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TRANSCRIPT
Investor Meetings
March 2019
Safe Harbor StatementThis presentation includes statements that are forward-looking statements made pursuant to the safe harbor provisions of the Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding 2019 earnings guidance (including the
anticipated impact of ASU 2016-01); statements regarding the impact of the Tax Cuts and Jobs Act of 2017 (the “TCJA”); statements regarding current regulatory
filings and anticipated regulatory filings; statements regarding expected capital expenditures; statements regarding expected dividends; and statements regarding
the adequacy of our liquidity to meet cash requirements. This information may involve risks and uncertainties that could cause actual results to differ materially from
such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those expressed in forward-
looking statements is contained in El Paso Electric Company’s (“EE” or the “Company”) most recently filed periodic reports and in other filings made by EE with the
U.S. Securities and Exchange Commission (the "SEC"), and include, but is not limited to:
➢ The impact of the TCJA and other U.S. tax reform legislation
➢ Increased prices for fuel and purchased power and the possibility that regulators may not permit EE to pass through all such increased costs to customers or
to recover previously incurred fuel costs in rates
➢ Full and timely recovery of capital investments and operating costs through rates in Texas and New Mexico, and at the Federal Energy Regulatory
Commission (“FERC”)
➢ Uncertainties and instability in the general economy and the resulting impact on EE’s sales and profitability
➢ Changes in customers’ demand for electricity as a result of energy efficiency initiatives and emerging competing services and technologies, including
distributed generation
➢ Unanticipated increased costs associated with scheduled and unscheduled outages of generating plant
➢ Unanticipated maintenance, repair, or replacement costs for generation, transmission, or distribution facilities and the recovery of proceeds from insurance
policies providing coverage for such costs
➢ The size of our construction program, the receipt of necessary permits and approvals and our ability to complete construction on budget and on time
➢ Potential delays in our construction and resource contracting schedule due to legal challenges or other reasons
➢ Costs at Palo Verde
➢ Decisions and actions of the Company’s regulators and the resulting impact on EE’s cost of capital, sales, and profitability
➢ Deregulation and competition in the electric utility industry
➢ Possible increased costs of compliance with environmental or other laws, regulations and policies
➢ Possible income tax and interest payments as a result of audit adjustments proposed by the Internal Revenue Service or state taxing authorities
➢ Uncertainties and instability in the financial markets and the resulting impact on EE’s ability to access the capital and credit markets
➢ Actions by credit rating agencies
➢ Possible physical or cyber-attacks, intrusions or other catastrophic events
➢ The U.S. Government shutdown and the resulting impact on EE’s sales and profitability
➢ Other factors of which we are currently unaware or deem immaterial
EE’s filings are available from the SEC or may be obtained through EE’s website, http://www.epelectric.com. Any such forward-looking statement is qualified by
reference to these risks and factors. EE cautions that these risks and factors are not exclusive. Management cautions against putting undue reliance on forward-
looking statements or projecting any future results based on such statements or present or prior earnings levels. Forward-looking statements speak only as of the
date of this presentation, and EE does not undertake to update any forward-looking statement contained herein.
