The Public Service Company of New Mexico announced on Friday that it reached a settlement agreement with state regulators and advocacy groups regarding rate credits associated with closing the San Juan Generating Station.

The agreement calls for PNM customers to receive $115 million in bill credits over a one-year period of time. This will result in an average credit of $9.28 per month for residential customers, which the utility says is about 11 percent of the average bill. 

According to the press release, the customer credits come from PNM earnings. The customer rates will not be used to pay any part of the credit. 

Customers must also be protected from increasing interest rates on the securitization bonds that PNM is using to refinance past investments in the coal-fired power plants.

The agreement is still pending approval from the New Mexico Public Regulation Commission.

The case is currently in the New Mexico Supreme Court and the court will likely remand it to the PRC to allow state regulators to consider the agreement.

“We came together to demand PNM return windfall profits that it has collected at the expense of New Mexicans,” Mariel Nanasi, executive director of New Energy Economy, said in a statement. “The savings that come from the transition to clean energy must be passed on to customers. Today’s agreement shows that when advocates for the people of New Mexico work together, we can achieve just outcomes that protect ratepayers.”

The various parties to the settlement include the PRC’s utility division staff, PNM, the New Mexico Office of the Attorney General, Western Resource Advocates, New Energy Economy, New Mexico Affordable Reliable Energy Alliance, Albuquerque Bernalillo County Water Utility Authority and Coalition for Clean Affordable Energy.

“We have been working towards this transition for many years and appreciate the collaborative effort from parties to reach a unanimous settlement to complete the final steps,” PNM CEO Pat Vincent-Collawn said in the press release. “As the solar and battery storage replacement power resources also begin to come online, we are seeing the full scope of the Energy Transition Act’s benefits for our customers, the environment, employees and the communities impacted by the plant’s closure.”