New Mexico Administrative Code
Title 17 - PUBLIC UTILITIES AND UTILITY SERVICES
Chapter 9 - ELECTRIC SERVICES
Part 550 - FUEL AND PURCHASED POWER COST ADJUSTMENT CLAUSES FOR ELECTRIC UTILITIES
Section 17.9.550.12 - CALCULATION OF FUEL AND PURCHASED POWER COST ADJUSTMENT FACTOR; PURPOSE OF BALANCING ACCOUNT

A. Calculation of a factor shall be made using the methodology, required format and data calculations approved for the utility by the commission, and shall be submitted on commission-approved forms. A sample format is provided in 17.9.550.20 NMAC of this rule. A utility's methodology for calculation of its factor shall be proposed in its initial tariff filing or continuation filing pursuant to 17.9.550.16 and 17 NMAC of this rule. A methodology approved by the commission may be based on monthly, rolling average, or fixed period calculations. Where applicable, a utility's methodology shall take into consideration the utility's multi-state and jurisdictional operations and shall identify any allocation factors applied by the utility. Costs associated with an investor-owned utility's long term purchase power contracts with a term of two or more years may be recovered through the utility's FPPCAC if consistent with all commission orders or rules regarding such contracts or with commission approval.

B. Unless otherwise ordered by the commission the methodology for calculating a monthly-adjustable factor shall employ the use of a balancing account. The purpose of the balancing account is to insure that only the appropriate revenue is recovered through the application of the factor. The balancing account shall compensate for under-collections and over-collections of revenue by increasing or decreasing the factor for the next following billing month. A utility may make additional adjustments to the factor to mitigate the effect on customers of monthly changes in the balancing account, and the adjusted factor shall go into effect unless suspended by the commission. Additional amounts may be applied to the balancing account as the commission may authorize or direct. These additional items may include such amounts as refunds received by the utility or extraordinary payments by the utility, provided that these payments have received written approval of the commission prior to inclusion in the balancing account.