed attempt to take into account the effect of climate change regulations on power supplies in New Mexico.

Efforts are currently under way at the regional level to restrict or curtail greenhouse gases emitted by power plants and other industrial activities. Scientists have linked those emissions to climate change, I which in New Mexico could I lead to deeper and more severe I droughts in the future.

PNM Says Cut Coal, Nuclear For Renewables

from PAGE B1

In addition to the regional efforts, both major-party presidential candidates have endorsed some sort of greenhouse gas restrictions, making it widely expected that utilities like PNM will face greenhouse gas restrictions in the future. That is an issue for PNM. Coal, a major greenhouse gas emitter, currently provides 62 percent of the utility's electricity.

No one knows yet what form the regulations will take, but the most likely scenario is some sort of tax on greenhouse gas emissions or a so-called "cap and trade" system that would have a similar effect - essentially putting a price on carbon emissions, reducing emissions by driving up costs.

That would drive up the cost of electricity from coal-fired power plants.

The PNM report found that a high carbon tax would make it more economical to bring new renewable energy like geothermal, wind and solar power on line sooner. But no matter what approach is taken to reducing greenhouse gas emissions, meeting future demand with a new coal-fired power plant did not appear to be economical, the study concluded.

"We're very clear," PNM's Wheeler said. "No new coal." Likewise, nuclear power does not look like an economical option, though the PNM analysis holds open the possibility of changing that if electricity demand in New Mexico rises faster than anticipated.

Even at the highest carbon taxes studied by the PNM analysts, continued use of existing coal-fired power plants in northwest New Mexico appears likely.

The plants are already paid for, which makes them relatively inexpensive sources of electricity, Wheeler explained. But by 2020, according to the plan, coal would provide just 49 percent of PNM's electricity, down from today's 62 percent. Whatever the future mix of renewables and energy efficiency, some new natural gas power plants are likely to be part of the future power mix in New Mexico, according to the study.

Consumer and renewable energy advocates pushed PNM to consider aggressive energy conservation measures as one way to minimize the need for new power plants, said Gail Ryba of the Coalition for Clean Affordable Energy.

The study found that those measures could significantly delay the need to build the new natural gas plants contemplated to meet the need for additional power - the equivalent of a new plant lug enough to provide 8 percent of PNM's electricity by 2020.

The first wave of new renewable power could be here soon. PNM is currently looking for companies to provide new sources of renewable energy, including a major new solar plant. Formal proposals are due later this year, and PNM power system analyst Cindy Bothwell said 120 compaAies have said they might bid.

"We've gotten tremendous interest already," Bothwell said.

Albuquerque Journal Sunday August 31, 2008

Friday August 29, 2008 06:59

Finally we got it in writing.

Mouths may have been open a bit too much in the past.

-------------- Forwarded Message: --------------
From: "Brown, Don"
Subject: Revised IRP Report
Date: Thu, 28 Aug 2008 22:08:13 +0000

Below is a link to the revised PNM Electric IRP report to be discussed at tomorrow morning's meeting public advisory meeting (9:30 a.m.-12:30 p.m.) in Alvarado Square. Copies will be available at the meeting. We apologize for the lateness of this, but this draft was just now finished and ready for distribution. db

Thursday August 28, 2008 06:42

PNM appears headed for trouble similar to
Wednesday, 27 August 2008, 00:00 CDT Alcoa said in June it would idle half of its annual production at Rockdale, or about 120,000 metric tons, because of unreliable power supplies from lignite-fueled Sandow and rising costs.

Wednesday August 27, 2008 06:50

We recevied the materials in the mail on Tuesday August 26, 2008 apparently designed to assuage my concerns over the future of citigroup and OUR MONEY.

Let's see what happens.

We continue to ramp-up viz for our legal project.

We hope to successfully conclude our legal project soon.

I am about ready to start another writing project.

I learned a lot about energy during the past several years. And A LOT about the people involved.

I may solicit some financial help from pnm.

This, in part, buys them some editing rights.

:-) bill

We think that the PNM DRAFT electric irp report has problems.

One is its length.
Ninety percent of everything is crap.
Sturgeon's law

Second is its failure to focus on essential problems. ...
It's not bad writing. That's the way they think.

So let's be constructive and write our report based on the data PNM electric presented and may not present. And include selected references pulled from these energy-related pages.

Checklist: Parts of an Abstract.


“An abstract is an accurate representation of the contents of a document in an abbreviated form” (Porush 75). An abstract can be the most difficult part of the research report to write because in it you must introduce your subject matter, tell what was done, and present selected results, all in one short (about 150 words) paragraph.

We, of course, are professional scientific and engineering writers :-)

We write for money.

Black and white test of cryptographic algorithms was witten for the the Laissez Faire City Times for $100.

We have been getting lots of email from Shattuck School and Whitman College classmate who we have not previously heard from in 49 years
R. Cargill Hall, Historian Emeritus, National Reconnaissance Office, has held a variety of posts in the U.S. Air Force History Program. He served as a historian at Headquarters Strategic Air Command and as NASA historian at Caltech's Jet Propulsion Laboratory. Hall is the author of Lunar Impact: A History of Project Ranger and is the editor of Case Studies in Strategic Bombardment; The U.S. Air Force in Space; and Early Cold War Overflights, 1950-1956. His most recent work in the open literature, "Clandestine Victory: Eisenhower and Overhead Reconnaissance in the Cold War," appears in Dennis E. Showalter, ed., Forging the Shield: Eisenhower and National Security for the 21st Century (Chicago: Imprint Publications, 2005).

Hall, too, is getting interested in electric energy evidenced by a email I got from him regarding ERCOT.

Hall recently moved to Texas from the WDC area.

So we might ask Carg to edit?

From: "Brown, Don"
Subject: August 2008 PNM Electric IRP Meeting
Date: Wed, 20 Aug 2008 14:57:22 +0000

Attached is the agenda for the next PNM electric IRP meeting, which will be held 8/29 from 9:30 a.m. to 12:30 p.m. An updated version of the draft report will be posted to on 8/28. We know this is not a significant amount of time to digest before the meeting, but this will be us an opportunity to present as complete a report as possible. We will also have copies available at the meeting for those of you who do not want to print it out on your own. Hope to see you later this month! db
Don Brown
Director, Corporate Communications
PNM Resources (NYSE: PNM)

505.241.2882 [office]
505.321.8856 [cell]

The problems of today will not be solved by the same thinking that produced the problems in the first place.
Albert Einstein

Thursday August 21, 2008 21:30

-----Original Message-----
From: bill payne []
Sent: Thursday, August 21, 2008 9:05 PM
To: Wheeler, Evelin; O'Connell, Pat; Brown, Don
Cc: Randy Gunn; Jill M. Roelle; Frank Stern; Carla J. Sonntag
Subject: will energy consumption tables be completed?

We think it is important for pnm to know how much energy it has consumed and may consume in the future to accurately formulate a meaningful electric irp.

John Fleck reports in BUSINES OUTLOOK Albuquerque Journal Thursday August 21, 2008 that New Mexico coal production may have peaked.


 Monday August 11, 2008 10:58

Substantial number of participants do not have science, math or engineering educations.

As a result, ... well, we won't go into the details.

-----Original Message-----
From: Brown, Don
Sent: Monday, August 04, 2008 1:57 PM
Cc: O'Connell, Pat
Subject: PNM Electric IRP UPdate: Informal Session to Review CCAE/WRA/NRDC/NMCC Comments

At the July 23 IRP meeting, PNM agreed that if we need to meet with a commenter on the Draft IRP report to better understand the comments, we would schedule the meeting and extend an invitation to the PA group. We have tentatively scheduled a meeting on August 12 from 3:00 to 5:00 pm to review the joint comments provided by the Coalition for Clean Affordable Energy, Western Resource Advocates, Natural Resources Defense Council and the New Mexico Conference of Churches. The meeting will take place at PNM's Downtown Albuquerque office. If you plan to attend, please RSVP (by responding to this email) so we can ensure we schedule a large enough conference room.

Attached is a *.zip file that contains the written comments that were distributed at the July 23 meeting.

The joint comments of CCAE/WRA/NRDC/NMCC will serve as the agenda for the August 12 meeting.

PNM electric irp group met on Wednesday July 23, 2008 13:30-16:30 to discuss the PNM draft report.

Arthur R Morales - partner in Pro Se Fights legal project, see to the immediate right,


Morales and Prassad Potturi, to Morales' right both worked for Plains Electric about 30 years ago.

Plains was bought by PNM.

That's Madonna Bixby to the right of Potturi. Bixby reported she works in PNM's legal department.

Jill Rolle is to the right of Bixby.

dark blue shirt


white blouse, are seen to the right of New Mexico AG attorney Jeff Taylor [long hair]

That's lawyer Letty Belin with colored blouse.

Gail Ryba, white blouse, is to the right of Belin.

Robb Thomson's white hair is seen behind Ryba.

Standing is Summit Blue moderator Brent Barkett who recently shaved off his beard.

Four packages of comments were distributed.

Gilmer is retired from PNM and usually has important things to say.

Note Gilmer's comment on Powder River Basin [PRB] coal.

BHP Billiton recented retired the La Plata coal mine which provided coal to the San Juan generating station.

The Navajo mine recently went from a surface mine to an underground mine.

Chevron is opening the El Segundo coal mine to complement the Lee Ranch mine which supplies coal for the Escalanate generating station.

It's unclear how much mineable coal remains in New Mexico. This is the point of some of these comments.

Here are the first and last pages of

Father and son went on fishing trip to Abquiu lake on Sunday July 20 starting at 05:30.

Essential non-power wasting Albuquerque city lights were photographed from Tramway Blvd.

It is unclear how much longer with city will be able to afford the expense of this light show.

Saturday July 19, 2008 we observed some citizens possibly training for when these lights grow fewer or out.

While the gas last we continue to pursue essential non-gas-wasting travel

which yielded

Essential non-gas-wasting travel to an from Austin Saturday July 12, through Thursday July 17, 2008 revealed transmission line construction between Roscoe and Post Texas.

The great number [almost unbelieveable] number of new wind turbines between Post to south of Sweetwater appear not to have transmission line capability.

Texas peak electrical supply and demand capacity appears to parallel New Mexico's but is much greater.

No objection email message sent on mail server.
----- Original Message -----
From: O'Connell, Pat
To: bill payne
Sent: Wednesday, July 16, 2008 1:38 PM


We are preparing for next week's meeting and wondering if you would object to us printing your comments to hand out at the meeting to aid in the discussion? Please let me know either way.


Pat O'Connell

----- Original Message -----
From: Brown, Don
Cc: O'Connell, Pat
Sent: Wednesday, July 16, 2008 3:55 PM
Subject: Next PNM Electric IRP Meeting: Next Wednesday

The next PNM Electric IRP meeting is next Wednesday, July 23, from 1:30 to 4:30 p.m. Attached is the agenda as well as dial-in instructions for those of you who can't be there in person. We hope to see you there! db

Don Brown
Director, Corporate Communications
PNM Resources (NYSE: PNM)


505.241.2882 [office]
505.321.8856 [cell]

New Mexico corruption.

Read the below and look for data to support or deny allegations.

PRC Won't Reopen PNM Fuel Case

The Public Regulation Commission voted 4-1 Tuesday to let stand its April decision allowing Public Service Company of New Mexico to pass along about $63 million in additional fuel charges to its customers.

Commission Chairman Jason Marks, the lone vote to reopen the case, said that an automatic adjustment to customers' electric bills reflecting PNM's cost of fuel would eliminate incentives for the company to improve operations, maintain generating plants properly, and find the best prices for fuel and purchased power.

PNM contended the adjustment is necessary to keep the company financially stable.

Commissioner Ben Ray Lujan voted against the fuel adjustment when it was enacted in May but voted against Tuesday's motion for rehearing because it would have reopened the case on grounds that Commissioner David King had discussed the case improperly with the governor and the attorney general. Lujan said he did not believe King had acted improperly. King said Tuesday he did not have improper communications about the case.

PNM said the fuel adjustment clause, which took effect in June, would add about $9.30 a month in the summer and $5.85 a month in the winter to the bills of residential customers who use 600 kilowatt hours a month. PNM makes no profit on the fuel adjustment charge.

The motion for rehearing was filed byNew Mexico Industrial Energy Consumers and incorporated motions for rehearing filed earlier by other opponents of PNM's fuel adjustment clause.

- Journal Staff Writer
Winthrop Quigley

Albuquerque Journal Wednesday July 9, 2008

Tuesday July 8, 2008 10:17

Seeking Alpha via coal viz

Tuesday July 8, 2008 07:18


I hope the below Schoellkopf article makes comment 4 more meaningful.
[t]he 37,500 home community planned south of the Albuquerque International Sunport.

Albuquerque Journal Friday July 4, 2008

-----Original Message-----
From: Brown, Don [mailto:xxxxx]
Sent: Tuesday, July 01, 2008 5:40 PM
Cc: O'Connell, Pat
Subject: New developments regarding PNM Electric IRP

PNM, Western Resource Advocates, the Coalition of Clean Affordable Energy, New Mexico Conference of Churches, Community Action New Mexico and the Natural Resources Defense Council filed for a variance requesting a two month delay of the filing date required by the IRP rule. The PRC approved the variance last Thursday, and Chairman Marks stated that he is supportive of efforts to achieve consensus on future resource planning on an integrated basis. So, rather than file by July 16th as previously discussed, PNM will file prior to September 15, 2008.

We have received some written comments as requested at the last meeting. Thank you. For those of you who intend to submit comments, we are extending the deadline for those until Tuesday, July 15. We will have a public meeting on Wednesday, July 23, from 1:30 to 4:30 pm to discuss the comments received. At the July 23 meeting we will also discuss the schedule through August and September. Look for a meeting notice and agenda for the July 23 meeting soon.

Also, PNM would like to include an acknowledgements page in the final report to recognize the contributions by the participants to this process. Attached is the first draft of the acknowledgements page. We have included everyone who signed in at a public advisory meeting over the last year. Please review this to ensure correct spelling and organization affiliation, if any. Also, if we have inadvertently left you out, please let us know.

Don Brown
Director, Corporate Communications

PNM Resources (NYSE: PNM)

505.241.2882 [office]
505.321.8856 [cell]

Try this energy link.

cheers from the dead viz.
-----Original Message-----
From: Martin, Elizabeth, PRC []
Sent: Tuesday, July 01, 2008 12:46 PM
To: bill payne

I have put your comments into the record. Thank you for taking the time to let us know how you feel

-----Original Message-----
From: Martin, Elizabeth, PRC []
Sent: Tuesday, July 01, 2008 8:22 AM
To: bill payne



From: bill payne []
Sent: Monday, June 30, 2008 7:37 PM
To: Martin, Elizabeth, PRC
Cc: Wheeler, Evelin; Randy Gunn; O'Connell, Pat; Jill M. Roelle; Frank Stern; Brown, Don; Brent Barkett; Carla J. Sonntag

Mr. Payne, can I please have your address for our records? Thank you
[bill payne]


13015 calle de sandias ne

abq, nm87111


-----Original Message-----
From: Martin, Elizabeth, PRC []
Sent: Monday, June 30, 2008 11:08 AM
To: bill payne

Mr. Payne, can I please have your address for our records? Thank you

From: bill payne []
Sent: Friday, June 27, 2008 2:25 PM
To: Wheeler, Evelin
Cc: Randy Gunn; O'Connell, Pat; Jill M. Roelle; Frank Stern; Carla J. Sonntag; Brown, Don; Brent Barkett; Marks, Jason, PRC; Aragon, Leroy, PRC; King, David, PRC; Starr-Garcia, Stacy, PRC; Lujan, BenR, PRC; Javaheripour, Setareh, PRC; Sloan, Carol, PRC; Ledezma, Luis, PRC; Jones, Sandy, PRC; Martin, Elizabeth, PRC


My comments

Tuesday July 30, 2008 10:08

4 Utilities Seek N.M. Solar Plant

Energy prices are going UP!

pnm draft final report comments. viz.

New Mexico has only one active underground coal mine: San Juan coal mine production.

The ratio of interpretation to data is unfavorable.
Article rejection referee comment to San Diego State Unversity psychology prof. About 1965.

Cutting consumption viz.

Friday June 27, 2008 14:11


My comments on
PNM Electric Integrated Resource Plan Draft Report.

address my concern about adequacy of data presented to support future electric

supply-side statements and graphs. For example on page 48
Of all the fossil fuels, coal is the most abundant. The United States is estimated to have sufficient coal reserves to meet current coal consumption for electric generation for hundreds of years. Typically, coal is supplied for electric generation using one of two methods: either the electric generation plant is located at the source of the coal, called a mine mouth plant; or the plant receives coal transported from one of the large coal producing regions in the United States. Both San Juan and Four Corners are mine mouth plants. The San Juan Mine, supplying San Juan Generating Station, and the Navajo Mine, supplying Four Corners, have provided a reliable supply of coal since the plants’ inception. These plants are supplied through long term coal supply agreements, and in both locations the coal reserve will last well beyond the life of the coal supply agreements and beyond the 2027 planning horizon used in this E-IRP.

Unlike coal and nuclear fuels, natural gas is neither as abundant nor as small a percentage of the operating cost to generate electricity. While most of the natural gas consumed in the United States is produced in the United States, the natural gas market relies heavily on supplies from Canada and the global liquefied natural gas market. Global natural gas reserves are estimated to adequately supply the current natural gas demand for about 60 years, considerably less than coal. Also, unlike coal and nuclear, demand for natural gas due to electric generation should be expected to increase during the planning horizon for this E-IRP because, other than energy efficiency and renewables, natural gas is about the only resource that can be brought on-line in the near term to supply growing electricity demand.

New Mexico is home to two of the largest natural gas supply basins in North America, the San Juan and the Permian Basins. As a result, there is robust natural gas infrastructure in place to supply natural gas to PNM’s existing plants and multiple opportunities to site new plants adjacent to reliable sources of pipeline supply. So, the most significant issue to consider when evaluating new natural gas generation is the impact of volatile and rising prices.

Failure of the electric irp to address the problem of new construction on future electric load is another concern.


A. PNM completes years 1998 - 2007.
B. BHP Billton completes years 2008-2027 for San Juan and Navajo coal mines.
C. Natural gas contractor completes years 2008-2027.
D. Palo Verde completes years 1998-2027.

Persons completing table should be identified by name and position.

San Juan Coal Mine
Year Tons mined BTU/pound $/ton

Navajo Coal Mine
Year Tons mined BTU/pound $/ton

Natural Gas Consumed
Quantity in Mcf
BTU/Mcf $ Total Cost

Nuclear Fuel Consumed
at Palo Verde
Quantity in pounds
BTU/pound $ Cost/pound

The above tables will help quantify information given on pages 32-35.

COMMENT 2: PNM requests to pass fuel costs along to customers.

Therefore PNM should complete the below two tables.

Persons completing table should be identified by name and position.

Diesel Consumed by PNM
Year Gallons BTU/gallon $ Total Cost

Gasoline Consumed by PNM
Year Gallons BTU/gallon $ Total Cost


Graph on page 35 suggests

that electrical demand is outstripping current supply with possibly serious problems beginning in 2011.

PNM employee Steve Martin identified causes of increased demand.

I believe that Mr Martin's above foil should be included along with the completed below tables.

PNM Peak Demand
Year Number of New Customers Number of new buildings Total Increase in Peak Demand

PNM Peak Demand Per Customer
Year Square feet per new home Average increase in power consumed as a result of electronic devices Power consumed for refrigerated air conditioning

COMMENT 4: The electric irp focused heavily on energy efficiency and conservation thus admitting that there is a possible future problem in satisfying electric demand.

PNM employee Steve Martin pointed out sources of increased electric demand.

Yet the irp did not focus on possible solution to new construction which is the major contributor to increase electric demand.

This appears disingenuous, at best.

And, at worst, a deliberate attempt to let new construction continue knowing full-well that electric shortages could appear at least by 2011. See graph on page 35 above.

Perhaps what PNM should do is alert New Mexico public and, particularly, New Mexico government to these possible electric power dangers?

If, in fact, the world has reach or soon will reach, peak oil production, then the PNM vehicle fleet could face very expensive fuel or even fuel shortage similar to what happened in 1973-4.

PNM could possible face adverse consequences if, in fact, New Mexico suffers electric shortages in the future and did not address the new construction problem today?


PNM employee Steve Martin showed increase in electric use of below project to start in 2008.

Albuquerque Journal Wednesday June 25, 2008.

Power use now looks to start in 2009.

Us cats, not associated, of course, with the wrong cats, read this stuff.

Natural-gas prices, up 74% since the year began, could be headed higher amid predictions of an unusually hot summer in parts of the nation. If those forecasts play out, air-conditioner use will rise -- and with it, demand for electricity production fueled by natural gas, possibly driving futures prices to records. ...

Natural-gas futures settled Friday at $12.994 a million British thermal units, up 11% in June and up more than 82% from 52 weeks ago. Prices are off about 16% from the record close of $15.378 a million BTUs set Dec. 13, 2005, in the wake of hurricanes Katrina and Rita, which disrupted natural-gas production in the Gulf of Mexico. ...
Natural gas generates as much as 30% of U.S. electricity during peak summer periods, according to the research firm Genscape Inc.

Monday June 23, 2008 08:59

Let's go after corp/gov msm stupidity.
The people who pay premium rates for green power got no consideration of the fact that wind and the sun are expected to continue providing energy for free.

Peak oil overthrows green revolution? viz

Tehran vehemently denies charges that it wants to develop a nuclear weapon, saying it wants atomic energy only for a growing population whose fossil fuels will eventually run out.

It is that last item that could result in catastrophe. A war with Iran, as is being discussed, would send oil prices skyrocketing overnight. Americans may be able to get by - barely - on $4 gas, but what if that doubles? What would happen to the economy at $8 gas? How would people get to work? What would happen to the price of food, and to heating our homes come winter? Printing more money for the war would send the dollar's value down further. Inflation would go into overdrive.

What's going to happen to Iran? viz

Editor Kent Walz is brother of Lawyer Jerry Walz.

Pat O'Connell stated at the electric irp on Monday June 16, 2008 that he was trying to arrange to visit the San Juan generation plant.

Pat stated that he had never been there before.

That's PNM employee Madonna Bixby to Pat's left.

We talked about the Navajo mine coal transportation.

"A review of train operations concluded that, because of the increase tonnage handled and then the high cost of diesel fuel, electric locomotives could prove attractive economies."

A Historical Survey
Revised Edition
Fourth paperback printing of the revised edition, 1999

Navajo Mine Railroad - near Farmington, New Mexico

The GE E60 is a C-C electric locomotive ...

Here's Evlin Wheeler [standing], engineer/statistician Cynthia Bothwell, and PNM spokesman Don Brown at the June 16, 2008 electric irp.

Bill made two comments:

1 irp was strong on demand but weak on energy supply projections.
2 PNM should address the problem of new construction identified by pnm employee Steve Martin.

We have a June 10, 2008 draft document of pnm's electric irp report to comment on by June 27, 2008.

Don Brown and the Beaverhead viz.

Smirking Chimp "Let's hope no attack." viz.

ANZAC cheers viz.

Paul Kedrosky Oil Drum viz.

"Also noteworthy is an increasing likelihood of military conflict involving Iran:" viz

We filed the void judgment action in the now-known-as Nojeh/NSA lawsuit just be before Patty and Bill went on vacation.

This turned out to be poor timing for the reason that MALEF judge Martha Vazquez issued 87 without jurisdiction

This caused much inconvenience since we had to file a response from Bozeman.

So we're waiting to return to abq before filing.

But we are posting Seeking alpha rural gas prices viz.

More seeking alpha viz.

 Isaak Walton Inn, Essex, MT was fun.

See the inverted brown V over the porch. Then look at the window just above the V. That's room 15 window.

This page was updated from room 15.

Hiking around Glacier Park can be really exciting!

Travelling to the Isaak Walton on Amtrak can be exciting too!

Poster photographed in the Isaak Walton bar/high speed Internet room in the basement.

Without Internet our legal project would fail.

Sunday June 15, 2008 field tripThe Oil Drum viz.

San Juan coal-fired generating plant.


San Juan coal mine. Note trucks parked behind nearest power pole.

Those trucks burn diesel, Pat.

Four corners coal-fired power plant as seen from San Juan coal-fired electric generation plant, heading south.

Note toxic brown cloud drifting to the west.

Billboard erected at intersection of Shiprock-Farmington highway [NM 64] and State Road 6800 to the San Juan coal-fired electric generation plant.

"americans living near coal-fired power plants"

Real reason for field trip.

We were on return from vacation.

Fishing on Thursday June 12, 2008 on the Beaverhead was good. Second fish caught was the largest, about 24 inches.

Guide Justin did a nice job. Fifteen or more fish caught. Only one large rainbow, the remainder brown trout.

Fishing is usually fuel intensive. But essential non-gas-wasting travel, of course.

Here's Justin's gas-guzzling rig in Dillon.

We discussed energy problems.

Justin reported that tourism was down in Dillon in 2007.

The float fishing part of Beaverhead river in Montana parallels I-15.

Guide Justin reported that Utahns are not held in high esteem for several reasons by Montana fly fishermen.

Justin pointed out green spray paint message on an I-25 support pier which states


Justin asked Payne what he did for a living before retirement. Payne told him ... and about how the Iraq/Iran war got started.

Guide Justin and Payne discussed the below mail too.

---Original Message-----
From: Iran Defence Forum []
Sent: Tuesday, June 10, 2008 11:01 PM
Subject: Happy Birthday from Iran Defence Forum

Hello billp37,

We at Iran Defence Forum would like to wish you a happy birthday today!

This was posted at Paul Kedrosky Oil Drum viz.
Below letter and enclosures not requested.

Maybe they were looking at this page?;;;;;;;;

-----Original Message-----
From: O'Connell, Pat [mailto:Pat.O']
Sent: Monday, April 28, 2008 11:24 AM
To: bill payne
Cc: Wheeler, Evelin
Subject: RE: cholla


I don't have the specific information you have requested on gas, diesel and motor oil. PNM does report operational data, including coal consumption, to FERC, and that info is published quarterly in a document called a FERC Form 1. You can view PNM's FERC Form 1's if you follow the instructions at this address:

Also, I looked a the the page with our Electric IRP information and the presentation from July 2 is still posted there.

