ML023100351
| ML023100351 | |
| Person / Time | |
|---|---|
| Site: | Palo Verde  |
| Issue date: | 10/30/2002 |
| From: | Bauer S Arizona Public Service Co |
| To: | Document Control Desk, Office of Nuclear Reactor Regulation |
| References | |
| 102-04859-SAB/TNW/CJJ | |
| Download: ML023100351 (8) | |
Text
El Paso Electric 2001 Annual Report El Paso Electric 2001 Annual Report 1 2001 Performance Highlights
Financial ($000) 1999 2000 2001 Earnings Per Share 2001 was a year of In the last five years, (diluted weighted average)
EBITDA $ 243,158 $ 258,839 $ 257,941 celebration for El Paso under Jims leadership, Electric Utility Operating Revenues $1.23 (net of energy expenses) $ 458,581 $ 475,644 $ 483,488 Electric. We celebrated 100 El Paso Electric has:
$1.06 restored investment grade Net Income (applicable to common stock) $ 46,774(1) $ 58,392 $ 63,659 years of service to the area as Total Assets $ 1,664,436 $ 1,660,105 $ 1,644,439 well as the beginning of a new credit quality to its EBITDA Interest Coverage 3.00x 3.64x 3.90x $0.78*
$0.75 era of leadership. securities, received national Common Stock Data On August 30, 1901, the awards for operational Earnings Per Share El Paso Electric Railway efficiency, been rated as (diluted weighted average) $ 0.78(1) $ 1.06 $ 1.23 Free Cash Flow Per Share $ 1.94 $ 2.34 $ 2.37 Company was created as the one of the most reliable Market Price Per Share electricity provider to about utilities in the state of (year-end close) $ 9.81 $ 13.20 $ 14.50 Book Value Per Share $ 7.36 $ 8.00 $ 8.96 450 customers in the young, Texas (as measured by Market To Book Ratio 133% 165% 162% 1998 1999 2000 2001 booming city of El Paso, Texas. standards set up by the Price Earnings Ratio 12.58x(1) 12.45x 11.79x *1999 excludes unusual and non-recurring items. One hundred years later, state regulatory Return on Book Equity 10.92%(1) 13.71% 14.77%
El Paso Electric is providing commission), received local Weighted Average Number of 309,000 customers with safe and national awards for Common Shares Outstanding 59,349,468 54,183,915 50,821,140 Common Stock Equity and reliable electric power. community involvement, George W. Edwards, Jr.
Number of Registered Holders 5,547 5,257 5,580 Chairman of the Board (percent of capitalization) Effective leadership guided and favorably resolved a Debt and Stock Repurchases ($000) 39% El Paso Electric for many of significantly advanced First Mortgage Bonds 34% those 100 years. This has municipalization attempt.
Repurchases $ 83,544 $ 38,848 $ 53,628 Redemptions $ 36,034 $ - $ 34,571 33% certainly been the case over Overcoming any one of these 28% the last few years as El Paso challenges would be worthy of the success enjoyed over the Common Share Repurchases 3,169,289 5,991,178 2,760,862 26% Electric has prospered under note; overcoming all of them last five years.
the leadership and guidance of and restoring prominence to It is with great excitement Relative Price Performance former President and Chief the company in each of these that we look forward to 2002 (3)
El Paso Electric vs. S & P Electric and S & P Utilities Indices Executive Officer Jim Haines. vital areas, in just a few short and beyond. Be assured that 12/29/00 - 12/31/01 years, is an outstanding El Paso Electric will continue achievement. Jim will continue its rich tradition of service to to provide leadership in his our customers and creating 1997 1998 1999 2000 2001 new role as vice chairman of value for our shareholders.
the board and will retain his position as chairman of the Executive Committee of the Market Price Per Share board.
