POWER PLAYER
PNM’s CEO takes on the role of industry leader
Originally published Nov. 19, 2017.
Pat Collawn not only runs the state’s biggest electric utility providing power to half a million New Mexico homes and businesses, she is also the first woman to head the Edison Electric Institute, the national trade group that represents more than 200 U.S. investor-owned electric companies and 60 international power companies.
But predicting a career path that now includes tasks like working with
Homeland Security to protect the nation’s electric grid from cyberattacks would have been tough to do based on her first job interview in an industry once dominated by male engineers.
Collawn, a college journalism major who went to high school in a small Nebraska town before earning an MBA at Harvard and landing marketing jobs at Quaker Oats and Price Waterhouse, was working as a consultant in Arizona when she interviewed at Arizona Public Service Co.
“They were thinking about deregulation and were looking for people with a marketing background,” she recalled in a recent interview. “The headhunter called and I went over. They said, what do you know about electricity. And I said, ‘Well, when I flip the switch it comes on, and I pay my bill every month.’ And they said, ‘great.’”
That was 20 years ago, and today Collawn, a low-key, serious-minded CEO, finds herself at the pinnacle of one of the nation’s most important industries.
Although her position as chair of EEI — think of it as an American Bar Association for electricity — is a major national commitment, her real job is chairman, president and CEO of PNM Resources, the parent company of PNM in New Mexico and TNMP in Texas.
It is the only New Mexico headquartered company to trade on the New York Stock Exchange, and it employs about 1,500 people in this state. Total revenue in 2016 was about $1 billion.
Collawn took the position after serving as president and CEO of Public Service Company of Colorado and has been here 10 years — and jokingly says, “I have the certificate to prove it.”
As for her unlikely career in an industry she hadn’t really thought about?
“I came to this industry and I just fell in love. I know that sounds hokey, but we have such an impact on people’s lives. The reliable, affordable power that we have in this country really makes a difference.”
EEI is the advocacy organization for the industry.
“We’ve got members in 50 states and serve about 200 million customers. We (EEI’s members) spend about $100 billion a year in capital investment. We just did a study that shows we account for about 5% of GDP in the U.S. and we like to say it’s the first 5% because without us (electric power) we wouldn’t have all that other cool stuff.”
Military family
The youngest of four siblings in a military family that moved around, including a stint living in Germany, Collawn went to high school in Papillion, Nebraska, outside Omaha, where her father was posted to an Air Force assignment.
“I was a total nerd,” she says. “I was on the pep squad because I wasn’t coordinated enough to be a cheerleader. I ran track but was really slow, and I worked on the high school newspaper.”
“I wanted to be a journalism major. I was in high school at the time of Woodward and Bernstein and really liked and admired what they did. So I applied at different schools and Drake University had a good journalism school and I was fortunate enough to get a scholarship.”
After graduating cum laude from Drake in four years, it was on to Harvard Business School — after a twoyear work detour.
“Harvard had what was called a deferred admittance program designed for people who had promise but no work experience,” Collawn says. “So I stayed at Drake and did fundraising and alumni/parent relations. And that work where you call people asking for money really gives you a thick skin.”
At Harvard she also ran the business school’s newspaper, the Harbus.
“Being a journalism major really prepares you for success. You learn how to ask questions. You learn how to write and be concise and communicate. A lot of my job is asking the right questions, so I think it is an incredible training ground.”
Fishbowl factor
Running PNM is a bit like being the Lobo basketball coach — there is a fishbowl factor because you’re the biggest game in town.
“When I started in utility marketing, the industry was what we called a low interest category. I mean nobody cared. We were never in the newspaper. Now, people care. They care where their power comes from and about the price of their power . ... And we are in the newspaper.”
There are reasons for that.
PNM has filed contentious rate increase requests with state regulators, which draw opposition from various sectors. A particular criticism is that PNM made imprudent investments and shouldn’t be allowed to recover or profit from them as a regulated utility.
There is an ongoing fight over how quickly the company should phase out coal, and in some quarters there is opposition to using natural gas to generate electricity rather than pushing exclusively to renewables such as wind and solar.
Then there is PNM’s executive compensation, including Collawn’s salary. She could earn a total of $4.118 million for 2016, including base salary, benefits, incentives and stock.