Pat O'Connell


From: bill payne .... Sent: Sunday, April 27, 2008 8:46 PM
To: O'Connell, Pat
Subject: cholla Pat

PNM may have fuel problems.

We are investigating.

Cholla apparently gets it coal from the McKinley coal mine in New Mexico.

Cholla Arizona coal fired plant photo taken November 12, 2007 on essential non-gas-wasting trip to visit Dr Ted Lewis in Salinas, CA.

Thursday July 5, 2007 07:09
I'm out at the Electric IRP page but I don't see the foils from the July 2, 2007 meeting posted. When will these foils be posted?

There are two foils, one related to load projections and the other about future coal use by PNM [Ms Bothwell presented both], I would like to examine more carefully. Not all issues raised the the Electric IRP appeared to me to be of equal importance.

I want to focus on what appears to me to be essential issues in the future production use and of electric power.

I would like to get from you answers to the three below questions:

1 annual gallons of motor oil consumed
2 annual gallons of diesel oil consumed
3 annual gallons of gasoline consumed
4 megawatts of electricity produced by PNM electric for years 1991 through 2006

for preparation for the next Electric IRP.

Please include San Juan coal mine consumption.

Utilities across the USA are raising power prices up to 29%, mostly to pay for soaring fuel costs, but also to build new plants and refurbish an aging power grid.

Even more dramatic rate increases are ahead. The mounting electric bills will further squeeze households struggling with spiraling gasoline prices. ...

The price of coal, which fires half of U.S. power plants, has doubled since last year, largely because of surging energy use in countries such as China and India. Natural gas prices are up nearly 50% on high U.S. demand. In California, drought has forced Pacific Gas & Electric to replace cheap hydroelectric power with natural gas, helping to prompt it to seek 13% rate increases. ...

-----Original Message-----
From: Brown, Don
Sent: Thursday, June 12, 2008 6:49 PM
Subject: Draft PNM Electric IRP Report + Meeting on Monday

Participants in the public advisory process.

Here is a link to the draft of the PNM electric IRP report: . This report is the result of your input and feedback, so we hope you'll spend some time reading the report before Monday's public advisory meeting. This will be your opportunity to provide feedback on the draft report.

Next PNM Electric IRP Meeting
Monday, June 16 9:30 a.m. to 12:30 p.m.
Downtown ABQ/PNM's Alvarado Square
La Luz Conference Room

Agenda and dial-in information is attached. Please let us know if you have any questions. Thank you for your help during the past (nearly) year! db

Don Brown Director, Corporate Communications
PNM Resources (NYSE: PNM)
don.brown@... brown doesn't want his is mail posted on Internet

ALBUQUERQUE — New Mexico's largest utility on Thursday terminated a power purchasing agreement with a proposed biomass electric plant that has been touted as part of the state's push for renewable energy. ...

PNM spokesman Don Brown acknowledged Thursday that the energy market is more expensive today. But he said the utility must focus on finding reliable renewable energy sources to meet the company's diversity goals as well as a state standard that calls for 10 percent of electricity from the state's investor-owned utilities to come from renewable sources by 2011.

"We really need to focus on renewable projects that have a high probability of becoming a reality and this one at this point does not appear to be close to fruition," Brown said. "There are too many question marks surrounding this project at this time." ...

Monday June 2, 2008 10:37

Seeking alpha viz.

Note: No mention of limiting new construction.

PNM employee Steve Martin [red check] blew the whistle on electrical increase reasons. Main reason, of course, is new construction.

Incidentally, Martin reported to the group that he has been working for PNM for 28 years. Retirement in imminent sight?

Above is PNM smokescreen to hide real problems identified by Steven Martin.


More smoke to try to hide Martin's identification of problems.

3 indicates TPTB wants us to suffer while they make money with new construction.

Engineer Ms Cindy Bothwell's audacious plot shows that in 2012 that electrical generation capacity falls below projected use provided no new capacity is added.

PNM might have problems funding new capacity for the reason
After the recommended decision was announced, Fitch Ratings downgraded PNM's long-term debt to the lowest investment-grade credit rating. Standard and Poor's changed PNM's outlook from stable to negative after downgrading PNM in December to a similar level. And Moody's Investors Services said it would continue to review PNM for possible downgrades.

Let's see what happens.

"He told shareholders that, under current conditions, PNM cannot afford to build new power plants to meet growing demand." Ouch!

Sterba offers plans to improve PNM's performance

By Jack King
Journal Staff Writer

PNM Resources Chairman, President and CEO Jeff Sterba told shareholders last week a bit of what they already knew: the utility has had a bad year. And then he offered specific plans for improving its performance.

Sterba said the $34 million rate increase the Public Regulation Commission gave PNM utility in April and the $63 million fuel adjustment clause the commission subsequently approved will not cover the costs of providing service in New Mexico. Both PNM, in New Mexico, and Texas-New Mexico Power, in Texas, will file a new rate case in the third quarter of this year, he said.

He told shareholders that, under current conditions, PNM cannot afford to build new power plants to meet growing demand. The $1.7 billion in capital spending over the next five years is mostly for transmission and distribution of infrastructure, he said.

"We're only contemplating $100 million in new generation. We're spending $400 million this year, and none of that on generation," he said.

PNMR's earnings per share were down almost 40 percent in 2007 from 2006 levels. Sterba said he takes responsibility for the cause of that loss - a 2002 agreement between PNM, a group of its larger customers and the PRC that included two rate decreases and eliminated PNM's fuel adjustment clause. Although the agreement benefitted PNM by allowing it to retain 100 percent of its revenue from sales of surplus energy, Sterba said it ran a year too long.

In the meantime, he said, PNM's customer demand grew enough to eliminate the surplus energy used to make the sales, and, in 2007, there were significant increases in fuel and the commodities required to maintain infrastructure. But, he denied that PNMR's financial difficulties have anything to do with the cost of acquiring its Texas utilities, with losses in those operations or with exorbitant executive compensation.

Besides the rate cases, Sterba said PNM will focus on three objectives in the coming year: reducing company. costs through efficiencies and technology; simplifying PNM's business model by separating its regulated and competitive generation, and selling its natural gas division; and improving the operating capability of Palo Verde Nuclear Generating Station. As part of that effort, PNM will ask the PRC to allow it to include its costs of buying back the leases on Palo Verde Units 1 and 2 in customers' rates, he said.

Business Outlook Albuquerque Journal Monday June 2, 2008

Sugar daddy got
PNM off the hook

PNM has for years mined the pockets of New Mexico customers, racking up enough profits to expand and buy new ventures in Texas and Oklahoma and create a holding company. These profits, plus the dividends that are paid out to stockholders such as Bill Gates, come from the people of New Mexico, many of them who are very poor.

Now that the bubble of mortgage speculation has burst and has taken us all down, PNM received Public Regulation Commission approval to let them open up new digging rights into our pockets to pay off high interest junk bond loans. They want to recover what are their losses from gambling on the market in a time of risky future stability. How much will they come back for next year?

The failure of PNM to set aside enough assets for basic new infrastructure in New Mexico rather than trying to expand into other states is a bad business decision, not a wise move and obviously not in our interest here.

When we little people make bad decisions or capitalist competition sinks our boats, we don't have a sugar daddy (the PRC) to bail us out. We have to take the losses. PNM should do the same and not come begging for permission to make us poor even poorer.

What are we to do? If we had a Legislature and governor not in the pockets of corporations like PNM we would see a revoking of PNM's monopoly charter, for a start. Then maybe we might move to nationalize and run our resources for the people of New Mexico, not outside speculators.

Why do we have to carry the rich on our back any longer, or give them rides into space?

Robert L. Anderson

Business Outlook Albuquerque Journal Thursday May 29, 2008

PNM proposes to generate about 49% of new electricity using natural gas.

The cost of a gallon of gas gets all the headlines, but the natural gas that will heat many American homes next winter is going up in price as fast or faster.
A longstanding assumption of American energy policy has been that natural gas would be plentiful abroad, and therefore readily available for importation, as production falls off in North America, where many fields are tapped out.

But some experts are starting to question that idea, saying natural gas could be subject to the same explosion in overseas demand that has made oil so expensive.


Letter Drive Backs PNM Fuel Clause

Stockholders Write To PRC Officials

Copyright 02008 Albuquerque Journal

By Jack King
Journal Staff Writer

"Approve PNM's emergency fuel clause" is the message in a letter-writing campaign from a utility shareholders group.

Executive Director Carla Sonntag of the New Mexico Utility Shareholders Alliance told the Journal that the group has sent 7,000 sample letters to PNM stockholders statewide suggesting they send them on to Public Regulation Commission members considering the company's request for immediate relief.

PRC Chairman Jason Marks said his office has received about 30 of the group's letters.

Although most have been retyped and/or customized to 'express the individual shareholder's personal viewpoint, many have simply had the top third torn off, then been mailed in with "sample letter" still printed at the top and a signature at the bottom, he said.

A cover document that goes with the letter is headlined, "The New Mexico Utility Shareholders Alliance (NMUSA) is concerned about recent decisions by the NM Public Regulation Commission (NMPRC) and needs your help!" A subhead farther down the page reads, "A fuel clause is critical to maintaining adequate cash flows." In the letter, a boldfaced sentence reads, "Your approval of PNM's requests, in the pending Emergency Fuel Clause case is critical."

Marks said that letter-writing campaigns are nothing new for PRC commissioners and that letters are placed into the record of a case, but don't have the same status as sworn testimony. Marks said he has


Form Letters on PNM Fuel clause Target PRC

from PAGE Al

received about six letter's a week on PNM's rate case.

"They do stimulate me to ask questions about the record and even to take a new perspective on the record," he said. "I've gotten some that told me something new about the case, something I didn't know or understand before. I read them all, although I don't think I'll read all of the 30 identical letters I've gotten this time," he said.

Commissioner Ben R. Lujan's assistant, Terah Javaheripour, said he had received approximately 25, and Commissioner Carol Sloan's assistant, Luis Ledezma, said she had received 16.

The PRC today begins what is expected to be at least two days of hearings on PNM's fuel clause request, which could generate $72 million in a 12-month period.

Sonntag at first denied that the letters are being sent under the aegis of the nonprofit shareholders alliance.

"That letter was not a letter from the shareholders alliance. It was not from anyone," she said.

She did, however, say the shareholders alliance had printed the sample letter and mailed it out to PNM shareholders who also are alliance members.

"As executive director, I represent shareholders, who can't all be involved. It's our job to keep them educated and to champion the best public policy for shareholders of gas and electric companies doing business in New Mexico," she said.

The New Mexico Utility Shareholders Alliance does not receive regular contributions from PNM, although the company, along with other utilities, has helped sponsor the alliance's annual luncheon. The alliance is primarily funded by contributions from its members, Sonntag said. The New Mexico Utility Shareholders Alliance has about 12,000 members, of which about 7,000 hold PNM stock.

Albuquerque Journal Thursday May 15, 2008

Yahoo Finance Wednesday May 14, 2008

PNM Resources Inc. (PNM)
PERIOD ENDING                                      31-Mar-08 31-Dec-07 30-Sep-07 30-Jun-07
Net Income Applicable To Common Shares ($48,636)    $16,597     $8,371       $20,240

New Mexico Public Regulation Commission

Tuesday May 13, 2008 07:10

Dear Commissioners:

New Mexico Utility Shareholders Alliance contacted us to make comments to the PRC.

I've been attending PNM natural gas and electric Integrated Resource Planning since 2007 for several reasons.

One reason is that I was informed of peak oil by my high school chemistry teacher, who previously was an oil industry chemist, in 1956.

PNM employee Steve Martin alerted us to the causes of increased electrical demand.

Further, Martin alerted us to electrical demands of Albuquerque mayor lawyer Martin Chavez's water project.

PNM promotes programs of energy conservation.

These energy conservations programs appear to be a smoke screen to try to mask business interests.

PNM appears to be asking customers to conserve on electricity so that new construction and other causes of electricity increases, like power hungry flat panel LCD and plasma TV purchases, can continue.

Continuation of new construction may not be sustainable for energy shortage reasons.

PNM showed that without addition of new electrical generation capacity it may have reached peak electrical production.

Further, PNM's suggested additions

which rely heavily on natural gas

renewable, and nuclear energy, and energy efficiency may have to be reconsidered.

Clearly not allowing PNM to pass along increased diesel, gasoline, natural gas, coal costs to consumers is unreasonable and could lead to PNM insolvency.

Bankruptcy is not be in the interests of PNM customers or the government of the State of New Mexico.

For these reasons I support allowing PNM to pass along increased fuel costs [including diesel and gasoline] to customers.

However, renegotiation of compensation packages for PNM Utility Officials before any rate increase might be warranted in view of PNM performance.

"We can't solve problems by using the same kind of thinking we used when we created them." Albert Einstein.

Continued new construction is a serious problem that I believe needs to be addressed by the PRC.

New Mexicans are faced, perhaps soon, with expensive and scarce energy which may lead to energy shortages.

Perhaps the PRC should consider options to attempt to limit new construction and ways to attempt to reduce volumes of unnecessary space currently heated and air conditioned in existing structures?

The PRC might wish to consider regulation of sale of new electric and natural gas meters?

bill payne

Another William H Payne.

"Two things are infinite: the universe and human stupidity; and I'm not sure about the universe." Albert Einstein

PNM Business Rate Hikes Complicated

from PAGE 1

had a declining bloc rate, charging less per kilowatt-hour for those who used more power. Because PNM has eliminated that rate structure, leveling the rates, customers using more than 4,000 kwh per month will receive proportionate increases.

For an average small-power customer, using 2,250 kwh per month, rates in September through May will go up 0.3 ercent, from $192.37 to 193.03 per month. But from June through August they'll go up 13.9 percent, from $192.37 to $219.09 per month.

For a small-power customer using 5,000 kwh per month, rates m the winter and spring months will go up 2.1 percent, from $410.73 to $419.49 per month. In the summer months, they'll go up 16.2 percent, from $410.73 to 477.40 per month.

For small-power users, the standard customer account charge will increase from $6.77 to $7.75.

For commercial customers m the "general-power" rate class, defined as those using 15,001 kwh per month or more, rates on average will go up 4 percent.

For the majority of customers in that class, differences in winter and spring bills will range from a 7 percent decrease to a 8 percent increase. Differences in summer bills will range from a 7 percent decrease to a 20 percent increase. Individual bills will vary according to usage, depending on such factors as time of day when power is used, fluctuation in usage and seasonal usage.

Customer charges for general-power users will rise from $187 to $200 for the winter months, and from $187 to $232.50 for the summer months. Demand charges will increase from $3.74 per kilowatt-hour to $4.65 in the summer, and from $3.74 to $4 in the spring and winter months.

"Large-power" customers are defined as those with high power requirements, for example, a factory that uses 500 kilowatt-hours at a single point during the month.

These are customers who find it more economical to pay a higher customer charge to get lower per-kilowatt-hour charges.

Averaged over the entire rate class, rates for large power users will increase by 5.1 percent. For the average large-power user, rates will increase 1.5 percent in the winter and spring, and 12.4 percent in the summer.

The customer charge for large-power users will go from $5,016.50 to $5,090 in the winter and spring, and $5,016.50 to $5,900 in the summer. Demand charges will increase from $10.03 to $11.80 in the winter and spring and $10.18 in the summer.

Albuquerque Journal Thursday May 8, 2008

Enclosed in April 2008 utility bill.

Finally we got a glimpse April 30, 2008 of what pnm proposes to do to increase electricity production.

Note the reliance on natural gas.

Simmons power points

LMS 100 and 7FA.

The risk of electricity blackouts in Southern California during the hottest days this summer is more than triple that of previous years because power plant additions have failed to keep up with demand, the state's grid manager said.

PNM may have fuel problems.

We are investigating.

Cholla apprently gets it coal from the McKinley coal mine in New Mexico.

Cholla Arizona coal fired plant photo taken November 12, 2007 on essential non-gas-wasting trip to visit Dr Ted Lewis in Salinas, CA.

The price of electricity in Chile has jumped from about 3.5 cents per kilowatt-hour to 35 cents per kilowatt-hour in just three years. That's like gasoline spiking from $2 a gallon in 2005 to $20 a gallon today.

This situation – which has big implications for commodity investors – stems from a deal between Chile and Argentina a few years ago...

In 1995, Chile generated 57% of its electricity from hydroelectric dams, 28% from coal, and the rest from diesel fuel. The government sought ways to diversify its electrical generation. It settled on cheap, clean natural gas piped in from neighboring Argentina. The media hailed the project as a model of national cooperation.

Chile bet big on Argentine natural gas, which quickly came to produce 37% of the country's electricity. The switch lowered energy prices... for about 18 months. Then, like my junior prom date, the relationship went bad in a hurry...

Argentina proved to be a terrible partner. By 2004, it began violating its production contracts. To meet increasing Argentine demand, suppliers cut the gas coming into Chile.

Chilean electrical production shifted to diesel, which effectively tripled the cost. Companies had to bring many of the old diesel generators out of retirement. Where a natural gas turbine costs $50 per megawatt-hour to run, the old diesel turbines cost $250 per megawatt-hour... a 400% increase.

Matt Badiali
Daily Wealth
Saturday April 26, 2006

Tuesday April 22, 2008 07:26

The Rio Grande water project looks to be coming on line at a time of diminishing new electricity production?

New generation capacity appears to be declining.

EIA 2008 conference.

Peak Oil's Investment Implications    Mathew Simmons March 7, 2008

Peabody's Black Mesa Project

PNM Says Employees Insulted

Did PNM Bring On Problems?: Fuel increase opponents ask if financial crunch is result of mismanagement

03/26/2008 1:41 PM ET

Two intervenors in Public Service Company of New Mexico's rate case say the company's request for an emergency fuel clause may be less about a real crisis and more about mismanagement at the state's largest utility.

he Albuquerque-Bernalillo Water Utility Authority and the New Mexico Industrial Energy Consumers asked state regulators Tuesday to give them more time to delve into PNM's fasttracked request that would generate $72 million in new revenue for the utility over 12 months.

With the support of Attorney General Gary King, PNM asked for the emergency relief after a hearing examiner recommended a much lower rate hike than the company sought -- and recommended against its request to pass along automatic increases in the cost of fuel used to generate electricity.

PNM has said that without the immediate help, its bond rating could be downgraded to junk status. PNM has cited the rate case as a major factor.

But the two intervenors say there are a number of issues that need to be explored before the Public Regulation Commission decides on the emergency request:

Whether and to what extent the credit crisis facing PNM's holding company, PNM Resources, is due to "mismanagement" of its unregulated enterprises in Texas.

Whether poor performance of PNM's regulated power plants is a "primary driver" of its credit problems.

Whether PNM's claimed emergency is a real, current crisis or a "forecasted emergency."

Why PNM's fuel cost projections in the emergency proceeding differ so significantly from its forecasts in discovery in the underlying rate case.

Whether the potential credit rating downgrade stems from PNM overselling the rate case to the investment community and its "frantic, very public, responses" to the recommended decision.

PNM spokesman Jeff Buell said the utility will object to the requested delay.

"We're seeking emergency relief. In our view, we just can't wait 60 days. These are extraordinary circumstances that require expedited attention," he said.

He said the company would file a detailed response.

'Radical departure'

As part of their request for a delay, the intervenors cite a notation from Wachovia Capital Markets attached as a PNM exhibit in the emergency fuel clause case.

"PNM's holding company ... went on the offensive and purchased a power plant and a utility, both in Texas ... largely financed by short-term debt that PNM, in our view, should have moved more quickly to term out," the exhibit said.

Wachovia said in another exhibit: "Management also accountable -- PNM's acquisitions over the past few years have piled on debt and debt equivalents, but there doesn't seem to have been enough attention paid to the flagship store."

The Public Regulation Commission has agreed to make PNM's request a separate case and put it on a fast track for a hearing April 15.

The two intervenors described PNM's request for expedited action "a radical departure from established commission procedure" and argue it denies due process to consumers by taking away the "right to be heard at a meaningful time and in a meaningful manner."

Attorneys Nann Winter of the Water Authority and Peter Gould of NMIEC say they need at least 60 days to get answers from PNM and to properly analyze them.

They are asking PNM to provide the contracts with fuel providers that will generate the costs it is projecting, as well as other information.

They also are asking PNM to turn over all its communications with bonding agencies.

Winter said PNM hasn't presented any new evidence about emergency coal costs and there was no specific number attached to the open-ended fuel clause requested in the rate case.

"Two days after the recommended decision we have publications from Wachovia and Standard and Poor's saying PNM absolutely had to have a fuel clause," she said.

Case history

In the initial rate case, PNM was seeking an unlimited fuel clause and a rate increase of $77 million.

The hearing examiner recommended a rate increase of $24 million -- about 4.4 percent -- and no fuel clause.

The Public Regulation Commission ultimately will decide.

The emergency clause now sought was a compromise with King, whose office originally recommended against a fuel pass through and for a rate cut.

His office agreed to the short-term fix because he was convinced the company was in financial peril.

As two of the big electricity users, the Water Authority and NMEIC would be hit with a proportionally higher increase through a fuel clause than through a basic rate increase.

They also raise the question of whether the fuel clause would, in essence, give PNM a fast-track to a rate increase in the range of 18 percent to 20 percent.

The company, meanwhile, points to its relatively low rates and says its credit problems would cost New Mexico consumers in the long run.

To see more of the Albuquerque Journal, or to subscribe to the newspaper, go to

Copyright (c) 2008, Albuquerque Journal, N.M.

My comment: When will banks learn that renewables cannot be substituted for the energy generated by coal plants? It would require a massive amount of renewables to do so. In California renewables have been touted for 30 years and there is very little results from them. PG&E is playing the game by contracting for 177 MWe of solar plants that will have a capacity factor of only 20% and produce very little amounts of energy.

Coal News and Markets

My comment: When will banks learn that renewables cannot be substituted for the energy generated by coal plants? It would require a massive amount of renewables to do so. In California renewables have been touted for 30 years and there is very little results from them. PG&E is playing the game by contracting for 177 MWe of solar plants that will have a capacity factor of only 20% and produce very little amounts of energy.

San Juan Mine Statistics

San Juan Coal Company - BHP Billiton Mine site size
17 square miles

Annual yield
7,800,000 million tons

Daily production
17,810 to 19,810 tons per day (average)

Estimated life span
Through at least 2017

-----Original Message-----
From: Brown, Don
Sent: Wednesday, March 26, 2008 11:30 AM
To: Brown, Don
Cc: O'Connell, Pat
Subject: New Date for Next PNM Electric IRP Meeting

You may remember we agreed to reschedule the meeting below to either April 1 or April 3. After polling participants, it has been decided that we will meet Tuesday, April 1, from 1:30-4:30 p.m. in the La Luz room in PNM's downtown Albuquerque Alvarado Square. Agenda same as below.

PNM draft electric report [dated March 14, 2008] attached to above email.

Here are three of the more interesting pieces of information presented in the report.

PNM electric generation facilities.

Here's the caption to the above audacious table.

3.5 Load and Resources Figure 3-5 illustrates the current load and resources balance. It is based on the Load and Resources table shown in Appendix D. The L&R table reflects the existing resources and mid load forecast documented in this report. Through the planning period, existing resources decline while projected demand increases.

PNM currently has a program to purchase renewable energy certificates (RECs) from retail customers that choose to install PV panels smaller than 10 kW.

PNM’s Renewable Portfolio Standard (RPS) targets.

PNM gas irp has something in writing as of Tuesday March 4, 2008.

We're starting a page on PNM Solar since Director, Advanced Generation Development, Greg Nelson, is in the planning starge of a solar project.

Cost of coal power is rising

Electric bills are poised to soar for customers of utilities building coal-fired power plants.

The plants, long-trusted purveyors of low-cost power, no longer seem like such good bets because of soaring construction costs and the surging cost of coal. ...

The Kansas City Star
Posted on Wed, Mar. 19, 2008 10:15 PM

PNM Seeks Emergency Increase

Utility, AG Seek Clause To
Pass Fuel Costs to Customers

Copyright © 2008 Albuquerque Journal

By Jack King
Journal Staff Writer

Public Service Company of New Mexico -with the support of Attorney General Gary King - is asking for an emergency fuel adjustment clause that would generate an estimated $44 million this year.

The average residential customer using 600 kilowatts a month would see an increase of about $5.

PNM President, Chairman and CEO Jeff Sterba said Thursday the measure is necessary to keep bonding agencies from downgrading the utility's bond rating to junk status - a move, he says will cost ratepayers more as the company tries to obtain credit.

The proposal is a modified version of the clause PNM has asked for in its pending rate case. It was rejected by a hearing examiner in a recommended decision March 6 and is awaiting action by the elected Public Regulation Commission.

While the AG's Office supports the emergency clause, several of the intervenors who opposed both PNM's rate hike and the earlier fuel clause said they would object.

The move is a turnabout for the Attorney General's Office, which is charged with representing residential consumers in rate cases. The AG Opposed both the fuel clause and PNM's 76.9 million rate request.

A fuel adjustment clause allows the company to pass the cost of fuel needed to generate power onn to customers.

As part of a compromise with the AG's Office, the emergency clause would be billed at .83 cents per kilowatt hour for the first year and capped at a penny after that.

PRC Commissioner Jason Marks said the commission will decide how to act on the request and make a determination as soon as possible. The PRC staff had not yet taken a position.

Reaction to the filing from other parties was mixed Thursday.

Peter Gould, counsel for the New Mexico Industrial Energy Consumers, called it "entirely improper."

PNM is asking that the clause be put into effect at the same time as the rest of rate case, on or before May 7, even though no hearings have been held on this new version, he said.

"How are they going to reopen the record without delaying the case?" he asked. "If they file affidavits of support, we have the right to respond to them in a timely manner. Are they going to ask for further hearings?"

