Good morning and welcome to the PNM Resources Third Quarter Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Jimmie Blotter, Director of Investor Relations. Please go ahead.

Thank you, Danielle. And thank everyone for joining us this morning for the PNM Resources third quarter 2016 earnings conference call. Please note there is a presentation for this conference call and other supporting documents are available on our Web site at, pnmresources.com. Joining me today are PNM Resources Chairman, President and CEO Pat Vincent-Collawn and Charles Eldred, our Executive Vice President and Chief Financial Officer as well as several other members of our executive management team. Before I turn the call over to Pat, I need to remind you that some of the information provided this morning should be considered forward-looking statements pursuant to the private securities litigation Reform Act of 1995. We caution you that all of the forward-looking statements are based upon current expectations and estimates and that PNM Resources assumes know obligation to update this information. For a detailed discussion of factors affecting PNM Resources results, please refer to our current and future Annual Reports on Form 10-K, quarterly reports on Form 10-Q as well as reports on Form 8-K filed with the SEC. And with that I will turn the call over to Pat.

Thank you, Jimmy. Good morning everyone. Happy three days before Halloween. Thank you all for joining us this morning to discuss the company's third quarter results. We will begin on Slide 4. Third quarter earnings per diluted share were $0.68 on a GAAP basis including write-downs associated with the final rate case order at PNM. Ongoing earnings per diluted share were $0.78 for the third quarter of 2016 up slightly from $0.76 in the third quarter of 2015. We continue to affirm our 2016 consolidated ongoing earnings guidance of $1.55 to $1.65. After 30 months the general rate case at PNM resulted in a final order on September 28 granting a non-fuel revenue increase of $61.2 million. While the order represents an improvement over the hearing examiners recommended decision in the case it only represents about half of our 121.5 million requests and does not provide full recovery of all of the investments we have made in our system. On September 30, we filed a notice of appeal with the New Mexico Supreme Court and this past Wednesday we filed our statement of issues outlining how we believe the commission misapplied the law and facts with regard to our investments in Palo Verde and the Pollution Control Technology at the San Juan generating station. While some recovery is approved in the rate increase for the 64 MW of Palo Verde unit two purchase capacity and the half-price extended lease payments both the purchase and extensions were deemed imprudent in the final order. This determination on prudence was used to disallow the fair market value price and limit recovery to know more than the estimated net book value of the 64 MW to disallow the undepreciated value of past resold improvements associated with the 64 MW and shift the future responsibility…

Thank you, Pat and good morning everyone. Beginning on Slide number 6, we're beginning to see slight traction in the economic developments efforts that Pat talked about. PNM’s residential weather normalized load was up 0.2% for the quarter and commercial continues to show strength with an increase of 1.8%. The strength in this segment is spread across various sectors and represents small business growth in our service territory particularly the Albuquerque Metro area. This sector is responsible for the employment growth in Albuquerque, which was 1.2% on a rolling 12-month average. Industrial, however, was down 12.1% compared to third quarter 2015 and down 8.9% year-to-date. This brings total weather normalized load at PNM down 0.4% compared to the third quarter of 2015 and down 0.6% year-to-date, which is in line with our guidance for the year of flat to down 2%. We continue to experience customer growth at 0.7%. TNMP continues to perform well. The volumetric load was up 3.7% in third quarter this year compared to last year it is up 3% on a year-to-date basis. This is at the upper end of our guidance range of 2% to 3% growth for 2016. Demand-based load also continues to show strength at 4.2% for the third quarter and 2.9% on a year-to-date basis. We continue to see growth in TNMP service territory driven by employment growth in the diverse Houston and Dallas economies and the continued customer growth in the Permian Basin and West Texas. For example in TNMP South Houston area end user growth year-over-year has been 2.5% year-to-date, in North Texas 1.6% year-to-date and in West Texas 1.9% year-to-date. Other areas of our service territory continue to see end user growth around 1%, which brings the total growth to 1.5% compared to the forecast of 1% growth Now,…

