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Pension and Other Postretirement Benefit Plans | 9 Months Ended
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Sep. 30, 2023
Retirement Benefits [Abstract] |
Pension and Other Postretirement Benefit Plans | Pension and Other Postretirement Benefit Plans PNMR and its subsidiaries maintain qualified defined benefit pension plans, postretirement benefit plans providing medical and dental benefits, and executive retirement programs (collectively, the “PNM Plans” and “TNMP Plans”). PNMR maintains the legal obligation for the benefits owed to participants under these plans. The periodic costs or income of the PNM Plans and TNMP Plans are included in regulated rates to the extent attributable to regulated operations. The Company presents the service cost component of its net periodic benefit costs in administrative and general expenses and the non-service costs components in other income (deductions), net of amounts capitalized or deferred to regulatory assets and liabilities, on the Condensed Consolidated Statements of Earnings. PNM and TNMP receive a regulated return on the amounts funded for pension and OPEB plans in excess of accumulated periodic cost or income to the extent included in retail rates (a “prepaid pension asset”). Additional information concerning pension and OPEB plans is contained in Note 11 of the Notes to Consolidated Financial Statements in the 2022 Annual Reports on Form 10-K. Annual net periodic benefit cost for the plans is actuarially determined using the methods and assumptions set forth in that note and is recognized ratably throughout the year. Differences between TNMP’s annual net periodic costs (income) and amounts included in its regulated rates are deferred to regulatory assets or liabilities, for recovery or refund in future rate proceedings. PNM Plans The following table presents the components of the PNM Plans’ net periodic benefit cost:
| Three Months Ended September 30,
| Pension Plan |  | OPEB Plan |  | Executive Retirement Program
| 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022
| (In thousands)
Components of Net Periodic Benefit Cost |  |  |  |  |  |  |  |  |  |  |
Service cost | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 2 |  |  | $ | — |  |  | $ | — |
Interest cost | 5,913 |  |  | 4,215 |  |  | 675 |  |  | 479 |  |  | 135 |  |  | 90 |
Expected return on plan assets | (7,299) |  |  | (7,140) |  |  | (1,242) |  |  | (1,088) |  |  | — |  |  | — |
Amortization of net loss | 2,646 |  |  | 3,948 |  |  | — |  |  | — |  |  | 38 |  |  | 81 |
Amortization of prior service cost | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Net Periodic Benefit Cost (Income) | $ | 1,260 |  |  | $ | 1,023 |  |  | $ | (567) |  |  | $ | (607) |  |  | $ | 173 |  |  | $ | 171 |
| Nine Months Ended September 30,
| Pension Plan |  | OPEB Plan |  | Executive Retirement Program
| 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022
| (In thousands)
Components of Net Periodic Benefit Cost |  |  |  |  |  |  |  |  |  |  |
Service cost | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 6 |  |  | $ | — |  |  | $ | — |
Interest cost | 17,740 |  |  | 12,643 |  |  | 2,027 |  |  | 1,437 |  |  | 405 |  |  | 270 |
Expected return on plan assets | (21,897) |  |  | (21,422) |  |  | (3,727) |  |  | (3,264) |  |  | — |  |  | — |
Amortization of net loss | 7,937 |  |  | 11,846 |  |  | — |  |  | — |  |  | 114 |  |  | 245 |
Amortization of prior service cost | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Net Periodic Benefit Cost (Income) | $ | 3,780 |  |  | $ | 3,067 |  |  | $ | (1,700) |  |  | $ | (1,821) |  |  | $ | 519 |  |  | $ | 515 |