Nann Winter, attorney for the cities of Albuquerque and Santa Fe, and the Bernalillo County Water Authority, said her clients oppose the request.

"Procedurally, the record is closed," she said. "PNM had a chance to present this issue. If they feel they are under-recovering they should file this proposal under a separate docket."

King said Thursday the proposal would protect electric energy consumers.

Assistant Attorney General Jeff Taylor said utility and AG officials had been meeting since Monday on the proposal.

"Not only does PNM need this clause to cover fuel costs, but there are a lot of adverse financial consequences if they don't get it," Taylor said.

"We don't need a bankrupt utility in this state. All kinds of problems could result from that. I wouldn't want them taken over by an out-of-state utility."

Taylor said the AG's Office hadn't realized the company's dire position during the earlier hearings. The AG's Office actually recommended a rate reduction. The company's stock has fallen from the $34 range last year to close at $9.99 on Wednesday. Its bond rating has been downgraded.

The PRC earlier this week gave the company permission to try to borrow an additional $300 million. AG spokesman Phil Sisneros said PNM officials appear to have been "in a panic" since the recommended decision was issued. He said King also has concerns about consumers "if PNM were to tank."

The new proposal has a number of changes from the first fuel adjustment clause presented in PNM's rate case.

Among the changes:

· Instead of the amount being revised monthly, customers would pay a fixed fuel adjustment charge of .83 cents per kilowatt hour for one year.

· At the end of the year, the amount would be raised or lowered, depending on the company's expenses - subject to PRC approval.

· PNM would pay the costs of auditing the costs included under the clause.

· If the commission allows a fuel adjustment increase, the amount customers would pay would be capped at 1 cent per kilowatt hour.

· If the commission decided .83 cents was too much, PNM would return the difference to customers.

· The commission could deny PNM the right to recover costs that were the result of poor plant performance at its base-load power plants. Poor performance is defined as the plants' capacities being below a weighted average of 82.9 percent.

· The clause would expire two years after the date rates in the current rate case go into effect, or on the date rates in a second rate case go into effect, whichever is sooner, PNM said.

PNM spokesman Jeff Buell said Thursday that statement doesn't mean PNM intends to file a second rate case within the next two years.

Albuquerque Journal Friday March 21, 2008

Smaller PNM Rate Increase Advised

Albuquerque Journal (NM) (KRT) Via Thomson Dialog NewsEdge

Mar. 7--The hearing examiner in PNM's electric rate case before the Public Regulation Commission has recommended a 4.4 percent rate increase for the utility, about a third of what the company requested.

The company had asked for a 14.7 percent increase, between $77 million and $82 million. Instead, in a recommendation issued Thursday evening, hearing examiner James Martin said Public Service Company of New Mexico's electric rates should be increased by about $24 million.

Martin also recommends that PNM's request for a fuel adjustment clause be denied. The clause would allow PNM to pass its fuel costs on to customers through surcharges on their monthly bills. ...

Florida Sparks Dark Visions

[U]tilities understand implicitly their roles -- to produce and deliver safe, reliable and cost effective power. The attention of those at the top has been diverted, however, and the job of fixing any problems associated with those goals has been the responsibility of those who are more technically oriented. But now that the federal law has more bite, those at the top of the chain of command are expected to be more involved.

Those in the trenches have always known that the capacity of the transmission system is insufficient and will be unable over a sustained period to support huge increases in power demand. The same infrastructure, meantime, is from a bygone era. Translation: The difficulties in winning permits coupled with lack of capital flowing to transmission projects has meant that the risks of large-scale reliability problems have increased because of inadequate or congested transmission lines. ...

Invariably, utility planners will be forced to draw parallels between the massive 2003 blackout and the recent one in Florida. At the heart of the matter is the fact that the nation will need an additional 141,000 megawatts of electricity by 2015 to accommodate a 19 percent increase by then, says NERC. But only 57,000 megawatts are planned.

March 5, 2008

PNM Rates Fair; Affordable

REPORTER JACK King's article on Public Service Company of New Mexico's pending electric rate case, "PNM Calls Rate Increase Imperative Others Say Request Too High," was a fair portrayal of the case but failed to mention a few key facts.

First, PNM electric customers have not had an electric-rate increase in more than 20 years - and have seen four rate reductions since 1994. A New Mexico residential customer with an electric bill of $'50 in 1994 would have paid $43.05 to use that same amount of electricity in 2007. Today, our rates are 29 percent below regional and 22 percent below national averages.

Second, our request for a mechanism to pass along to customers changes in the cost of fuel used to make electricity, with full oversight by state regulators, is something that most electric utilities have. Every state but one allows electric utilities to recover costs this way, and all other investor-owned utilities in New Mexico already do so. Third, we agree that in a state such as ours with a high level of poverty, electricity must remain affordable. Looking at the average annual residential electric bill as a percent of median personal income, only residents of Maine currently pay less than PNM customers - about 1 percent of annual median income versus 1.25 percent.

Had our proposed increase and fuel clause been in effect for the year ending September 2007, PNM customers would have paid a lower annual electric bill than residents in 46 of the 50 states.

We understand that rate increases are never popular and acknowledge' the enormous task facing the state Public Regulation Commission as it considers our request. But it is critical that rates properly reflect the cost of running our business and are structured in a way that encourages efficient use of electricity. We believe our proposal does that while keeping the price both competitive and affordable.

PNM Resources Albuquerque
Albuquerque Journal Saturday March 1, 2008

A serious power crunch developing in Guangdong. viz

Until recently, external power supplies for consumer devices such as cordless phones and laptop computers were notorious power hogs. Consumers generally considered any adapter, or “wall wart,” that provided enough power at the correct voltage and current for the cheapest price was good enough. With efficiency levels as low as 40 to 50%, these adapters wasted power as low as 1W each—too low to get an individual consumer’s attention. However, multiply these adapters by the millions that exist in the United States alone, and you’ve wasted enough power to require extra power stations. The Energy Star program, which has since 1992 been offering voluntary-compliance standards for household appliances, has now created a similar specification for EPS (external-power-supply) products.

Gates' Investment Firm Loads Up on PNM Stock

Feb 22, 2008 (Albuquerque Journal - McClatchy-Tribune Information Services via COMTEX) -- Bill Gates' personal investment firm has bought an additional 500,000 shares of PNM Resources' common stock, bringing the number of its shares of the holding company's common stock to more than 7 million. ...

PNM Resources shares traded at $23.21 at the beginning of the fourth quarter last year and at $21.19 at quarter's end.

The stock price has dropped sharply since then, closing at $12.78 Thursday on the New York Stock Exchange.

The company's share price dropped almost 25 percent Feb. 11 after it announced its profit for the fourth quarter fell 49 percent.

A Robert W. Baird & Co. stock analyst who follows PNM Resources said long-term investors like Gates are looking for return on investment years from now and don't pay much attention to near-term fluctuations in stock price. ....

Sent to San Filipe de Neri grade school, Albquerque on about Friday February 23, 2008.

Here's another of our New Mexico interests: crooked lawyers and judges and msm.

Lots of money to be made by the above group on the below subject.

A perfect electric storm?

Will Electric Bills Go Up?

Most of the intervenors who address the issue also oppose the so-called fuel clause adjustment - which PNM says is desperately needed and some observers say is as important to the company as the rate increase, if not more so.

The notable exception is the union representing electrical workers. It supports both the rate hike and the fuel clause.

Besides the PRC staff, 18 businesses, interest groups and governmental entities are represented in this case.

What's at stake?

There is no question that electric bills will jump if the commission approves the request.

PNM is asking for a 13.8 percent revenue increase based on its "test year" from September 2005 to October 2006.

The increase would differ depending on the class of customer - i.e. residential, industrial and others - and on how much electricity a customer uses.

If PNM gets its way, rate increases would be magnified by fuel cost adjustments tacked onto bills - much the way customer bills started to fluctuate when a similar system was applied to natural gas service.

If the cost of the fuel used to generate electricity jumped in a given month, it would be reflected in your bill. The same would be true if fuel costs went down.

Until now, those fuel costs have been included in periodic rate cases like this one.

The prospect of higher utility bills doesn't sit well in a state always near the bottom of the income charts.

Jeff Sterba, PNM's president and CEO, has said the increases will help the company:

· Be a stable long-term supplier;

· Secure favorable financing to build new power plants to meet growing demand; and

· Gain the flexibility to develop more "green" power such as wind and solar - both more expensive than traditional fuels.

Without rate relief, he has said, the company will have to pay higher financing costs to build new plants, and pursuing green alternatives will be very difficult to do.

The company has already announced layoffs and is trying to sell its natural gas operations.

Sterba painted a bleak picture last week after the company's stock took a 25 percent hit based on its 2007 earnings report, falling to $13.31 a share after trading in the $34 range last spring.

He said the company needs the fuel clause and said PNM's rates are "well below the cost of providing service."

"Clearly, our pending electric rate case ... is a crucial component of our efforts to restore the company's healthy financial performance," he said.

Sharp differences

Not all intervenors address the revenue question. But several of the heavyweights do:

· The staff of the PRC, which is charged with balancing the interests of the utility with those of ratepayers, recommends an increase of only 3.27 percent, about $18.3 million.

· Attorneys for the cities and the Albuquerque Bernalillo County Water Utility Authority recommend a 2.8 percent increase, about $15.6 million.

· The Attorney General's Office, which by law represents residential ratepayers recommends a revenue decrease of 0.5 percent, or $2.8 million.

PNM's proposal has several important new features. It wants to create a new, higher-priced rate category for residential customers who use more than 700 kilowatt hours a month.

For all customers, it wants to create higher rates for power used in the summer months, the highest-use time of the year.

PNM is also requesting an increase in its fixed charges. For residential customers, that will mean an increase of $1.20 per month - from $2.80 to $4.

The three residential rate categories would be: up to 200 kilowatt hours, from 200 to 700 kilowatt hours and over 700 kilowatt hours.

A customer who uses 900 kilowatt hours, watt hours, for example, would pay one charge for the first 200 hours, a higher charge for the next 500 and the top rate for kilowatt hours over 700.

PNM says its average residential customer uses 600 kilowatt hours per month.

PNM says the rate structure is designed to urge people to conserve, which it says will help hold down costs in the long run by delaying the need to build more plants or buy more electricity from other sources.

In general, intervenors support adding the top residential rate block rate and adding seasonal rates to encourage conservation.

However, they dispute other details of the proposed rate design.

PRC staff, the AG's Office, the cities and the water authority argue that rates should be lower, and that rates in the first, least expensive rate block should not increase at all.

Attorneys for Community Action of New Mexico say the first rate block's size should be enlarged to 500 kilowatt hours per month to fully cover minimum use of refrigeration, lighting and heating.

Conversely, attorneys representing the University of New Mexico, Wal-Mart and J.C. Penny and the Kroger Co. argue that residents should pay a larger percentage of rates so the burden will be more equally shared by all rate classes.

A rate case is a legal proceeding and a giant accounting problem.

As a regulated utility, PNM is allowed to charge rates that let it recover what the commission concludes are reasonable operating costs and prudent investment for the benefit of ratepayers - plus a reasonable return for the company's owner/share holders.

PNM faced a financial crunch in the 1980s and 1990s because regulators concluded it. had built more generating capacity than was needed for ratepayers and refused to let the company charge for it.

The last four rate cases have resulted in agreements to reduce and/or freeze rates. This last was settled in January 2003.

The current case involve pages of complicated financial questions such as whether to include pre-paid pension assets in the rate base and whether refunds relating to gross receipts taxes should be applied to income or coal mine decommissioning costs.

According to an estimate by attorneys for Albuquerque, Santa Fe and the water authority testimony and arguments in the case covered more than 40 such issues.

Most parties identified the biggest ticket as the calculation of PNM's allowable rate return. Different ways of figuring the rate of return would cut PNM's proposed increase to amounts ranging between $12 million and $18 million.

Who decides?

The case will be decided by the five elected members of the Public Regulatory Commission: David King, Jason Marks, Carol Sloan, Ben Ray Lujan and Sandy Jones.

PNM first filed the case last February, and witnesses began filing testimony.

A public hearing, during which lawyers for all sides could cross-examine witnesses, began in December and lasted for three weeks.

The parties have since submitted briefs for consideration by hearing examiner James Martin, who presided over the hearing.

Martin is scheduled to issue a recommended decision Feb. 28.

After that, the parties will have until March 17 to file objections, or "exceptions," to Martin's decision. Responses to those exceptions must be filed by March 31.

The commission has said it will issue a final decision by May 7.

Exactly how the various proposals will affect consumers won't be clear until the PRC decides how much revenue PNM should receive, and then how to apportion the increase it approves among the various classes of ratepayers.

If PNM disagrees with the final ruling, it can appeal to the state Supreme Court.

Three key issues

Most intervenors who address the issue oppose three proposals PNM says are key to its financial health - although none of them is included in the basic rate calculation. Rather, they are known as "rate riders."

Fuel adjustment
The biggest is the fuel and purchased power adjustment clause that would allow PNM to pass along those costs directly to customers without going through a formal rate case such as this one.

PNM notes that Southwestern Public Service and El Paso Electric already have such clauses. It says having one will improve its standing in the bond market. That's important, the company says, because that's where it gets money to invest in power plants, transmission lines and other infrastructure essential to its business.

Some intervenors say PNM agreed not seek a fuel adjustment clause as part of a 2005 deal that allowed the company to designate its Afton, N.M. power plant to serve ratepayers -and recover its costs in rates. Also, PRC rules require that fuel costs must be a significant percentage of a utility's total cost of service, and intervenors say PNM's figures for that cost are overstated.

Finally, some intervenors argue that having the ability to pass its costs on to consumers removes any incentive PNM has to control its fuel costs.

PNM disagrees and says consumers would be protected because these costs would still be subject to monthly PRC review.

Surplus power sales
The second issue is a 70-30 split in revenue from sales of excess power produced by PNM plants dedicated to producing power for ratepayers. Any power produced by these plants but not needed by ratepayers is sold on the wholesale market.

PNM says it is required by earlier agreements to give ratepayers $21 million each year, whether or not it earns that much from the sales. When the utility had a large amount of excess capacity it made money off the deal. Recently, with more customer demand, the company says it has lost money.

That was exacerbated last year by more downtime at its Four Corners and San Juan plants, meaning less power available to sell.

PNM wants to firm up an agreement that would allow it consistently to keep 30 percent of the sales. Intervenors argue that 100 percent of the revenues should go back to the rate base, to help lower rates.

Clean costs
PNM wants to be able to recover costs of environmental improvements at its plants through a surcharge on bills -subject to PRC approval.

Intervenors argue that the surcharges would amount to "piecemeal rate making" that would increase customer rates without the overall review of costs and operations that comes with a rate case.

They add that the proposal lacks oversight and reporting requirements and could encourage PNM to pass costs of environmental negligence on to consumers.

Albuquerque Journal Sunday February 17, 2008

Wednesday February 13, 2008 irp looks to be a switching point in the pnm electric irp.

Business cards Wednesday February 13, 2008 irp in Santa Fe.

Thomson represents lots of interests. And is very knowledgeable about energy matters.

Griscom sat to the right of bill and is into solar and wind.

New commerical and residential construction may have to halt for energy and waters shortage reasons.

PNM Rate Hike Would Help Cut Usage

By Dale P Dekker
Albuquerque Architect

The world is changing, and we as a society are realizing that the world as an ecosystem consists of a finite set of resources that must be conserved for future generations. Electric utility producers just like water utility producers are "critical" infrastructures for society to exist and thrive into the future.

I support the Public Service Company of New Mexico's rate increase request for the above stated reasons In addition, I urge the Public Regulation Commission to take the "long term" view and work with PNM to develop a rate structure that communicates the value of electricity to its customers; thereby promoting long term efficient use and conservation.

Unless a rate structure is implemented that sends "strong conservation price signals" to the consumer, we are burying our heads in the sand.

The success of the water utility that serves the Albuquerque area and the Water Utility Authority's conservation strategy are clear indicators that this model should be replicated in other applicable industries.

In 1995 the Water Utility Authority put in place an "Increasing Block Rate Structure" designed to:

· Provide water at low prices for basic and essential needs so all customers can afford it.

· Reward conserving customers with low unit rates for water.

· Encourage efficient use by sending a strong conservation price signal and seasonal adjustments.

· Assign water supply and development costs proportionately to the customers who place the highest burden on the supply system and the natural supply system.

· Do all of the above while maintaining a stable flow of revenue to the utility.

This "long term" rate strategy has had dramatic results on water conservation. In 1995 the average per person use was 251 gallons. As of 2006, water consumption has been reduced to 162 gallons per day.

Production of water in 1995 was 40,775 billion gallons with a service population of 445,167 people. In 2006 production was reduced to 31,751 billion gallons while the service population increased to 537,659 people. Simply stated, the service area population has increased by 20 percent, while real water decreased by 46 percent.

Since the authority, put in place the "Increasing Block Rate Structure" in 1995, rates have increased for the average residential user by 100 percent. Clearly there is a relationship between the cost that one pays for a resource and one's desire to manage the resultant cost increases through conservation efforts.

We are all consumers of water and electricity with the expectation that water will be there when we get up every morning and go to bed at night. To aid in the conservation effort, we have installed low flow shower heads, removed the grass from our lawns and changed out our toilets to conserve water, while at the same time doubling our water utility rates over the past 10 years.

We also expect the power to be there to run our refrigerators, air conditioners, home entertainment centers and personal computers as we need it on a 24/7 basis. Moreover, we have come to take for granted the reliability and low cost of electric service and consequently have become "spoiled" consumers.

Well, tomorrow is here and we are discovering that our habits have led to global warming, climate change and pose a potential threat to our economy and way of life.

I personally do not know what the proper "amount" of the increase is, but I do know that unless we start pricing the commodity like a precious resource we will not change our consumptive habits.

Conservation is the primary way to maintain capacity and provide long term stable rate to the consumer. The PRC and PNM must also develop a long-term pricing and rate system that reflects the real cost of doing business and in determining. a reasonable return on investment for PNM's shareholders.

I believe we as a community of consumers, providers and regulators can work together in the best interest of current and future generations of New Mexicans to develop a long term vision that recognizes the value of having a sustainable, efficient and reliable supply of electricity.

The above was adapted from
Dekker's Jan. 4 testimony before the
Public Regulation Commission.

Energy-Saving Bill Deeply Flawed

By Ben Luce
Chairman, Break the Grip!

House Bill 305 is now poised for Senate passage. Despite the large alliance of supporters, this bill is deeply flawed.

Although purported to promote energy efficiency, all HR 305 really does is take away people's energy efficiency savings by allowing the utilities to implement huge rate increases, as a means to prodding those utilities into promoting energy efficiency.

Proponents argue that HB 305 is needed to avoid new power plants. But the state could just as easily have the Public Regulation Commission fund independent energy efficiency programs that would be just as effective, more trustworthy, and for a small fraction of the cost of approach mandated by HB 305.

The real reason for this bill is simply the high level of influence that the utilities have in New Mexico. A tell-tale sign that increased utility profits are the real driver for HR 305 is that the bill applies the same rate increase approach to gas efficiency, which has nothing to do with avoiding power plants.

The environmental groups promoting HR 305 are deeply misguided and in some case compromised by their relationships with utilities. One of the main proponents, Western Resource Advocates, a member of the Coalition for Clean Affordable Energy, even has a Public Service Company of New Mexico official, Jeff Burkes, on its board. Burkes is lobbying for HR 305.

Another, the Southwest Energy Efficiency Project, accepts money from investor-owned utility interests. The lobbyist, for this group, Gail Ryba, is now the chairperson for the coalition, and the main advocate promoting HR 305.

The Public Regulation Commission has failed to provide legislators critical information about this bill in the bill's Fiscal Impact Report. The commissioner who led the PRC to support this bill, Ben Ray Lujan, is the son of the sponsor of the bill, House Speaker Ben Lujan. The speaker often favors utility interests with his bills. Examples include his support for electricity deregulation and related legislation in 1998 and 2001, his memorial in 2003 to remove PRC authority to impose a renewable energy standard; his bill last year to roll back the moratorium on winter utility shutoffs for low-income people.

Ben Ray Lujan's support for this bill is truly contrary to his role as PRC Commissioner. For while he negotiated some language in the bill that purports to protect consumer interest, that language is very weak, and clearly trumped by the guaranteed extra profits provided for by the bill, and also other language in the bill that is designed to largely strip the Commission of its authority to limit or regulate utility-based efficiency programs.

I believe the impetus for HR 305 is PNM's frustration with the commission' s prior opposition to the rate increase mechanism established by the 2005 Efficient Use of Energy Act, which HR 305 is intended to strengthen. It is noteworthy that the PRC did contribute highly critical information in the fiscal impact report for that bill in 2005.

PNM's frustration with the PRC is reflected in an e-mail which I obtained last year via a public records request, and which was subsequently cited by the PRC in the recent rate case proceedings. Rurkes, the lobbyist pushing HR 305 for PNM now, wrote the e-mail in an attempt to break an alliance between myself and the commission with respect to flawed legislation in the 2007 Session.

It's interesting that the bulk of the fiscal impact report for HR 305 was contributed by the Environment Department, which does not have expertise with utility rate regulation. Rut the department does have a high-level staff member, Sandra Ely, who heads the Climate Change Program, and who is the spouse of lobbyist Steve Michel. Michel is lobbying for HR 305 on behalf of Western Resource Advocates, the same group with the PNM lobbyist on its board.

Most crucially, the fiscal impact report fails to give a fair evaluation of the potential for independent - non-utility-based -efficiency programs or a true estimate of the cost to consumers of HR 305. The cost will likely be in the hundreds of millions of dollars per decade. It could be even more should utilities succeed in exporting extra power and justifying new plants. HR 305 also exposes ratepayers to further risk associated with fuel prices, climate impacts to energy sales, and other unanticipated consequences.

It therefore appears that the fiscal impact report, the most critical source of technical information for legislators, has been thoroughly whitewashed, and that the Legislature has been deprived of crucial information.

HR 305 was developed behind closed doors over the space of just a few weeks before the session, instead of with the kind of extensive and open public process that complex regulatory law demands.

I urge senators to oppose HR 305 or amend it such that proper regulatory oversight is restored and the option for independent efficiency programs is included.

Albuquerque Journal Wednesday February 13, 2008

We still haven't gotten answers to our questions about the relation of petroleum to electricity production.

We were told that this is O&M [operations and maintenance].

World Oil all liquids Supplies.

by Byron W. King

A story in USA Today reports that “The U.S. population will soar to 438 million by 2050.” Most of the population growth will be driven by immigration and live births to immigrants. How depressing. And it ought to make you mad, so that you want to “do something” about it... like build a wall or something.

Really, why is it that the so-called “immigration debate” in the United States is often tied up with terms of race and seldom tied into the discussion of depleting resources and declining infrastructure? ...

Each year, the system requires more and more juggling and wheeling of power just to remain up and running. (For example, within the U.S. power companies move electricity from Montana to California; from North Dakota to Illinois; from Tennessee to South Florida.) From where, and from what power plants (few are being built), will the nation obtain its electricity? ...

But when you arrive at your destination you typically find that much of the formerly rural landscape has been transformed into development and track housing, all of which uses energy and water in wasteful ways that will be untenable in years going forward due to scarcity and high costs....

So better just to focus on the fact that an increased U.S. population – from whatever source – will lead to massive shortages of food, water and energy. And the public infrastructure will simply break down. Vastswaths of the country will become unrecognizable slums filled with broken-down housing, bad transportation, and hungry and thirsty people living on the squalid edge of human survival.

Now, let's talk about building that wall...
Byron King
for The Daily Reckoning

Tuesday Februery 12, 2008

PNM Resources Stock Drops

from PAGE P1

adjustment clause, which would allow it to pass increases in the cost of fuel or purchased power on to consumers through a monthly surcharge on bills.

Intervenors in the pending rate case oppose the fuel clause.

Sterba said PNM's rates are "well below the cost of providbig service." A fuel-adjustment clause would "allow the recovery of substantially higher fuel and purchase power costs caused by rising fuel prices, increased loads and variability in base load generation availability."

"Clearly, our pending electric rate case ... is a crucial component of our efforts torestore the company's healthy financial performance," he added.

For the year, PNM said the performance of its power plants cut consolidated earnings by 11 cents per share com pared with the previous year.

The San Juan Generating Station had an availability factor (a measure of plant performance) of 80.4 percent, compared with 89.6 in 2006. The Four Corners Plant was 78.5 percent, compared with 90.6 percent the year before.

The Palo Verde Nuclear Generating Station improved from 70 percent to 77.3 percent.

The downtime was due to a combination of upgrades and mechanical problems.

Reduced wholesale opportunities for electricity and higher costs for items such as coal and purchased power costs had a negative impact on earnings, the company said.

PNM also issued more stock last year. That 10.3 percent increase in the average number of common shares outstanding reduced earnings per share by 17 cents, PNM said.

PNM Resources also reported reduced earnings in First Choice Power, the retail electricity provider established in Texas by PNM Resources and a subsidiary of Cascade Investments LLC, Bill Gates' investment firm.

First Choice reported ongoing earnings of $26.8 million in 2007, compared with $41.4 million in 2006.

May said that, even though many utilities' stock prices have fallen recently, PNM is doing "very poorly" in comparison to other companies.

"Other companies' prices have fallen 15 percent to 20 percent. PNM's has fallen 14 percent to 34 percent. On average, other companies have a rate of return on equity of 10 percent; PNM has a rate of return of 5 percent," he said.

"It's a very unusual company in that it doesn't have a fuel clause," he added.

Albuquerque Journal Tuesday February 12, 2008

pnm yahoo finance.


Albuquerque Journal Sunday February 10, 2008

Guys, we've been attending pnm irp meetings for viz reasons.

And listening to a lot of smart engineers.

Mostly we keep our mouth shut , except to ask infrequent questions.

One question was: "Why doesn't pnm start a program to limit new construction."

January 2008 flyer included with bill

PNM, we believe, should start a program on how to shut-off rarely-used space in homes during the heating and coolng seasons.

We'll work on this As well as on the feds and slfcu.