Thanks Chuck. Before I conclude the call today, I would like to draw your attention to the new sustainability portal that we have added to pnmresources.com. We operate PNM Resources in an ethical open and transparent manner and have created the sustainability portal to give our stakeholders information about these activities. The information provided here will be updated on a regular basis and is categorized by environmental, economic, social and governance information. I strongly encourage you to visit the site and learn about all of the great work that we do at PNM Resources to ensure that we are providing for a sustainable future. As we wrap up the call today, we certainly continue to have a full plate of regulatory activities in New Mexico between the Supreme Court appeal; the integrated resource plan process; and our upcoming general rate case filing. It’s a testament to both the ability and the dedication of our employees as we move straight into these items from a lengthy rate case proceeding and it’s also a testament to the hundreds of employees that continue to provide reliable electricity and excellent customer service to our customers in both New Mexico and Texas. PNM set another all-time high for overall customer satisfaction in the latest JD Power residential customer satisfaction survey. It is encouraging to see that our focus in this area has not gone unnoticed by our customers. And our crews in Texas, with [indiscernible] in October traveling to aid in hurricane Matthew restoration efforts, I would like to thank them for doing such great work with no injuries. This type of work is a true reflection of our company and our industries value. Thank you, again, for joining us today. Operator let's now open it up for questions.

[Operator Instructions] The first question comes from Insoo Kim of RBC Capital Markets. Please go ahead.

Good morning, guys.

Good morning, Kim.

Good morning.

Just regarding the plan to withdraw the middle peaker CCN proposal. I guess, in your analysis, has the future potential build-out of renewables and the potential need for backup generation also been accounted on this decision?

Insoo the decision is really primarily driven at this point where the demand forecast being slightly under what we projected and the other factors that go into this is cost and the actual reliability of the system, which is important when you are beginning to add renewables in the system of making sure that we can maintain that reliability with more renewables to the system. So, in our analysis that are preliminary at this point, we felt it was prudent to recognize that the demand forecast is falling slightly off or we originally projected, basically this means the peaking is continue to grow, but not at the pace that we anticipated so we need about 20 MW in those years that we thought we would need to have the additional peaking capacity and we can do that from just purchases in the market and then we see the growth in that peaking going into 2019 and 2020, and of course, if there is additional data centers or other components that could be considered at some point in time that could certainly accelerate that. But, at this point we think it is better to be conservative relative to where we are today, what we see in the forecast and the fact that we think we can solve less than 40 megawatts of peaking capacity through purchases in the market. So we just push that capital into 2019 to 2020 at 40 MW peaker.

Remember Insoo the next jump in that renewal portfolio comes in 2020, when we go up to 20% by 2020 so that is when we have that need and as Chuck said if we get some more data centers we can obviously accelerate that peaker.

Understood. I do not know if I missed this earlier, but what are some of the items that when into the additional CapEx -- PNM as well as TNMP.

Yes. There's a number, TNMP certainly we continue to invest in the transition component of the business but also we are seeing growth in the distribution side. So we're just seeing opportunities given the growth that we can continue to invest more to allocate capital to meet that continued above average growth. In New Mexico, we continue to see some opportunities really on the transmission side as we begin to see more renewables being built in our service territory around in the territory in New Mexico and also in the distribution side and mainly in substations and reliability aspects of our system. So, we have had pipeline projects in anticipation of what would be an update when the time came to reallocate the capital to both businesses and we have just completed that analysis and as a result of that we're reflecting that of a new capital plan to be more current on what we see in the next several years to 2019 and 2020.

Understood. And just lastly turning to the earnings power slide given the implementation of the future tester and a part of that was applied in the recent rate case and the full future tester that is going to be implemented in the up coming rate case. How much do think that will help in reducing regulatory lag in New Mexico and allow you to earn close to that 9.75 that is allowed level.

Yes. For 2017, obviously, didn’t get the four tester this rate increase went in October 1, so you will start to see some regulatory lag in 2017 just by additional capital investment in depreciation that gets cleared with projects that clear in 2017, but you are probably still in that 30 basis points range within the 9.575% return, so it’s still an attractive earnings expectation but you can’t get to the allowed return and given the fact that you will have some additional capital and depreciation that will be picked up in 2017. Then in 2018, would be a full for test year, we look in 2018 to begin to earn our live return based on that being a true for test year.

Got it. Thank you very much.

Thank you, Insoo.

The next question comes from Ali Agha of SunTrust. Please go ahead.

Thank you. Good morning.

Good morning, Ali.

Hi, Ali.

Good morning. First question, Pat or Chuck, given the experience you had going through this current rate case and the kind of pushback on issues that you would have assumed were pretty settled how does that influence your thinking as you file the next one in December, does that change much in terms of how you're thinking about that having gone through this one?

