Administrative Law Judges Issue Order to Abate Hearing in El Paso Electric Company’s Texas Rate Case

EL PASO, Texas–(BUSINESS WIRE)–On August 24, 2017, the Administrative Law Judges (ALJs) in El Paso
Electric Company’s (EPE) (NYSE: EE) pending case to change its Texas
retail electric rates in Public Utility Commission of Texas (PUCT)
Docket No. 46831 issued an order to abate the hearing on the merits,
which commenced on August 21, 2017. The hearings were abated to
facilitate settlement discussions among the parties. The outcome of any
hearing or settlement would be subject to review by the PUCT. EPE
expects to file a status report on settlement progress with the ALJs on
a weekly basis.

On February 13, 2017, EPE filed with the City of El Paso, other
incorporated municipalities in its Texas service territory and the PUCT
a request for an increase in non-fuel base revenues of approximately
$42.5 million. When EPE filed its rebuttal testimony in the rate case on
July 21, 2017, it modified the requested increase in non-fuel base
revenues to $39.2 million primarily to reflect the separation of $3.0
million in rate case expenses into a separate docket.

“Settlement agreements can occur at any stage in the rate case process
and this suspension of the hearing allows the parties involved in this
case to continue settlement discussions with the possibility of finding
common ground on several issues,” said Mary Kipp, El Paso Electric
President and Chief Executive Officer. “While we do not know the final
outcome, the action taken today will still allow rates to relate back to
July 18, 2017.”

El Paso Electric Company is a regional electric utility providing
generation, transmission and distribution service to approximately
416,000 retail and wholesale customers in a 10,000 square mile area of
the Rio Grande valley in west Texas and southern New Mexico.

Safe Harbor

This news release includes statements that may constitute
forward-looking statements made pursuant to the safe harbor provisions
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements often involve risks and
uncertainties that could cause actual results to differ materially from
such forward-looking statements. Risks and factors that could cause or
contribute to such differences include, but are not limited to: (i) a
breakdown in settlement discussions with the parties in EPE’s Texas rate
case; (ii) EPE’s inability to reach agreement with the intervenors in
EPE’s Texas rate case; (iii) increased prices for fuel and purchased
power and the possibility that regulators may not permit EPE to pass
through all such increased costs to customers or to recover previously
incurred fuel costs in rates; (iv) full and timely recovery of capital
investments and operating costs through rates in Texas and New Mexico;
and (v) other factors detailed by EPE in its public filings with the
Securities and Exchange Commission (SEC). EPE's filings are available
from the SEC or may be obtained through EPE's website, http://www.epelectric.com.
Although EPE believes that the expectations reflected in such
forward-looking statements are reasonable, no assurances can be given
that these expectations will prove to be correct. Any such
forward-looking statement is qualified by reference to these risks and
factors. EPE cautions that these risks and factors are not exclusive.
EPE does not undertake to update or revise any forward-looking statement
that may be made from time to time by or on behalf of EPE except as
required by law.

Contacts

El Paso Electric Company
Public Relations:
Eddie
Gutierrez, 915-543-5763
[email protected]
or
Investor
Relations:
Lisa Budtke, 915-543-5947
[email protected]
or
Richard
Gonzalez, 915-543-2236
[email protected]