2
3
El Paso Electric Company Overview
LISTED
Traditional, vertically integrated electric utility
serving west Texas and southern New Mexico
Consistently increasing customer, MWH sales,
and load growth
Sizeable capital expenditure plan and resulting
rate base growth for next several years
Focus on credit quality and capital structure
Favorable environmental profile – low carbon
footprint
Enhanced regulatory mechanisms in Texas
EE
NYSE
4
Service Territory
➢ Approximately 425,000 retail
customers
➢ Service territory larger than the
state of New Jersey
➢ Clean dependable generating
capability 2,085 MW
➢ 30% nuclear
➢ 70% natural gas
➢ < 1% renewables
➢ EE owns 1,848 miles of transmission lines
➢ Interconnected with WECC (not ERCOT) and Mexico
➢ Texas jurisdiction represents ~ 80% of non-fuel base revenues
➢ Fuel “pass-through” in Texas and New Mexico jurisdictions
5
CAGR
2.83%
➢ Native system peak has increased by 65% since 1998
➢ EE has set 16 new peaks since 1998
800
1,000
1,200
1,400
1,600
1,800
2,000
1,167 1,1591,1591,199
1,2821,308 1,332
1,3761,428
1,5081,5241,571
1,6161,714
1,6881,7501,766 1,794
1,8921,935 1,929MW’s
Native System Peak Load Growth
6
Annual Historical MWH Sales
5,000
6,000
7,000
8,000
MWH’s
➢ MWH retail sales continue to trend upwards
➢ EE has set a new record for MWH sales in 19 out of the last 20
years
➢ MWH retail sales have grown by approximately 40% since 1998
(000s)CAGR
1.58%
Customer & Population Growth
100,000
300,000
500,000
700,000
900,000
1,100,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
EP & Doña Ana Pop 953,431 970,785 992,160 1,009,8 1,032,9 1,046,2 1,046,5 1,049,6 1,049,8 1,052,1 1,055,9
EE EOP Res Customers 317,091 322,618 328,553 334,729 339,860 345,567 349,629 353,885 358,819 363,987 370,054
El Paso County & Doña Ana County Population
& EE Residential Customer Growth
EP & Doña Ana Pop EE EOP Res CustomersSource: U.S. Census Bureau
* End of Period (EOP); Residential (Res)
CAGR
1.03%
CAGR
1.60%
*
7
8
Residential Customer Growth
230,000
250,000
270,000
290,000
310,000
330,000
350,000
370,000
390,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Average Number of Residential
Customers
➢ Refrigerated air conditioning is being installed in 99% of new homes
➢ Majority of customers within our service territory utilize evaporative coolers
➢ Refrigerated air conditioning uses 85% less water and three times more electricity than evaporative coolers
➢ Usage per customer impacted by increased energy efficiency and conservation initiatives
10 Year CAGR (2006-2016) – Avg. No.
Residential Customers
EE Industry*
Usage per Customer 1.24% -0.34%
Customer Growth 1.62% 0.86%
* Source EEI-2017 Statistical Yearbook for the years 2006-2016
CAGR
1.57%
9
Retail Revenue and Sales Distribution
Residential C&I Small C&I Large Public Authorities
12 ME December 31, 2018 12 ME December 31, 2018
48%
31%
6%
15%
Non-Fuel Base Revenue Mix
37%
30%
13%
19%
MWH Sales
* Month Ended (ME); Commercial & Industrial (C&I)
* *
10
Economic Growth
➢ El Paso based Hunt
Companies 18-story $85
million downtown office
tower now under
construction
➢ Texas Department of Transportation improvement
projects totaling $1.4 billion
➢ El Paso’s economy is strong and growing
➢ El Paso’s unemployment rate is the lowest in 30 years(1)
➢ Major drivers of El Paso’s economy include:
➢ Over $400 million in downtown construction and
revitalization projects, including a doubling of
hotel rooms year-end 2018 over 2015 levels
(1) Source: Texas Workforce Commission
data for the period ending December 31, 2018.