Ali, if you look at the last case in this upcoming case, they are really kind of different animals, the pushback in this current case was really around what value and was it prudent to buy Palo Verde and then the balanced draft. This next case what is going in is what’s agreed-upon in the BART settlement is the majority case obviously there's some catch-up TNMP. But in those items were already agreed on, the values have been set for those and we had everybody with a signatory to the case other than one party. So you've got an agreed-upon value for all of those and so the only discussion around those really should be around what the ROE, obviously no commission can bind a future commission but again since everybody signed onto it all of the interveners will have to support that.

And roughly, I know the filing comes in December, but just to give a some perspective, what kind of a rough rate increase would be embedded in this next filing?

December, December -- when the rate case comes out, we will go over that with you.

Okay. And then, I know I believe a couple of seats are up for election in November. What is your read on what comes out of that and does that in any way in your mind change the tone of the composition of the commission?

The two future already decided as both candidates are running unopposed. Nora Espinoza up in Santa Fe ran unopposed and so she would be the Commissioner. Cynthia Hall here in Bernalillo County beat Karen Montoya in her primary, she is running unopposed, so she will also be the Commissioner. Hard to tell where they are going to be. I think we are going to continue to have discussions and the main questions are going to be what is the future of our generation portfolio look like and as Chuck mentioned we are doing that integrated resource plan with the two separate scenarios and I think that will help sort of set the tone for the commission discussion more than anything else.

Okay. But you would take Commissioner Hall -- future Commissioner Hall wouldn't be much of a change from what we have been seeing so far?

Hard to tell. They are very careful when they campaign not to say anything because of the fact that it can get them taken off the cases, so it will be hard to call. Again, I think a lot of what’s going to set the tone is what the generation portfolio is going to be because if you look out what the discussion is at the commission it is all around coal and nuclear. It is not around PND.

Last question, looking at the overall load picture in New Mexico, are you getting any signs to suggest that we may be close to a bottom, we have been still seeing this negative year-over-year comparisons, I guess industrial was the big driver this quarter but any sign that you can point to that tells you we may have bottomed out here?

Ali as Pat pointed out there's a lot of economic development activity that is occurring and certainly some successes that we are seeing, but it still takes time for that to be reflected and incorporated into a more solid trend in our load growth. And we still see a decline on the industrial side, but since the customer growth although it being slightly above average with energy efficiency and renewables would still kind of offset any kind benefit we get from customer growth. So if you net all of that against these slight declining on the industrial side probably still feel like there is a slight trend downward. Maybe not as aggressive as much as 2% as we have seen in the last year and this year's guidance but certainly a slight negative into 2017 just to be reflective of what we see today.

I see. And just to clarify Chuck I think I heard you right, but did you say that given the test year issues, you think about a 30 basis point lag is probably what will happen in 2017?

I think that’s a reasonable expectation. You are going to see some lag off of the 9.575, so I think recently considering we haven't provided guidance in 2017, but I think that’s probably fair just as a perspective as how we see some regulatory lag going into 2017 around 30 basis points, probably an area to think about.

Got it. Thank you.

Thank you, Ali.

The next question comes from Anthony Crowdell of Jefferies. Please go ahead.

Good morning. First question I have is on the Slide 9 depreciation any chance you could break that out for us -- help us to separate this for PSNM and TNMP?

Yes. Anthony I think it would be better just to call Jimmy or I will have Jimmie call you and she will work that through with you.

Okay. Also when I look in 2017 and 2018 , the PSNM, how much revenue each year do you get from the writers or for expanding like there should be a some rate increase in there that are not related to NMP or rate increases, what’s a reasonable estimate to assume you get each year?

Actually Anthony, if you look at Slide 10, you can see the renewable writer and you can see FERC.

Right, but there is some lag you mentioned, there is some lag there. So, have you provided any guidance on what type of revenue you get each year?

Well, you can calculate this, but on the FERC side, we talk about 7% to 9%, roughly 8% is probably a reasonable assumption given the fact you are filing on a historical basis. And obviously, get a decline in the rate base for the renewables just the depreciation of the assets that we have. We can break it down for you that would help you, but Jimmie can do that for you and give you some detail.

Lastly, I just want to make sure I am understanding all the peaker math. But, when I look at, so first, I think when you guys are on the road in October, or maybe September, you had mentioned the key elements of the next filing involved 80 MW gas peaker that’s lower to 40 MW, but that’s 40 MW is going to be in the next rate filing?

