|UNITED STATES SECURITIES AND EXCHANGE COMMISSION                                                        
|--------------------------------------------------------------------------------------------------------
|WASHINGTON, D. C.  20549                                                                                
|                                                                                                        
|FORM 10-Q                                                                                               
|                                                                                                        
|(Mark One)                                                                                              
|(X)     COMBINED QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|For the quarterly period endedMarch 31, 2001                                                            
|                                                                                                        
|or                                                                                                      
|                                                                                                        
|(  )     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934       
|For the transition period from  to                                                                      

____________________________________________________________________________________________

|Commission File Number: 1-8847                                   
|-----------------------------------------------------------------
|                                                                 
|TNP ENTERPRISES, INC.                                            
|(Exact name of registrant as specified in its charter)           
|                                                                 
|Texas                                                            
|(State of incorporation)                                         
|                                                                 
|4100 International Plaza, P. O. Box 2943, Fort Worth, Texas 76113
|(Address and zip code of principal executive offices)            
|                                                                 
|Registrant's telephone number, including area code 817-731-0099  



Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes \X\ No \   \

TNP Enterprises, Inc. has no publicly traded shares of common stock outstanding.

____________________________________________________________________________________________

|Commission File Number: 2-97230                                  
|-----------------------------------------------------------------
|                                                                 
|TEXAS-NEW MEXICO POWER COMPANY                                   
|(Exact name of registrant as specified in its charter)           
|                                                                 
|Texas                                                            
|(State of incorporation)                                         
|                                                                 
|4100 International Plaza, P. O. Box 2943, Fort Worth, Texas 76113
|(Address and zip code of principal executive offices)            
|                                                                 
|Registrant's telephone number, including area code 817-731-0099  



Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes \X\ No \   \



TNP Enterprises, Inc. holds all 10,705 outstanding common shares of Texas-New Mexico Power Company.

____________________________________________________________________________________________



|TNP Enterprises, Inc. And Subsidiaries                                    
|--------------------------------------------------------------------------
|Texas New-Mexico Power Company And Subsidiaries                           
|Combined Quarterly Report on Form 10-Q for the period ended March 31, 2001



This Combined Quarterly Report on Form 10-Q is filed separately by TNP Enterprises, Inc., and Texas-New Mexico Power Company.  Texas-New Mexico Power Company makes no representation as to information
relating to TNP Enterprises, Inc., except as it may relate to Texas-New Mexico Power Company, or to any other affiliate or subsidiary of TNP Enterprises, Inc.





|TABLE OF CONTENTS                              
|-----------------------------------------------
|                                               
|PART I.  FINANCIAL INFORMATION                 
|Item 1.                                        
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|Item 2.                                        
|PART II.  OTHER INFORMATION                    
|Item 1.                                        
|Item 6.                                        
|                                               
|                                               
|Statement Regarding Forward Looking Information
|Signature page                                 



2

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|TNP ENTERPRISES, INC. AND SUBSIDIARIES                                                 
|---------------------------------------------------------------------------------------
|CONSOLIDATED STATEMENTS OF INCOME (LOSS)                                               
|(Unaudited)                                                                            
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|OPERATING REVENUES                                                                     
|                                                                                       
|OPERATING EXPENSES:                                                                    
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|NET OPERATING INCOME                                                                   
|                                                                                       
|OTHER INCOME:                                                                          
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|INCOME BEFORE INTEREST CHARGES                                                         
|                                                                                       
|INTEREST CHARGES:                                                                      
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|INCOME (LOSS) BEFORE THE CUMULATIVE                                                    
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|NET INCOME (LOSS)                                                                      
|                                                                                       
|                                                                                       
|INCOME (LOSS) APPLICABLE TO COMMON STOCK                                               
|                                                                                       
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|3                                                                                      
|_____________________________________________________________________________________  
|                                                                                       

|TNP ENTERPRISES, INC. AND SUBSIDIARIES                                                 
|---------------------------------------------------------------------------------------
|CONSOLIDATED STATEMENTS OF CASH FLOWS                                                  
|(Unaudited)                                                                            
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                  
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                    
|                                                                                       
|CASH FLOWS FROM INVESTING ACTIVITIES:                                                  
|                                                                                       
|                                                                                       
|                                                                                       
|NET CASH USED IN INVESTING ACTIVITIES                                                  
|                                                                                       
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                  
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                                    
|                                                                                       
|NET CHANGE IN CASH AND CASH EQUIVALENTS                                                
|CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                       
|                                                                                       
|CASH AND CASH EQUIVALENTS AT END OF PERIOD                                             
|                                                                                       
|                                                                                       
|RECONCILIATION OF NET INCOME (LOSS) TO NET                                             
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
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|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                    
|                                                                                       
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|4                                                                                      
|_____________________________________________________________________________________  
|                                                                                       