11
Workforce and Rankings
Highest college student population by
workforce per capita of any border region (1)
10th Largest exporting city in the United States (2)
Largest bilingual workforce in the western
hemisphere (1)
Voted one of the News & World Reports 2017
Best Places to live in the U.S. for Quality of Life (2)
One of the largest international markets in
North America (1)
Population: 2.4 million *
Second largest international manufacturing
employment center on the U.S-Mexico border (1)
The Borderplex
3 States - 2 Nations - 1 Economy
Workforce Metrics Accolades & Rankings
#1 Lowest Crime Rate in the U.S. for a
population of 500,000 or more (2)
Young and Growing Population Median
Age: 31 (2)
* Approximately 1 million reside in EE’s service territory
Sources: (1) Borderplex Alliance (2) City of El Paso
Sector Specific Competitive Assets
Defense and Aerospace
▪ Largest U.S. Contiguous Military
Installation
▪ Largest U.S Open-Air Land Test Range
▪ Largest U.S. Contiguous Airspace
▪ First All Drone Army Airport
▪ Extensive Runways
Medical & Life Sciences
▪ Woody L. Hunt School of Dental
Medicine (Announced September 6,
2016)
▪ Paul Foster School of Medicine
▪ Burrell College of Osteopathic
Medicine in Las Cruces
▪ The Hospitals at Providence
Transmountain Campus
▪ Gayle Greve Hunt School of Nursing
▪ Cardwell Collaborative Medical
Research Facility
▪ UTEP Graduate School of
Biomedical Sciences
▪ El Paso Children’s Hospital
Advanced Manufacturing & Logistics
▪ Well Established Manufacturing Hub
▪ Six International Ports of Entry
▪ El Paso International Airport
▪ Growing Cross Border Trade Volume
▪ Union Pacific Intermodal Rail Yard
▪ Foreign Trade Zone
12
13
Smart Community Initiatives
➢ Engaging regional stakeholders on smart community
initiatives, including the possibility of investing in Advanced
Metering Infrastructure (AMI)
➢ Initiatives will help:
➢ Modernize our electric grid
➢ Further improve operational efficiency
➢ Expand customer products and services such as smart
pricing options, high usage alerts, online management tools
➢ Legislation has been introduced in the Senate and House
during the current Texas Legislative Session which will
provide legislative clarification for AMI deployment
➢ Legislative clarification will allow EE to develop the business
case and seek regulatory approval in Texas and New Mexico
14
Anticipated Timeline for New Generating Resources
(1) The winning bids include the expected Power Purchase Agreements (“PPAs”) of 200 MW of utility
scale solar resources, 100 MW of battery storage, and the construction of a 226 MW natural gas
combustion turbine generating unit at the Company’s Newman Power Station for an expected cost of
approximately $143 million
(2) Selected proposals are subject to the execution of contracts following negotiations with the winning
bidders, obtaining the applicable environmental and construction related permits, and obtaining the
necessary approvals from the Public Utility Commission of Texas (“PUCT”) and the NMPRC
Q2
2017Q4
2018Q1
2019Q2
2019
Q3
2019Q4
20192021
Q2
2022Q2
2023
Issued All-Source RFP
Seek Regulatory Approvals
Contract negotiations and execution
Announced RFP results
Q3
2022
Q3
2023
Additional 100 MW of peak generating
capacity
Additional 276 MW of peak generating
capacity
(2)
(1)
➢ May purchase 50 to 150 MW of wind and solar generated power for fuel
diversity and energy cost savings
2020
Five Year Cash Capital Expenditures
$0
$100
$200
$300
2019E 2020E 2021E 2022E 2023E
99.270.8
95.892.2 91.7
25.3
24.5
23.9 43.8 49.9
90.389.1
110.7116.7 111.2
34.239.8
35.625.5 25.6
Estimated Costs of ~ $1.3 billion
Generation Transmission Distribution General
$249mm
$224mm
$266mm $278mm $279mm
(millions)
(2) (3)
15
(1) (4)(3)
(1) Includes the construction of a 226 MW natural gas combustion turbine generating unit at the Company’s Newman Power Station with an
anticipated operational date of 2023 at an expected cost of $143 million.
(2) Excludes PPAs for 200 MW of utility scale solar resources and 100 MW of battery storage.
(3) In the 2017 Texas rate case, EE established baseline revenue requirements for transmission and distribution investment costs. The first
filings for recovery of T&D investments occurred on January 25, 2019 for the TCRF and is anticipated to occur in late March for the
DCRF.
(4) Estimates reflect approximately $85 million of initial project costs for AMI, including deployment of the back-office systems and meters.
Legislative proposals regarding the clarification of the regulatory process to implement AMI are anticipated during the Texas legislative
session that convened in January 2019. With legislative clarification, EE would then have the opportunity to request regulatory approval
for the deployment of AMI. Estimates are subject to change based on legislative and regulatory approvals.