Actually a pick up in 2020 if we file a rate case because if we start spending that in 2019 and finish and clear that peaker in 2020, so if we file for 2020 rate case that is when it would be picked up.

Okay. So it’s not going to be part of the filing in December and that is also the difference between the previous CapEx slide of TNM generation in 18 of 168 not a 112 that is the loss of the peaker?

Yes. For the most part, it’s -- the loss of the peaker than we would reallocate with some capital both amongst the businesses and it is a net increase in PNM, but it’s a slight amount but it still covers the fact that we have moved the capital to 2019 and 2020, we picked up a little bit for PNM in 2017 and the slight decrease in 2018 in a more significant pickup in infrastructure investment and the peaker that we will start building in 2019. So again and that's out to be overall a slight increase, and overall capital including PNM but a shifting of that capital to be more on the backend instead of the front-end that we had originally projected.

And we have been studying Anthony. We've been studying a lot of capital and generation and so the transmission and distribution folks have a lot of projects that they would like to do here in New Mexico and in Texas it continues to grow so there is opportunities for capital over there.

If I think of its -- just last question, if I think about the bumps that have gone on in the regulatory process for some time and also now with load growth looks like it's pretty anemic. It seems like getting generation built or generation in rates in New Mexico has clearly been the biggest challenge or maybe it is just fossil and nuclear generation rates. And also just not even looking at that and with the peaker going just PPA and just looking to maybe type of utility scale, solar or something else to meet the needs?

Yes. When we look at that integrated resource plan, we will be able to look at what new sources make sense and is the utility scale solar and actually in the San Juan replacement case when you just let the models run on their own. They did pick megawatts of utility scale solar. So we will continue to look at that. We will look at PPA's where they makes sense but one of the things we found is that, we tend to operate our plants better and we know how the maintenance is done and a permitting is done. So if there is gas plants we tend to like to own them and the same with peakers. So we will look at them. But, I think Anthony, it’s mostly about coal and nuclear and if you think about and just step back from New Mexico that is where the national discussion and quite frankly the international discussion in certain countries is on coal and nuclear and I think what you see here is just a reflection of that broader conversation about what kind of generation this country should have.

And I will to add to that Anthony, when you get to that 40 MW peaker, you really need the technology for quick start and you cannot really dissolve that through PPA. So what we're indicating is that, we can use the PPA's when we are under 40 MW and balance the system but when it comes to uncertainty of that peak hitting that 40 MW requirement, we need to have the quick start capability to build the reliability in the system.

And is it linear previously I think the 80 MW peaker was roughly 80 million is it 40 million for this peaker?

Roughly, that’s about right. Yeah.

Great. Thanks for taking my questions.

Okay.

Welcome.

The next question comes from Lasan Johong of Auvila Research Consulting. Please go ahead.

Good morning. Thanks for taking my questions.

Good morning, Lasan.

How are you?

Good.

Okay. So, I wanted to follow up on these excellent question, I understand 2018 is mostly the BART agreement coming to place, so there's not a lot of maneuvering little more changes, but how do you -- given the final decision on the commission, is that kind of shake your confidence about spending money going forward without getting prior approval?

Not really because I think if you look at what the commission did not like it was Palo Verde and it was balanced draft. And if you look at this next case as we mentioned all but one party signed on to this agreement.

But beyond this first, beyond this on the 2018 rate case, I’m talking about longer term for 2019 and 2020 and beyond. And did that kind of give you pause?

Well, if you look at generation, we always get a CCN before we would spend money on a power plant and we will continue with that or we get it approved through renewable writer. So we will continue on with that. And the T&D spending is not where there has been much pushback on, so either generation spending goes down and see if they are going to build there, if you are going to build the peaker for example, we got peaker, we will have to get a CCN before hand. So that gives you that assurance obviously what was different in this case that we have taken to the Supreme Court is that we have CCN's and that was challenged so.

Agreed. Okay. So going back to the peaker situation, things change somewhat differently if you have San Juan coming back after June of 2022 or not coming back after June of 2022 or are you going to just wait until you have more stability on that before you make any decisions on additional generation.

