ARTHUR

                                    ANDERSEN

                               ARTHUR ANDERSEN LLP






July 31, 1997                               Arthur Andersen LLP
                                            Suite 400
                                            6501 Americas Parkway NE
                                            Albuquerque, NM 87110-5372
                                            (505) 889-4700


Public Service Company of New Mexico:

We are aware that  Public  Service  Company of New  Mexico has  incorporated  by
reference in its Registration Statement Nos. 33-65418,  333-03303, and 333-03289
its Form 10-Q for the quarter  ended June 30, 1997,  which  includes our report
dated  July 31,  1997, covering  the  unaudited  interim  financial  information
contained therein.  Pursuant to Regulation C of the Securities Act of 1933, that
report  is not  considered  a part of the  registration  statement  prepared  or
certified  by our firm or a report  prepared or certified by our firm within the
meaning of Sections 7 and 11 of the Act.

Very truly yours,



Arthur Andersen LLP