Heat Disconnect Protection To End

The winter moratorium on disconnections of heating service by utility companies is scheduled to end March 15.

The Public Regulation Commission on Thursday approved language for notices that utilities statewide may voluntarily send customers to notify them to arrange payment plans in advance to avoid disconnection after March 15. Under a state law passed in 2005, utilities may not disconnect customers eligible for the federal Low Income Homes Energy Assistance Program for being behind on payments from Nov. 15 to March 15. However, that protection ends with the moratorium.

Fax or e-mail your New Mexico business briefs to (505) 823-3994 or

Albuquerque Journal Friday February 8, 2008

Friday February 8, 2008

Gholamreza Ansari said construction had started at Darkhovin in south-western Khuzestan province. Iran has said it would construct a 360 megawatt plant at the site.

Visibility is key to successful ligitation.

Every day, five U.S. soldiers try to kill themselves. Before the Iraq war began, that figure was less than one suicide attempt a day. A U.S. soldier patrols the streets of Baghdad in January.

The dramatic increase is revealed in new U.S. Army figures, which show 2,100 soldiers tried to commit suicide in 2007. ....

"Our troops and their families are under unprecedented levels of stress due to the pace and frequency of more than five years of deployments," Webb said in a written statement.

No MSM articles on limiting new residential and commerical construction for electric power and natural gas load limitation.

No PNM programs to discourage new residential and commerical construction either. What's going on?


The Associated Press

A force as insidious as Dracula is quietly sucking a nickel of every dollar's worth of the electricity that seeps from your home's outlets.

Insert the little fangs of your cell phone charger in the outlet and leave it there, phone attached: That's vampire electronics.

Allow your computer to hide in the cloak of darkness known as "standby mode" rather than shutting it off: That's vampire electronics.

The latest estimates show 5 percent of electricity used in the United States goes to standby power, a phenomenon energy efficiency experts find all the more terrifying as energy prices rise and the planet warms. That amounts to about $4 billion a year.

The percentage could rise to 20 percent by 2010, according to the U.S. Department of Energy.

In California, lawmakers passed a proposal last year - dubbed the Vampire Slayers Act -to add vampire electronics labels to consumer products, detailing how much energy a charge computer, DVD player, PlayStation, microwave or coffee maker uses when on, off or in standby mode.,

"Anything with memory or standby activity using electricity even when it's turned off," said Erick Seelinger, a technical program developed for the Public Service Company of New Mexico.

PNM, which refers to this type of power use as "phantom loads," has performed studies of local power users as part of efforts to educate the public on efficiency. Though most power use can be identified - refrigerators, heating fans and lighting some 28 percent of PNM customers' power use falls into the "miscellaneous" category.

That is, it's hard to say where it's going.

"That's the vampire load - it's the sum total of so many different things," Seelinger says.

The International Energy Agency has estimated standby energy use by vampire electronics at 200 to 400 terawatt-hours a year. The entire country of Italy consumes about 300 terawatthours of electricity each year, according to the agency.

Picture any appliance that displays a clock while otherwise idle, such as a microwave oven, coffee make or DVD player. They constantly consume little bits of energy.

"About 40 percent of the electricity being used to power your home electronics is consumed while they are in that standby mode," said Dave Walton, home ideas director for Direct Energy, a utility an energy services company. "If you just focus on that piece, you will be making a big step.' Ditto for things that charge, such as cell phones, PDAs, toothbrushes or portable tools some of which trickle a charge even after the device that's charging is at capacity. Some chargers halt the flow of current when it's not needed, which should happen automatically with chargers for lithium-ion batteries. If you're uncertain, Walton advises unplugging chargers when not in use.

He recommends hooking up your home computer system, including accessories like a - printer or scanner, to a single power strip that can be easily switched off each night. He advises shutting off the other vampires, too, though the inconvenience of resetting the clocks, channels and timers on those devices each morning will discourage most people.

The government-backed Energy Star program, coordinated jointly by the U.S. Department of Energy and U.S. Environmental Protection Agency, identifies appliances that consume less energy.

"That's our best recommendation - that you look for the Energy Star label," PNM's Seelinger says.

Among other things, Energy Star looks at power supplies, standby modes, monitor modes, and other power consumed by appliances that are not actually in use. Energy Star labels are even used on A/C chargers.

"They look at the whole package," he said.

If one in 10 American homes used only appliances endorsed through the program, the Energy Department estimates, it would reduce U.S. carbon emissions by the same amount as planting 1.7 million acres of trees.

Journal staff writer Andrew Webb contributed to this report.

That bites

Some everyday appliances that use energy around the clock unless unplugged or shut off:

· Cell phone, PDA and pager chargers
· Microwave ovens
· Coffee makers with digital clocks
· VCRs, DVD players and DVRs with digital displays
· Digital televisions'
· Digital-to-analog converter boxes
· CD players
· Portable tool chargers
· Computers in standby mode

Albuquerque Journal Sunday January 3, 2008

Thursday October 31, 2008 PNM irp disclosed

Cindy Bothwell responded with the "Germany" and "Alabama" when asked about compressed air energy.

PNM announced that it was going to begin the Monte Carlo [a New Mexico thing] simulations.

PNM scenarios are audacious in the sense they include retirement of the Palo Verde nuclear and its San Juan and Four Corners coal-fired electric generation plants.

Can PNM generate load doing this?

Note from the PNM articles below that PNM has $1.7 billion to invest in the future in new resources to accommodate increasing projected load.

Glenn Kuswa reported on that he had reached a settlement agreement with Sandia Labs and was retiring.

Glenn Kuswa, an employee of Sandia National Laboratories (Sandia) in Albuquerque, New Mexico,. appeals the dismissal of his whistleblower complaint filed ... - Similar pages

We too are working on settlement with Sandia Labs.

Kuswa was sitting directly behind

who is representing the University of New Mexico's electric interests.

Roelle commented that slight electric rate increases can cost UNM millions of dollars.

Let us venture into a political no-go zone and say that at some point in the not too distant future there is a bitter pill that we will need to swallow and we are getting just a foretaste with the current energy crisis. In a nutshell, our global growth based economic model is fundamentally unsustainable.

Eskom provides 95% of the country's electricity. Of this, some 90% is generated in coal-fired power stations, and another 6% is generated by two pressurised water reactors at the Koeberg nuclear power station near Cape Town. There is a small contribution from hydroelectricity and a negligible contribution from solar and wind power.

Question of PNM's ability to handle load of electric cars has come up.

Jan 28, 2008 12:17 PM GMT

Who are they kidding? 95 % of Israel's electricity is generated by imported coal and other fossil fuels. A conversion to electric cars does not make Israel any more independent of foreign energy sources. In reality, if Israelis go through with this centralized, power grid dependent electric car system, their national security might be compromised by the inflexibility of electric "fuel" distribution system. Suppose the electric grid is damaged due to sabotages or attacks. Even a temporary disruption will litter the streets of Israel with thousands of disabled cars, which then must be towed back to battery swapping stations once they are back online. This will never happen with gasoline powered cars since gasoline is easily transported in a container by anyone; 500 lbs batteries are not. The reason the gasoline powered cars have lasted this long is their versatility. If electric cars were to replace them, they must be as versatile. Best Place cars will not be.

Santa Fe and Seattle apparently pushed for water conserving. The water utilities lost money and had to raise rates, , bill was told.

Looks like the same story for electricity.

The article doesn't mention discouraging new construction to save power.

One PNM employee speakers at an irp meeting talked about his experience with compact florescent bulbs.

He said he was trying to convince his family to use them ... and three of them failed at the same time.

Bill Pushes Utilities' Energy-Saving Efforts

· Proposal would allow firms to recover some lost profits

Copyright © 2008 Albuquerque Journal

By Jack King
Journal Staff Writer

Utilities may soon be allowed to recover some of the profits they lose when customers buy less electricity because of energy efficiency programs.

A bill to do just that, amend-big the 2005 Efficient Use of Energy Act, has been introduced by House Speaker Ben Lujan, for the Governor's Office.

The bill is based on the premise that the current rate structure discourages utilities from pushing energy efficiency and conservation.

"In Gov. Richardson's State of the State, he called for electric utilities to invest in energy efficiency programs that will be cheaper and cleaner than new power plants. HB 305 sets new standards to achieve at least 5 percent energy efficiency savings from 2005 electricity sales by 2014 and 10 percent by 2020," said Allan Oliver, the governor's deputy communications director.

The legislation adds that a public utility shall "have the option of recovering its prudent and reasonable costs along with commission-approved incentives for demand-side resources and load management programs"

Energy companies are allowed to recover the costs of specific energy efficiency programs approved by the PRC by tacking on extra charges to customer bills. Examples are a low-income weatherization program and a $500 rebate on insulation work performed by participating contractors.

Utilities have argued that they should also be able to make up the reductions in earnings that occur when customers buy less energy -either because they are using energy more efficiently or generating their own with alternative sources.

The utility companies say the revenue losses serve as "disincentives" to development of energy-saving programs, as opposed to building more power plants.

"One of the challenges we have with programs that manage customer demand, such as energy efficiency, is that there's no way to earn a return," PNM spokesman Jeff Buell said.

"Incentives are a way to level that playing field and encourage more energy efficiency programs," he said.

The legislation introduced by Lujan would' amend the Efficient Use of Energy Act.

The new bill says "it is necessary and appropriate to provide rate treatment and financial incentives to public utilities to develop all cost effective and achievable energy efficiency and load management resources."

It would require the PRC to identify and remove regulatory disincentives or - in a manner that balances public, consumer and investor interests, and "provide public utilities an opportunity to earn a profit on cost-effective energy efficient and load management resource development."

Plans proposed

Companies have proposed several plans to allow them to recover all or most of the lost revenue.

El Paso Electric and Southwestern Public Service have incentive proposals pending before the PRC.

El Paso Electric proposes to figure monthly how much money each rate class is saving through energy efficiency programs, then recover a portion of that through a rate surcharge.

SPS proposes to recover the lost revenues through a "shared saving" program. The company would figure how much per year the company and customers save through energy efficiency.

It would then add 15 percent of that to its proposed rate surcharge for energy efficiency.

Commissioner Jason Marks said he thinks the PRC should consider all aspects of the incentive proposals.

"We should consider reasonable incentives, but we shouldn't throw money at the utilities," Marks told the Journal this week.

Mary Homan, PNM's manager of regulatory affairs, said her company welcomes a PRC investigation of the incentives.

"We certainly are interested in finally getting a handle on what the PRC wants (in terms of incentive proposals)," she said.

Environmental groups also are willing to look at the issue.

"It's great that the commission is finally talking about a business case for energy efficiency," said Tom Singer, senior policy analyst for the Natural Resources Defense Council.

"What they're trying to do is develop testimony about a mechanism for putting into effect any future policy," he added.

Gail Ryba, director of the Coalition for Clean Affordable Energy, said it was "about time" the commission took up the issue.

"We continue to allow utilities to get a profit for the development of coal plants. Which do we prefer, new coal plants or energy efficiency?" he asked.

Eight states have passed legislation mandating incentives to utilities: Arizona, California, Connecticut, Massachusetts, Minnesota, Nevada, Rhode Island and Vermont.

Peter Gould of the New Mexico Industrial Energy Consumer said the group hasn't take a position.

"We'll - -- look at anything they bring forward," he said.

"In general, we're not in favor of giving incentives to utilities fox doing what they should be done anyway, "he said.

"One of the challenges we have with programs that manage customer demand, such as energy efficiency, is that there is no way to earn a return. Incentives are a way to level that playing field and encourage more energy efficiency programs."

Albuquerque Journal Saturday January 26, 2008

PMN seeking transfer of generating capacity

Copyright © 2008 Albuquerque Journal

By Jack King
Journal Staff Writer

PNM filed Wednesday for approval of the $49.7 million transfer of ownership of 30 megawatts of generating capacity at Palo Verde nuclear plant from its parent company, PNM Resources, to the electric utility itself.

PNM vice president and treasurer Terry Horn said that in the summer of 2007, PNM Resources bought 30 megawatts of Palo Verde capacity from JPMorgan Chase & Co., the investment firm that held the lease.

PNM nows wants the Public Regulation Commission to approve transferring ownership. PNM would pay PNM Resources $49.7 million and the amount would then be recovered from customers.

If the PRC approves the request PNM would put a surcharge on customers' bills to cover carrying charges on the sale amount from mid-2008 until 2016. PNM is asking to begin recovering the full $49.7 million in 2016.

The surcharge, 1.1 percent or about 52 cents on a residential bill of $48 a month, will generate $6,065,515 a year, beginning about the middle of this year until 2016, according to PNM.

Purchasing the 30 megawatts would allow PNM to ensure a fixed price for it when the lease expires in 2016. If the company had not bQught it, it would have faced the prospect of having to attempt to buy the capacity from an institutional investor in 2016, when the price is likely to be higher, or to replace it from another source, Horn said.

In 1985 to 1986 PNM sold its interest in Units 1 and 2 of Palo Verde to institutional investors.

Albuquerque Journal Business Outlook Thursday January 24, 2008

----- Original Message -----
From: Brown, Don
Cc: O'Connell, Pat
Sent: Wednesday, January 23, 2008 1:21 PM
Subject: Next PNM Electric IRP Meeting: Jan. 31

Based on a survey of participants, we have chosen next Thursday, Jan. 31, for the next PNM Electric IRP public advisory meeting.

Please save the date -- we will send an agenda out as soon as it is complete.

Late January Electric IRP Meeting

Date: Thursday, Jan. 31
Time: 9 a.m. to 4 p.m.
Topics: sensitivity/scenario wrap up, super high and super low load forecast, and demand-side management
Location: La Luz Room, second floor, Alvarado Square, 4th and Silver, Albuquerque

Since this a needed all-day meeting, lunch will be served.

If you plan to attend, please RSVP to me by COB Tuesday, Jan. 29, so we can have enough food there for the group.


Don Brown Director, Corporate Communications
PNM Resources (NYSE: PNM)
505.241.2882 [office]
505.321.8856 [cell]

01/23/2008 14:40 CHINA
In a snow-covered China, entire regions are without electricity and gas The energy shortfall has reached 70 gigawatts, equal to the production of all of Great Britain. There is a shortage of coal because of the closure of many non-compliant mines and the imposition of price caps. The snow is blocking the roads and preventing fuel delivery. The cold is also impacting water and gas suppliers.

Leave coal in ground, switch to solar|
The New Mexican 1/23/2008

Check PNM table to see that solar is the most expensive technology to generate electric power.

PNM needs to start a discougage new construction program. Both commercial and residential.

The shut-offs will keep electric rates lower and help delay the construction of new, expensive power plants, PNM spokeswoman Susan Sponar said.

PNM wants energy savers

· Two customer programs shut off devices in homes or businesses during peak-use periods

Copyright © 2008
Albuquerque Journal

By Jack King
Journal Staff Writer

Public Service Company of New Mexico is seeking customers to participate two programs designed to reduce the amount of energy used during peak periods.

The Power Saver program, designed for use by residential and small-business customers who have refrigerated air conditioning, and the Peak Saver program, designed for use by large commercial customers, will allow PNM to shut off energy-using devices in customers' homes or plants for very brief periods of time at peak-use periods.

The shut-offs will keep electric rates lower and help delay the construction of new, expensive power plants, PNM spokeswoman Susan Sponar said.

Participation is voluntary, free and customers will receive financial incentives for participating, Sponar said. In the Power Saver program, a mall device is attached, free of charge, to the exterior of the refrigerated air-conditioner. During high-use summer weekday afternoons, June through September, the device turns the unit's compressor off for a few minutes each half-hour. Typically, the temperature rises 1 to 3 degrees and the air conditioner returns to normal operation when energy demand on PNM's system is reduced, Sponar said.

Most people don't notice the few degrees difference and' participants get a $25 "thank you" check each fall, she added.

Interested customers in Albuquerque and Santa Fe can sign up for the program now, online at or by calling 1(866)471-7906. Sponar said the program will be offered in other areas in the near future.

In the Peak Saver program, devices will be placed on energy-using devices in a plant. In a manner similar to the Power Saver program, the devices will allow a PNM contractor to lower the machines' rate of operation to reduce their energy use at peak periods.

Sponar emphasized that company owners who choose to participate will have complete control over how Peak Saver is implemented in their plants. Representatives from EnerNOC, a Boston, Mass., smart technology company contracting with PNM for the program, will meet with the owners. Together, they will decide which devices can have their operating rates reduced and where the best opportunities are for implementing the energy-use reduction program in the plant, she said.

"The equipment affected will be as varied as the different participating companies, but two systems that might commonly be affected are lighting and. heating/air conditioning," Sponar said.

A quarterly incentive will be paid to companies participating in the program. The amount paid will depend on the amount of peak demand the customer can allow to be controlled and the complexity of the technology installed to control the load, she said. The Peak Saver program is available now throughout PNM's service area. Those interested can sign up at or call (505) 243-0671.

Second phase of Sun Valley work to start

Construction is scheduled to begin next month on the first two buildings of five planned in the second phase of Sun Valley Commercial Center on Osuna NE.

Sun Valley's second phase is a speculative office condominium project, although Jim Rogers of Albuquerque-based Sunland Development said there are commitments from potential buyers for some of the space.

The two one-story buildings will each be 5,300 square feet and set back from Osuna, west of the existing office buildings near the corner with Edith. They should be ready as shell or unfinished space by August, Rogers said.

Three slightly larger one-story buildings, ranging from about 7,650 to 8,320 square feet in size, are planned next to Osuna. The $8 million second phase will have a total of 34,209 square feet of office condos when completed.

Sunland's Rogers and partner Jeff Jesionowski bought the roughly 3.5 acres from the original developers of Sun Valley, which was started in 1999 on the site of the former Treeland Nursery.

Brothers Bob, Gary and Mackie Kitts developed the initial phase in the northern New Mexico architectural style, preserving the large trees and quaint courtyard from the site's nursery days.

Phase two will continue the architectural style. "You wouldn't want to do anything else," Rogers said.

Acknowledging demand for office condos may be softening in the broader market, Rogers described Sun Valley as a niche product geared to business owners from the North Valley.

"We think it's a good little market for people who live in that area who need access to the highway (Interstate 25), to Downtown, to the Journal Center," he said.

The buildings are being marketed by Stacey Nenninger and Scott Throckmorton of Argus Investment Realty at an asking price of $205 a square foot for unfinished space.

The buildings can be divided into smaller condo spaces, said Throckmorton, explaining, "We'll go down under 2,000 (square feet) once we're trying to top off a building."

Sunland Development is best known for developing the Oxbow residential subdivisions that surround St. Pius X High School

Five-story 'tower' planned

Rio Rancho and the West Side in general are on deck to see what could be described as the area's first mid-rise building.

Presbyterian Healthcare Services has preliminary plans for a five-story "tower" for inpatient care at its proposed Rio Rancho hospital.

There are at least a couple four-story buildings on the west side of the Rio Grande, such as the AMREP building in Rio Rancho and Ladera Senior Housing across the street from Albuquerque's Ladera Golf Course.

But there's no five-story buildings. Sperry Van Ness' Pat Frerkes and West Wood Realty's Roderick Smith couldn't think of any either.

The second phase of Sun Valley Commercial Center, already under way with site preparation, calls for five office condo buildings, one of which is shown here, with about 32.400 square feet of space.

Presbyterian's planned hospital will have about 330,000 square feet on a 50-acre site at Unser and Westside Boulevard, said spokeswoman Elizabeth Brophy.

The hospital has not been named yet and the design hasn't progressed to the point of an architect's rendering or image being available yet.

Construction is expected to begin later this year, with completion in 2010.

A three- to four-story physician's office building with 120,000 square feet is planned next to the hospital in Rio Rancho, Brophy said.

Richard Metcalf covers commercial real estate for the Journal. You can reach him at 823- 3972 or

Albuquerque Journal Business Outlook Monday January 21, 2008

Where have we seen the design for the above building?

PNM Reeves peak electric natural gas plant, I 25 and Paseo del Norte, Albuquerque, NM Friday January 18, 2008 10:59.

Temperature 28oF.


Below foils were distributed at the PNM electric irp held at the Santa Fe Service Center Wednesday January 16, 2008

Foil below was distributed on December 20, 2008 irp at the Santa Fe Service Center but at that time was "confidential."

Pat O'Connell said the changes had been made and now the foil is no longer confidential.

Links to abbreviations EPRI, NREL, IGCC.

Peak oilers: diesel, gas, and motor oil cost are included in the column labelled 2008 O&M $/MWhr. O&M = Operation and Maintenance.

What is going to happen electric generation and cost if there are diesel and gas shortage in the future? We will probably see.

In our opinion this is one of the more interesting foils distributed at the electric irp meeting.

PNM retiree Dave Gilmer and PNM engineer manage Cindy Bothwell both explained

to mean what pnm is capable of delivering in the future with existing electrical generating plants.

This above foil does not include projected loadincrease as a result of increased existing home [refrigerated air, lcd and plasma tvs] and business electrical usage or new construction!

shows that pnm is running scenario retiring Palo Verde nuclear power plant and well as coal fired and San Juan and Four Corners plants!

Note in below article

Sterba said in a Journal interview that the sale is part of an effort by PNM to focus its resources in advance of an expected $1.7 billion investment in its New Mexico electric system over the next five years.

corrected Tom Singer's recollection of $1.5 billion.

Ryba is a Ph.D. chemist and worked for Sandia labs.

Dave Gilmer recalls the record low temperature of -17 degrees F occurred on January 17, 1971.

Glimer reported that pnm had to add compressed air to maintain natural gas pressure and that gas flames were very low.

Gilmer also reported that plug-in electric heaters were flown into Albuquerque in 747s and sold.

"Coalition for Clean Affordable energy?"

OTHER in Supply Side Options Available for irp appears to oxymoron this?

PNM a significant amount of cash.

In addition to the $202 million PNM would pay for Cap Rock Holding, there would be taxes and debt retirement on the gas utility. After the money it pays for Cap Rock and the other expenses, PNM is expected to realize only $35 million from the sale, Sterba said.

Sterba said in a Journal interview that the sale is part of an effort by PNM to focus its resources in advance of an expected $1.7 billion investment in its New Mexico electric system over the next five years.

The company is also in the midst of a case at the state Public Regulation Commission in which it is seeking to boost electric rates and a gain provision that would allow it to automatically pass through fuel cost increases to electric customers.

"This is a strategic transaction geared around our focus on electric operations," Sterba said of the proposed sale.

"It's a hard decision in the sense that we've been in the gas business for 20 years. But as we look forward we have to take a hard look at where we best serve our customers and shareholders in terms of concentrating our efforts."

"As capital gets constrained - and we have an enormous amount of capital that is required by our business, both in New Mexico and elsewhere - we have to look at that."

New Mexico native

Schreiber, a 1966 Highland High School graduate whose father was a top PNM executive, described Continental Energy as privately owned by institutional-type investors and some "extremely wealthy" individuals.

He said he had no immediate plans to move to New Mexico.

In addition to Real, who retired in 2007 as PNM's senior vice president for public policy, he said. New Mexico Gas Co.'s top management team here will include Melissa Davis, formerly president of Cap Rock Energy Co.

She will serve as president.

Schreiber said acquiring PNM's gas holdings is part of Continental's strategic plan.

The company, which owns gas utilities in Michigan and Alaska, has decided to get out of the electric utility business and concentrate on natural gas.

"With the need on the electric side for additional generation and the tremendous capital expenditures, we've thought for a while that there are opportunities for us to aggregate gas companies from combination companies," he said in a Journal interview.

Although PNM Gas showed a zero return on equity in 2006, Schreiber said he believes the division shows promise.

Unlike many states, he said New Mexico shows a growing number of gas customers, with 2 percent growth a year, compared to Michigan's growth rate of 1 percent or less.

He described Michigan's economy as "flat on its back," while New Mexico's shows more potential.

Schreiber said New Mexico Gas Co. would abide by the gas rates the PRC approved for PNM in 2007.

PNM stock closed down 27 cents at $19.10 on the New York Stock Exchange on Monday. The stock has been trading near its 52-week low in recent weeks - down from a high of $34.28 last year.

The company's investment securities were also downgraded recently by Standard & Poor's. The transaction with Continental Energy faces approval from New Mexico and Texas regulatory agencies, the Federal Energy Regulatory Commission and the Department of Justice.

Sterba said he expects the sale to be completed in about eight months.

PNM Merger With Natural Gas Firm Ended Suit

Copyright © 2008
Albuquerque Journal

BY Jack King

It was called the biggest business merger in New Mexico history when PNM acquired Gas Company of New Mexico in January 1985. The. deal combining the state's biggest electric and gas utilities also ended one of the largest antitrust lawsuits in the country up to that time and made possible refunds to New Mexicans of about $122 million, according to a January 1985 Journal article.

The court case began in 1979, filed on behalf of a Southern Union Gas Co., which owned the Gas Company of New Mexico.

PNM; which at that time was also a customer of the Gas Company of New Mexico , joined the lawsuit in 1981.

The lawsuit accused Southern Union Gas and four other natural gas producers of conspiring to fix the price of gas for sale to the customers of the Gas Company of New Mexico.

The other producers -Conoco Inc., Consolidated Oil and Gas Co., Southland Royalty Co. and Supron Energy Corp. - settled earlier for $70.3 million.

The merger of PNM and Gas Company of New Mexico was another part of the settlement.

PNM paid about $226 million for the gas 'company, of which $174,794,000 went to Southern Union

Most of the remaining $51.5 million,' plus the $70.3 million from the other producers, was refunded to gas and electricity customers and to state agencies who were parties to' the lawsuit. About $33.3 million went to residential gas customers, members of the "Brewster class," named after one the Gallup teachers whose name topped the antitrust company complaint.

Approval of the sale from state and federal regulators and the courts was completed in January '1985. The' agreement meant that the largest electric utility and the largest. gas utility in the state were combined into one entity. The only other obstacle to the merger was a bill presented in the Legislature by then Reps. Max Coil, D-Santa Fe, and Pauline Eisenstadt, D Corrales. They argued that the merger action would result in restraint of trade. The bill failed to make it out of the House's Energy and Natural Resources Committee.