Yes. That is the great part about this integrated resource plan process that we're going through, it’s a public participatory process and as Chuck mentioned we will run the two scenarios one with San Juan and one without San Juan. So that will give us clarity on under either scenario what our generation needs and mix looks like going forward. So, you won’t see us proposing a lot of new generation until we have that plant and because obviously our needs would be very different if the commission decides that we should shut down San Juan for example.

So, if you shut down San Juan, could the 40 MW peaker turned into an 80 MW CCGT?

It’s a different scenario.

Look at this way, if you shut down San Juan you'd be shutting down 500 MW of power. And so, 500 MW is going to be a combination of baseload, peaking capacity, renewables, whatever that combination replacement power would be, it’s going to be a different set of capital investments towards a generation over the next 20 years that would accommodate the fact you are shutting that 500 MW down. So the peaker is really more reflective how the demand forecast on the system occurs over the next few years and the potential addition of renewables in the system i.e. more data centers if that would come about in order to balance the system in a cost effective way. Shutting down San Juan is a much different set of circumstances to determine the replacement power of the 500 MW, which would begin with the accommodation of a lot of different resources to meet that requirement.

Chuck I understand that. But my point is, given that you already have a plan in place for your 40 megawatt, could that be upside to accommodate part of the baseload equation that you were just talking about? And then you do something else with the peaker and the renewables?

Yes. You could have a larger gas unit but again the difference in how the system needs to balance itself, the peaking capacity being more for quick start as opposed to larger intermediate gas type plants. So, it’s a combination of both and that’s what the integrator resources plan is intended to do is to take all the variables in consideration lay out the next resource requirements over 20 years making a necessary adjustments into how we look at that load requirement in the future with different generation mixes the 40 MW peaker right now would be more isolated in our view towards what the peak demand forecast would be in the system. Not so much of the replacement of San Juan.

I see. Any preference which way you want to go shutting down San Juan or not shutting down San Juan?

We will let the numbers speak.

Good question. You make me want to do my trump impersonation but I won’t do that.

No.

I’m getting close. Okay. I’m being held back.

Thank you very much.

Okay.

The next question comes from Paul Patterson of Glenrock Associates. Please go ahead.

Good morning.

Good morning, Paul.

Actually would like to hear the Trump impersonation, if it is okay.

Paul, the problem is, if he does that I have got a big can of hairspray here and I will aim it at him.

But, I have a sign that here this is such a nasty woman.

Okay. All of my questions have been answered, but just the smart [indiscernible] thing, I know it’s been suspended, I think what’s the outlook for that? I do not think it is in your plan but is that just off the table for now or how should we think about that?

We are still looking at that. Talking with folks that are part of the case we would obviously still like to do that, it is a little tough cell right now given the economy in New Mexico because obviously one of the things that AMI does is, over time it will eliminate meter reading jobs but we're still working on that one.

Okay. And then, the sales forecast for the next three years, I apologize what is it that you guys are projecting weather adjusted?

Well, we didn’t show a forecast over the next year, we just said that year-over-year we continue to see a slight decline driven more like -- more from the industrial side. Some benefit on the commercial residential side, but again even though we have a slight improvement in customer growth it is not enough to offset the impact of energy efficiency in some accommodation of growth in the solar residential solar. So, again, that would pretty much put it on a flat year-over-year basis and then slight decline because of the industrial load. So maybe not as much as we had this year in the guidance, which was zero to minus 2, but maybe along the lines of a 1% reduction year-over-year. So again slight decline, it’s going to take a while for some of the benefits of the economic development activity that Pat alluded to in her earlier comments. We're making progress, things are beginning to show some slight improvement in tracking to that expectation, but just too early to pick that up into the forecast and know exactly when that will transform into some real benefit there.

How should we think about next year or the year after that, I mean was leap year in this number by the way?

Pardon me. What did you say? I'm sorry.

Leap year was that in this 6.6 decrease that you guys have here?

It is adjusted for leap year. Again, I would say to be reasonable based right now probably -1% in the area of that range year-over-year.

Okay. And then, I think that’s all my questions actually.

Thanks Paul.

Thank you.

The next question comes from Chris Ellinghaus of Williams Capital. Please go ahead.

Hey, good morning, guys.

Good morning, Chris.

Can you just clarify, I wasn’t sure on the load growth expectation in the earnings power does that sort of slight decline cover all three years?

The earnings power slide is just rate based math. So it’s just taken the rate base and the ROE, so there's really no load upside or downside built into that.

Okay. So does not consider load at all?

