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Electric Operating Revenues
 9 Months Ended
Sep. 30, 2020
Revenue from Contract with Customer [Abstract]  
Electric Operating Revenues Electric Operating Revenues
PNMR is an investor-owned holding company with two regulated utilities providing electricity and electric services in New Mexico and Texas. PNMR’s electric utilities are PNM and TNMP.

Additional information concerning electric operating revenue is contained in Note 4 of the Notes to Consolidated Financial Statements in the 2019 Annual Reports on Form 10-K.

Accounts Receivable and Allowance for Credit Losses

Accounts receivable consists primarily of trade receivables from customers. In the normal course of business, credit is extended to customers on a short-term basis. The Company estimates the allowance for credit losses on trade receivables based on historical experience and estimated default rates. Accounts receivable balances are reviewed monthly, adjustments to the allowance for credit losses are made as necessary, and amounts that are deemed uncollectible are written off. On January 1, 2020, the Company adopted Accounting Standards Update 2016-13 – Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. As a result of the adoption of the new standard and economic conditions resulting from the COVID-19 pandemic, PNM updated its allowance for accounts receivable balances and recorded incremental credit losses of $2.0 million and $2.7 million in the three and nine months ended September 30, 2020. The NMPRC issued an order authorizing all public utilities to create a regulatory asset to defer incremental costs related to COVID-19, including increases in uncollectible accounts. See additional discussion of ASU 2016-13 in Note 7 and the related regulatory treatment in Note 12.
Disaggregation of Revenues

A disaggregation of revenues from contracts with customers by the type of customer is presented in the table below. The table also reflects alternative revenue program revenues ("ARP") and other revenues.
PNMTNMPPNMR Consolidated
Three Months Ended September 30, 2020(In thousands)
Electric Operating Revenues:
Contracts with customers:
Retail electric revenue
Residential$158,549 $53,114 $211,663 
Commercial125,414 31,077 156,491 
Industrial25,475 6,842 32,317 
Public authority7,982 1,468 9,450 
Economy energy service3,270 — 3,270 
Transmission17,463 19,845 37,308 
Miscellaneous3,697 924 4,621 
Total revenues from contracts with customers
341,850 113,270 455,120 
Alternative revenue programs(7,067)(5,309)(12,376)
Other electric operating revenues29,721 — 29,721 
Total Electric Operating Revenues
$364,504 $107,961 $472,465 
Nine Months Ended September 30, 2020
Electric Operating Revenues:
Contracts with customers:
Retail electric revenue
Residential$370,448 $122,315 $492,763 
Commercial305,127 87,868 392,995 
Industrial65,313 20,232 85,545 
Public authority17,236 4,311 21,547 
Economy energy service11,802 — 11,802 
Transmission45,727 58,095 103,822 
Miscellaneous10,106 2,597 12,703 
Total revenues from contracts with customers
825,759 295,418 1,121,177 
Alternative revenue programs(2,377)(5,107)(7,484)
Other electric operating revenues50,043 — 50,043 
Total Electric Operating Revenues
$873,425 $290,311 $1,163,736 
PNMTNMPPNMR Consolidated
Three Months Ended September 30, 2019(In thousands)
Electric Operating Revenues:
Contracts with customers:
Retail electric revenue
Residential$137,741 $50,718 $188,459 
Commercial121,702 31,042 152,744 
Industrial20,946 5,415 26,361 
Public authority6,140 1,440 7,580 
Economy energy service5,731 — 5,731 
Transmission16,068 17,384 33,452 
Miscellaneous3,465 881 4,346 
Total revenues from contracts with customers
311,793 106,880 418,673 
Alternative revenue programs(2,372)(4,407)(6,779)
Other electric operating revenues21,692 — 21,692 
Total Electric Operating Revenues
$331,113 $102,473 $433,586 
Nine Months Ended September 30, 2019
Electric Operating Revenues:
Contracts with customers:
Retail electric revenue
Residential$331,371 $114,791 $446,162 
Commercial305,903 86,529 392,432 
Industrial51,022 16,326 67,348 
Public authority15,447 4,204 19,651 
Economy energy service18,677 — 18,677 
Transmission43,794 48,972 92,766 
Miscellaneous9,581 2,670 12,251 
Total revenues from contracts with customers
775,795 273,492 1,049,287 
Alternative revenue programs(1,617)1,317 (300)
Other electric operating revenues64,471 — 64,471 
Total Electric Operating Revenues
$838,649 $274,809 $1,113,458 

Contract Balances

Performance obligations related to contracts with customers are typically satisfied when the energy is delivered and the customer or end-user utilizes the energy. Accounts receivable from customers represent amounts billed, including amounts under ARPs. For PNM, accounts receivable reflected on the Condensed Consolidated Balance Sheets, net of allowance for credit losses, includes $94.4 million at September 30, 2020 and $59.3 million at December 31, 2019 resulting from contracts with customers. All of TNMP’s accounts receivable results from contracts with customers.

Contract assets are an entity’s right to consideration in exchange for goods or services that the entity has transferred to a customer when that right is conditioned on something other than the passage of time (for example, the entity’s future performance). The Company has no contract assets as of September 30, 2020 or December 31, 2019. Contract liabilities arise when consideration is received in advance from a customer before satisfying the performance obligations. Therefore, revenue is deferred and not recognized until the obligation is satisfied. Under its OATT, PNM accepts upfront consideration for capacity reservations requested by transmission customers, which requires PNM to defer the customer’s transmission capacity rights for a specific period of time. PNM recognizes the revenue of these capacity reservations over the period it defers the customer's capacity rights. Other utilities pay PNM and TNMP in advance for the joint-use of their utility poles. These revenues are recognized over the period of time specified in the joint-use contract, typically for one calendar year. Deferred revenues on these arrangements are recorded as contract liabilities. PNMR's, PNM's, and TNMP's contract liabilities and
related revenues are insignificant for all periods presented. The Company has no other arrangements with remaining performance obligations to which a portion of the transaction price would be required to be allocated.