16
Projected Rate Base and CWIP Pro forma Rate Base Balances ($ in millions)
YE 2019 YE 2020 YE 2021 YE 2022
Beginning Rate Base (1)
2,362$ 2,464$ 2,533$ 2,682$
Other Plant Additions (2) (3)
228 185 260 227
New Generating Units:
226 MW Combustion Turbine (4)
163
Depreciation Expense (101) (107) (112) (117)
Change in Deferred Income Taxes & Other (25) (9) 1 (3)
Additions to Other Rate Base 102 69 149 270
Total Rate Base 2,464 2,533 2,682 2,952
NM Palo Verde Unit 3 Rate Base 36 37 37 38
Total Pro forma Rate Base (5)
$2,176(6)
$2,500 $2,570 $2,719 $2,990
Year End CWIP Balances (4)
$210 $260 $279 $311
T&D Plant Additions, as included above (2)
90 103 164 143
Depreciation Expense, as included above (2)
(30) (32) (34) (37)
Total 60 71 130 106
(1) Year end balances exclude CWIP.
(2) In Texas, the first filings for recovery of T&D investments occurred on January 25, 2019 for the TCRF and is anticipated to occur
in late March for the DCRF.
(3) Excludes the Texas portion of AMI, which is assumed to be collected through a surcharge.
(4) $163 million of CWIP balance in 2022 is included in rate base in December 2022 as we anticipate using a Post Test Year
Adjustment in Texas.
(5) Represents a pro-forma rate base that is subject to change based on actual rate filings and capital expenditure projections.
(6) Total Company rate base as filed in the 2017 Texas rate case (uses a test year ended September 30, 2016)
2019 Texas Cost Recovery Factor Filings
17
TCRF
DCRF
Q3
2016 2017
Filed on January 25th, PUCT Docket No. 49148
Plan to file with PUCT in late March 2019
Q3
2018
Q4
2018
Q1
2019
Q2
2019
Q3
2019
Q4
2019Q4
2016
Anticipate obtaining approvals
Anticipate obtaining approvals
Distribution infrastructure not included in rates
(Oct 1, 2016 – Dec 31, 2018)
Transmission infrastructure not included in rates
(Oct 1, 2016 – Sept 30, 2018)
(1) Under PUCT Docket No. 49148, seeking to recover $8.2 million for transmission
infrastructure investments.
(2) First time EE has filed for TCRF and DCRF approvals, so timing is subject to change.
(1) (2)
(2)
18
Anticipated 2019 Regulatory Filings
➢ Seek regulatory approvals for the resource additions
selected in the RFP process in second half of 2019
➢ File the New Mexico general rate case with the New
Mexico Public Regulation Commission by July 31, 2019
➢ File Federal Energy Regulatory Commission general
rate case in 2019
➢ Seek legislative clarification for AMI in Texas during the
first half of 2019 and develop a business case to seek
regulatory approvals in Texas and New Mexico
Increasing Cash Returns
➢ In Q2 2011, EE re-initiated a quarterly cash dividend of $0.22
per share, which has increased by 64% to $0.36 per share since
20117% CAGR
65%
55%
(1) The timing and amount of future dividend increases will be based on the Board’s continual review of our
return of capital policies in the context of our operating performance, financial condition, capital needs
and other relevant factors in the Board’s determination.
(2) EE’s goal is to achieve an annual 55% - 65% dividend payout ratio by 2020.
(3) On May 24, 2018, the Board approved a 7.5% increase to the quarterly cash dividend to $0.36
per share from $0.335 per share.
Target Payout
Ratio (1) (2)
19
(3)
$0.88
$1.00 $1.06
$1.12 $1.18
$1.24 $1.34
$1.44
$0.50
$0.70
$0.90
$1.10
$1.30
$1.50
2011 2012 2013 2014 2015 2016 2017 2018
Annualized Dividend Per Share Actual Payout Ratio
Commitment to Credit Quality
Capital Structure
As of December 31, 2018 *(thousands)
Common Stock Equity $1,164,102
Long-term debt, net of RGRT 1,275,219
Total Capitalization Before RGRT $2,439,321
RGRT and RCF - LT & ST Debt 159,207
Total Capitalization After RGRT and RCF $2,598,528
Regulatory Capitalization** Book Capitalization
Moody's S&P
Rating Baa1 BBB
Outlook Negative Stable
* Capital structure includes current maturities and short-term
borrowings
** Regulatory Capitalization excludes borrowings for nuclear fuel by the Rio
Grande Resources Trust II (“RGRT”) and all borrowings under the revolving
credit facility (“RCF”), while book capitalization includes nuclear fuel
borrowings in the debt portion of capitalization.