Albuquerque Journal Tuesday January 15,, 2008

Let's investigate.

From: gnm

To: billp
Posted: Tue Dec 11, 2007 3:21 am
Subject: Re: pnm

Thanks for the replies. The power outages continued for about another week after I emailed you but then returned to more consistent normals. We have only had 1 brief outage since then. Perhaps I should record time and duration over a year to see if there are patterns. I was hoping to get a device which would log to the computer since I don't have time to do it manually nor am I always aware/there when it happens.


From: gnm
To: billp
Posted: Sat Oct 27, 2007 3:49 am
Subject: pnm

Do you have any idea (or suspicions) if PNM might be engaging in "load shedding"? Since they didn't get their rate increase they have laid off staff as you heard... And we (out SE of Tijeras) in the sticks have been having almost daily outages. When I call them they say oh no its an unplanned outage but its been almost 2-6 hours daily or every other day at least for weeks.

-Brian (aka gnm)

All right, you primitive screw-heads, listen up!

News Monday January 14, 2008 reports that PNM is trying to sell its natural gas business.

----- Original Message -----
From: O'Connell, Pat
Sent: Friday, January 11, 2008 3:11 PM
Subject: PNM Electric IRP Meeting Notice

Please join us on Wednesday, January 16, at PNM's Santa Fe Service Center on Hwy 14 south and west of the I-25/Carrillo's road interchange for an Electric Integrated Resource Plan Meeting. At that meeting we will continue our discussion of modeling sensitivities and scenarios. At the meeting on January 7, we made some progress towards a better modeling plan. Some of the key observations from that meeting were:

The market sales option sensitivity should be eliminated so that all scenarios are comparable on a relative basis.

We are adding a sensitivity around capital costs, but need to better define how to do that. The Strategist model takes an input capital cost and a cost escalation rate. The costs for all options are escalated over time with the given rate. On the 16th we will present a proposal for modifying the capital cost assumptions for different resource options.

On the 16th, we will review and ask for feedback on the results of the meeting on the 7th. We will hand out an updated version of the attached document that reflects where we are today and use that as the basis for discussion. Please review the attachment and think through the sensitivities listed and consider whether the scenarios make sense to you. Bring your questions and observations to the meeting on Wednesday.

Meeting Details:
Date: Wednesday, January 16
Time: 2:00 pm to 4:30 pm
Location: Santa Fe Service Center
4565 State Road 14
Santa Fe, New Mexico 87508

Below card received wth December 2007 PNM utility bill.


PNM might think of addressing the problem of discouraging new construction for reason of future declining energy sources? Ouch!

Thursday December 27, 2007 slightly south of Snyder, TX.

We're going toward Lubbock.

Not seen in December 2006! !!!

Natural gas elecrtic generation plant [we think?] to west of Lubbock, TX on Saturday December 28, 2007.

Think second law of theromdyamics.

What are the Laws of Thermodynamics?

1st Law—Energy can be changed from one form to another, but it cannot be created or destroyed. The total amount of energy in the universe remains constant, merely changing from one form to another.

2nd Law—In all energy exchanges, if no energy enters or leaves the system, the potential energy of the state will always be less than that of the initial state. This is also known as the law of entropy.

3rd Law—It is impossible to cool a body to absolute zero by any finite process. This is actually more of a postulate than a law. In any case, it has little application to our discussion and is presented here merely for thoroughness.

Fredricksburg, TX Wednesday December 26, 2007. The Chester W Nimitz museum.

A Doolittle B24 exhibit

Lots of Japanese war memorabilia are in the museum.

About 25 feet from B24 is a glass box containing Saburo Sakai's flight googles with right lens missing.
Saburo Sakai Goggles and Helmet Displayed at the Nimitz Museum, this flight helmet and goggles was worn by Sakai on August 7, 1942 mission to Guadalcanal. On this mission he was wounded in his eye when bullets three SBDs he attacked from the rear hit his plane. Wounded and flying a damaged fighter, he flew all the way back to Rabaul alone and landed safely. Also displayed is a silver belt buckle with a tiger given to Sakai as a good luck gift. Sakai donated these items to the museum when he passed away in 2000.

Sakai sustained grievous injuries from the return fire; he was struck in the head by a .30 caliber bullet, blinding him in the right eye.

Samurai! Autobiography of Japan's Fighter Ace Saburo Sakai

.If you want to discuss details of the spy sting on Iran, then send one of us cats an email.
Saturday December 29, 2007 17:36

The Oil Drum message.

Mid-January deadline for input to PNM electric.

The average household in America consumes 10,656 kilowatt-hours (kWh) per year
, according to the Department of Energy. In 2006, Gore devoured nearly 221,000 kWh—more than 20 times the national average.


Lawmaker: Iran to build 19 more nuclear plants

TEHRAN, Iran - Iran plan to build 19 more nuclear power plants and will seen solicit international bids for the construction., a lawmaker said Monday. "Contracts for the construction of 19 nuclear power plants, each with a capacity of 1,000 megawatts, will be put into into international tender in the near future, " Kazem Jalali was quoted as saying by the official IRNA news agency. Mr Jalali, a member of the Iranian parliament's National Security and Foreign Policy Committee, said the bids will be in line with parliamentary legislation that call for production of 20,000 megawatts of electricity through nuclear power plants in the future.

Dallas Morning News December 25, 2007

If PNM is to meet its projected demands, then PNM must do something. What?

Frank Stern [right] and Pat O'Connell left at December PNM IRP at the PNM service center in Santa Fe Tuesday December 20, 2007.

----- Original Message -----
From: Frank Stern
To: bill payne
Cc: Wheeler, Evelin ; O'Connell, Pat ; Brown, Don ; Randy Gunn ; Brent Barkett
Sent: Monday, December 24, 2007 11:12 AM
Subject: RE: how many KW/h/mile a plug-in car would take?


A recent NREL study projected usage from a plug-in vehicle with a 20 mile range and a plug-efficiency of 2.9 miles /kWh, or 6.89 kWh per trip. Assuming 1 trip per day, that would be an additional 2,517 kWh/year per car.


A Preliminary Assessment of Plug-In Hybrid Electric Vehicles on Wind Energy Markets” W. Short and P. Denholm. NREL/TP-620-39729 April 2006.


Frank Stern
Summit Blue Consulting
+1 720 564 1130 desk
+1 303 618 4979 cell

Emmanuel Amara (SUNSET Presse) – A High-Risk Barrel.

Bill asked two questions:

Why isn't diesel and gasoline included in the above plot?

Evlin Wheeler answered that both are included in M&O [maintenance and operation].

BNSF apparently uses 180,000 gallons of diesel per day at its Belen, NM refueling facility. Diesel is both piped and delivered by rail car.

Sunday December 16, 2007

Looking north.

About 100 yards to east of workers is pipline terminal. Terminal has small building the air conditioner on roof. May not be in operation.

Looking to the south.

Nominal capacity stenciled on tank cars is about 23,000 gallon. This means that BNSF uses about 9 tank car loads of diesel per day.

How much diesel does PNM use per day?

Bill stated to the group that world production of oil may have peaked in May of 2005. EIA reported that US natural gas production peaked in 2001. China is currently experiencing diesel shortages. So

Why doesn't above plot show a peak?

Evlin Wheeler explained that this is what is going to look like New Mexico. Impression was that New Mexico was going to be different that the rest of the country or world.

At the break

introduced himself.

He said that he knows New Mexico state senator William H Payne well.

are two of the more, if not most, vocal participants at the electric irp.

One of the most fascinating handouts was a EPRI CONFIDENTIAL chart showing a comparison of electric energy source, Size/MW, Cost range $/Kw, Fixed O&M cost, Variable O&M mills/KWh, BTU's/Kwh, CO2, ... .
Water consumption was not shown.

Natural gas did about the best, coal next. Carbon capture coal next.

Wind did not do that well.

Solar did the worst.

PNM's Credit Rating Lowered Utility

Says Downgrade Is 'Bad News' for Customers

Copyright © 2007 Albuquerque Journal

By Jack King
Journal Staff Writer

Standard & Poor's rating service lowered its corporate credit rating for PNM Resources from BBB to BBB-, its lowest investment grade.

Continued weak cash flow and a "challenging regulatory environment, which has not permitted the company timely recovery of costs," were cited as factors, according to an S&P news release.

The downgrade is "bad news for PNM and bad news for customers," company spokesman Frederick Bermudez told the Journal.

"As your credit rating goes down, interest rates go up on money you have to borrow. Even-. tually these financing costs are passed on to customers

The ratings news came during the last day of testimony in PNM's electric rate case in SantaFe.

The company is asking the Public Regulation Commission for an electric rate increase of $77.3 million and a monthly fuel adjustment clause.

There are a number of intervenors. One of them is the PRC staff, which said Wednesday it would support an $18.3 million rate increase and oppose the fuel adjustment clause that would allow a pass-through to customers after PRC approval. PRC staff, which is charged with balancing the interests of the utility with those of rate payers, did say it would support PNM's proposal for an Inverted, or increasing, block rate that would increase per-kilowatt-hour prices as customers used more energy.

Arguments in the rate case are not over, and details of the request, as well as objections, could still change.

Attorneys for the company and intervenors are scheduled to file briefs in January.

Hearing examiner James Martin is scheduled to issue a recommended decision Feb. 28. PRC commissioners have said they may begin considering the case in March.

A decision could come in early May.

PNM's request, as it stands now, would mean a 15.4 percent increase for residential rate payers, a 14.4 percent increase for small commercial users, an 11.6 percent increase for general commercial users, a 12.4 percent increase for large commercial users and a 13.4 percent increase for the largest commercial or industrial users, according to PNM.

Positions concerning PNM's proposal vary among the intervenors.

University of New Mexico attorney Bruce Throne said the university opposes the way PNM has apportioned the rate increase among the rate classes, because it means UNM and many businesses subsidize other customers' usage, particularly residential customers.

The approach also fails to encourage conservation, he said.

Melvin Christopher, PNM's vice president for regulatory policy, agreed that under the current design some rate payers overpay in proportion to their cost of service, while others underpay.

Ideally, a utility wants to assign each rate class its exact share of the costs of service, but moving to that situation in a single rate case would lead to "rate shock," where customers believe the, rates are unfair, he said.

Standard & Poor's vice president for corporate communications, Chris Atkins, said the next step down from BBB- in S&P's rating scale is "speculative grade."

"BBB- is still investment grade, but it does suggest PNM has a weakened capacity," he said.

PNM Resources is PNM's parent company.

Thursday December 20, 2007

We need to have a talk with Don Brown about settlement of these unfortunate matters.

----- Original Message -----
From: bill payne
To: Brown, Don
Cc: ; O'Connell, Pat ; Wheeler, Evelin
Sent: Tuesday, December 18, 2007 8:40 PM
Subject: Re: What time?

Let's talk settlement.

----- Original Message -----
From: Brown, Don
Cc: ; O'Connell, Pat ; Wheeler, Evelin
Sent: Tuesday, December 18, 2007 8:08 PM
Subject: Re: What time?

830 to 1230

----- Original Message -----
From: Brown, Don
Cc: O'Connell, Pat
Sent: Friday, December 14, 2007 7:52 AM
Subject: December PNM Electric IRP Meeting

As was discussed at our November meeting, the December meeting will be held Dec. 20 -- next Thursday -- in Santa Fe. We will have the meeting at our Santa Fe service center on South 14, near the I-25 exits for South 14 and Highway 599.

We will be discussing what the modeling outputs will look like as well as have a discussion of the cost of various resource options. Draft agenda and directions attached. We hope to see you next Thursday; in the meantime, please let us know if you have any questions.

Be safe if you're out in the snow today!

Don Brown
Director, Corporate Communications
PNM Resources (NYSE: PNM)

don.brown email extension removed at Brown's request

505.241.2882 [office]
505.321.8856 [cell]

NMUSA - The New Mexico Utility Shareholders Alliance


The N.M. Public Regulation Commission will hold a two-week public hearing of PNM's electric rate case in Santa Fe beginning Dec. 5. The public can comment on the electric rate case that day, or during any of the open meetings that are held every Tuesday and Thursday. The PRC is expected to make a final ruling on the rate case by early May 2008.

If approved, the rate increase would be PNM's first in 20 years. In fact, the utility has actually decreased its rates four times since 1994. PNM rates are currently about 25 percent below regional and national averages. The company estimates the new rates would still be competitive with rates elsewhere in the country.

The base rate increase, which totals about $77 million, is necessary to allow PNM to adequately recover the cost it incurs to serve electric customers as well as have the opportunity to earn a fair return. PNM's existing rates do not reflect the rapidly rising prices of fuel and the fundamental building blocks of the electric system, including steel, copper and aluminum.

Growing demand is also increasing PNM's costs. The utility expects that it will require an additional 825 megawatts of electric capacity by 2015 - enough to power about 575,000 homes.

In order to meet this growth, PNM will need to invest $1.7 billion in new electric infrastructure in the next five years, more than double what it spent in the last five years.

Three key proposals in PNM's rate case include:

o Establishing seasonal rates for all customers that are higher in the summer (June through August) and lower during non-summer months (September through May).

o Establishing a residential rate structure in which customers who use more energy pay more per kilowatt hour.

o Reinstituting a monthly fuel and purchased power adjustment mechanism so the utility can pass through changes in fuel costs to customers. PNM is the only utility in the state that does not currently have this mechanism (see related article in this issue).

FUEL CLAUSES: Adjusting Electric Bills for the Price of Fuel

Imagine if gas station owners were required to predict the average cost of gasoline for the next five years, then charge that price regardless of what the actual cost of gasoline was from day to day. When oil prices went up, the owner - or investor - would be at a disadvantage. And customers would never know the true cost of gasoline and have no incentive to be more fuel efficient.

But in the case of PNM, market fluctuations in the cost of fuels such as coal, natural gas and nuclear are embedded in the price customers pay for electricity, even though these fuels vary significantly in cost over time. That's why PNM has proposed a fuel and purchased power adjustment clause in its pending rate case. With such a mechanism, the company would be able to pass the changing cost of fuel along to customers. As fuel costs go up, customer bills would rise.

When fuel costs go down, customer bills would drop accordingly.

PNM hasn't had a fuel adjustment clause since the mid 1990s. Until recently, it has been able to tolerate the risk of fuel cost fluctuations because it has had enough excess generating capacity to sell power on the wholesale market. Revenues from that activity allowed the company to absorb the risk of rising fuel costs, which produced benefits for customers and the company's investors.

But times have changed. With growing demand for electricity in New Mexico, there is less opportunity to sell power to other utilities, and the mutual benefit to investors and customers has diminished. In response, PNM is proposing a fuel cost adjustment to help mitigate the risk of fuel volatility. The company calculated what its known fuel costs were for a test year and embedded those in its proposed rates. Any changed cost, whether up or down, would be captured monthly through the fuel cost adjustment mechanism.

This is a standard practice throughout the industry. Fuel adjustments exist in 49 of the 50 states, including New Mexico, where PNM is the only electric utility regulated by the PRC without a fuel clause.

Investors provide the capital investment necessary to serve customers, and do so in expectation of a reasonable return on that investment. Customers pay their bills expecting the price to reflect the true cost of the service they are receiving. Such a mechanism would help protect the interests of investors and customers.

"The problems of today will not be solved by the same thinking that produced the problems in the first place."
- Albert Einstein Leanan

I'm bloody well sick of boomers and older screwing my generation over by mortgaging our future! viz

Monday December 17, 2007 07:55

PNM CEO Jeff Sterba writes below

Electric demand on the PNM system is rising faster than the nation as a whole, requiring unprecedented investment in new power lines and equipment, new energy sources and more energy efficiency to meet customer needs.

What Sterba appears to be saying is that new construction within the PNM system should continue for business reasons, of course.

PNM should start a PR campaign to discourage new construction and to reduce volumes currently being heated and cooled.

But this would be bad for traditional businesses.

Sterba states in article seen below:

Ultimately, a healthy utility that adequately recovers the cost of serving customers will have greater flexibility to make clean energy and other desirable investments. Case in point: the New Mexico Wind Energy Center.

But we read

Because wind generation is immensely erratic and hard to forecast it is almost impossible to incorporate it into the grid without compromising reliability. Detailed study of inflow and outflow between Germany and Scandanavia demonstrates that as much as 84 per cent of west Denmark’s wind power is exported to Norway (at a loss to Danish consumers of about £100million) (4).

Currently, the Danish Wind Industry Association (DWIA) admits: ‘Danish wind power only contributes to adequacy [of supply] with a capacity value of zero.’ That is, wind’s generating capacity does not guarantee any of the basic and essential electrical supply.

PNM engineer Ms Cindy Bothwell commented at several electric irps that wind is not "dispatchable." Energy source may not be there when it is needed. Natural gas, if it is available ... which it may not in the near future, is dispatchable.

PNM focused on its Afton natural gas facility which works well for peak load but does not appear to have a plan to increase its base load capacity.

So what's really going on?

Don't count on liberal-arts educated media people to tell you. Or lawyers.

Main reason for these energy postings is visibility on our legal project.

lets cancel those irritating laws of thermodynamics. viz

We aren't getting paid to attend PNM irp meetings.

Another reason is that we are meeting some of those in positions of power. And hopefully are attracting some attention by combining PNM matters with How the Iraq/Iran War Got Started and lawyer education! Not good to be associated with either one.

Energy Future Relies on Fair Rates

By Jeff Sterba
Chairman, President and CEO,
PNM Resources

As a state with a growing economy and aspirations of becoming the national leader in clean energy, New Mexico has a vested interest in a reliable, affordable and clean supply of electricity.

If you take a look at where New Mexico stands today, we do pretty well:

Public Service Company of New Mexico's electric reliability in most years ranks in the top 10 percent of U.S. utilities;

Our existing electric rates are 29 percent below regional and 22 percent below national averages - the result of more than 20 years without a rate increase and four consecutive rate reductions since 1994.

We have made significant progress on clean energy in a short time, ranking eighth in the nation for voluntary renewable energy subscriptions and, with our plant co-owners, investing more than $300 million on major environmental upgrades at the PNM San Juan Generating Station.

But the energy world is changing. Electric demand on the PNM system is rising faster than the nation as a whole, requiring unprecedented investment in new power lines and equipment, new energy sources and more energy efficiency to meet customer needs.

Like gas at the fuel pump, the building blocks of our system are more expensive than ever. In just a few years, copper prices are up 350 percent, steel 55 percent and cement 30 percent. We pay these increased prices as a cost of doing business, but they are not currently reflected in what customers pay.

And then there is the financial health of our business. Today, PNM's investment-grade credit rating is in jeopardy because income is not properly covering expenses. A lower credit rating would make it harder for us to borrow money and more expensive to do so, which ultimately affects electric prices. This is not a scenario we want to see as we embark on a $2 billion investment to meet New Mexico's growing energy demand.

To preserve the long-term sustainability of our business and its ability to make needed investments, we are seeking fair rate recovery, reducing costs and looking at other potential ways to restructure our business.

Our first electric rate increase in 20 years is now pending before the Public Regulation Commission. It includes:

· An increase to basic residential and business rates of about 15 percent, reflecting costs as they existed during our 2005 test year

· Like other regulated electric utilities in the state, the ability to pass changing fuel costs along to our customers, similar to how we do in our natural gas business with full oversight by state regulators to make sure costs are prudently incurred and fairly administered;

· Seasonal and other rate mechanisms that encourage customers to use electricity more efficiently.

Simultaneously, we are reducing costs to prepare for the future. This summer we launched a process improvement effort to increase our use of technology and help stabilize costs. Unfortunately, this means reducing the size of our work force. Saying goodbye to coworkers is never easy, but we owe it to our customers to run as efficiently as we can in this rising-cost environment.

Ultimately, a healthy utility that adequately recovers the cost of serving customers will have greater flexibility to make clean energy and other desirable investments. Case in point: the New Mexico Wind Energy Center.

In 2002, our company signed an agreement that resulted in the construction of this massive, $200 million facility near Ft. Sumner. The financial risk of doing so was borne by our shareholders, not customers - as the cost of this contract remains outside of current customer rates. It was a smart investment. Today, with rising steel and other costs, the facility would cost almost three times more than it did when it was built.

In our electric rate case, we are proposing to devote a large portion of the wind farm - at the original, lower 2002 cost - as a resource to serve our electric customers (much of the remainder would serve our PNM Sky Blue customers voluntarily supporting additional renewable energy). We made this investment because we knew a good deal when we saw it, were committed to moving aggressively into renewable energy and had the financial strength to take the risk.

It is possible to encourage and reward this kind of clean energy investment and also keep electricity affordable and reliable. Fair rate treatment for regulated energy businesses is a key part of making that happen.

Albuquerque Journal Sunday December 16, 2007

Coal, electric power and Kansas. PNM has similar serious problems.

PNM is stressing "energy-saving programs."

PNM is not addressing curtailing new construction or scaling-back on volumes heated or cooled.


PNM Exec Says Rate Plan Is a Gradual Shift

Sterba: Utility Wants Fairness

By Jack King
Journal Staff Writer

SANTA FE - In a hearing on Public Service Company of New Mexico's proposed rate increase Tuesday, the company's top executive, Jeffrey Sterba, said PNM is moving toward a rate design that fairly allocates the company's costs among the five rate classes.

These are residential, small power, general power, large power and largest commercial/industrial.

But he said the company wants to avoid "rate shock" for ratepayers, particularly those in the residential class.

University of New Mexico attorney Bruce Throne questioned Sterba on Tuesday about the rate design. UNM is an intervener in the rate case being held by the state Public Regulation Commission.

Throne asked Sterba whether he was testifying that under PNM's proposal the company's costs for each rate category would be completely covered by ratepayers in their respective categories.

Sterba replied that he has not stated that. Instead, PNM should move gradually toward that rate design, he said.

Throne told the Journal that the proposed rate design allows for ratepayers such as UNM and medium-size businesses to subsidize residential ratepayers who pay less than their full share of PNM's cost of service, he said.

PNM spokesman Jeff Buehl said residential ratepayers proportionately would receive the largest rate increase in the company proposal.

In response to a question from PRC Commissioner Jason Marks, Sterba said the company's proposal includes energy-saving programs as part of its cost reduction measures. However, rates should be adjusted first, so that all ratepayers are motivated to save energy.

PNM spokesman Jeff Buehl said residential ratepayers proportionately would receive the largest rate increase in the company's proposal.

Melvin Christopher, PNM's vice president for regulatory policy, said making each rate class pay the correct proportion of a company's "marginal costs" is a recognized principle of rate-making design.

However, if each class immediately had to pay its correct proportion, the sudden increase in real money cost would be perceived as unfair by the ratepayers, he said.

Albuquerque Journal Wednesday December 12, 2007

Glenn Kuswa

Sandia labs.

Kuswa cleared up gallons of water per kilowater hour at pnm electric irp November 27, 2007.

About one. PNM apparently incorrectly stated, on two foils, one gallon of water per megawatt hour.

Wednesday December 12, 2007 09:36

Here are the two foils enlarged by 50%.

That's Morgan Lake under 4 Corners.

That's Afton under the Combined Cycle.

We questioned whether the ordinate should be gal/KWh instead of gal/MWh.

Reason for the question is that refrigerated air advocates say that it is much more water efficient than swamp coolers.

Engineers point out that electricty generation consumes about one gallon/KWh thus making refrigerated air as water consuming as swamp coolers.

We still haven't gotten answers to questions about how much oil, gas, and diesel is consumed per KWh.

Some PNM personnel stated that petroleum is not used in electricty production. However, one reason PNM wants to raise electricity rates is because of increased cost of petroleum products.

Possibility of peak oil in May of 2005 raises questions about the reliance of forms of energy on each other. Kansas is a good example because western Kansas food projection is extremely reliant on oil and electricity. Fun example.

PNM Makes Its Pitch for Rate Increase

Intervenors: Utility Asking Too Much

Copyright © 2007
Albuquerque Journal

BY Jack King
Journal Staff Writer

The hearing to decide how much Public Service Company of New Mexico customers will pay for electricity begins Wednesday, but, if intervenors have their way, the utility's proposed increase could end up as a rate cut.

Nineteen intervenors have filed with the Public Regulation Commission to introduce evidence and cross-examine witnesses daring the hearings. Virtually all of them question the size of PNM's $82.4 million rate increase request, as well as how any approved increase would be apportioned among user groups ranging from residential to industrial.

"Every single intervenor is taking issue with PNM's $82 million rate increase," said Nan Winter, the attorney for the Albuquerque Bernalillo County Water Utility Authority.

"If the exceptions of all the interveners combined were entered in the decision, you would be looking at a multi-million dollar rate decrease," she. said.

Intervenors include the state Attorney General's Office, the cities of Albuquerque and Santa Fe, the University of New Mexico, New Mexico Industrial Energy Consumers, the New Mexico Coalition for Clean Affordable Energy and the Albuquerque/Bernalillo County Water Utility Authority.

According to PRC records, PNM's rate request will equal a 14.8 percent increase over current rates. If the request is approved, PNM's total electric utility 'revenue for next year will be more than $640 million. PNM says the increase is justified because it costs more to generate power and is needed to protect the company's rating.

"This is important to customers, because our credit rating will affect the cost of financing and that will ultimately be borne by the customers," said PNM spokesman Jeff Buell.

"We're looking at an up-coming building cycle, with the. need over the next five years to invest in the billions of dollars to develop new infrastructure to meet growing demand. Without the ability to recover costs through rates, our credit rating could be in jeopardy."

Buell said the requested rate increase is based on data collected during the "test year" September 2005 to October 2006. The request is not the result of PNM's two poor earnings quarters this year, he said.

Lawyer intrigue

Strategy issues figured into discussions about the case last week.

The University of New Mexico's attorney in the case, Bruce Throne, told other attorneys that he would only cross-examine PNM witnesses about rate design - who should pay how much - not about the actual size of the requested increase.

Information provided to the Journal suggested Throne indicated he had been instructed to limit his questions to the PNM witnesses.

A UNM witness list obtained by the Journal shows Throne is slated to question only three PNM witnesses out of more than 20 called by the company.