|TNP ENTERPRISES, INC. AND SUBSIDIARIES                                                 
|---------------------------------------------------------------------------------------
|CONSOLIDATED BALANCE SHEETS                                                            
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|ASSETS                                                                                 
|                                                                                       
|UTILITY PLANT:                                                                         
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|OTHER PROPERTY AND INVESTMENTS, at cost                                                
|                                                                                       
|CURRENT ASSETS:                                                                        
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|LONG-TERM AND OTHER ASSETS:                                                            
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|CAPITALIZATION AND LIABILITIES                                                         
|                                                                                       
|CAPITALIZATION:                                                                        
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|CURRENT LIABILITIES:                                                                   
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|LONG-TERM AND OTHER LIABILITIES:                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|COMMITMENTS AND CONTINGENCIES (Note 4)                                                 
|                                                                                       
|                                                                                       
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|5                                                                                      
|_____________________________________________________________________________________  
|                                                                                       

|TEXAS-NEW MEXICO POWER COMPANY AND SUBSIDIARIES                                        
|---------------------------------------------------------------------------------------
|(a wholly owned subsidiary of TNP Enterprises, Inc.)                                   
|CONSOLIDATED STATEMENTS OF INCOME                                                      
|(Unaudited)                                                                            
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|OPERATING REVENUES                                                                     
|                                                                                       
|OPERATING EXPENSES:                                                                    
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|NET OPERATING INCOME                                                                   
|                                                                                       
|OTHER INCOME:                                                                          
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|INCOME BEFORE INTEREST CHARGES                                                         
|                                                                                       
|INTEREST CHARGES:                                                                      
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|INCOME BEFORE THE CUMULATIVE EFFECT                                                    
|                                                                                       
|Cumulative effect of change in accounting for                                          
|                                                                                       
|                                                                                       
|NET INCOME                                                                             
|Dividends on preferred stock and other                                                 
|                                                                                       
|INCOME APPLICABLE TO COMMON STOCK                                                      
|                                                                                       
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|6                                                                                      
|_____________________________________________________________________________________  
|                                                                                       

|TEXAS-NEW MEXICO POWER COMPANY AND SUBSIDIARIES                                         |                                                                                            
|--------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------
|(a wholly owned subsidiary of TNP Enterprises, Inc.)                                    |                                                                                            
|CONSOLIDATED STATEMENTS OF CASH FLOWS                                                   |                                                                                            
|(Unaudited)                                                                             |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                   |                                                                                            
|                                                                                        | Cash received from sales to customers                                                      
|                                                                                        | Purchased power and fuel costs paid                                                        
|                                                                                        | Cash paid for payroll and to other suppliers                                               
|                                                                                        | Interest paid, net of amounts capitalized                                                  
|                                                                                        | Income taxes refunded                                                                      
|                                                                                        | Other taxes paid                                                                           
|                                                                                        | Other operating cash receipts and payments, net                                            
|                                                                                        |                                                                                            
|NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                     |                                                                                            
|                                                                                        |                                                                                            
|CASH FLOWS FROM INVESTING ACTIVITIES:                                                   |                                                                                            
|                                                                                        | Additions to utility plant                                                                 
|                                                                                        | Additions to other property                                                                
|                                                                                        |                                                                                            
|NET CASH USED IN INVESTING ACTIVITIES                                                   |                                                                                            
|                                                                                        |                                                                                            
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                   |                                                                                            
|                                                                                        | Dividends paid on preferred and common stocks                                              
|                                                                                        | Borrowings from (repayments to) revolving credit facilities - net                          
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        | Redemptions:                                                                               
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                                     |                                                                                            
|                                                                                        |                                                                                            
|NET CHANGE IN CASH AND CASH EQUIVALENTS                                                 |                                                                                            
|CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                        |                                                                                            
|                                                                                        |                                                                                            
|CASH AND CASH EQUIVALENTS AT END OF PERIOD                                              |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|RECONCILIATION OF NET INCOME TO NET                                                     |                                                                                            
|                                                                                        | CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:                                           
|                                                                                        | Net income                                                                                 
|                                                                                        | Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        | Cash flows impacted by changes in current assets and liabilities:                          
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|                                                                                        | Other, net                                                                                 
|                                                                                        |                                                                                            
|NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                     | $           23,873                                                                         
|                                                                                        |                                                                                            
|                                                                                        |                                                                                            
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                        |                                                                                            
|7                                                                                       |                                                                                            
|_____________________________________________________________________________________   |                                                                                            
|                                                                                        |                                                                                            