Debt52.3%
Equity47.7%
Debt55.2%
Equity44.8%
➢ Well-positioned to finance planned investments
➢ Investment grade credit ratings
➢ S&P reaffirmed its BBB rating and Stable
Outlook in May 2018
➢ Moody’s reaffirmed its Baa1 rating and changed
Outlook to Negative in March 2018
20
Capital Requirements and Liquidity
➢ On December 31, 2018, EE had liquidity of $313.6 million, including
cash and cash equivalents of $12.9 million and unused capacity under
the revolving credit facility
➢ Expended $240.0 million for new electric utility plant for the twelve
months ended December 31, 2018
➢ Capital expenditures for utility plant in 2019 are expected to be
approximately $249 million
➢ For the twelve months ended December 31, 2018, credited
approximately $28.2 million to customers for the reduction in the federal
corporate income tax rate
➢ Paid $57.5 million in cash dividends during the twelve months ended
December 31, 2018
➢ On January 31, 2019, the Board approved a quarterly cash dividend of
$0.36 per share of common stock payable on March 29, 2019 to
shareholders of record as of the close of business on March 15, 2019
21
22
2018 Year End Load and Resources
2018 YE Company Owned Generation 2,085 MW Solar Purchased
Power
74 MW
Palo Verde MontanaNewman Copper Four Corners Renewables SolarRio Grande
Natural GasNuclear Coal Solar Solar Power
633 MW 752 MW 354 MW (1) 64 MW 0 MW (2) 6 MW 74 MW (3)276 MW
2018 YE Total Net Resources 2,159 MW
(1) Montana Power Station (“MPS”) includes Units 1 & 2 (88 MW per unit), Units 3 & 4 (89 MW per unit).
(2) In July 2016, EE became coal free following the sale of its 7% minority ownership interest in Four Corners Units 4 & 5 and common facilities
(3) Solar purchased power represented approximately 70% of their capacity during the summer peak period
23
Diversified Energy Portfolio and
Low Carbon Footprint
EE vs. U.S. Avg. Carbon Footprint(Short tons CO2 equivalent emissions/MWH)
2016 EE
0.28
2016 National
Average 0.51
45%
12%
43%
EE 2018 Energy Sources (by MWh)
* Renewable energy purchases represent 20% of total
purchased power
Nuclear Natural
Gas
Purchased
Power
Corporate Sustainability Report
24
➢ EE released it’s first Corporate
Sustainability Report
➢ Demonstrates commitment to
transparency and improvement
with regard to environmental,
social, and governance
sustainability performance
➢ Part of a collaborative effort
designed to support the
transition to a lower carbon
and increasingly sustainable
energy future
Large Scale Solar Projects
➢ Texas Community Solar Facility (3
MW) became operational during Q2
2017
➢ The Holloman Air Force Base Solar
Facility (5 MW) became
commercially operational on October
18, 2018
➢ The Company is continuing to
investigate opportunities regarding
renewable and microgrid
development initiatives
➢ Recent regulatory filing:
➢ Seeking expansion of the Texas
Community Solar Facility (2 MW)
➢ Final order expected to be issued in
the first half of 2019
25
26
Appendix
➢ As required by a recent accounting standard, changes in the fair value of equitysecurities are now recognized in EE’s Statements of Operations. The adoption of thisstandard added the potential for significant volatility to the reported results of operationsas changes in the fair value of equity securities may occur.
➢ Accordingly, in addition to disclosing financial results that are determined in accordancewith U.S. generally accepted accounting principles (“GAAP”), EE has provided adjustednet income and adjusted basic earnings per share, both of which are Non-GAAPfinancial measures. Management believes that providing this additional information isuseful to investors in understanding EE’s core operating performance because eachmeasure removes the effects of variances that are not indicative of fundamental changesin the earnings capacity of EE. Adjusted net income and adjusted basic earnings pershare are calculated by excluding the impact of changes in fair value from EE’s equitysecurities and realized gains (losses) from the sale of both equity and fixed incomesecurities.