Throne confirmed that he briefed other attorneys and told the Journal he has been ordered to refer all questions from the media to UNM chief counsel Patrick Apodaca.

Apodoca refused to confirm or deny that Throne had been ordered to avoid cross-examining witnesses about the size of PNM's rate request, saying university attorneys do not talk publicly about case strategy. Apodaca said it is standard university practice to prohibit outside counsel from speaking to the press.

Apodaca practiced law at the Albuquerque firm of Keleher & McLeod from 1984 to 2006, during which he represented PNM in a number of cases.

Intervenors could lose some expertise if Throne passes at questioning PNM witnesses about the size of the increase.

In response to a question, Winter told the Journal that Throne was "one of the most talented litigators in the state when it comes to cost of service issues, to how much revenue a utility might be entitled to."

The public hearing on the rate request begins at 10 a.m. Wednesday in the Public Regulation Commission's chambers in the PERA Building, 1120 Paseo de Peralta, in Santa Fe. The hearing will continue until Dec. 19.

Once the hearing is concluded, PRC-appointed hearing examiner Jim Martin is scheduled to issue a recommended decision by Feb. 28. Commissioners have said they hope to consider and vote on the rate request by March.

PRC approval

PNM has worked to generate support for the proposed increase, making presentations to groups as varied as the Greater Albuquerque Chamber of Commerce to the Bernalillo County Commission.

However, the rate-making process is essentially nonpolitical.

As a regulated monopoly, the utility's rates are subject to PRC approval.

The commission uses the hearing process to determine the utility's investment and costs as they apply to PNM's regulated utility - not its other ventures.

The PRC then calculates the allowable rate of return to arrive at rates.

In addition to a basic rate increase, PNM wants to charge high users more and seeks permission to have an adjustment clause for fuel used to generate electricity -- as it now has for natural gas.

That would mean fluctuating costs for coal, natural gas and uranium could be passed through to customers monthly, following PRC approval.

Saturday December 3, 2007

PNM Chief Grilled At Rate Hike Hearing

Company Seeking 14-Percent Increase

Copyright © 2007
Albuquerque Journal

Journal Staff Writer

A lawyer challenging Public Service Company of New Mexico's proposed $82.4 million rate increase grilled the company's chief executive Wednesday in the opening day of hearings. PNM President and CEO Jeff Sterba was the first witness in the scheduled 13-day hearing on the proposed rate increase, which the company says is justified by rising costs and is necessary to keep the company financially healthy.

The company also wants the authority to pass along changes in fuel costs directly to customers each month, as it now does with natural gas.

Peter Gould, representing the New Mexico Industrial Energy Consumers, charged that PNM is breaking regulatory policy and past agreements in parts of its proposal.

Gould questioned Sterba on two points of the PNM executive's previously filed statement in support of the increase; that PNM needs it to pay for increased capacity to meet growing demand, and that the company needs to reinstitute a fuel cost adjustment clause.

Gould asked Sterba whether it is his position that customers should pay for a new plant before it is built, pointing out that it is common regulatory policy that a company can't put rates to pay for a plant into effect until after the plant is in service.

Sterba replied that it is not his position. Instead, he said the rate increase would help make PNM financially healthy so that it could raise the capital for new plants. Gould also charged that, in asking for a fuel adjustment clause, PNM is violating terms of 2005 agreement with the PRC that allowed the company to make its Afton generating plant in Doña Ana County part of its regulated rate base.

According to a copy of the agreement Gould offered as evidence, PNM is required to "work with the siguatories toward the goal of avoiding reinstatement of a fuel adjustment clause."

The siguatories are the PRC, the state Attorney General's Office and New Mexico Industrial Energy Consumers, he said.

Sterba said that PNM has negotiated but that no satisfactory agreement could be reached before the beginning of the rate case.

Another PNM proposal would allow it to collect money from ratepayers for environmental improvements, such as those it is making on its San Juan coal-powered plant northwest of Farmington.

Gould charged that by using the "environmental pass through" and the fuel adjustment clause, PNM is trying to get incremental increases in rates without adequate commission review.

Cindy McGill, PNM's senior vice president for public policy, said that under the company's proposal, PNM would seek PRC approval for environmental pass-throughs and fuel adjustments before putting them into customers' bills.

Hearing examiner Jim Martin told Sterba that he is subject to recall in the hearing and that he could return to the stand as seen as Monday, when University of New Mexico attorney Bruce Throne is expected to return from an out-of-town trip. PNM had a show of support at the outset of the hearings, as officials from the Greater Albuquerque Chamber of Commerce and the Albuquerque Hispano Chamber of Commerce went on record as backing the utility's request -which would amount to a rate increase of about 14 percent.

Meanwhile, there are 19 intervenors in the case, including the cities of Albuquerque and Santa Fe and the Attorney General's Office. If all their objections prevailed, the utility would end up with no increase or a slight reduction.

Wensday December 5, 2007

We are trying to raise awareness that there may be a looming problem with world peak oil, peak US natural gas, and even perhaps peak US BTU output of coal.

PNM extrapolates about a linear increase in demand in electric power ... which PNM currently apparently believes it can meet. meet.

This may not be the case.

We bought up the question of when PNM expects its electric power output to peak on Tuesday November 27, 2007.

This did not appear to be well-received.

But no doubt, this may have gotten some of the participants thinking about future power production.

Here's Evlin Wheeler at the November 27 meeting.

To my left sat Don Brown, Jeff Sterba' assistant. To the left of Brown sat Pat O'Connell.

Pat replied that peak natural gas in the US could be compensated for by foreign imports? Payne counter with, "from Nigeria?"

Hunting buddy and bill discussed energy matters.

Artesia, New Mexico essential non-gas-wasting Quail Hunt December 3-5, 2007.

Something should be done about halting new construction for energy reasons and reducing heating and air conditioning volumes.


“We all know that the U.S. dollar has no economic value,” as the Iranian president, Mahmoud Ahmadinejad, put it last week.

"They get our oil and give us a worthless piece of paper," Ahmadinejad spat." But for now - and unless Iran really wants the USS Enterprise to divert its bomber flights from Afghanistan to Tehran - worthless paper is all the US has to offer. That leaves America's biggest creditors, like all big-time lenders, stuck with a quandary.

PNM engineering manager Ms Bothwell points out that combined cycle natural gas electric generators costs much more than single gas generator.

We were told at during the Carter administration that natural gas use for electricity generation was outlawed.

Afton Plant Back on Line

The. Associated Press ANTHONY, N.M. -- PNM's newly expanded Afton Generating Station, about 30 miles southwest of Las Cruces, is now on line after a project to expand its capacity to 235 megawatts - enough to supply 195,755 average households. "Our primary goal in expanding Afton is to keep up with the tremendous growth in demand in a way that is affordable for our customers and that provides an environmentally friendly approach," said Jim Ferland, the company's senior vice president of utility operations.

Before expansion, Afton was a simple-cycle plant that used natural gas to turn a turbine capable of pro- ducing 141 megawatts of electricity. PNM added a boiler to use exhaust heat, which would otherwise have been wasted, to create steam to power a second turbine. Now, the utility said, the two cycles provide about 40 percent more electricity from the same amount of fuel. PNM also installed selective catalytic converter technology to reduce nitrogen oxide emissions.

Albuquerque Journal Saturday November 17, 2007

Likewise, the risk of any single power station failing may be low, but if you continue to take that risk — year in and year out, over many miles of infrastructure — it becomes a much more likely event.

As so much of the grid approaches the end of its useful life and we ask it to deliver more and more power, the prospects of eventual massive failure — like the big blackout of 2003 — become ever more likely. It's like crossing the Atlantic over and over again in that war-torn world of 1941. You tempt fate with each crossing.

Those risks grow every day as the modern electricity-sucking economy gets larger. Just think of all those computers and electronic devices soaking up power. The people of this country plug in more than ever. And it shows in the data of electricity consumption. Server farms, those massive storage areas for computer networks, now drink up 4% of total U.S. electricity production. Only 10 years ago, they were practically invisible.

Microprocessors — which require a continuous flow of electricity to work — eat up roughly 10% of all electricity. The Electric Power Research Institute projects that this number could rise to as high as 50% by 2020.

Whiskey & Gunpowder
November 8, 2007
By Chris Mayer
Gaithersburg, Maryland, U.S.A.

Associated Press - November 1, 2007 6:45 PM ET BILLINGS, Mont. (AP) - Environmental groups citing the dangers of global warming want a state panel to revoke the permit for a 385-megawatt coal plant near Gillette, Wyo.

Construction of the 385-megawatt Dry Fork Station power plant north of Gillette commenced immediately upon issuance of the permit this week, according to Basin Electric Power Cooperative officials.

The Powder River Basin Resource Council condemned the actions and noted that other states, such as Kansas, are more progressive toward curbing carbon emissions. On Thursday, Kansas Department of Health and Environment denied an air quality permit for two 700-megawatt plants that would also use conventional, CO2-emitting technology.

"We're permitting outdated coal-fired power generation technology that even the utility industry's most reliable investors and lenders are beginning to question," Bob LeResche, Powder River Basin Resource Council chairman, said in a prepared statement on Friday.

"Regardless of the governor's progressive pontifications, Wyoming seems determined to stay in the Dark Ages," LeResche added.

Dry Fork Station is expected to pump 3 million tons of carbon dioxide into the atmosphere for the next 40 years. Man-caused carbon dioxide emissions are a significant contributor to global warming.

Engineer Ms Cindy Bothwell stated that the price pnm pays for natural gas is not that quoted by nymex. Nymex is New Orleans price.

Here's PNM CEO Jeff Sterba astride his segway scooter

attending, for a while,

public advisory meeting
October 23, 2007
PNM Alvarado Room 415
Silver Ave. SW, Albuquerque
8:30 a.m.-12:30 p.m.

Above meeting was interesting but bland. Next meeting on November 27, 2007 looks to be very interesting because it addresses forcasts of demand and fuel supply.

Let's advance an energy and architecture conspiracy money-making theory.

Houses, beginning shortly after WWII, were designed for more "openness" and therefore consumed more energy. Energy inefficiency was promoted.

Before this time homes, especially farm houses, were designed for energy efficiency. Rooms could be shut-off during the heating season. No air conditioning then.

Energy companies made lots of money because of "openness".

A conspiracy?

But in about 2005-07 energy source problems may have arrived?

Here's a Sunday September 23, 2007 example of this energy-wasting [but money making ... for energy companies] design.

Jubliee homes, Los Lunas, NM.


How do you close-off portions of such a home during heating and cooling seasons during possible future energy crises?

Do you think that PNM is going to advise how to close-off portions of homes during the heating and cooling seasons.

Saturday October 20, 2007 128 car coal train with 4 pullers and 2 pushers leaving to the west Belen, NM refueling [180,000 gallons/day] rail facility.

Harvey house museum at the right.

To give you and idea about the magnitude of New Mexico landscape, here is above coal tran descending from Dalies, NM grade toward the Rio Puerco.

BNSF employees said that BNSF will soon run 2 mile long coal trains.

Another train approaches going to the east. Look to the east. There are two pushers at the end of the coal train.

Dash 9 locomotive 73 feet. Coal car 55 feet. So 6 x 73 + 128 x 53 = 7268 feet or about 1.37 miles long.

Each car carries approximately 235,600 lbs x 128 = 15,081.6 tons of coal for the above train.

If 2.8 million tons of coal is consumed each day, then approximately 186 trains similar to the above would be need to transport the coal.

World Energy and Population: Trends to 2100

As fuel prices continue to rise, the pain at the pump is leading consumers to look for ways to improve fuel economy. The same is true for the nation’s largest railroad. Imagine the cost of fueling a 4,000 horsepower vehicle with a 4,900-gallon tank. Union Pacific fuels nearly 8,000 of these vehicles every day.

In terms of fuel efficiency, railroads are three times more fuel-efficient than trucks. If just 10 percent of the freight moved by highway were diverted to rail, the nation could save as much as 200 million gallons of fuel each year. And, railroad fuel efficiency has increased by 72 percent since 1980. Prior to 1980, a gallon of diesel fuel moved one ton of freight an average of 235 miles. In 2001, the same amount of fuel moved one ton of freight an average of 406 miles.

Information [disinformation?] on train diesel consumption.

Looks to be between 25-50 gallons per mile for 128 car coal train pulled/pushed by 6 Dash 9 locomotives. We'll continue to try to refine numbers.

The Powder River Basin is less than 600 miles from albuquerque so that's only less than 15,000 to 30,000 gallons of diesel used.

Keep in mind that each Dash 9 or Evolution can carry up to 5,000 gallons of diesel.

Pre-production evolution 7525 photographed on Tuesday October 16, 2007 in Belen, NM.

BNSF Railway:
30 pre-production ES44AC, numbered 5718-5747.

The average locomotive measures about 75 feet in length, at least 15 feet in height, and weighs on average 420,000 pounds, about the same as 26 elephants. ...

Since 1995, the preponderance of our locomotives have been GE," said Graab. "Locomotives are purchased looking at three criteria: cost, fuel consumption and reliability. In the past decade, GE won probably in all three criteria, and certainly in at least two."

Initial computations for 6 Dash 9 engines combined with 128 BethGon coal cars is Dash 9 = 197 tons, BethGon = 143 tons. So 6 x 197 + 128 x 143 = 1182 + 18304 = 19486. 19486/786.5 = 24.81 gallons per mile. Let's do some checking.

Let's try GE article 6 x 210 + 128 x 143 = 1260 + 18304 =19564. 19564/786.5 = 24.87 gallons per mile.

Through employees’ efforts thus far in 2007, four of five months have been above plan in fuel savings. Last month, BNSF recorded 786.5 gross tons per mile/per gallon (GTM/GAL) versus 752.8 GTM/GAL in May 2006.

We've observed coal trains in the 116-128 car range so let try to estimate the weights involved.

Gross Rail Load 280,400 Lbs. 286,000 Lbs.
Gross Rail Load 286,000 Lbs.

American Association of Railroads plot

or about 38.97 gallons per mile?

Re: Diesel's Miles Per Gallon Rate

silicon212 10-10-2007, 2:12 AM

Depends on the locomotive, running conditions, tonnage etc.

According to the AAR, one ton of freight can be moved 423 miles on one gallon of diesel.

or about 19486/423 = 46.07 gallons/mile?

Another opinion

We are, of course, concerned about possible future energy problems and naturally limit ourselves to essential non-gas-wasting travel.

Like clay bird shooting senior citizen exercise practice on Thursday October 11, 2007.

Here's the game.

1 toss clay bird,
2 drop tosser,
3 raise shotgun to shoulder,
4 take off safety,
5 aim at clay bird,
6 pull trigger,
7 see if clay bird is hit or, best, DUSTED,
8 put shotgun on safe.
9 search desert for missed and unbroken clay birds after a box of 25 shells is fired. Without getting bit by a rattlesnake.

Senior hit about 70% of clays last year. It is taking longer to come up to this this year. Not advancing age, of course.

17 of 25 hit: 68% on Friday October 12, 2007. Not advancing age, we hope. Previously bill was counting clays hit, not missed. Not good.

Sunday October 14, 2007 senior citizen visited clay shooting location on the desert with plastic garbage bags to to pick up about 90 pounds of broken clay birds and other trash in two hours.

Prior the desert looked orange where clay birds were broken. Senior citizen was concerned that he might get busted for littering.

Bill has been look for BNSF evolution locomotives. None identified so far. Only Dash 9s. Dash 9 - Evolution.

Note BNSF train the the background.

----- Original Message -----
From: Brown, Don
Sent: Wednesday, October 10, 2007 12:23 PM
Subject: Next Meeting Dates for PNM Electric IRP + Materials Online

To the public advisory membors for the PNM Electric Integrated Resource Plan,

We hope this message finds you well. For those of you who missed the September meeting, it was a productive, engaged discussion about energy efficiency and our modeling process and the beginning of a larger discussion we will have this fall on the the costs, lead times, reliability and environmental impacts of various resource options. Many of us left the meeting feeling encouraged about the prospects for the IRP and the commitment of those of you who attended. We appreciate your continued time and energy! Here is the latest.


After canvassing all of you through online meeting tool, we have chosen Tuesday, Oct. 23, and Tuesday, Nov. 27, as our next two meeting dates. Please place these on your calendars. We will send out a specific meeting room with each agenda ahead of time, but both meetings will be in PNM's Alvarado Square complex in downtown Albuquerque. While we cannot accommodate the scheduling needs of everyone, these dates seem to work best for most of the group.

Both meetings will begin at 8:30 a.m. and last until about 12:30 p.m.


As we promised in the September meeting, several new documents are posted on our electric IRP page. These include maps of New Mexico's solar and wind potential as well as a PNM study on our transmission grid. These documents, along with slides and audio from the September meeting, can be found at .

Thanks for your continued involvement in this important effort. We hope to see you on Oct. 23. db

Don Brown

Old senior citizen told bill that BNSF [probably Santa Fe then] was thinking about electrifying it tracks some years ago. Bill believes that the old senior citizen said that there was even a power house build for this. But that diesel fuel was so inexpensive at that time, that diesel power was selected.

Old senior citizen told bill that the Russians electrified the trans-Siberian railway.

While fishing the St Joe river east of Avery, ID between 1966-1980, Bill saw about a mile of the electric portion of the Milwaukee railroad before it turned up the North Fork of the St Joe. Advantage of electric power in the mountains is that descending locomotives can put generated electric power back into the system. Some diesel locomotives have regenerative electric braking but have to dissipate the power as heat as opposed to putting the energy back into the power system.

Swiss railways use electric powered locomotives.

Here's Patty at the Hauptbahnhof in Zurich for day trip to Lugano.

Bill was in Zurich in 1997 on business with Patty. And talked to Hans Buehler on the phone from the Zurich Flughafen about settlement strategies.

Gerald drives a fuel truck of Giant. Bill asked Gerald at the corner of Menaul and San Mateo on Thursday October 10, 2007 how many gallon his fuel tanker held.

Gerald responded that it was a standard 10,000 gallons tanker but legally he could only carry about 8,600 gallons mixed mostly gasoline and some diesel. We talked about how much diesel BNSF burns. Gerald said he was aware of the the magnitude of the problem.

Gerald said his daughter flies an F-16. His daughter says that the F-16 burns 4000 lbs of fuel per hour. Gerald said his daughter and about 4-5 other pilots from from Spain to Iraq which takes about 4 four hours behind a tanker plane. The F-16 were constantly lined up to refuel.

Gerald mentioned how many tanker loads Giant refines per day in New Mexico. Gerald concluded that if they don't come up with something to replace oil, then we are in some real trouble.

The Harvey House museum in beneath the green dot.

The diesel oil storage tanks are beneath the red dot. Photo taken on August 4, 2007.

How much diesel is required to tranport, on the average, a ton of coal one mile? We are working on answer to this question.

Dash 9s are the most frequently seen locomotives west of Los Lunas, NM.

Senior citizen gave young senior citizen bill [only 70] a lecture on his perspective of future energy and his view on amount of diesel to move coal for one mile the the Harvey House museum in Belen, NM on Tuesday October 9, 2007.

But first the reasonable non-gas-wasting reason for being here.

Bill was practicing clay bird shooting about 16 miles west of Los Lunas close to the BNSF tracks for 2007 bird hunting season.

Bill returned to shoot more clays on Friday October 12, 2007.

After shooting bill revisted the Harvey House museum in Belen to retake a picture of the yard layout.

West end text: 60,000 gallons diesel 10,000 gallons waste; and 20,000 gallon lube. Chart made 9/28/95.

East end appear to have to same configuration and tanks on Tuesday October 16, 2007. Note that "west end" is north and "east end" is south.

Light bulb reflections messed-up first attempt.

Female docent turned off lights for better photo.

Female docent identified above older senior citizen.

Female docent said Rizzo is super-knowledgeable about trains.

Female docent recollected as a youth being assigned job of pumping water by hand.

Female docent reported she does not let the water run while bushing her teeth.

Female docent appears well-aware that energy crisis is looming.

Female docent recalls when natural gas went off in 1971 when New Mexico temperatures went to about -17o F for several days. Neighbor Tim reported that natural gas went off in Santa Fe at this time.

Absolute Record Low in Albuquerque -17 deg. F (1/17/71)

January 5, 1971 -15°F, January 6, 1971 -12°F, January 7, 1971 -17°F, January 8, 1971 -8°F, January 9, 1971 2°F

Getting on target is taking longer this year than last. Too much litigation and harrassment. Not advancing age, of course.

Senior citizen reported to bill

1 Belen, NM fuels trains with about 180,000 gallons of diesel per day.
2 Trains refuel in Winslow, AZ which about 300 miles distant.
3 180 tons of material [including coal] is tranported through Belen each day.
4 Moderate average train climb and descent.
5 5,000 gallons of diesel on board each dash 9
6 4,400 HP for Dash 9
7 415, 000 lb weight
8 About $1.25M
9 Anti-slip wheels
10 Can pull 30% of weight

Old senior citizen reported that BNSF plans 5 more diesel tanks [see below] once Abo Canyon is double tracked.

Old senior citizen reported that diesel to Belen BNFS arrives both by pipeline and train.

Old senior citizen commented on inefficent electric transformers in the east [about 88% vs 99% pnm], nuclear energy, and concluded that the US is in big energy trouble in about 20 years.

Older, perhaps yet, senior citizen museum caretaker advised bill to visit the BNSF office next door to get precise answers. Maybe on the next essential non-gas-wasting clay bird shooting.

PNM may be a company which operates by subcontract. Like Lybrook plant.

Let's try to find out.

Lybrook natural gas processing plants in New Mexico, which have a combined processing capacity of 760 million cubic feet per day; and the Milagro and Esperanza natural gas treating plants in New Mexico, which are designed to remove carbon dioxide from up to 750 million cubic feet of natural gas per day.

----- Original Message -----
From: bill payne
To: O'Connell, Pat ; Homan, Mary E. ; Brown, Don
Sent: Monday, October 01, 2007 5:55 PM
Subject: Be sure to look at the front side of Evelin Wheeler, not just the backside.

I need to be more careful about my photos!


I have a favor to ask from your directorate.

Are my differentiations of the normal density correct or not?

My senior citizen buddies have refused to help for several possible reasons. Senility possibly one?


WRIGHT -- A prominent Wyoming community has stepped up its efforts to become more energy efficient and reduce its carbon footprint.

The town has earned the Tree City USA honor several years running. It's buying green tags to switch from coal-based electricity to wind, solar and biomass to power all of its government facilities.

And, its vehicle fleet includes an olive-green, ultra-fuel-efficient Prius.
It's not Jackson. It's not Cody, Dubois or any other tourist destination town.

It's Wright, a community built by and sustained by the most prolific coal-producing district in North America. ...

Wright began in the mid-1970s when Atlantic Richfield needed a place to house workers for its Black Thunder coal mine.

Today, four of the Powder River Basin's 15 active coal mines produce 256 million tons of coal annually outside Wright's front door. In this town of 1,600, more than 75 percent rely on coal mining as their primary source of income.

Coal miners consume millions of gallons of diesel annually to run their mining equipment
. If the price of oil and petroleum products rises significantly, companies will face millions of dollars in added costs.

Peabody, based in St. Louis, consumes about 105 million gallons of diesel annually, according to its quarterly report filed with the U.S. Securities and Exchange Commission in August.

Massey has said it consumes about 55 million gallons of diesel each year.

PNM elecric irp Friday September 28, 2007 revealed that PNM makes extensive use of Monte Carlo simulation techniques to model what might happen in the future.

That is Ms Bothwell showing Monte Carlo [a New Mexico thing] foil


at the right. See green dot for front photo.

My impression by talking to Evelin Wheeler and Pat O'Connell is that they believe that demand destruction, because of price increase, will flatten-out any effects of peak fuels.

Wheeler pointed to the log normal seen underneath Gas Price in middle of foil to explain her views.

PNM IRP, populated with lots of pnm employees, talked long and hard about energy efficiency.

A Sears refrigerator repairman replaced a defrost timer on our 1973 Kemore refrigerator about a year ago.

I asked the repairman which were the good new models. He responded, "none really." He said they know how to build refrigerators that last but they don't build them.

He said the compressors go out with several years. But if you have to buy one, Whirlpool or Kenmore are about this best. Sears repairman recommendation, of course.

New appliances have microcontrollers in them. The microcontroller can be programmed to cause the compressor to fail after the warranty expires. Significant money can be made by "spiking" the software.

Below was distributed at the irp.

Appears disingenuous.

PNM promotes energy efficiency but doesn't promote not building new residences.

Albuquerque is in a desert. Home builders like Pulte Los Lunas [3116 to 3754 Square Feet], ... and Jubilee Los Lunas are building homes on the desert at an absurd rate considering possible water shortage problem, high gasoline prices and dwindling supply, and future possible natural gas and perhaps even electric power shortages. But there is, or was, a lot of money to be made.

Here are some Jubilee homes photographed on September 16, 2007 on highway 6 going west from Los Lunas.

Here's a backyard shot illustrating the desert problem.

Postage stamp-sized lots have advantage of little yard work but no space to store a boat.

Sand dunes accumulate on the streets.

Reason for essential non-gas-wasting trip out onto the desert was to practice clay bird shooting in preparation for essential non-gas-wasting fall trips.

Essential New Mexico Quail hunt travel
Essential Kansas travel 2005
Essential Kansas travel 2006
Essential chukar hunting travel

Shall we suggest at the next IRP that PNM run ads in the Albuquerque Journal to the effect?


There appears to be other reasons for PNMs drive for energy efficiency.

Loading problems at mines in the Wyoming Powder River Basin have slowed coal shipments out of the region during September, according to the two major Western rail carriers, which both issued customer alerts recently notifying them of the loading issues.

"Mine issues have resulted in the loss of an average of 5.2 train loading opportunities per day in the Powder River Basin (PRB), including Wyoming and Montana mines, during the first 16 days of September 2007," BNSF Railway said in a Sept. 20 customer update. "Up to 40 empty trains per day were holding for mine loading slot availability during the first half of this month."