(year-end)
$14.50 On November 1, 2001, a new
$13.20 era of leadership began with the selection of Gary Hedrick as president and chief
$9.81 EE S & P Electric S & P Utilities $8.75 executive officer. Garys 25 (1) 1999 results before the effects of unusual and non-recurring items.
years of extensive financial and (2) Certain prior year amounts have been restated to conform to the 2001 presentation. regulatory experience (3) Daily closing values for S & P classification system in use prior to 01/01/02.
combined with his lifelong Statements in this document, other than statements of historical information, are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, as well as other oral and written forward-looking statements made by or on behalf of El Paso Electric (EPE) from knowledge of the communities time to time, including statements contained in EPEs filings with the Securities and Exchange Commission and its reports to shareholders, involve known and unknown risks and other factors which may cause EPEs actual results in future periods to we serve have prepared him to differ materially from those expressed in any forward-looking statements. Please refer to EPEs 10-K for fiscal year ended December 31, 2001, and EPEs other 34 Act filings for a detailed discussion of these risks and uncertainties. EPE cautions Zach T. White lead El Paso Electric into the that the risks and factors in such filings are not exclusive. EPE does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of EPE, except as required by law. 1998 1999 2000 2001 Founder, El Paso Electric Railway Company next century and to continue
2 El Paso Electric 2001 Annual Report El Paso Electric 2001 Annual Report 3
In 2001, El Paso Electric differs materially from the Regulatory Commission price with our ongoing goal to reduce through of fuel costs in our New commemorated 100 years of California model. It is too early caps in the western market, debt and thereby strengthen Mexico jurisdiction effective service to west Texas and to tell, however, whether the plans for increased generation, EPEs balance sheet. Of course, June 15, 2001. Our inability to southern New Mexico. Texas structure will encounter and continued softness in the common stock repurchases or recover these increased costs in Throughout a century of service, its own unique set of wholesale market. future reductions in fixed our New Mexico jurisdiction for EPE has been an active partner challenges. During 2001, our free cash obligations will depend on the the first half of the year resulted in the growth and prosperity From EPEs perspective, we flow remained strong at $2.37 comparative economic value of in an approximate $6.3 million, enjoyed by the region. Over that have several inherent per share, enabling us to reduce alternative uses of cash. $0.12 per share, reduction in time, EPE has remained a advantages that we believe will debt during the year by over At $14.50, our year-end 2001 profits. As of today, our vertically integrated utility, work in our favor as we prepare $88.2 million. This reduction in closing stock price increased for regulatory structure in both producing, transmitting, and for retail competition in 2006 debt has decreased annual fixed the sixth consecutive year and retail jurisdictions allows for distributing electricity and beyond. First, we have an charges on an ongoing basis by produced a one-year return of complete pass-through of our throughout its service territory opportunity to learn from other $7.2 million. We will redeem the almost 10 percent. This prudently incurred fuel in a fully regulated utilities as they resolve remaining $42.9 million of our significantly outperformed the expenses.
environment. Now, standing at structural dilemmas and Series C bonds at maturity in S & P Electric Utilities Total EPE owns approximately the threshold of a new century develop a fully operative Gary R. Hedrick February 2003 with internally Return Index, which closed 1,500 MW of generating capacity President and CEO of service to our customers, we, market. Second, we will generated cash. As a result of down 8.3 percent, and the S & P that, along with some small as well as our industry, are in continue to use a portion of our our debt reduction plan, EPEs Utilities Total Return Index, purchased power contracts to the midst of dramatic and rapid significant cash flow to reduce conservative approach to both common stock equity increased which closed down 30.4 percent. provide adequate reserves, change. debt and strengthen our financial and operational to 39 percent of long-term The Dow Jones Utility Index also should be sufficient to meet the In January 2002, retail balance sheet. Third, as we management - while capitalization (including current closed down 28.7 percent. In present and near-term projected competition began in portions enter competition, we estimate relentlessly adhering to our core maturities) at year-end, a October 2001, EPE was included electricity needs of its service of Texas. EPEs service territory, that nearly half of our assets values of safety, integrity, and dramatic improvement from the in the S & P SmallCap 600 territory. In 2001, the Palo Verde as well as parts of the will remain in the regulated excellence in all that we do. June 30, 1996, level of 19 Index, which had a total return Nuclear Generating Station panhandle and far east Texas, transmission and distribution Our pursuit of these business percent. of 6.5 percent for the year. EPE supplied approximately 49 have not yet begun retail business, providing a stable principles and values continued EPE has also utilized its free is also included in the Russell percent of EPEs energy mix and competition. In EPEs case, we base of earnings and cash flow. to produce excellent results cash flow to essentially 2000 Index, which posted a total operated at an 86 percent are currently scheduled to begin Fourth, we operate in an during 2001. Diluted earnings complete the 12 million-share return of 2.5 percent for the capacity factor. EPE, along with a retail pilot program in August historically high growth area per common share increased to common stock repurchase year. the other participants in Palo 2005, and to begin full retail and have a significant market $1.27, before extraordinary item. program started on June 14, During 2000 and early 2001, Verde, recently began competition seven months later. opportunity literally on our This performance was 1999. As of January 31, 2002, the utility industry saw dramatic discussions regarding the In New Mexico, which doorstep in the form of the significantly enhanced by more than 11.9 million shares increases in the cost of natural possible replacement of the comprises approximately 20 considerable energy needs increases in both demand and have been repurchased for gas used to produce electricity. steam generators at Units 1 and 3.