|TEXAS-NEW MEXICO POWER COMPANY AND SUBSIDIARIES                                        
|---------------------------------------------------------------------------------------
|(a wholly owned subsidiary of TNP Enterprises, Inc.)                                   
|CONSOLIDATED BALANCE SHEETS                                                            
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|ASSETS                                                                                 
|                                                                                       
|UTILITY PLANT:                                                                         
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|OTHER PROPERTY AND INVESTMENTS, at cost                                                
|                                                                                       
|CURRENT ASSETS:                                                                        
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|LONG-TERM AND OTHER ASSETS:                                                            
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|CAPITALIZATION AND LIABILITIES                                                         
|                                                                                       
|CAPITALIZATION:                                                                        
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|CURRENT LIABILITIES:                                                                   
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|LONG-TERM AND OTHER LIABILITIES:                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|                                                                                       
|COMMITMENTS AND CONTINGENCIES (Note 4)                                                 
|                                                                                       
|                                                                                       
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|8                                                                                      
|_____________________________________________________________________________________  
|                                                                                       



|TNP Enterprises Inc. and Subsidiaries          
|-----------------------------------------------
|Texas-New Mexico Power Company and Subsidiaries
|Notes to Consolidated Financial Statements     



Note 1.  Interim Financial Statements



The interim consolidated financial statements of TNP and subsidiaries, and TNMP and subsidiaries, are unaudited, and contain all adjustments (consisting primarily of normal recurring accruals)
necessary for a fair statement of the results for the interim periods presented.  Results for interim periods are not necessarily indicative of results to be expected for a full year or for previously reported periods due in part to seasonal revenue
fluctuations.  It is suggested that these consolidated financial statements be read in conjunction with the audited consolidated financial statements and notes thereto included in TNP's and TNMP's 2000 Combined Annual Report on Form 10-K.



Prior period statements have been reclassified in order to be consistent with current period presentation. The reclassification had no effect on net income or common shareholders' equity.



Note 2.  Regulatory Matters



Texas



Unbundled Cost of Service Filing (UCOS).  The legislation that established retail competition required TNMP to file a rate case that will set rates for the transmission and distribution company
that will provide regulated services once competition begins in 2002.  On March 31, 2000, TNMP filed its UCOS with the Public Utility Commission of Texas (PUCT).  The filing proposed the rates at which TNMP's customers would purchase transmission and
distribution services after December 31, 2001.  The filing also included a proposed Competition Transition Charge (CTC), as required by the legislation.  The CTC is designed to recover stranded costs or Economic Cost over Market (ECOM) related to TNMP's
generation assets and purchased power contracts, as determined by a PUCT-established model.



In March 2001, the PUCT issued an interim order in the ECOM phase of the UCOS that directed TNMP to recalculate ECOM based on inputs provided by the PUCT.  In April 2001, TNMP filed the results of
its recalculation of ECOM with the PUCT.  In its filing, TNMP estimated that it would not have any ECOM after taking into account the amount of stranded cost TNMP will have mitigated by January 1, 2002.



In April 2001, the PUCT ratified a settlement regarding the transmission and distribution cost of service that the parties reached in March 2001.  The settlement provides for transmission and
distribution service tariffs effective January 1, 2002 that will provide $125.6 million of revenue to TNMP.  In addition, the PUCT made its initial ECOM determination, accepting the amounts filed by TNMP as discussed above.



Although the PUCT has made its initial determination of ECOM, the actual amount of ECOM will be determined through one of the four market-based mechanisms required by the legislation by 2004.  The
actual determination of ECOM may differ from the PUCT's initial determination.



In addition to UCOS issues, TNMP expects the PUCT to address certain issues related to its January 2000 Business Separation Plan filing in the UCOS.  The PUCT's current schedule for TNMP's UCOS
contemplates issuance of a final order in August 2001.