Meantime, Michael Morris, chairman and chief executive of American Electric Power, said in a Wall Street Journal article that the cost of sharply reducing the 2.5 billion tons of CO2 emitted by utilities each year - one-third of all such emissions - will be unprecedented. "I think power prices could go up 50 percent, maybe more."

Challenges Facing the Kingdom of Coal September 24, 2007 energybizinsider email

Sep 21 - San Jose Mercury News

The state's Public Utilities Commission approved a plan Thursday that will reward or penalize utilities such as PG&E for the effectiveness of their energy-efficiency programs.

California's four large investor-owned utilities could earn up to $323 million over three years for persuading their customers to cut energy use. If they fail, they could pay as much as $500 million in penalties.

Energy efficiency is seen a key component in meeting the state's aggressive targets for reducing greenhouse-gas emissions.

Is the solar array merely PR?

----- Original Message -----
From: Brown, Don
To: bill payne
Sent: Sunday, September 23, 2007 11:32 AM
Subject: RE: jeff sterba

Bill, it is a small facility -- 25 kilowatts. db

Sent: Monday, September 24, 2007 6:09 AM

Bill, no problem. Can I ask one favor? I am fine with our email discussion on your Web page, but could you possibly omit my email address from each posting (and also delete it from past postings)? Since you have started to post the emails, the amount of spam I am getting has increased substantially. I believe bots are picking up the email address from your page. If you notice in most places on the PNM Web site, we have forms to submit an email but typically do not list employee emails directly in the text for this very reason. Thanks. db

We may be entering into a energy era the world has never seen before: decreasing supplies of oil and natural gas looks likely.

PNM stock.

Copyright © 2007
Albuquerque Journal

Journal Staff Writer

Running a profit-oriented utility while publicly advocating mandatory restrictions on carbon dioxide emissions seems hopelessly in conflict.

But PMM Resources chairman, president and CEO Jeff Sterba told the Journal recently the contradiction is more apparent than real.

Sterba - whose company has clashed with the Public Regulation Commission this summer over an energy conservation program and two requests for rate increases - said planning for the future of a utility in a world where limits on carbon dioxide emissions will soon be widely accepted requires taking positions that only seem contradictory.

Q: Under your leadership, PNM was a founding member of the U.S. Climate Action Partnership, a coalition of businesses and environmental groups that advocates mandatory limits on carbon emissions. But, in March you and several other utility executives announced that such restrictions could damage utilities and raise costs throughout the economy. Isn't that a contradiction?

Sterba: There's no contradiction at all. Frankly, I can clearly believe that you've got to do things that may increase costs. But you've got to do them with eyes wide open, and recognize that one, they will have cost implications, and two, the magnitude of the cost increases is a function of what gets implemented.

I believe in a slow, stop and reduce strategy, and that's what USCAP is about. Slow the rate of increase (of carbon dioxide in the atmosphere) by 2020, stop the rate of increase, then start to decline it.

Q: Doesn't that just delay cutting the amount of greenhouse gases going into the air?

A: If we try to just decline, as some proposals have been, the only thing I could do to make sure I still served my customers, would be to cut back on coal generation and pick up natural gas generation. That's going to be much more expensive and the cost to the economy could be dramatic. If utilities pick up significant "generation of gas, we would add a serious load to the natural gas demand in their country."

Q: So how do you believe limits on carbon dioxide should be done?

A: In my judgment, you want to be careful what mechanism is used. I tend to favor a cap and trade system, but it's got to be economy wide. Otherwise, you don't get the lowest cost options.

The point of regulation would be upstream, where the fuel enters into the economic cycle. So, with natural gas it could be at the point where natural gas comes into the pipeline. On the coal side, it could be at the coal mine, so that it would increase the cost of coal, or at the utility.

The market would set a price on the basis of who's buying and selling and, if you're a manufacturer, you could see what the price of carbon was and decide whether it was cheaper to buy carbon allowances on the market or to do things in your system to reduce your carbon footprint. A lot of times, you would be able to reduce your carbon footprint, at a lower cost, and then sell your allowances."

Q: A system very similar to that has been successful at cutting emissions of sulfur dioxide, which cause acid rain.

A: That's how markets operate, and they can be very effective. But, they're not that simple. These are complex systems, particularly when you move to the scale of carbon emissions. It's a bit more of a challenge, because we don't necessarily have the technologies today.

That's why I and some others advocate the use of what's called a safety valve which has been incorporated into legislation proposed by Sen. Jeff Bingaman.

What it says is the government will set a cap on the price of carbon, which will escalate at a predefined rate. It will issue allowances at that price. So, if the market price looks like it's going above that, then you can buy allowances in the near term at this safety valve price. It provides protection from a shock to the economy and it provides some predictability for those of us who are going to operate under the carbon constrained system.

That's one of my real motivations for supporting a mandatory constraint. It's a huge uncertainty, but it's the right thing to do, and the sooner we impose it, the better we'll all be. We'll be able to hold costs down much better by knowing what kind of system we have.

Q: In previous discussions, you've said modern nuclear technology could be part of PNM's suite of tools for addressing global warming. Is PNM thinking about using more nuclear?

A: We certainly are thinking about using more nuclear. If we didn't have Palo Verde, and our coal resources, we would not have been able to do what we've done with rates for customers. But, if we started building a nuclear plant today, even if it was on an existing site, it would still be 10 to 12 years away. So the earliest you could get one in today would be in the 2017 window.

Probably, we will be evaluating nuclear resource, additions in the 2020 time frame. Nuclear expansion on the regulated side obviously would require the approval of the PRC.

I tend to think there are some other things we're going to be doing in the intermediate time.

Q: Such as what?

A: Well, we have a natural- gas-combined-cycle facility that's in the final throes of construction near Las Cruces. It will be in service next year. We have signed an agreement for the construction of a small combustion turbine plant near Belen, scheduled for completion in June 2008. It will be 130 megawatts and powered by natural gas.

We've launched a study, with the technological assessment and site assessment for a large-scale, concentrating solar project. If we find a technology that will work and we find a site that will work and we get comfortable with the economics, it could be in service by 2011 to 2012.

We're also looking at an integrated-gasification combined cycle facility. What IGCC does is take coal through a gasifier, a chemical process to rum it into a gas, then it uses that gas to fire a regular turbine. IGCC by itself doesn't do anything about carbon. But, it will potentially allow you to strip the carbon out more cost effectively before you combust the gas. Then you're looking at a turbine that's burning hydrogen, not carbon. So, we're looking at a jointly developed project that would include carbon capture and sequestration. IGCC is very complicated. To do an initial study is $25 million.

Q: Ben Luce, former director of the New Mexico Coalition for Clean, Affordable Energy, has charged PNM cut inside deals with the Richardson administration to soften the effects of energy legislation, particularly renewable energy legislation, in the last session. Is that true?

A: PNM is engaged in the legislative process and we make our position on energy issues well known. It's part of the collaborative process and we feel many voices were heard this last session in addition to our own.

Q: In the case of Senate Bill 418, which enlarged the renewable energy-use requirement for utilities to 20 percent of retail sales by 2020, Luce charges PNM's influence led to a reduction of the final energy-use target and to a failure to specify the deadlines for renewable energy use increases required to meet the 2020 target. How do you respond to that?

A: Early in the legislative process, the governor's office convened a group of stakeholders, including electric utilities, CCAE, the Natural Resources Defense Council and others, including the Public Regulation Commission, the Environment Department and the Energy, Minerals and Natural Resources Department. Everyone had input and the two bills that passed the Legislature were the result of that collaborative process."

Q: While writing the rules that will put SB 418 into action, the PRC also rewrote the requirement for the amounts and types of renewable energy utilities must use. Now, instead of picking and choosing from a menu of renewable sources, like solar, wind or biomass power, with each of the sources given different numbers of credits to encourage companies to use them, utilities will be required to adopt a fixed percentage of each source. What's your reaction to these new rules?

A: We're still studying the new renewable energy portfolio standard, but we're concerned that its technology- specific mandates could further increase costs for customers at a time when the other costs of running our system are already rising. from PAGE 6 states, has a relatively small population and a relatively small electric load. This makes getting affordable scale on expensive technologies challenging. Ultimately, letting the market guide us on how and when we make investments will produce a better price for customers.

Q: Is there any good reason a company would avoid adopting a wide variety of renewable resources?

A: Sure. Cost would be one reason. Technology infancy would be another. We would like to diversify away from just wind and a very small amount of solar right now, but it's got to be done with an eye toward economy. At the end of the day someone's got to pay the bill.

Q: In a speech at a shareholders' meeting this summer, you said that, instead. of being rewarded, just for increasing capacity, utilities should be rewarded for meeting customers' needs, whether that meant building a new plant or investing in devices to reduce energy use. How would you actually put that into effect?

A: There are a couple of different mechanisms. One is, what if tomorrow we get into the rate base the money we spend to help customers reduce use?, By investing on their side of the meter, by investing in technology. There are a lot of things. Another way could be what's called the "avoided cost concept." What is our cost of building facilities to meet growing demand? Let's say it's 10 cents per kilowatt-hour. Let's take a percentage of that, say 9 cents per kilowatt-hour. The utility gets 9 cents per kilowatt-hour for every kilowatt hour it helps customers avoid using , through energy efficiency. You could call them "savowatts"; instead of selling them megawatts, we're saving a watt.

Q: Is that the way utility companies are going to have to think between now and the end of the century?

A: Oh, I don't think "have to." Some can decide to keep doing what they've always done. It's not, to me, what makes sense from the customer's perspective.

Albuquerque Journal Business Outlook Thursday September 20, 2007

----- Original Message -----
From: Brown, Don
Sent: Wednesday, September 19, 2007 11:22 AM
Subject: Agenda for Sept. 28 PNM Electric IRP Meeting

PNM Electric IRP Participants,

Attached is the agenda for next Friday's meeting. We have limited it to half a day (8 a.m. - 12:30 p.m.) and hope to do the same for future meetings. We will have October and November meeting dates to share next week and will also post those to our Web site at

For planning purposes, please respond to this email if you plan to attend. As always, happy to answer any questions you may have. Hope to see you next Friday! Should be a good discussion. db

Don Brown

505.241.2849 [office]

505.321.8856 [cell]

PNM supplies electricity to Eldorado, NM.

Union Pacific hauled 1,118 trainloads of coal from Wyoming's southern Powder River Basin in August, delivering a monthly record 17.2 million tons of coal to the nation's coal-fired utilities.

Coal stockpiles at utilities are up 38 percent over last year, the highest level in four years, according to the U.S. Department of Energy's Energy Information Administration.

"We are pleased with the progress and contributions we have made to help restore coal stockpiles to normal," Union Pacific vice president and general manager Doug Glass said in a prepared statement.

Union Pacific and BNSF Railway jointly own the triple-track line that delivers coal out of the southern portion of the basin. Two successive derailments on the line in 2005 caused a delivery shortfall of more than 20 million tons. Since then, the railroads have invested nearly $1 billion to expand coal delivery throughout their rail systems.

Powder River Basin mines in Wyoming scooped 431.3 million tons of coal in 2006, according to a Star-Tribune survey.

Basin has been at odds with BNSF over rail service since a 20-year contract to haul 8 million tons of coal annually from the Powder River Basin to Laramie River Station expired in 2004. The two sides were unable to negotiate a contract, and BNSF then set a rate at twice the expired contract rate, or roughly $6 per ton, to haul the coal about 200 miles to the plant, board documents say.

Basin, which filed the complaint against BNSF along with the Western Fuels Association, claims its costs for shipping coal to the Laramie River Station plant have doubled, and says that will cost utility customers in nine states an additional $1 billion over the next 20 years.

The plant produces power for about 2 million consumers in North Dakota, South Dakota, Colorado, Iowa, Minnesota, Montana, Nebraska, New Mexico and Wyoming.

The Powder River Basin in Wyoming and Montana is the largest known coal deposit in the United States with an estimated 550 billion tons of federally owned coal in the ground, but only 1.5 percent of it is currently available for mining, according to a new federal report.

The remainder is either off limits entirely because mining is prohibited by law, such as areas designated as wilderness, or is not being mined because the coal is unreachable or the land is being used for other purposes.

Greg Schaefer, spokesman for Arch Coal Inc., which operates two mines in the Powder River Basin, said the coal in the basin is shaped like a bathtub, with the edges near the land surface and then dropping deep underground in the middle.

‘‘That coal can be several thousand feet deep in the middle,’’ Schaefer said. ‘‘There’s no technology for that kind of operation.’’

Thermal coal, or coal used to fire electricity-generation plants, is also enjoying surging demand as utilities around the world scramble to cope with skyrocketing energy use. Thermal coal used to fire European generators moved up for the fifth day to the highest price in more than two years, according to Bloomberg News.

----- Original Message -----
From: Brown, Don
Sent: Wednesday, September 05, 2007 12:18 PM
Subject: Save the Date: September PNM Electric IRP MeetingFriends of the PNM Electric IRP ...


The next public advisory meeting for PNM's Electric Integrated Resource Plan (IRP) project will be FRIDAY, SEPTEMBER 28 at PNM headquarters in downtown Albuquerque. We are still working on an agenda, but do plan to begin the discussion of what resource options are or may be available to PNM in the next 20 years.

We will try to limit this and future meetings to a half day, so please reserve the morning on your calendars. We'll be in touch soon with a specific start time and agenda. Note that while we would prefer to announce our October and November meeting dates today, changes in the timeline for our pending electric rate case prevent us from doing so. Our hope is that we will have specific October and November dates to share in the next week or so.


Also note that we have now posted the audio and slides from a presentation given by Dr. Bryan Hannegan, Vice President, Electric Power Research Institute, during our last meeting. Hannegan talked about demand and supply options, their tradeoffs, and their costs in a carbon-constrained world. The presentation is available online at The audio on PNM's load forecast was not successfully recorded; however, the slides are posted on this page, and PNM load forecaster Steve Martin is available to answer any questions you may have about where we see electric demand going in the coming years.

Thanks to those of you who were able to attend the August meeting. Whether you or not you attended, we hope you'll stay engaged in this important process. db

Don Brown
505.241.2849 [office]
505.321.8856 [cell]

Southern California Edison said 20,000 customers in Los Angeles, Orange, Ventura, Riverside and San Bernardino counties had no electricity, spokesman Steve Conroy said.

About 3,500 more customers in scattered parts of Los Angeles also were without power, Los Angeles Department of Water and Power spokeswoman MaryAnne Piersen said. "Probably more than 90 percent of them are due to stress on the system due to the heat," she said. "Different pieces of equipment get fatigued and blow out, so they have to be replaced."

One day, even coal will be gone.
How much longer are we going to wait before we figure out how to survive without fossil fuels?

Windmills could be a substitute for coal and oil. But a windmill's capacity to generate electricity is so far below that of coal and oil, it's almost laughable to include it in any serious discussion of "alternative energies." But we do so for one simple reason: We don't have any better ideas.

The trustees of CSIS
who are attending this closed meeting include Henry Kissinger, Bilderberg and Trilateral; Zbigniew Brzezinski, Trilateral; and Harold Brown, former defense secretary and Trilateral. Also participating is Richard Armitage, Bilderberg. Other Bilderberg-Trilateralists may be attending but have not been identified.

1. Weight Grade

The weight grade determines how much energy there is per pound of energy resource. For example, coal has about 12.7 thousand BTU/lb, natural gas about 10 thousand BTU/lb, oil about 19.3 thousand BTU/lb, and an electric battery typically has 100 BTU/lb. Electric batteries then are very heavy compared to their energy output which is why electric cars do not have very good driving ranges.

PNM's Steve Martin addressses increase energy use in bigger homes

PNM IRP, Peak Oil, and The Oil Drum viz
Don Brown reported.

PNM electric IRP Tuesday August 21, 2007 Albuquerque, NM. Posted at The Oil Drum. Linked at Peak Oil.

PNM employee Kelly Gossett blue dot.
PNM employee Don Brown red dot. Brown reports to Jeff Sterba.
PNM HIGH LEVEL employee Evelin Wheeler green dot.

Summit Blue irp consultant Dan Violette writing "Peak" on paper after pressure by bill.

We added the red digital dot.

We are bringing the information and ideas from Peak Oil and The Oil Drum to this meeting.

Hey, peakers, we did it! See red check.

Writing "Peak" on the agenda appeared to to be about painful for Violette.

So bill suggested adding a ? suffix to Peak. This worked.

Here's Dan Violette [green check], Randy Gunn [blue check] and Steve Martin, PNM forecaster] red check.

Steve commented on the residential increase of electrical load being attributable to larger home size and refrigerated air cool instead of swamp coolers.

Martin also commented on

and huge 72 inch diameter pipes which were being installed to get the water from the Rio Grande river to the water treatment stations.

Albuquerque is running low on water as a result of large number of homes being overbuilt on the desert.

Water is released into the Rio Grande, then trapped behind an inflatable dam wher it is pumped.

Mayor Martin Chavez is a lawyer, not an engineer. Perhaps Mayor Chavez' plan may encounter some mud problems.

You see the inflatable dam from the Alameda street bridge.

Martin commented on the electrical pumping load increase caused by Rio Grande water project.

So mayor Chavez may have an electric power problem in addition to a possible mud problem.

The forecast beyond 2008? We will see.

PNM industrial electricity use has been declining, Martin reported. Martin commented that this is true to the US as a whole. See page 40.

According to the Department of Energy, the United States mines more than 2.8 million tons of coal each day and if it did not, the nation would have double its natural gas production. Coal remains cheap and plentiful, with 250 years worth of reserves. It comprises 51 percent of the electricity generation.

energybizinsider August 20 2007

2800000 x 365.25 = 1,022,700,000 Websites have reported 1.1 billion tons of coal per year currently used in the US.

TORONTO -- A temporary shortage of electricity from nuclear reactors in Ontario is forcing the province to run its coal plants longer to keep the lights on, causing a spike in greenhouse gas emissions and a potential headache for Premier Dalton McGuinty.

Electricity output from the province's four pollution-spewing coal-fired plants rose 19 per cent during the three-month period ending June 30, compared with the corresponding period a year ago. Greenhouse gas emissions climbed in lockstep with that increase.

The coal from the big Powder River Basin coal mines, Selmer said, will not work for UW's plant because it is uncrushed "mine-mouth" coal that goes directly from the mine to rail cars. Any crushing happens at the destination power plants.

Selmer said the Wyoming coal may reduce the heating costs because it has more heating capacity per unit and burns better in UW's three boilers. "The Montana coal is more of a lignite-type, and its ash will melt at a lower temperature, causing clinkering inside the boilers," he said. "We've had some severe maintenance issues with it."

Also in UW's budget proposal this week is a request for $4.7 million over the biennium to begin utility system improvements, including adding a coal crusher "so we can buy mine-mouth coal" and replacing the boiler feeder system "to facilitate burning that coal," Selmer said.

How bad it really is viz.
----- Original Message -----
From: Brown, Don
Sent: Thursday, August 09, 2007 8:59 PM
Subject: Re: Please get answers to questions

Bill, be aware that whatever numbers we can find and give you on Aug. 21, the vast majority of PNM's oil, diesel and gasoline use for this time period is from our distribution and transmission system (fueling the trucks manned by crews who work on power lines, restoring power in neighborhoods, etc.). Fuel consumed to transport coal from the BHP mine to San Juan Generating Station is minimal as San Juan is strategically located right at the mine.


----- Original Message -----
From: bill payne
To: Brown, Don
Cc: art morales ; Homan, Mary E.; O'Connell, Pat; ; Sanders, Tommy; McFearin, Dan;
Sent: Thu Aug 09 21:12:20 2007
Subject: Please get answers to questions

Mr Brown

Please get answers to questions

1 annual gallons of motor oil consumed
2 annual gallons of diesel oil consumed
3 annual gallons of gasoline consumed
4 megawatts of electricity produced

by PNM electric for years 1991 through 2006

to make august irp more meaningful on August 21, 2007 agenda

regards bill

----- Original Message -----

From: Brown, Don
Sent: Thursday, August 09, 2007 7:26 PM
Subject: Re: Please get answers to questions

Bill, I will see what I can do for the Aug. 21 meeting.


----- Original Message -----
From: bill payne
To: Brown, Don
Cc: art morales ; Homan, Mary E.; O'Connell, Pat; ; Sanders, Tommy; McFearin, Dan;
Sent: Thu Aug 09 21:12:20 2007

Subject: Please get answers to questions
Mr Brown

Please get answers to questions

1 annual gallons of motor oil consumed
2 annual gallons of diesel oil consumed
3 annual gallons of gasoline consumed
4 megawatts of electricity produced

by PNM electric for years 1991 through 2006
to make august irp more meaningful on August 21, 2007 agenda


Bryan Hannegan, vice president of environment for the Electric Power Research Institute, will discuss energy options for the future in a public forum Aug. 21 in Albuquerque.

The presentation, sponsored by Public Service Co. of New Mexico, will address conventional electricity generation from coal, natural gas and nuclear power, as well as renewable sources of energy, energy efficiency, and demand-side management. Hannegan will consider the strengths and weaknesses of each energy technology, including cost, reliability, and environmental impact.

Coal trains numbers appear to be increasing. Here's a 139 car coal train ascending the hill between Belen and Dalies, NM on Saturday August 11, 2007.

This coal train, with aluminum hopper cars, was unusual because it had four pushing locomotives.

Harvey House museum, Belen, NM
. Coal train [114 cars, two pulling and two pushing locomotives] going south photographed at the Harvey House museum.

Note the car bottom discharge chutes.

Coal trains going mostly west, but sometimes east, are rotary unload

And electricity seems to be a growing problem, at least in the third world (and those areas that the US military has transformed into the same). It is interesting to note that Jay Hanson (of notoriety) popularized Richard Duncan's Olduvai Theory along just these lines--that it would be electricity, not oil, that would be the actual cause of collapse.

August 21, 2007 agenda

----- Original Message -----

From: Brown, Don
Sent: Thursday, August 09, 2007 6:03 PM
Subject: Agenda for PNM Electric IRP Meeting

As I mentioned in my email of last week, here is the draft agenda for the next public advisory meeting for the PNM Electric Integrated Resource Plan, which will take place Tuesday, 8/21, from 9 a.m. to 4 p.m. We will have a guest speaker from the Electric Power Research Institute about current and future energy technologies, an overview of the coming 10 months, and a presentation and discussion of PNM's electric load forecast.

Please let me know if you have any questions. In the meantime, for those of you who haven't responded to the questions I posed in an earlier meeting, we encourage any feedback you feel like giving. See you on the 21st! db

Don Brown
505.241.2849 [office]
505.321.8856 [cell]



We're committed to making the most of your time and running a process that is open, constructive and productive. I am new to the project and didn't attend the first meeting, but your honest feedback would be most appreciated. If you would take a few minutes to consider the following questions, I would be happy to take your comments by email or discuss on the phone or in person. We may also want to discuss some of these issues together as a group.

1. Did you find the first IRP meeting worthwhile? Is there anything specific you can suggest that could improve future meetings?

2. Do you feel as though you have an understanding of the goals of the IRP process and how it will progress?

3. What do you hope to get from the IRP process -- and what can we do to be sure you stay engaged?

4. Are there any particular topics you would like to discuss or have covered at future meetings?

5. We want to ensure a variety of viewpoints in the room at every meeting as well as expand the scope of public involvement. Do you have any specific suggestions on a.) people or groups who should be invited to participate in the IRP process, and b.) opportunities to increase public engagement in this process?

I look forward to your response -- and to seeing you on August 21. Stay tuned for a more specific agenda.

Best Regards,

Don Brown
505.241.2849 [office]
505.321.8856 [cell]

Mississippi River Bridge Collapse in Minneapolis Separates Two Locks from the River System

Coal shipping will be most affected by the collapse.

Gossett's email reporter not received.

Monday August 6, 2007 07:32

Kelly Gossett

Mr Gossett

Thanks for the call about clarifying my email address on Friday afternoon.

I didn't get the email you said I would get late Friday afternoon. So maybe there's an email problem.

I send you an email to see if you receive it.

You asked about reason for my interest in the electric irp. Perhaps the first part of this email might explain help explain my interest.

August 4, 2007
By Kevin Kerr,
New York, New York, U.S.A.

The Coming Resource War

The other morning, I was making coffee at the crack of dawn, as I do each day. As I stood there watching the coffee percolate, I began to think about how difficult it would be to survive in a world where we were fighting for resources everyday. We take so much for granted, especially as Americans. After all, electricity is just a light switch away, groceries are usually in abundance just a few miles away and gasoline, while costly, is cheaper than many other liquids we buy each day, including some fancy bottled water.

Let's face it. Most of us have never had to kill our own food or forage in the forest to find enough wood to heat our home for the night. What would that be like? Would we be prepared? I highly doubt it.

The battle for global resources has already begun — the borders are being drawn and the players are suiting up. The grim reality is that commodities are being gobbled up around the globe, and as Earth's population surges past six billion, resources are being stretched to the limit. ...

I am concerned that the Resouce Needs 2008-2024 might not take into consideration future production of oil, natural gas, and coal.

I look forward to your email.


Coal mining and delivery takes a fair amount of diesel fuel.

Here's photos of two of four diesel storage tanks at BNSF rail yard in Belen, NM taken Saturday July 28, 2007

Here's an enlargment of the notice seen on the right tank.

That's 2,843,393 same as the tank to the left.
If there are diesel and gas shortages in the future, what will this do to coal delivery for electric generation?

PNM electric IRP should address this issue.

Here's two pusher engines on a coal train going west

phographed at Rio Puerco, NM shortly after above tank photos were taken.

Here the coal train with three pulling and two pushing locomotive going west.

The pushers at the rear are seen in the foreground.

Friday July 13, 2007 08:48

Mr O'Connell:

Now that I've an opportunity to think about the two more imporant foils presented at the Elecrtric IRP, I have a request for information. But first let me explain my request

The foil

clearly show 2007 Demand v Enegy broken down by nuclear, coal, natural gas, oil, wind and purchases.

The foil

projects MW electric resource needs.

What I think is needed are similar plots for projecting energy supply from 2008 to 2024 for nuclear, coal, natural gas, oil, and wind.

