Equity Method Investment

3 Months Ended

Mar. 31, 2021

Equity Method Investments and Joint Ventures [Abstract]

Equity Method InvestmentAs discussed in Note 1 of the Company's 2020 Annual Reports on Form 10-K, PNMR Development and AEP OnSite Partners created NMRD in September 2017 to pursue the acquisition, development, and ownership of renewable energy generation projects, primarily in the state of New Mexico. As of March 31, 2021, NMRD’s renewable energy capacity in operation was 135.1 MW. PNMR Development and AEP OnSite Partners each have a 50% ownership interest in NMRD. The

investment in NMRD is accounted for using the equity method of accounting because PNMR’s ownership interest results in significant influence, but not control, over NMRD and its operations.

In the three months ended March 31, 2021 and 2020, PNMR Development made cash contributions of zero and $10.0 million to NMRD to be used primarily for its construction activities. In February 2021, NMRD paid PNMR Development a dividend of $3.0 million of which, $2.4 million represents PNMR Development's cumulative equity in earnings of NMRD as of March 31, 2021 and is presented as cash flows from operating activities on the Condensed Consolidated Statement of Cash Flows. The portion of the dividend in excess of PNMR Development's cumulative equity in earnings of NMRD amounting to $0.6 million is presented as cash flows from investing activities.

PNMR presents its share of net earnings from NMRD in other income on the Condensed Consolidated Statements of Earnings. Summarized financial information for NMRD is as follows:


	Results of Operations
	Three Months Ended March 31,
	2021		2020
	(In thousands)
Operating revenues	$	2,750	$	1,667
Operating expenses	2,522		1,580
Net earnings	$	228	$	87


	Financial Position
	March 31,		December 31,
	2021		2020
	(In thousands)
Current assets	$	5,005	$	8,046
Net property, plant, and equipment	170,032		172,585
Non-current assets	2,133		1,900
Total assets	177,170		182,531
Current liabilities	1,249		841
Non-current liabilities	383		380
Owners’ equity	$	175,538	$	181,310