Docket No. APPLICATION OF TEXAS-NEW MEXICO POWER COMPANY. NOW COMES Texas-New Mexico Power Company ( TNMP or Company ),

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1 Docket No. APPLICATION OF TEXAS-NEW MEXICO POWER COMPANY FOR INTERIM UPDATE OF WHOLESALE TRANSMISSION RATES PURSUANT TO SUBSTANTIVE RULE (g)(1) BEFORE THE PUBLIC UTILITY COMMISSION OF TEXAS APPLICATION OF TEXAS-NEW MEXICO POWER COMPANY TO THE HONORABLE PUBLIC UTILITY COMMISSION: NOW COMES Texas-New Mexico Power Company ( TNMP or Company ), and files this, its Application of Texas-New Mexico Power Company For Interim Update of Wholesale Transmission Rates Pursuant to Substantive Rule (g)(1) ( Application ), respectfully showing the following: I. BACKGROUND AND AUTHORITY In this docket, TNMP seeks an interim revision to its previously approved transmission cost of service ( TCOS ) and wholesale rate pursuant to, and consistent with, the requirements of Public Utility Commission ( Commission or PUC ) Substantive Rule (g)(1) and the Filing Requirements for Interim Update of Wholesale Transmission Rates Pursuant to Substantive Rule (a)(1) 1 (the Interim TCOS Filing Package ). Commission Substantive Rule (g)(1) provides that [e]ach TSP in the ERCOT region may, on an annual basis, update its transmission rates to reflect changes in its invested capital. Proceedings pursuant to such rule are not intended to determine 1 Now P.U.C. SUBST. R (g)(1)

2 the reasonableness of the interim costs. 2 Rather, the rule provides that the Commission shall review whether the costs of transmission plant additions are reasonable and necessary at the next complete review of the TSP s transmission cost of service. 3 II. TNMP s FILING Together with this Application, TNMP has filed the Direct Testimony and Exhibits of Shauna Lovorn-Marriage, Direct Testimony of Evans Spanos, and the Interim TCOS Filing Package Schedules and Workpapers. As discussed in Section V below, TNMP s notice is attached as Exhibit A. III. COSTS INCLUDED IN TNMP s INTERIM TCOS UPDATE TNMP s Application compares the actual December 31, 2009 transmission net plant balances with the March 31, 2008 net plant balances established in PUC Docket No The difference between these two balances provides the increase in the rate base for TNMP in this Application. IV. RELIEF REQUESTED The requested increase in total rate base in this filing is $33,836,174, with a total revenue requirement increase of $5,503,396. TNMP further requests that the Commission approve an interim wholesale transmission rate of $ /kW, effective April 29, See Id. 3 See P.U.C. SUBST. R (g)(2)

3 V. NOTICE AND PROCESSING Commission Substantive Rule (g)(2) specifically removes from this proceeding any consideration or determination of whether the costs included in TNMP s Application are reasonable and necessary. Because such determinations are reserved for a later proceeding, the issues in this docket are very limited and should be processed expeditiously. Within one working day after the filing of this Application, TNMP will provide written notice pursuant to Commission Procedural Rule to all affected customers in the form attached as Exhibit A. Because this Application requests an interim revision to TNMP s wholesale transmission rate, the customers directly affected by such proposal are all of the distribution service providers who pay wholesale transmission charges pursuant to Commission Substantive Rule Therefore, TNMP will provide direct written notice to every distribution service provider listed in the matrix established by the Commission in Docket No , which established wholesale transmission charges for the year This approach is consistent with other recent dockets involving the establishment of, or revisions to, utility TCOS. Upon completion of the notice described above, TNMP will file an affidavit attesting to the provision of such notice within a reasonable time and by such date as may be established by the presiding officer. TNMP respectfully requests that the Commission docket this Application upon receipt hereof and issue an order establishing an appropriate intervention deadline and requiring Commission Staff to comment on the material sufficiency of the Application

4 The Commission has previously set intervention deadlines in interim TCOS update cases of approximately one month. 4 If no timely requests to intervene are filed, TNMP requests the Commission consider the following procedural schedule for this Application to be processed and approved informally pursuant to Commission Procedural Rule 22.35: Action Date No. of Days from Filing TNMP Application Filed Tuesday, March 2, 2010 Deadline for Intervention and Request for a Hearing Thursday, April 1, days If hearing is not requested, deadline for Staff s Final Tuesday, April 6, days Recommendation Proposed Finding of Facts Conclusion of Law filed Friday, April 9, days Proposed Order filed by ALJ Friday, April 15, days Deadline for final order, if no hearing requested Thursday, April 29, days In the alternative, and to the extent that the Commission determines such is necessary, TNMP requests the scheduling of a prehearing conference as soon as possible to address the processing of this docket. To the extent the relief requested herein is contested in a manner that would prevent the implementation of TNMP s request by April 29, 2010, TNMP respectfully requests an opportunity for hearing, pursuant to Commission Procedural Rule (c), to establish that good cause exists for the Commission to grant TNMP interim relief. In 4 See Application of AEP Texas Central Company for Interim Update of Wholesale Transmission Rates Pursuant to P.U.C. Subst. R (g)(1), Docket No , Order No. 2 (March 16, 2009) (setting intervention deadline at 30 days from the date the application was filed); Application of Oncor Electric Delivery Company LLC for Interim Update of Wholesale Transmission Rates Pursuant to Subst. R (g)(1), Docket No , Order No. 3 (March 24, 2008) (setting the intervention deadline at 34 days from the date the application was filed); Application of TXU Electric Delivery Company for Interim Update of Wholesale Transmission Rates Pursuant to P.U.C. Subst. R (g)(1), Docket No , Order No. 2 (March 14, 2007) (setting intervention deadline at 30 days from the date the application was filed)

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