percent of our retail business, facing the Republic of Mexico. prices in the western power $133.9 million, including While EPE was able to pass Those initial discussions retail competition is slated to Finally, we have over 700 MW of market, resulting in profit commissions. We estimate that these increased costs through indicate that it may be begin in January 2007. nuclear and coal capacity that margins on economy sales this common stock share to its Texas customers, a economically desirable to Much remains unsettled we believe should be contributing approximately 35 reduction added almost $0.07 previous settlement agreement replace the steam generators at regarding the structure and competitive. percent to net income, after tax, per share to diluted earnings, prevented recovery of these those units in addition to the benefits of retail competition. The challenges we face are in in 2001, compared to 29 percent before extraordinary item, in increased costs from our New Unit 2 steam generator The model in California, once adapting our company to the in 2000. While EPE welcomes 2001. In early 2002, EPE Mexico customers prior to May replacement scheduled for Fall regarded as the vanguard for competitive landscape after a these increased sales and authorized an additional stock 1, 2001. EPE filed a petition to 2003. Replacement of the steam effective retail competition, has century of regulation. We will margins, there is no guarantee repurchase of up to three recover these increased costs in generators would increase the been abandoned as unworkable. meet these challenges by that these conditions will million shares. EPEs goal is to late April 2001 and was plant output and is essential for In Texas, we are in the early remembering the lessons from continue at the levels previously produce maximum value for successful in entering into a the proposed extension of the months of a structure for retail our past - focusing on our core experienced. This is especially shareholders through stock settlement agreement which units operating licenses for an competition, which most agree business and taking a true given the Federal Energy repurchases, in combination allowed for the full pass- additional 20 years.
4 El Paso Electric 2001 Annual Report El Paso Electric 2001 Annual Report 5 2001 Operational Highlights Our commitment to creating EPE Call Center, for example, numerous awards and Operational 1999 2000 2001 Wholesale Sales Contracts value includes evaluating the has resulted in better, more recognition EPE received over Retail GWh Sold 5,866 6,115 6,218 Imperial Irrigation District need to secure additional timely customer service. the past year. Of particular note, Native Peak (MW) 1,159 1,159 1,199 of California (IID) generation resources for 2006 In 2001, kWh sales to the is the recognition of EPEs 100 Customers at Year-End 297,982 303,722 309,221 100 MW Firm Capacity and beyond. Our conservative Comisión Federal de 50 MW Contingent Capacity years of service by the Texas Employees at Year-End 1,068 1,037 1,033 Expires April 2002 operating philosophy is Electricidad (CFE), Mexicos Senate and House of (including temporaries) reflected in EPEs commitment national electric utility, were Representatives. El Paso Electric Palo Verde Capacity Factor 91% 91% 86% Texas-New Mexico Power Co.