These plots would be valuable to assess if the above Resource need plot is reasonable.

Tommy Sanders at the Gas IRP was asked how long natural gas was going to be available for fuel to heat homes with, if I recall corrrectly.

Sanders responded, "Twenty-five years."

The questioner then asked, "What do we use then." Sanders responded, "Electricity."

I showed Sanders the Dave Hughes plots of natural gas depletion. I asked if similar plots existed for New Mexico natural gas depletion.

Sanders responded that they did.

I asked Sanders if these could be posted on the Gas IRP site. Sanders said, "yes."

I haven't seen these plots posted yet.

I ask that PNM prepare plots similar to Resource Needs for projecting energy supply from 2008 to 2024 for nuclear, coal, natural gas, oil, and wind.

Reason is that there appears to be a growning concern that the building boom in the Albuquerque area may not be sustainable because of future shortages of electricity and natural gas.

Water shortage is already a problem in the Albuquerque area because of the west-side residential expansion and Intel.

Thanks in advance.

 ----- Original Message -----
From: O'Connell, Pat
To: bill payne ; Homan, Mary E.
Sent: Wednesday, July 11, 2007 7:59 AM
Subject: PNM's Electric IRP

Dear Mr. Payne, I see from your recent e-mails that you have found that the files from the July 2 Electric IRP meeting are posted on Also you have expressed an interest in some common fuels. Fuel price and availability are risks that will be considered in the Electric IRP. As we work our way through the informational phase, there will be several discussions about this topic and other variables that must be considered. PNM has planned to make the Electric IRP a public process through interactive public forums, and we welcome your continued comments and observations,

Again, thank you for your interest in PNM's Electric IRP, and I hope to see you at the future public meetings.

Pat O'Connell

When the first coal-burning plants were used by Thomas Edison to produce electricity, he was able to use only about 4% of the energy from the coal, but much of the rest of the energy was captured as heat, and since the power plants were in New York City, much of the waste heat was used. The consolidation of utilities led to much more efficient generation of electricity by coal-fired plants, up to 30%, but the use of the waste heat virtually disappeared, because the plants were now located outside the cities. Now, fully 67% of the energy from coal plants is wasted, because burning things generates more energy in the form of heat than in the form that we want.

North America consumed about 4,322 terawatthours (TWh) of electricity in 2000, or about 30 percent of estimated global electricity consumption. Canada consumed 546 TWh; Mexico consumed 155 TWh; and the United States consumed 3,621 TWh. Electricity consumption is projected to grow significantly by 2010.
In the IEO2007 reference case, world demand for electricity advances strongly from 2004 to 2030. Global electricity generation increases by 2.4 percent per year over the projection period, from 16,424 billion kilowatthours in 2004 to 30,364 billion kilowatthours in 2030 (Figure 60). Much of the growth in electric power demand is projected for nations outside the OECD. Although the non-OECD nations consumed 26 percent less electricity than the OECD nations in 2004, total electricity generation in the non-OECD region in 2030 is projected to exceed generation in the OECD by 30 percent (Figure 61).

Posted Monday July 16, 2007

...Right now, energy supply looks to be struggling to keep up with demand. A recent study by the Lawrence Berkeley National Laboratory concludes that, thanks to the industry shift to low-end servers, global power consumption has doubled since 2000 to more than 123 million kw/hours. Power demands are expected to increase by 40 percent come 2010 -- and that's assuming that per-server power consumption remains at 2005 rates.

Railroads invest in coal transportation
Venerable industry seeing resurgance
Business Outlook, Albquerque Journal, Thursday July 12, 2007


Railroads Bet on Coal Despite Pollution
Railroads Put Money on Coal Despite Pollution, Economic Concerns

"The facts are pretty simple. It is the single cheapest way to generate a kilowatt hour," said Donald Broughton, a railroad analyst with A.G. Edwards & Sons. "Are there regulatory challenges as a result of environmental concerns? Absolutely. But this is still a fairly free market."
But what will it cost? After some hemming and hawing, company executives gave figures by the standard industry metric, dollars per kilowatt of capacity, but in a huge range: $2,000 to $3,000.

“There’s massive inflation in copper and nickel and stainless steel and concrete,” said John Krenecki, president and chief executive of GE Energy. The uncertainty is not just in nuclear plants, he said; coal plant prices are now similarly unstable.

As talk of building new power plants rises sharply, so does the cost. A new fleet of coal-fired power plants and a revival of nuclear construction after three decades are both looking tougher lately.

For example, in late 2004, Duke Energy, one of the country’s largest utilities and most experienced builders, started planning a pair of coal-fired power plants to replace several built around the middle of the last century, at Cliffside, in western North Carolina. In May 2005, the company told regulators it wanted to spend $2 billion to build twin 800-megawatt units. But 18 months later, in November 2006, Duke said it would cost $3 billion. Then the state utility commission said to build only one of the plants, and in May of this year Duke said that would cost $1.83 billion, an increase of more than 80 percent from the original estimate.

That report notes that while US production in tonnage may not peak for another few decades, its energy content has already peaked in 2000, as the Wyoming coal being produced today is less energetic than earlier production.

Monday July 9, 2007

The requested foils.

Let's see what happens.

----- Original Message -----

From: O'Connell, Pat
To: bill payne
Sent: Thursday, July 05, 2007 3:48 PM
Subject: RE: When Electric IRP foils to be posted?

Dear Mr. Payne,

I am on vacation for a few days this week and won't have the opportunity to get back to you on this (and your other messages) until some time next week. Thanks for your continued interest in PNM's Electric IRP.

Pat O'Connell

Thursday July 5, 2007 07:09


I'm out at the Electric IRP page but I don't see the foils from the July 2, 2007 meeting posted.

When will these foils be posted?

There are two foils, one related to load projections and the other about future coal use by PNM [Ms Bothwell presented both], I would like to examine more carefully.

Not all issues raised the the Electric IRP appeared to me to be of equal importance.

I want to focus on what appears to me to be essential issues in the future production use and of electric power.

I would like to get from you answers to the three below questions:

1 annual gallons of motor oil consumed
2 annual gallons of diesel oil consumed
3 annual gallons of gasoline consumed
4 megawatts of electricity produced
by PNM electric for years 1991 through 2006

for preparation for the next Electric IRP.

Prasad [], who sat to my left, and I were discussing coal production.

Prasad, if my memory is correct, commented that coal in the Powder River Basin can be mined for about $8/ton but that rail transportantion costs averaged about $26/ton.

Coal production has apparently been increasing the the US although, I read on Internet, total BTU output apparently peaked in 1998.

Since 1970 lower quality subbituminous and low qualitiy lignite have been contributing with rising volumes. The growing share of lower quality coal is the reason why *total coal production in terms of energy content peaked in 1998* at 598.4 Mtoe and has since declined to 576.2 Mtoe in 2005 in spite of the continuous rise in produced volumes (BP 2006).

Transporting coal requires use of lots diesel fuel.

To illlustrate my point, here's a 114 car coal train cresting the summit of the pass between Livingston and Bozeman, MT on Thursday June 14, 2007 with four pulling and three pushing locomotives.

The contemplation of things as they are,
without error or confusion,
without substitution or imposture,
is in itself a nobler thing
than a whole harvest of invention.

Francis Bacon

Tuesday July 3, 2007 07:46


My impression at the end of the electric IRP on Monday was that you wanted to discuss load projections in the next meeting.

I hope I expressed my concern that the topic of what is going to fuel any projected electric load should also be discussed.

You told me that CERA did not seem concerned about future energy supplies. I think that I told you that there are concerns expressed by others about the accuracy of CERA predictions.

You might like, like I have done, to enlighten yourself and others to other viewpoints by reading some of the materials on energy at Peak Oil and The Oil Drum.

Projected peak load in Albuquerque appears to be driven by residential expansion. This expansion might be limited in the future by lack of water, natural gas, and oil accompanied by high prices?

Peak Suburbia is reposted below for you and others consideration.

I have some requests for information for some of the Monday presenters. I feel that it is best to present my requests in writing and receive written answers.

Gregory Nelson seem very knowledgeable about coal.

Cindy Bothwell appeared very knowledgeable about all electric production fuel sources.

Could you please send me email address for Nelson and Bothwell.

Twice it was mentioned that Ms Bothwell has a master's degree in statistics. We may have a common interest

Ted Lewis is one of my ms and phd students in computer science.

This is ted lewis and bill on Wednesday March 31, 2004 shot by Molly Lewis in Salinas, CA.

Ted G. Lewis is a professor of computer science at the Naval Postgraduate School and academic associate of the Center for Homeland Defense and Security master degree program. He has forty years experience in academic, industrial, and advisory capacities, ranging from academic appointments at the University of Missouri-Rolla, University of Louisiana, and Oregon State University, to Senior Vice President of Eastman Kodak Company, to CEO and President of DaimlerChrysler Research and Technology, North America. Dr. Lewis has published over thirty books and 100 research papers, and is the author of the forthcoming book Critical Infrastructure Protection in Homeland Security: Defending a Networked Nation, published by John Wiley & Sons, 2006. He received his Ph.D. in computer science from Washington State University.

Here's John [holding salmon] and bill posing with their about $50 per pound, maybe more, salmon in Kenmore, WA Thursday evening August 23, 2004. But it sure was fun!

Here's an example page from part 1 of the article.

My expertise is not in energy.

I do microcontrollers. And machine combinatiorics.


The reason I attended both the pnm gas and electric irp is that it appears that we are entering a new period in the history of this planet. Energy depletion and over population.

And I want to see what PNM projects for the future of natural gas and electric power. Then see how accurate the predictions are and what PNM does.


Peak Suburbia

James Howard Kunstler
June 25, 2007

I get lots of letters from people in various corners of the nation who are hysterically disturbed by the continuing spectacle of suburban development. But instead of joining in their hand-wringing, I reply by stating my serene conviction that we are at the end of the cycle -- and by that I mean the grand meta-cycle of the suburban project as a whole. It's over. Whatever you see out there now is pretty much what we're going to be stuck with. The remaining things under construction are the last twitchings of a dying organism.

It is not an accident that the housing bubble coincided with the phenomenon of Peak Oil. First of all, the housing bubble should more properly be called the suburban bubble, because most of the activity came in the form of "greenfield" housing subdivisions, and included all the additional crap-o-la accessories required by them -- strip malls, power centers, Outback steak houses, car washes, et cetera. The suburban expansion has been based entirely on cheap-and-abundant supplies of oil. Similarly, it was not an accident that the suburban project faltered briefly in the 1970s, when America's oil production entered its long decline, OPEC seized the moment, and oil prices shot up. Notice that the final suburban blowout occurred after 1990, when the North Sea and Prudhoe Bay oil strikes came into full production, disabling OPEC, and a world oil glut finally drove prices as low as ten dollars a barrel in 1999. That ushered in the climactic phase of suburbia, as represented by things like the standard 4000-square-foot Toll Brother's McMansion and the heyday of the super-gigantic SUV to go with it.

The American public has no idea how over all that is. The bottom is falling out under not only the housing market (as in houses up for sale) but on the whole apparatus for delivering future houses, and the car-oriented crap associated with it. The production home-builders, such as Toll Brothers, Hovanian, Pulte, et cetera are going down and they will not be coming back. There will be a great deal of wishing that they might come back, but they won't. Likewise, the commercial builders of all the various forms of suburban retail will be waiting to "turn the corner." But they will discover that the wall they have hit has no corner. It's just a wall. For anyone who wonders how much we do not need anymore retail space in America, have a look at this chart showing the comparative amount of retail square-footage allotted for citizens of each nation:

Those of you considering the purchase of more WalMart stock, take note.

Some years back, when those watching the oil scene began to coalesce in their recognition that a worldwide production peak was imminent and hugely significant, the concept developed that this peak would take the form of a "bumpy plateau," meaning that supply-and-demand would teeter in an uncomfortable relationship for a period of time as markets and economies adjusted to the new reality by oscillating from higher prices to "demand destruction" to recession to recovery to higher prices, and so forth. This was expected to go on for quite a while before the world really headed into a slow permanent decline.

The latest statistical work by Dallas geologist Jeffrey Brown over at The Oil, suggests that something else is happening, something that was not anticipated: an imminent oil export crisis. This Export Land Theory states that exporting nations will have far less oil available for export than was previously assumed under older models. (Story here.) The theory states that export rates will drop by a far greater percentage than net production decline rates in any given exporting country. For example, The UK's portion of the North Sea oil fields may be showing a nine percent annual decline for the past couple of years. But it's export capacity has declined 60 percent. Something similar is in store for Saudi Arabia, Russia, Mexico, Venezuela -- in short, the whole cast of characters in the export world. They are all producing less and they are all using more of their own oil, and have less to send elsewhere.

Brown's math suggests that world oil exports will drop by 50 percent within the next five years, certainly enough to trigger a systemic breakdown in market allocation, meaning serious supply shortages among the importing nations. That's us. We import two-thirds of all the oil we use.

The implication in all this is that the activities that have become "normal" for us during the post World War Two era will very shortly become untenable. An economy based on suburban expansion and incessant motoring is on the top of the list of supposedly "normal" activities that will not be able to continue. I would maintain that even if we had 20 years, no combination of bio-fuels and other alternatives would enable us to keep suburbia running. But this latest work indicates that we have much less time to adjust.

This new information is consistent with my view that we had better prepare to make other arrangements for living in this country, by which I mean specifically re-localizing, de-globalizing, with an emphasis on local agriculture wherever possible, the emergency restoration of passenger railroad service and related modes of public transit, the rebuilding of local commercial infrastructures, and a radical rethinking of how we inhabit the landscape under New Urbanist lines. Perhaps the most imminent danger is that the financial markets, which have been driving our insane, hollowed-out economy, will soon recognize what's in store and implode, creating a crisis of capital that will leave us with no ability to make any emergency investments, such as would be required to rebuild the railroad system. The equity markets sure blinked last week when two hedge funds based on phony-baloney collateralized debt obligations tanked. The collateral underlying this load of hallucinated "wealth" is comprised of contracts made by the insolvent for suburban houses worth far less than the value stated on the contracts -- with every indication that the real value will keep dropping.

In any case, those who keep wringing their hands over the bulldozers leveling the plots of prairie, or cornfield, or desert -- those distressed folks can direct their anxiety elsewhere. Worry less whether one final strip mall will tilt up out in gloaming, and think harder about how you are going to feed yourself and your family in a couple of years when the stupendous motorized moloch of American life begins to sputter, and the Cheez Doodle shipments can no longer make it to your supermarket shelves, and all that is "normal" melts into air.

June 25, 2007 in Commentary on Current Events

Aside from the Irak quagmire, energy problems continue to dominate Bilderberger discussions. Oil and natural gas are finite, non-renewable resources. That’s because once used up it cannot be replenished. As the world turns, and as oil and natural gas supplies dwindle while demand soars dramatically, especially with Indian and Chinese booming economies who want all the trinkets and privileges of an American way of life, we, as the Planet, have crossed the midpoint of oil production and discovery. From now on, the only sure thing is that supply will continue to diminish and prices will continue to increase. In these conditions world conflict is a physical certainty. End of oil means end of world’s financial system, something which has already been acknowledged by Wall Street Journal and the Financial Times, two full time members of the Bilderberger inner circle. Goldman Sachs oil report, [another full time member of the Bilderberger elite] published on March 30, 2005 increased the oil price range for the year 2005-6 from $55-$80 per barrel to $55-$105. During 2006 meeting, Bilderbergers have confirmed that their short range price estimate for oil for the 2007-08 continues to hover around US$105-150/barrel. No wonder Jose Barroso, President of the European Commission, announced several months ago during the unveiling of the new European energy policy that the time has come for a “post-industrial age.” To bring the world into the post industrial age, you first need to destroy the world´s economic base and create another Great Depression. When people are poor, they don´t spend money, they don´t travel, and they don´t consume.

Bill sent John Sobolewski [born Krakow 1939, lived 10 km from Dresden when it was bombed. Speaks Polish, German, French and AUSTRALIAN] [BSEE, MSEE U Adelaid, PhD Washington State University, Computer Science, 1971] a link to the electric irp and received in reponse.

----- Original Message -----
From: "John Sobolewski"
To: "Bill Payne"
Sent: Sunday, July 15, 2007 11:47 AM
Subject: RE: Uzytkownicy portalu nie moga wykorzystywac tekstów do celów komercyjnych bez wiedzy

While you are getting into saving energy, I am using energy while I still
can. Went Halibut fishing on a charter into cnadian water and got my limit
of 2 25 pounders but I was not much fun because it was like pulling in a 4
by 8 foot piece of sheetrock.

I also took a sturgeon charter on the Columbia. You can keep one fish
beween 45 and 60 inches. I caught 4, including a 58 inch keeper (first
photo) and a 72 incher (second photo) that I had to throw back.

The salmon fishing started so-so but the last report from Olson's at Sekiu
for July 13 was that fish were "everywhere" and people were limiting with 4
fish (2 pinks plus 2 coho and/or kings) before even getting into 150 feet of
water (ie close in).

We will see if that keeps up.

Cheers, John.

Where did I go wrong?

We'll hopefully discuss Sobolewski's position on energy depletion while engaged in essential non-gas-wasting salmon fishing at Sekiu, WA in August of 2007.

Oil depletion estimates based on knowledge of normal distribution parameters µ and σ

Executive Summary

Oil production in the world is mathematically modeled with the normal distribution. The normal, or bell-shaped, curve slope [rise over run] starts at zero, then accelerates over time to a point where the acceleration is zero. This is called the inflection point. The production slope decelerates at time past the inflection point. The decelerating slope will reach zero at some point in time. This is called peak oil. Identification of the inflection point is easily done by looking at oil production curves over time. The inflection point is where the production slope begins to flatten. In mathematical terms this is called µ -σ: the mean minus the standard deviation. World oil production, from looking at graphs, appears to start to flatten in the mid 1950s. The International Energy Agency reports that peak oil appears to have arrived in 2005; that is, 1/2 of world oil has been used. 68% of the area [total oil production] under the normal is contained between µ -σ and µ +σ. Since the normal distribution is symmetric, the means that 84% of the world's oil will have been consumed by about 2030 - 55 depending on the inflection point location guess if the mathematical model is correct and no unfortunate events intervene.

Update Monday September 24, 2007

Crude Oil + NGL: the peak date remains May 2005 at 82.09 mbpd ( 0.01 mbpd), the year to date average production for 2007 (6 months) is 81.20 mbpd ( 0.04 mbpd), down 0.06 mbpd from 2006.

Let's try to compute the first and second derivatives of the normal density to try to guess the future of oil depletion.

IEA apparently has confirmed that world oil production peaked in 2005. Maybe May, 2005.

So we know µ = 2005. The next task is to estimate σ. This is done by locating the inflection point on the negative side of the normal distribution.

The inflection point is where the rate of change of slope [first derivative of the normal] changes from positive to negative. The second derivative of the normal distribution is zero. This occurs at µ - σ.

This can be seen by sliding a straight line tangentially along the normal density.

Mentally put an x, y coordinate system with the origin at the tangent [rise over run] point.

The tangent starts near zero at the far left of the normal distribution, then increases until µ - σ.

Picture in you mind the tangent rotating on the x, y coordinate system in a counter clockwise direction.

To the right of µ - σthe tangent begins to rotate in a clockwise direction on the x, y coordinate system.

To the right of µ - σ, the tangent starts to flatten again reaching zero at µ.

At µ, 2005, the deceleration is at a maximum, then decreases until µ + σ.

y = (1/σ(2π)(1/2) )e- (x -µ)2/2σ2

dy/dx = y' = 1/(σ(2π)(1/2) )e- ½((x -µ)/σ)2d(- ½((x -µ)/σ)2)/dx

                 = 1/(σ(2π)(1/2) )e- ½((x -µ)/σ)2-((x -µ)/σ2)

                 = -y ((x -µ)/σ2)

d2y/dx2   = y" = y ((x -µ)/σ2)2 - y/σ2

                        = y /σ4( (x -µ)2 - σ2)

providing septuagenarian didn't make any mistakes differentiating.

Spetuagenarian hasn't used differential calculus formally in more than 25 years. Senior citizen "gutsed it" and differentiated from what he though were the correct rules. After doing the above computations the "chain rule" and "differentiation of a product." came to mind and got googled.

This means that at x = µ, y' =0 and at x =µ -σ, y" = 0.

To be a true inflection point sign of y" should change on either side of an inflection point.

Wikipedia peak oil shows

so was the inflection point about 1956? [Diagram may be inaccurate since the normal distribution is symmetric about the mean. And is highly idealized! Further, the drop to the right of the mean may prove, in reality, to be more rapid than the ascent.] At this point only about 16% of world oil may have been used.

Bill's 50 high school reunion - also the year Hubbert made his prediction of peak US oil production.

So will the next inflection point be at 2054?

Or is the inflection point much later?

say around 1965?

The above graph illustrates difficulties of fitting a normal distribution to actual data and the limitations of mathematical modeling.

68% of the area under the normal distribution is between µ -σ and µ +σ so there is 34% of the area of the distribution between µ -σ and µ since the normal distribution is symmetric.

There is 50% of the area under the normal distribution between - ∞ and µ.

In 2054 84% of world oil may have been used if the inflection point was in the middle 1950s or 2025 if the inflection point was around 1980.

The normal distribution second derivative [acceleration/deceleration] has two maxima and one minimum points.

Let's try to find them by taking the third derivative of the normal density and setting the result equal to zero to find the zeros.

y = (1/σ(2π)(1/2) )e- (x -µ)2/2σ2
y' =   -y ((x -µ)/σ2)
y" = y /σ4( (x -µ)2 - σ2)

y'" = d3y/dx3 = y' /σ4( (x -µ)2 - σ2) + y /σ4 2 (x -µ)
                   = -y ((x -µ)/σ2) /σ4( (x -µ)2 - σ2) + y /σ4 2 (x -µ)
                   = -y/σ6((x -µ)3 - (x -µ)σ2 - 2σ2 (x -µ))
                   = -y/σ6(x -µ)(( (x -µ)2 -3σ2)

(x -µ)2 -3σ2 =0 ; (x -µ)2 = 3σ2, and (x -µ) = +/- σ31/2.

So y'" = 0 is at x = µ, x = µ - 3 1/2 σ and x = µ + 3 1/2 σ.

Bill did this differentiation on a Southwest airplane from Seattle to Albuquerque on Saturday September 1, 2007 returning from

fishing at Sekiu, WA between August 28-31 2007.

That's Vancouver island you see in the background.

John Sobolewski took the photo.

----- Original Message -----

From: "David "
To: "Bill Payne"
Sent: Wednesday, September 12, 2007 6:40 PM
Subject: Salmon

We had your salmon tonight and it was some of the best we have ever
had. Thanks again! If I could bring home 30 to 40 pounds of it at a
time, I could probably get into fishing again!


Bill emailed dave that he was happy since the salmon only cost about $50-100 per pound.

Reason salmon tasts so good is likely the John Soblewski cut the gills and bled the fish immediately after catching.

We met Harold Van Riper.

Van Riper introduced us to his two granddaughters.

Van Riper is a 1953 graduate of Gonzaga U. in Spokane, WA. Bill is a 1959 graduate of Whitman College in Walla Walla, WA.

Van Riper told us that in 1964 about 16 million pink salmon entered the strait of Juan de Fuca.

Van Riper told us that in 2007 21 million pink salmon enter the strait of Juan de Fuca.

One afternoon Sobolewski and Payne quit fishing because we got tired reeling in salmon.

So what's 2008 going to be like?

No pinks on odd years.

Us seniors will hopefully report.

Internet google search found the plot.

Something looks fishy. 31/2 = 1.732 so maximum points should, if computations are correct, be at -1.732 and 1.732. But on the above plot the maximum points look to be between +-2 and +-2.5.

Let's do some checking of everything.

Wikipedia normal distribution plots.

Visually +-1.732 looks more plausable here for the maxima for µ = 0 and σ= 1.

Normal distribution lecture.

The normal density can be actually specified by means of an equation.

y = (1/σ(2π)(1/2) )e- (x -µ)2/2σ2

The height of the density at any value x is given by Although there are many normal curves, they all share an important property that allows us to treat them in a uniform fashion.

The 68-95-99.7% Rule

All normal density curves satisfy the following property which is often referred to as the Empirical Rule.

68% of the observations fall within 1 standard deviation of the mean, that is, between mu - sigma and mu + 1 sigma.

95% of the observations fall within 2 standard deviations of the mean, that is, between mu - 2 sigma and mu + 2 sigma.

99.7% of the observations fall within 3 standard deviations of the mean, that is, between mu - 3 sigma and and mu + 3 sigma.

Thus, for a normal distribution, almost all values lie within 3 standard deviations of the mean.

Wolfram MathWorld on the normal distribution.

Did I get differentiations right or not?

Sent Wednesday September 19, 2007.

Hai or ieie?

Check computations were made on return from Seattle to Albuquerque.

Whoops. Last should be σ6 not σ2.


Reason that peak oil or about peak anything can be modeled by the normal distribution is likely the Central-limit Theorem

Professor Irving Burr taught Mathematical Statistics course at Purdue University in 1961.

Our class used this book.

Reason for looking through Mood's book was to see what he had on the derivatives of the normal distribution. Nothing.

Memories returning.

My office mate at the computing and statistical lab, Jerone [n is corrrect] Deverman and I got, if I recall correctly, the two highest cumulative homework and test scores in the class of about 25 students.

Al Behrens was Burr's TA.

Deverman lives in albuquerque. I've seen him several time in airports [not albuquerque] over the last 26 years.

Albuquerque Youth Symphony Current DonorsCity of Albuquerque Urban Enhancement Trust Fund Forgemaster Iron, Inc - In Memory of Venetia Farmer ... Jerone & Wona Deverman Bill Donald William Drotning ...

My girl friend took

from Burr at the same time I was taking math stat.

Girl friend relationship got serious in 1962.

It still is in 2007.

PNM peak electricity viz.

PNM electric IRP viz

Us cats are on the move.

We, of course, deny that we are working with these cats.