Fuel Factor.In April 2001, TNMP filed a request with the PUCT to increase its fuel factor by approximately 40 percent as compared to the fuel factor currently in effect.  TNMP filed the
request in response to projected increases in the cost of fuel and energy-related purchased power.  TNMP has asked the PUCT to put the new fuel factor into effect on June 1, 2001.



New Mexico



Restructuring.  In March 2001, legislation was finalized that delays the effective dates of retail electric competition established in the Electric Utility Industry Restructuring Act of 1999
(the Act).  The Act had originally provided for the phase-in of retail choice beginning January 1, 2001, and the New Mexico Public Regulation Commission (NMPRC) had previously delayed the start of retail electric competition by one year to January 1,
2002.  Under the new legislation, retail electric competition for residential, school, and small commercial customers will begin on January 1, 2007.  Open access for large commercial and industrial customers will begin on January 1, 2008.



During the first quarter of 2001, TNMP eliminated its $0.9 million reserve for stranded costs associated with purchased power contracts as a result of the legislation's delay of the start of
competition.



9

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Note 3.  Accounting Developments



Accounting for Derivatives



As reported in the 2000Combined Annual Report on Form 10-K,TNP and TNMP adopted Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments and
Hedging Activities," as extended and amended, effective January 1, 2001.  The initial adoption of SFAS 133 had no impact on the financial position, results of operations or cash flows of TNP and TNMP.



Ongoing implementation issues being addressed by the Derivatives Implementation Group (DIG) may affect the application of SFAS 133.  In the normal course of business, TNMP enters into commodity
contracts, which include "swing" components for additional purchases or sales of electricity.  TNMP and its customers use these contracts to meet electricity requirements.  TNP and TNMP have evaluated these contracts and determined that they qualify for
the normal purchases and sales exception provided by SFAS 133.  In October 2000, the DIG reached a tentative conclusion that all option contracts do not qualify for such exception.  In April 2001, the Financial Accounting Standards Board (FASB) approved
this tentative conclusion and, if not further modified, these contracts will be required to be accounted for as derivatives commencing July 1, 2001.



TNP and TNMP are unable to determine the precise impact related to the electricity contracts discussed above.  There are a number of other issues pending before the DIG that may have an impact on the
application of this statement.  TNP and TNMP are unable to predict the outcome of these issues.



Change in Accounting for Major Maintenance Costs



Effective January 1, 2001, TNP and TNMP began charging the costs of major maintenance projects to expense as incurred and wrote-off the balance of previously deferred major maintenance costs.
Prior to January 1, 2001, TNP and TNMP had deferred the costs of major maintenance projects and amortized those costs to expense over periods ranging from three to seven years.  TNP and TNMP believe that expensing major maintenance costs is preferable to
deferring those costs because those costs do not result in the acquisition of or the replacement of units of property.



The change in accounting for major maintenance costs reduced pre-tax net income for the three months ended March 31, 2001, by $1.9 million ($1.2 million after tax).  Had this new accounting method
been in effect during prior periods, income before the cumulative effect of the change in accounting would not have been materially different from that shown in the accompanying consolidated statements of income.



Note 4.  Commitments and Contingencies



Legal Actions



Phillips Petroleum.TNMP is the defendant in a suit styled Phillips Petroleum Company vs. Texas-New Mexico Power Company, filed on October 1, 1997 and pending in the 149th
State District Court of Brazoria County, Texas.  The suit, which is in the discovery stage, is based on events surrounding an interruption of electricity to a petroleum refinery and related facilities that occurred in May 1997.  Phillips Petroleum Company
is seeking the recovery of damages arising from the interruption and in May 1999 demanded payment in the amount of $47.1 million.  TNMP's tariff approved by the PUCT contains limitations against recovery of the great majority of Phillips' alleged damages.
 The Texas Supreme Court, in another matter, has recently upheld the enforceability of such tariff limitations in litigation of this type; TNMP believes the ruling will operate to substantially limit any recovery by Phillips to the cost of its electrical
equipment, in the event that any damages are awarded in this matter.  Discovery has not sufficiently progressed to quantify any damages to Phillips' electrical equipment; however, Phillips has previously reported to the SEC that it incurred costs of
approximately $2.0 million in this interruption.  In May 1999, TNMP filed a Third Party Petition naming Sweeny Cogeneration Limited Partnership, the operator of cogeneration and related facilities at the Phillips refinery, as a defendant.  TNMP has
previously charged to earnings the deductible amount of its insurance coverage, $500,000.