to enter the competitive almost twice as high as sales as well as past President and Up to 75 MW Firm Capacity Expires December 2002 environment with sufficient during 2000. The contract to CEO, James Haines, were Generating Capacity generation to meet customer serve 80 MW in 2000 and 100 honored with the readings of Plant Entitlement Fuel Source Energy Mix needs. Currently EPE is MW in 2001 of summer load resolutions during the 77th Palo Verde 600 MW Nuclear 49%
evaluating the need for was not renewed in 2002, Legislative Session. In these Newman 482 MW Natural Gas Military Contracts constructing additional generating capacity against the however, due primarily to the significant slow-down in the readings, EPE was commemorated for having spurred growth and Rio Grande Copper 246 MW 68 MW Natural Gas Natural Gas
} 32% Ft. Bliss Army Air Defense Center Expires December 2008 Holloman Air Force Base mandated requirement under Mexican economy. EPEs development of the El Paso and Four Corners 104 MW Coal 8% Expires December 2005 the Texas restructuring law that relationship with the CFE is surrounding communities, and Purchased Power 11%
White Sands Missile Range we lose 40 percent of our based on strong operating ties for having proven itself to be an TOTAL 1,500 MW 100% Expires May 2009 incumbent residential and small and literally a century of service industry leader that is committed A pilot wind project began operating in April 2001 with a capacity of 1.32 MW.
commercial customers. Our to the CFE and its predecessors. to serving the areas citizens.
current capacity and contracts We intend to continue In 1901, El Paso Electric for power are sufficient to supply our needs through 2005.
partnering with the CFE as it seeks solutions to Mexicos Railway Company focused Service Area primarily on electric railcar 2001 Electric Utility Retail This provides us with additional substantial infrastructure transportation between El Paso Operating Revenues time to thoroughly evaluate our requirements. and Juárez, Mexico. Today, our (in millions / includes fuel) capacity needs in a competitive Corporate citizenship is a focus is reflected in our mission environment and to contract for, responsibility we take very statement.
or construct, any needed seriously. Contributing to our 34.49%
El Paso Electric will be a premier 16.44%
additions. communities is an express part electric and energy services EPE will also continue to of our corporate mission company which anticipates and 12.53%
work to improve customer statement, and, as such, helps 36.54%
meets the electric energy needs of its relationships, which are vital to to define our corporate purpose customers in the U.S. and Mexico earning and retaining customer and mold the actions taken by by creating extraordinary value for: Public Authorities Residential Commercial & Ind. Large Commercial & Ind. Small loyalty as we enter the our employees. We believe this our customers through top quality competitive market. For two community partnership creates service at a fair price; our years in a row, EPE has ranked real value over time through shareholders through exceptional number one in the two enhanced communication and returns; our employees through 2001 Retail MWh Sales reliability measures reported by collaboration with our superior compensation for superior investor-owned utilities to the customers and communities. work; and for our communities Public Utility Commission of During 2001, our employees through outstanding leadership, Texas. We have also worked to contributed over 14,000 hours0 days <br />0 hours <br />0 weeks <br />0 months <br /> stewardship, and commitment. 19.07% 28.77%
increase operating efficiencies of their time to charitable and Thank you for your support and 18.88%
in other areas. The number of civic causes and events. EPEs continued confidence in El Paso customers served per employee progress in this area is purely a 33.28%
Electric.