No, no. We tried to do that when we do the guidance, but the earnings potential shows you what the potential earnings obviously of the business is from a rate base perspective. There's a few baskets of cost in there that we provide to you that a lot of moving variables that we try to give you some perspective on that. And then, once we tighten up guidance and we take everything else into consideration, O&M, cost controls, load et cetera.

Can you give us a little color on the industrial weakness where it’s coming from and why you think that might continue?

We don't have a strong industrial base as it is. We are around 12% for and the most utilities, so there is a larger customer here in New Mexico in the Albuquerque area that tends to be slowing down the operations mainly because of some of the obsolescence of their technology. So the [best] [ph] that we know provide that publicly, but it wouldn't take too much to figure out who is in Albuquerque to understand who that customer might be and they are global and nationally recognized.

Right. I think we all know who that is,

So, I am just being very careful although I could do my Trump impersonation right now. Really got this going but I won't do it. That is really what is driving it. There's a little bit of other variables on some cogeneration and dealing with New Mexico, things like that but again it’s really driven by that customer.

Is that really that one singular entity?

That’s the driver. In all honestly that’s the driver.

Okay. Pat in light of the rate case and certainly the continuing long-duration of rate cases have you got any thought about a legislative effort to maybe try to get some relief on that?

You can only ask for so much at a legislature and the fact that we now have a fully forecasted test year. We got that and we're going to stick with that. We are filing 13 months ahead of the time we need rates so the commission can have the entire time that they are allowed if they choose to do that. The last rate case was obviously a bit of an anomaly because of the fact that they set our filing wasn’t complete and that we have used the wrong test year and two things have changed since then. One is, we have a ruling from the commission that the test year that we believe -- we and SPS believe it’s appropriate, is appropriate, secondly, we have worked out all the filing requirements with the staff. So, I think that our legislative agenda on that probably would not look to shorten that timeframe.

Okay. And then, one last question about the San Juan process in determining what happens in 2022, can you go through how that determination is going to be made and what sort of lead time you are going to get to make decisions in terms of replacement?

If you look at the process, the integrated resource plan process, it started this year. It is a year long process. So it goes into the middle of next year and then we will present an integrated resource plan to the commission. In New Mexico IRP's are not formally approved by the commission. They are accepted and consistency with that integrated resource plan, if you put generation and constitute, prima fascia evidence of that type of resource, but you still would get a CCN. But we also agreed as part of the BART settlement that we would present a plan to the commission one with San Juan and one without San Juan and all of the signatories to the -- said they would support having a decision and the commission will make a decision on that in six months, probably in 2018. So there is a lot of lead-time there at 2018 and right now San Juan coal contract goes all the way to 2022. So lots of lead time, long answer to that question, but.

Okay, great. Thanks for the color. We will see it a little bit.

Okay.

Thank you.

The next question comes from John Barta of KeyBanc. Please go ahead.

Hey, good morning, everyone. And can you hear me all right?

Yes, John. Good morning.

Sorry, if I missed this, but on the peaker, are you completely withdrawing or just revising it to the 40, CCN.

No. We're withdrawing the peaker completely. And then, as I mentioned, we are looking at an updated forecast on the demand side that is included in this IRP process that Pat has alluded to. But, currently our preliminary analysis which showed the 80 MW peaker would adjust itself to about a 40 MW requirement that would begin to build out in 2019 and 2020.

Okay. And then, on the IRP you said 2017. Do you have any timing first or back half of the year?

It is July of 2017, it will be done.

And then, I guess lastly, are you aware that the commission is taking on an initiative or if they're looking at any potential workshops on better understanding some of the current rate design issues that are out there?

They are not. They’re looking at some workshops possibly on that metering but nothing on the rest of rate design. We tend to handle that here in New Mexico through our rate cases. So for example in the last case we -- bumped our fixed charge up a little bit and we were able to eliminate some of the residential subsidies and keep the large commercial and industrial customers much more harmless than before. So we deal with them sort of individually through our rate cases here in New Mexico.

All right. That’s all. Thank you.

Thank you.

This concludes our question-and-answer session. I would now like to turn the call back over to CEO, Pat Vincent-Collawn, for closing remarks.

Again, thank you all for joining us on this beautiful morning. I hope you all have a safe and Happy Halloween. And you get all the kind of candy that you want. And we look forward to seeking many of you at EEI in a couple of weeks. Have a great weekend.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.