➢ Adjusted net income and adjusted basic earnings per share are not measures offinancial performance under GAAP and should not be considered as an alternative to netincome and earnings per share, respectively. Further, EE’s presentation of any non-GAAP financial measure may not be comparable to similarly titled measures used byother companies. Please refer to slide 29 of this presentation for a reconciliation ofadjusted net income and adjusted basic earnings per share to the most directlycomparable financial measures, net income (loss) and earnings (loss) per share,respectively, prepared in accordance with GAAP.
Use of Non-GAAP Financial Measures
27
Q4 and YTD 2018 Key Earnings Drivers
28
2017(GAAP)
2018(GAAP)
2017(non-
GAAP)
2018(non-
GAAP)
$2.07
$2.21
$2.33
$2.42
29
Reconciliation of Net Income (GAAP) and Basic EPS
(GAAP) to Adjusted Net Income (Non-GAAP) and
Adjusted Basic EPS (Non-GAAP) ➢ Financial Instruments – Overall (Topic 825-10) – unrealized gains and losses on equity securities that historically
have been recorded through Accumulated Other Comprehensive Income will be immediately recognized in the
Statements of Operations.
➢ Upon adoption of this standard, EE recorded as of January 1, 2018 a cumulative effect adjustment to retained earnings of $41
million, net of tax, for the unrealized gains (losses) related to equity securities held in the NDT.
➢ The adoption of this standard added the potential for significant volatility to EE’s reported results of operations as changes in
the fair value of equity securities may occur.
➢ Equity investments included in the NDT are significant and are expected to increase significantly during the remaining life
(estimated to be 22 to 30 years) of Palo Verde.(1) Accordingly, EE is providing adjusted net income (a Non-GAAP financial
measure) and adjusted basic EPS (Non-GAAP), both of which are reconciled below to net income (loss) and basic earnings
(loss) per share (the most comparable GAAP financial measures):
2018 2017 2018 2017
Net Income (loss) (GAAP) (15,285)$ 6,500$ 84,315$ 98,261$
Adjusting items before income tax effects
Unrealized losses, net 22,331 - 18,601 -
Realized (gains) losses, net 319 (1,504) (5,634) (10,626)
Total adjustments before income tax effects 22,650 (1,504) 12,967 (10,626)
Income taxes on above adjustments (4,530) 301 (2,593) 2,125
Adjusting items, net of income taxes 18,120 (1,203) 10,374 (8,501)
Adjusted net income (non-GAAP) 2,835$ 5,297$ 94,689$ 89,760$
Basic earnings (loss) per share (GAAP) (0.38)$ 0.16$ 2.07$ 2.42$
Adjusted basic EPS (non-GAAP) 0.07$ 0.13$ 2.33$ 2.21$
Three Months Ended
December 30,
(In thousands except for per share data)
Twelve Months Ended
December 30,
(In thousands except for per share data)
(1) As of December 31, 2018, the EE nuclear decommissioning trust portfolio was
comprised of 49% equity securities and had a market value of $276 million.
30
YTD Customers and Retail Sales
Average No.