PNM did not make any contributions to its pension plan trust in the nine months ended September 30, 2023 and 2022 and does not anticipate making any contributions to the pension plan in 2023 through 2026 based on current law, funding requirements, and estimates of portfolio performance. In 2027, PNM does anticipate making a contribution of $0.4 million based on current law, funding requirements, and estimates of portfolio performance. Funding assumptions were developed using a discount rate of 5.7%. Actual amounts to be funded in the future will be dependent on the actuarial assumptions at that time, including the appropriate discount rate. PNM may make additional contributions at its discretion. PNM did not make any cash contributions to the OPEB trust in the nine months ended September 30, 2023 and 2022, however, a portion of the disbursements attributable to the OPEB trust is paid by PNM and are therefore considered to be contributions to the OPEB plan. Payments by PNM on behalf of the PNM OPEB plan were less than $0.1 million and $0.1 million for the three and nine months ended September 30, 2023 and $0.9 million and $2.4 million for the three and nine months ended September 30, 2022. These payments are expected to total $0.2 million in 2023 and $9.0 million for 2024-2027. Disbursements under the executive retirement program, which are funded by PNM and considered to be contributions to the plan, were $0.4 million and $1.0 million in the three and nine months ended September 30, 2023 and $0.4 million and $1.0 million in the three and nine months ended September 30, 2022 and are expected to total $1.3 million during 2023 and $4.5 million for 2024-2027. TNMP Plans The following table presents the components of the TNMP Plans’ net periodic benefit cost:
| Three Months Ended September 30,
| Pension Plan |  | OPEB Plan |  | Executive Retirement Program
| 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022
| (In thousands)
Components of Net Periodic Benefit Cost |  |  |  |  |  |  |  |  |  |  |
Service cost | $ | — |  |  | $ | — |  |  | $ | 5 |  |  | $ | 9 |  |  | $ | — |  |  | $ | — |
Interest cost | 601 |  |  | 430 |  |  | 106 |  |  | 77 |  |  | 3 |  |  | 2 |
Expected return on plan assets | (674) |  |  | (618) |  |  | (120) |  |  | (104) |  |  | — |  |  | — |
Amortization of net (gain) loss | 110 |  |  | 233 |  |  | (190) |  |  | (130) |  |  | — |  |  | — |
Amortization of prior service cost | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Net Periodic Benefit Cost (Income) | $ | 37 |  |  | $ | 45 |  |  | $ | (199) |  |  | $ | (148) |  |  | $ | 3 |  |  | $ | 2 |
| Nine Months Ended September 30,
| Pension Plan |  | OPEB Plan |  | Executive Retirement Program
| 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022
| (In thousands)
Components of Net Periodic Benefit Cost |  |  |  |  |  |  |  |  |  |  |
Service cost | $ | — |  |  | $ | — |  |  | $ | 16 |  |  | $ | 27 |  |  | $ | — |  |  | $ | — |
Interest cost | 1,802 |  |  | 1,290 |  |  | 319 |  |  | 231 |  |  | 9 |  |  | 8 |
Expected return on plan assets | (2,023) |  |  | (1,854) |  |  | (361) |  |  | (312) |  |  | — |  |  | — |
Amortization of net (gain) loss | 329 |  |  | 699 |  |  | (570) |  |  | (390) |  |  | — |  |  | — |
Amortization of prior service cost | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Net Periodic Benefit Cost (Income) | $ | 108 |  |  | $ | 135 |  |  | $ | (596) |  |  | $ | (444) |  |  | $ | 9 |  |  | $ | 8 |
TNMP did not make any contributions to its pension plan trust in the nine months ended September 30, 2023 and 2022 and does not anticipate making any contributions to the pension plan in 2023 through 2027 based on current law, funding requirements, and estimates of portfolio performance. Funding assumptions were developed using a discount rate of 5.8%. Actual amounts to be funded in the future will depend on the actuarial assumptions at that time, including the appropriate discount rate. TNMP may make additional contributions at its discretion. TNMP did not make any contributions to the OPEB trust in the three and nine months ended September 30, 2023 and 2022 and does not expect to make contributions to the OPEB trust during the period 2023-2027. Disbursements under the executive retirement program, which are funded by TNMP and considered to be contributions to the plan, were zero in the three and nine months ended September 30, 2023 and 2022 and are expected to total $0.1 million during 2023 and $0.2 million in 2024-2027.

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