Asset Retirement Obligations

12 Months Ended

Dec. 31, 2017

Asset Retirement Obligation Disclosure [Abstract]

AROs are recorded based on studies to estimate the amount and timing of future ARO expenditures and reflect underlying assumptions, such as discount rates, estimates of the future costs for decommissioning, and the timing of the removal activities to be performed. Approximately 80% of PNM’s total ARO liabilities is related to nuclear decommissioning of PVNGS. PNM is responsible for all decommissioning obligations related to its entire interest in PVNGS, including portions under lease both during and after termination of the leases. Studies of the decommissioning costs of PVNGS, as well as SJGS and Four Corners are performed periodically and revisions to the ARO liabilities are recorded. Changes in the assumptions underlying the calculations may also require revisions to the estimated AROs when identified. A reconciliation of the ARO liabilities is as follows:



	PNMR			PNM			TNMP
	(In thousands)
Liability at December 31, 2014	$	104,170		$	103,182		$	848
Liabilities incurred	—			—			—
Liabilities settled	(730		)	(506		)	(224		)
Accretion expense	8,625			8,543			71
Revisions to estimated cash flows	(170		)	(170		)	—
Liability at December 31, 2015	111,895			111,049			695
Liabilities incurred	—			—			—
Liabilities settled	(14		)	(14		)	—
Accretion expense	9,170			9,098			59
Revisions to estimated cash flows	6,468			6,468			—
Liability at December 31, 2016	127,519			126,601			754
Liabilities incurred⁽¹⁾	1,854			1,853			—
Liabilities settled	(968		)	(944		)	(24		)
Accretion expense	10,680			10,603			63
Revisions to estimated cash flows	7,594			7,594			—
Liability at December 31, 2017	$	146,679		$	145,707		$	793

⁽¹⁾ Represents the obligation related to the additional ownership interest in SJGS Unit 4 that PNM acquired on December 31, 2017 due to the restructuring of the ownership of SJGS.