of Retail
Customers
Percent
Change (1)MWH
Percent
Change (1)
Residential 374,138 1.7% 2,988,695 5.9%
C&I Small 42,349 0.9% 2,431,920 0.9%
C&I Large 48 - 1,050,834 0.5%
Public Authorities 5,746 3.9% 1,563,227 (0.1)%
Total Retail 422,281 1.6% 8,034,676 2.4%
Cooling Degree Days 3,174 8.8%
Heating Degree Days 1,937 27.3%
(1) Percent change expressed as change in 2018 from 2017
31
Historical Weather Analysis
10-YR HDD
Average – 2,056
10-YR CDD
Average – 2,863
Calendar Year 2018 CDDs
• 10.9% Above 10-YR Average
• 8.8% Above 2017
Calendar Year 2018 HDDs
• 5.8% Below 10-YR Average
• 27.3% Above 2017
2,144
2,2732,402
2,009
2,426
1,9002,095
1,851
1,522
1,937
2,768 2,738
3,141
2,876
2,695 2,671
2,839 2,811 2,917
3,174
900
1,400
1,900
2,400
2,900
3,400
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Calendar Year HDDs & CDDs
HDDs CDDs 10-YR CDD Avg 10-YR HDD Avg
32
2019 Earnings Guidance➢ On February 27, 2019, EE initiated guidance:
➢ GAAP earnings guidance range of $2.25 - $2.80 per basic share
➢ Non-GAAP earnings guidance range of $2.10 - $2.45 per basic share
2018 Basic EPS Actual 2019 Basic EPSGuidance
GAAP
$2.07
$2.80
$2.25
2018 Adjusted BasicEPS Actual
2019 Adjusted BasicEPS Guidance
Non - GAAP
$2.33 $2.45
$2.10
Guidance assumes normal operations and considers significant variables that may impact earnings, such as
weather, expenses, capital expenditures, nuclear decommissioning trust gains/losses, and the recovery of
transmission and distribution costs in Texas. The mid-point of the guidance range assumes 10-year average
weather (cooling and heating degree days) for the year. The GAAP guidance range includes $6.3 million or $0.15
per share to $14.8 million or $0.35 per share, after-tax, of unrealized gains (losses) on equity securities and
realized gains (losses) from the sale of both equity and fixed income securities from the Palo Verde
decommissioning trust funds.
Texas Renewables
33
➢ Requirements➢ EE must obtain renewables through renewable generation or
purchase of Renewable Energy Credits (RECs). The amount is based on the ratio of EE’s Texas sales compared to total sales in the state. This number has averaged approximately 5%.
➢ Compliance
➢ EE primarily purchases RECs
➢ Cost Recovery
➢ REC costs recovered through
base rates
➢ EE capital investments included
in rate base
34
New Mexico Renewables
➢ Requirements
➢ EE is required to meet 15% of its current retail
energy sales in New Mexico via renewables;
escalates to 20% in 2020
➢ Must be from diverse sources – at least 20% solar, 30% wind, 5% other (e.g. biomass, geothermal) and 3% renewable distributed generation
➢ Reasonable cost threshold will limit future requirements for EE
➢Compliance➢ Power Purchase Agreements for solar generation and associated RECs
➢ EE has reached the reasonable cost threshold
➢ EE’s 2017 and 2018 RPS plans are approved
➢Cost Recovery➢ Renewable energy with RECs recovered through RPS Rider
35
El Paso City Council Overview
Name Term Ends District
Dee Margo (Mayor) 6/27/2021
Peter Svarzbein 1/1/2023 1
Alexsandra Annello 6/27/2021 2
Cassandra Hernandez Brown 6/27/2021 3
Sam Morgan 6/27/2021 4
Isabel Salcido 1/1/2023 5
Claudia Ordaz Perez 1/1/2023 6
Henry Rivera 6/27/2021 7
Cissy Lizarraga 1/1/2023 8
El Paso City Council
36
Name Term Ends Party
DeAnn Walker (Chair) 8/31/2021 Republican
Arthur C. D' Andrea 8/31/2023 Republican
Shelly Botkin 8/31/2019 Republican
Name Term Ends Party District
Cynthia Hall (Vice-Chair) 12/31/2020 Democrat 1
Jefferson Byrd 12/31/2022 Republican 2
Valerie Espinoza (Chair) 12/31/2020 Democrat 3
Theresa Becenti-Aguilar 12/31/2022 Democrat 4
Stephen Fischmann 12/31/2022 Democrat 5
Public Utility Commission of Texas - Appointed by Governor
New Mexico Public Regulation Commission - Elected
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Regulatory Overview
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Lisa Budtke
Director - Treasury Services and Investor Relations
(915) 543-5947
Richard Gonzalez
Manager – Cash Management
and Investor Relations
(915) 543-2236
El Paso Electric Headquarters
Stanton Tower
100 North Stanton
El Paso, Texas 79901
(800) 592-1634
EE Contact Information
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