has increased year over year, reflection of our employees and the implementation of dedication and contributions Public Authorities Residential process improvements at the and is illustrated by the Commercial & Ind. Large Commercial & Ind. Small
6 El Paso Electric 2001 Annual Report El Paso Electric 2001 Annual Report 7 Operating Statistics Electric Utility Operating Revenues Retail:
(in thousands):
2001 2000 1999 1998 1997 1996(a) 1995 1994 1993 1992 Residential $ 195,214 $ 184,769 $ 164,524 $ 173,215 $ 172,917 $ 163,742 $ 140,799 $ 149,321 $ 144,365 $ 143,150 Commercial and Industrial, Small 206,815 192,895 175,924 174,729 173,318 163,875 142,981 148,024 143,102 141,039 Commercial and Industrial, Large 70,959 65,687 59,497 62,450 64,468 59,041 48,643 51,452 47,930 49,742 Sales to Public Authorities 93,059 86,957 80,393 82,360 82,278 81,185 69,149 73,732 72,529 71,496 Total Retail 566,047 530,308 480,338 492,754 492,981 467,843 401,572 422,529 407,926 405,427 Wholesale:
Sales for Resale 86,443 70,162 49,441 82,396 83,448 93,737 90,246 102,304 126,187 108,985 Economy Sales 92,452 84,918 32,523 20,167 10,612 11,032 6,681 5,672 3,078 4,982 Total Wholesale 178,895 155,080 81,964 102,563 94,060 104,769 96,927 107,976 129,265 113,967 Other 9,582 11,020 6,076 5,076(c) 4,980 3,981 3,744 4,050 4,433 3,575 Total Operating Revenues $ 754,524 $ 696,408 $ 568,378 $ 600,393 $ 592,021 $ 576,593 $ 502,243 $ 534,555 $ 541,624 $ 522,969 Number of Customers (end of year):
Residential 276,200 271,588 266,627 260,356 254,348 250,209 245,245 240,368 235,151 228,688 Commercial and Industrial, Small 28,573 27,947 27,274 26,396 25,900 25,304 24,615 23,857 23,338 22,883 Commercial and Industrial, Large 140 133 124 117 115 102 89 80 74 68 Other 4,308 4,054 3,957 3,867 3,811 3,711 3,674 3,470 3,395 3,251 Total Customers 309,221 303,722 297,982 290,736 284,174 279,326 273,623 267,775 261,958 254,890 Energy Supplied, Net, MWh:
Generated 8,181,836 8,706,790 8,392,890 8,586,098 8,186,187 7,920,675 7,439,404 7,018,423 6,625,162 7,330,004 Purchased and Interchanged 951,359 905,770 328,225 478,396 617,651 711,791 584,853 1,051,251 1,416,172 589,288 Total Energy Supplied 9,133,195 9,612,560 8,721,115 9,064,494 8,803,838 8,632,466 8,024,257 8,069,674 8,041,334 7,919,292 Energy Sales, MWh:
Retail:
Residential 1,789,199 1,767,928 1,653,859 1,621,436 1,587,733 1,545,274 1,473,349 1,500,426 1,424,935 1,395,387 Commercial and Industrial, Small 2,069,517 2,026,768 1,943,120 1,891,703 1,834,953 1,779,986 1,754,176 1,721,736 1,616,434 1,555,047 Commercial and Industrial, Large 1,174,235 1,142,163 1,133,751 1,314,428 1,271,449 1,216,941 1,121,329 1,092,028 872,477 911,750 Sales to Public Authorities 1,185,521 1,177,883 1,135,438 1,120,654 1,090,312 1,110,706 1,068,048 1,081,850 1,034,231 997,483 Total Retail 6,218,472 6,114,742 5,866,168 5,948,221 5,784,447 5,652,907 5,416,902 5,396,040 4,948,077 4,859,667 Wholesale:
Sales for Resale 1,460,383 1,282,540 905,975 1,757,880 1,897,885 1,753,553 1,646,357 1,925,671 2,484,128 2,361,204 Economy Sales 929,914 1,714,288 1,497,880 888,708 640,017 757,999 538,102 320,026 164,559 264,654 Total Wholesale Sales 2,390,297 2,996,828 2,403,855 2,646,588 2,537,902 2,511,552 2,184,459 2,245,697 2,648,687 2,625,858 Total Energy Sales 8,608,769 9,111,570 8,270,023 8,594,809 8,322,349 8,164,459 7,601,361 7,641,737 7,596,764 7,485,525 Losses and Company Use 524,426 500,990 451,092 469,685 481,489 468,007 422,896 427,937 444,570 433,767 Total, Net 9,133,195 9,612,560 8,721,115 9,064,494 8,803,838 8,632,466 8,024,257 8,069,674 8,041,334 (b) 7,919,292 (b)
Native System:
Peak Load, MW 1,199 1,159 1,159 1,167 1,122 1,105 1,088 1,093 997 974 Net Generating Capacity for Peak, MW 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,497 1,497 1,497 Load Factor 64.6% 65.4% 62.5% 63.1% 64.0% 63.4% 61.6% 61.1% 62.1% 62.3%
Total System:
Peak Load, MW 1,425 1,360 1,287 1,439 1,442 1,387 1,374 1,365 1,335 1,302 Net Generating Capacity for Peak, MW 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,497 1,497 1,497 Load Factor 64.1% 64.3% 62.9% 64.3% 64.0% 64.2% 62.0% 63.7% 66.4% 66.4%
(a) Financial data is based on the results for the Predecessor Company for periods prior to February 11, 1996 and the Reorganized Company thereafter.