Other.TNP and TNMP are involved in various claims and other legal proceedings arising in the ordinary course of business.  In the opinion of management, the ultimate dispositions of these
matters will not have a material adverse effect on TNMP's and TNP's consolidated financial condition or results of operations.

10

____________________________________________________________________________________________



Item 2.   Management's Discussionand Analysis of Financial Condition and Results of Operations (MD&A).



The following discussion should be read in conjunction with the related interim consolidated financial statements and notes.



Results of Operations



Overall Results



TNP



TNP had a loss applicable to common stock of $8.2 million for the quarter ended March 31, 2001 as compared to earnings of $3.8 million for the quarter ended March 31, 2000.  The decrease in
earnings was caused primarily by goodwill amortization, interest expense, and preferred dividends resulting from the acquisition of TNP by SW Acquisition, L.P. in April 2000 (the Merger).



TNMP



TNMP's earnings applicable to common stock were $6.7 million for the quarter ended March 31, 2001 as compared to $7.8 million for the quarter ended March 31, 2000.



Under legislation passed in 1999, TNMP's earnings on its Texas operations are capped at a 10.53% return on rate base adjusted for discounted rates to industrial customers, which are expected to be
approximately $1.9 million in 2001.  TNMP will apply Texas earnings in excess of the cap to recover its stranded costs.  During the first quarter of 2001, TNMP recorded pre-tax excess earnings of $3.1 million ($1.9 million after tax).



The changes in TNP's and TNMP's earnings for the quarter are attributable to the factors listed below (in millions):



|                       |                                                                                    |                                                                      | EarningsIncrease (Decrease)             
|---------------------- | ---------------------------------------------------------------------------------- | -------------------------------------------------------------------- | ----------------------------------------
|                       |                                                                                    |                                                                     
|                       |                                                                                    |                                                                      | Three Months
Ended March 31,2001 v. 2000
|                       |                                                                                    |                                                                     
|                       |                                                                                    |                                                                     
|Factors affecting TNMP |                                                                                   
|                       | Changes in base revenues                                                           | $          5.2                                                      
|                       | Texas non-pass-through purchased power expenses                                    | (6.5)                                                               
|                       | Interest charges                                                                   | 2.5                                                                 
|                       | All other (including income tax effects on the items above)                        | (0.1)                                                               
|                       | Cumulative effect of change in accounting for major maintenance costs (net of tax) | (1.2)                                                               
|                       |                                                                                    | Change in TNMP earnings before charge for recovery of stranded plant | (0.1)                                   
|                       | Charge for recovery of stranded plant (net of tax)                                 | (0.9)                                                               
|                       |                                                                                    | Change in TNMP earnings                                              | (1.0)                                   
|Factors affecting TNP  |                                                                                   
|                       | Other operating expenses                                                           | 4.2                                                                 
|                       | Goodwill amortization                                                              | (2.9)                                                               
|                       | Interest charges                                                                   | (10.9)                                                              
|                       | Dividends on preferred stock                                                       | (3.9)                                                               
|                       | All other (including income tax effects on the items above)                        | 2.5                                                                 
|                       |                                                                                    | Change in TNP earnings                                               | (11.0)                                  
|                       |                                                                                    | Change in consolidated earnings                                      | $        (12.0)                         
|                       |                                                                                    |                                                                      |                                         

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TNMP Operating Revenues



The following table summarizes the components of base revenues (in thousands).



|                      | Three Months Ended March 31,
|--------------------- | ----------------------------
|                      |                             
|                      | 2001                        
|Operating revenues    | $  168,354                  
|                      |                             
|Pass-through expenses | 86,554                      
|                      |                             
|Base revenues         | $   81,800                  
|                      |                             

Pass-through expenses in Texas include fuel and the energy-related portion of purchased power.  In New Mexico, pass-through expenses include all purchased power costs.  Details of pass-through
expenses are discussed under "Results of Operations -- Operating Expenses."

The following table summarizes the components of the change in base revenues for the three months ended March 31, 2001 compared to the same period in 2000 (in thousands).



|                                 |  |  |  |                  | Three Months
Ended March 30,2001 v. 2000
|-------------------------------- |  |  |  | ---------------- | ----------------------------------------
|                                 |  |  |  |                 
|                                 |  |  |  |                 
|Weather related                  |  |  |  |                  | $          4,029                        
|Customer growth                  |  |  |  |                  | 1,369                                   
|New Mexico stranded cost reserve |  |  |  | 927             
|Texas base rate reduction        |  |  |  | (1,586)         
|Industrial sales                 |  |  |  |                  | (1,553)                                 
|Price/sales mix and other        |  |  |  |                  | 1,997                                   
|Base revenues increase           |  |  |  | $          5,183
|                                 |  |  |  |                 



Current quarter base revenues increased $5.2



Effective January 1, 2001, TNMP implemented base rate reductions of 3% and 1% for residential and commercial customers, respectively, under the terms of a Declaratory Order issued by the PUCT on
December 6, 1999.