She understands the connection people make between her salary and paying their monthly bill, and that the numbers are hard for people to comprehend.
But Collawn says PNM has done a good job of “making sure customers don’t pay most of my compensation. Some utilities ask for their executive bonus and executive stock to be paid by the customers. We don’t. Most of my salary is paid for by shareholders.”
And she says, “It’s what you get for running a utility. Our linemen are paid what linemen are paid. You don’t take a New Mexico discount for a lineman because we’re in a poor state. Same thing here.”
Despite being on the perennial firing line, Collawn expresses no regrets about the move to New Mexico.
“I love the geography here. We tell people this is the best of Denver and the best of Phoenix. You get high desert and mountains, but it’s not as hot as Phoenix or as cold as Denver. And I’m a total weather wimp now.”
And, she says, the company “has a public service mentality in its DNA. Yes, we have to work for the shareholders
... but we also have to take care of our employees and be good to the community in which we live and work.” The people at PNM, she says, “really care.”
As for being good to the community, Collawn has served as chair of United Way, helped launch Mission: Graduate, previously chaired the Greater
Albuquerque Chamber of Commerce and is the incoming chair-elect. She is also the current chair of the New Mexico Partnership, an important agency in New Mexico’s economic development efforts and had a key role in getting Facebook to locate to New Mexico.
She says her priorities are all about “economic development and creating jobs. A lot of the problems we have as a state go away when people have jobs. People are brought out of poverty, the state gets more money, etc. It’s a virtuous cycle as opposed to a vicious cycle. And that’s what I really want to work on.”
Energy future
Collawn says her No. 1 priority at PNM is changing the electricity generation portfolio.
“Getting out of coal makes the most sense for our customers and for the environment. The price of natural gas is incredibly compelling and the forecasts all say the price is going to stay down because of fracking.”
The company’s proposed Integrated Resource Plan would shut down the coal-fired San Juan Generating Station in northwest New Mexico by 2022 and it would pull PNM out of the Four Corners Power Plant by 2031.
The lost power would be replaced by a combination of natural gas generation, wind, solar and nuclear.
The proposed timetable is too slow for some and too fast for others — including those whose livelihoods are tied to the coal-fired plant.
“Unfortunately, up in the San Juan area, there’s not a lot of replacement jobs for all those jobs in the coal mine and plant and those are good middle class jobs. So doing it gradually gives us a chance to work with those communities and help train those folks and find jobs.”
She says the company’s timetable will ensure good prices for customers and be good for the environment.
Some environmental groups oppose natural gas and nuclear power, but Collawn says they are still needed for the foreseeable future.
“The sun doesn’t shine all day, and the wind doesn’t blow all the time. We have to have something for baseload. At some point I think batteries could replace natural gas (for baseload), but they just aren’t there yet.”
“At the end of the day, we’ve go to make sure everybody’s got electricity” and it has to be at a reasonable price.
Collawn’s personal initiatives at EEI — the new chairman usually gets to pick a couple — are pushing diversity and inclusion and “smart cities” technology that will make the grid “smarter” and empower consumers.
EEI also works with the federal government on cybersecurity, working to harden the grid to protect against attacks — which she describes as a “real issue.”
Iron Lady
Collawn, whose mother died when she was 7 and whose father passed away while she was in college, says she was fortunate along the way to have “good bosses who mentored me and gave me a chance.”
As for role models, “I’ve always been a big fan of Margaret Thatcher. She was a strong female who was controversial but really made a difference in the history of Great Britain. And Angela Merkel, just for her long-standing service to country.”
Collawn is a diehard Denver Broncos fan and dog lover.
She met Colorado businessman Bob Collawn on a bus during a leadership exchange trip to Chicago in 2001, and they married in 2005. They have marked Vietnam, China and Thailand off their travel list and are headed to Russia in the spring.
They have a ranch in the Colorado Springs area, as well as a home in Albuquerque and the family includes two dogs, a cat and Bob’s blue and gold macaw, named Pirate.
Work and travel don’t leave a lot of time for hobbies, but she likes to cook. Best dish? Buffalo chili.
Asked to look 10 years down the road, the 59-year-old Collawn says, “I can’t imagine not working. But, I do kid around the office that I’m going to go to law school.”
Who knows? Maybe she isn’t kidding.