(b) Excludes unbilled MWh.
(c) Excludes MiraSol revenue of $1,430.
8 El Paso Electric 2001 Annual Report El Paso Electric 2001 Annual Report 9 Board of Directors Shareholder Information George W. Edwards, Jr. Securities and Records Form 10-K Report and Annual Meeting of Chairman of the Board Retired in 1995. Prior to retirement, The common stock of El Paso Electric is Shareholder Inquiries Shareholders President, CEO and Director of Kansas City Southern Railway Company traded on the American Stock Exchange. A complete copy of EPEs Annual Report The annual meeting of El Paso Electrics Kansas City, MO The ticker symbol is EE. and Form 10-K for the year ended shareholders will be held at 10 a.m.,
December 31, 2001, which has been filed Mountain Daylight Time on Thursday, Wilson K. Cadman Retired in 1992. Prior to retirement, EPE and The Bank of New York (BONY) with the Securities and Exchange May 9, 2002 at the Stanton Tower, Chairman of the Board, President and CEO, Kansas Gas and Electric Company, act as co-registrars for EPEs common Commission, including financial 100 N. Stanton, El Paso, TX 79901. In Wichita, KS and Vice Chairman of the Board of Western Resources, Inc. stock. BONY maintains all shareholder statements and financial statement connection with the meeting, proxies will Topeka, KS records of EPE. schedules, is available without charge be solicited by the Board of Directors of James A. Cardwell upon written request to: EPE. A notice of meeting, together with a Chairman of the Board and CEO Petro Stopping Centers, LP Shareholder Services Investor Relations proxy statement, a form of proxy, and the El Paso, TX Shareholders may obtain information El Paso Electric Annual Report to Shareholders for relating to their share position, transfer P.O. Box 982 2001, were mailed on or about James W. Cicconi General Counsel and requirements, lost certificates, and other El Paso, TX 79960 April 4, 2002 to shareholders of Executive Vice President Or Call: (800) 592-1634 record as of March 11, 2002.
Law and Government Affairs, AT&T related matters by telephoning BONY Washington, D.C. Shareholder Services at (800) 524-4458. E-mail:
Seated left to right: Gary R. Hedrick, George W. Edwards, Jr. investor_relations@epelectric.com Ramiro Guzman Standing left to right: James A. Cardwell, Charles A. Yamarone, Stephen N. Wertheimer, Patricia Z. Holland-Branch, This service is available to all shareholders President Kenneth A. Heitz, James W. Cicconi, Eric B. Siegel, Michael K. Parks, James W. Harris, Wilson K. Cadman, Monday through Friday, Website:
James Haines, Ramiro Guzman.
Ramiro Guzman & Associates El Paso, TX 8 a.m. to 8 p.m., ET. http://www.epelectric.com Kenneth A. Heitz Eric B. Siegel James Haines Partner Independent Investor and Vice Chairman of the Board Irell & Manella Business Consultant Address Shareholder Inquiries to:
Los Angeles, CA Retired Limited Partner of Apollo Retired in November 2001. Prior to retirement, Advisors, LP The Bank of New York President and CEO, El Paso Electric Company El Paso, TX Patricia Z. Holland-Branch Los Angeles, CA Shareowner Relations President, CEO and Owner Church Street Station James W. Harris Facilities Connection, Inc. Stephen N. Wertheimer Founder and President El Paso, TX Managing Director P.O. Box 11258 Seneca Financial Group, Inc. W Capital Management Greenwich, CT Greenwich, CT New York, NY 10286-1258 Michael K. Parks Managing Director Website:http://www.stockbny.com Gary R. Hedrick Trust Company of the West Charles A. Yamarone President and CEO Los Angeles, CA Executive Vice President El Paso Electric Company U.S. Bancorp Libra Securities, LLC El Paso, TX Send Certificates for Transfer Los Angeles, CA and Address Changes to:
The Bank of New York Receive and Deliver Dept.
Officers Church Street Station P.O. Box 11002 Gary R. Hedrick Kathryn R. Hood Hector Puente New York, NY 10286-1002 President and Chief Executive Officer Treasurer Vice President, Power Generation Terry Bassham Helen Knopp Guillermo Silva, Jr.
Executive Vice President, Chief Financial and Vice President, Customer and Public Affairs Secretary Administrative Officer J. Frank Bates Kerry B. Lore Maintenance crew Executive Vice President, Chief Operations Controller replaces street light in Officer Southeast El Paso (1930s)
Raul A. Carrillo, Jr. Robert C. McNiel General Counsel Vice President, New Mexico Affairs
10 El Paso Electric 2001 Annual Report El Paso Electric 2001 Annual Report 11 History of El Paso Electric sparked new interest in El Paso employees joined the armed By the end of the decade, Electric Railway Companys services, and EPE made El Pasos population was electric lights. Because the special financial arrangements 290,000, and Juárez boasted company dedicated more and for them as a patriotic gesture. 260,000. One-third of Juárezs more of its efforts to producing In 1943, EPE sold its electrical requirements were and distributing electricity, in transportation and bridge supplied by EPE. Las Cruces 1925, the El Paso Electric properties and began focusing population had reached 29,500.
Railway Company changed its strictly on the generation, name to the El Paso Electric transmission and distribution Company (EPE). That same of electricity. Economically, 1 9 6 0 - 1 9 7 0 year, EPE was also granted the city prospered during the The 1960s brought changes authorization to transact war years. Mining, smelting, such as the expansions at both business in New Mexico. Hatch and refining industries had a Texas Western College (now and Rincon, New Mexico, were record year in 1944, and the The University of Texas at El Line crews pose with vehicles for department photo (1920s) added to the system in 1928. El Pasoans conserved electricity during World farming industry reached Paso) and New Mexico State War II by lighting the streets with kerosene Four years later, EPE built the lamps (1940s) $22 million in revenues, with University in Las Cruces, as Rio Grande Power Plant and cotton accounting for two- well as the remodeling of the The Advent of Electricity So, in 1924, the El Paso high voltage lines were erected thirds of the total crop value. El Paso International Airport.
To keep up with all its new In 1901, the El Paso Electric Electric Railway Company to serve Sierra Blanca and Through 1965, demand for customers, the company Railway Company opened for made a strategic move, and Van Horn, Texas. electricity grew at roughly twice switched from manual to business, delivering electricity expanded its focus to the machine-generated billing 1 9 5 0 - 1 9 6 0 the rate of the economy. The to a few hundred streetlights generation and delivery of the latest in modern business El Pasos economy boomed fast pace could be attributed to electricity.
1 9 3 0 - 1 9 4 0 and about 450 customers. technology. during the 1950s, too. In the development of electrical Owner Zach T. White, wanted The 1930s was a decade of Agriculture was flourishing as response, EPE built a new appliances, the convenience of the electricity primarily to expansion for El Paso Electric. well. Electric pumping stations 30,000 kiloWatt turbo- electricity, and effective transform his mule-drawn 1 9 2 0 - 1 9 3 0 As Las Cruces and other parts made it possible to irrigate generator and boiler at the Rio marketing by electric utilities.
streetcar business into an of its New Mexico territory thousands more acres of Grande Power Plant. EPE also On December 24, 1924, a new electric streetcar business. grew, EPE began to sell power farmland, yielding greater successfully negotiated a street lighting system to These streetcars carried up and down the Rio Grande harvests of cotton, fruits, and three-year contract with 1 9 7 0 - 1 9 8 0 illuminate El Pasos business passengers between El Paso, valley from Hatch, New vegetables. Mexicos Comisión Federal de district was turned on for the The early 1970s heralded Texas and Juárez, Mexico. Mexico to Van Horn, Texas and Electricidad to sell off-peak first time. This event was the beginning of what would In 1902, he retired the even into Mexico. It operated power to Juárez, Mexico.
marked by a public celebration become the energy crisis, mules for the latest in high-tech all the electric trolley and bus 1 9 4 0 - 1 9 5 0 El Pasos economy still relied in Pioneer Plaza. Mayor R. M. and EPE immediately took transportation electric services in El Paso, as well as on cotton, copper, cattle, and Dudley pressed a button that In 1940, general business railcars. sightseeing tours, an ice farming. The city further caused the new lights to shine conditions rose sharply, due in For the next two decades, company, and two toll bridges. benefited from the national brightly across downtown. A large part to the expansion of trolley service dominated the municipal Christmas tree Fort Bliss, which increased defense program. The Annual companys business activities. program was begun and the personnel from 3,500 to 30,000 Report to Shareholders for By 1920, it served 12,000 lighting of the Christmas tree by July 1941. Phelps Dodge 1953 noted that Fort Bliss, electric customers, carried in downtown El Paso became a Copper Refinery operated at William Beaumont Army 15 million trolley passengers a holiday tradition that near capacity as a result of an Hospital, Biggs Air Force Base, year, and even ran a special continues today. increased demand for copper. and White Sands Proving line out to the American People were becoming aware American Smelting and Ground (now known as White Smelting and Refining that electricity could improve Refining Company also Sands Missile Range) served Company. Industry was the lives of everyone, not just experienced a profitable year. as the areas greatest assets growing, attracted by the easy businesses and wealthy As the country geared up and were among EPEs largest availability of electric power. customers. This awareness Customer Service representative Yvonne Cabrales (2000) for World War II, many EPE customers. Meter reader Janet Hallsted, Las Cruces (2000)
12 El Paso Electric 2001 Annual Report subsidiaries. EPE thinking energy company also put portions dedicated to its customers, of its interest in shareholders, and employees.
PVNGS up for The little company that sale. However, Zach White started in 1901 has by the mid- grown and changed, and has Mesilla Valley Electric Company truck (1900s) made great strides in providing 1980s, EPE was unable to sell any its customers with safe, reliable measures to confront the of its interest in PVNGS. energy. Along the way, it has problem by negotiating long- In 1989, EPE was forced to also worked to maintain the term fuel contracts, increasing lay off employees for the first highest standards of quality fuel storage facilities, and time in its history. Additionally, service.
reviewing fuel mix procedures. EPE suspended the payment EPE and its employees are EPE also participated in of dividends to its common committed to meeting the future research and development shareholders. The end of the with the same enthusiasm, programs for alternate forms 1980s also saw EPE discontinuing dedication, leadership, and of energy production. In 1973, all of its subsidiary operations. vision that marked the companys EPE signed an agreement with first one hundred years.
several other utilities to 1 9 9 0 - 2 0 0 1 El Paso Electric celebrating participate in the Arizona a century of progress...and a The 1990s opened with Nuclear Power Project. The future of energy.
uncertainty and that uncertainty feasibility study for the Palo grew when EPE filed for Verde Nuclear Generating bankruptcy in 1992. This was a Station (PVNGS) began in difficult period for EPE, but April 1970. The U.S. Nuclear thanks to the hard work of Regulatory Commission dedicated employees who granted a construction permit continued to provide quality in May 1976, and construction service to customers, EPE was on the first unit started soon able to weather the storm and thereafter. emerge from bankruptcy in 1996 EPE was doing more than with a fresh start.
searching for alternative forms Change in the electric utility of energy during this decade.
industry is redefining EPE in In 1977, EPE formed a wholly-ways that are not yet fully owned subsidiary, known as known, but change has been Franklin Land & Resources.
part of EPE for over 100 years.
Originally formed for the EPE has grown from 450 purpose of acquiring real customers in 1901 to 309,000 estate for possible power plant customers in 2001. Generating sites, Franklin Lands purpose capacity has increased just as broadened in 1978.
dramatically in that same time Diversification became EPEs period, from 500 kW to 1.5 focus in the next decade.
million kW. EPE continues to transform itself to meet the 1 9 8 0 - 1 9 9 0 needs of its customers.
El Paso Electric grew as it EPE has entered the 21st diversified through its century as a flexible, forward- Line crews work on EPE distribution lines (2000)