The following table summarizes the components of gigawatt-hour (GWH) sales.



|                            |                  | Three Months Ended March 31,
|--------------------------- | ---------------- | ----------------------------
|                            |                  |                             
|                            |                  | 2001                        
|Residential                 | 590              |                             
|Commercial                  | 458              |                             
|Industrial:                 |                  |                             
|                            | Firm             | 161                         
|                            | Economy          | 959                         
|Sales for resale (including |                  |                             
|                            | power marketing) | 178                         
|Other                       | 23               |                             
|                            | Total GWH Sales  | 2,369                       
|                            |                  |                             



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Current quarter sales of 2,369 GWHs increased by 188 GWHs (or 8.6%) as compared to the corresponding 2000 period. The increase resulted from higher off-system sales, higher weather-related sales in
the commercial and residential classes, and growth in the number of commercial and residential customers.  The increase was partially offset by reduced sales to a significant industrial customer under an economy sales arrangement.



Operating Expenses



Factors Affecting TNMP



TNMP incurred operating expenses of $152.7 million in the quarter ended March 31, 2001, an increase of $46.2 million over the amount incurred during the corresponding period of 2000.  The
increase reflects higher costs for purchased power and fuel, and higher charges for recovery of stranded plant.



Purchased Power and Fuel Expenses



The following table summarizes the components of TNMP's purchased power and fuel expenses (in thousands).



|                                  |                           |                       | Three Months Ended March 31,
|--------------------------------- | ------------------------- | --------------------- | ----------------------------
|                                  |                           |                       |                             
|                                  |                           |                       | 2001                        
|Purchased power and fuel expenses |                           |                       |                             
|                                  | Pass-through expenses     |                       |                             
|                                  |                           | Purchased power       | $  76,600                   
|                                  |                           | Fuel                  | 9,954                       
|                                  |                           |                       | 86,554                      
|                                  | Non-pass-through expenses |                       |                             
|                                  |                           | Texas purchased power | 17,672                      
|                                  |                           | Fuel                  | 349                         
|                                  |                           |                       | 18,021                      
|                                  |                           |                       |                             
|Total purchased power and fuel    | $ 104,575                 |                       | $  59,550                   
|                                  |                           |                       |                             



In the first quarter of 2001, purchased power and fuel expenses increased $45.0 million from the level incurred during the first quarter of 2000.  Pass-through expenses increased $38.7 million,
reflecting increased purchases caused by higher sales overall and price increases in Texas and New Mexico.  Non-pass-through expenses increased $6.4 million due to higher demand purchased power costs in Texas during 2001, and a $2.4 million credit in
2000, resulting from a PUCT order to defer and amortize previously incurred costs.



Charge for Recovery of Stranded Plant



Charge for recovery of stranded plant increased $1.5 million in the first quarter of 2001 compared to the same period in 2000.  The charge for recovery of stranded plant in the first quarter of 2000
included a $1.0 million credit for the PUCT order discussed above.



Interest Charges



Interest charges decreased by $2.5 million in the three months ended March 31, 2001 compared to the same period in 2000.  In October 2000, TNMP established a $315 million credit facility that
carried a composite interest rate of approximately 6.6% as of March 31, 2000.  That rate was significantly lower than the rates on the first mortgage bonds and secured debentures outstanding at March 31, 2000.  Reduced debt levels also contributed to the
decrease in interest charges.



Cumulative Effect of Change in Accounting



As discussed in Note 3, TNMP began charging the costs of major maintenance to expense as incurred effective January 1, 2001, and wrote-off the balance of previously deferred major maintenance
costs.  The change resulted in a pre-tax charge of $1.9 million ($1.2 million after tax).

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Factors Affecting TNP



Other Operating Expenses



Other operating expenses for the first quarter of 2001 decreased $4.2 million compared to the same period in 2000.  The decrease resulted from the first quarter of 2000 including a one-time charge of
$5.6 million for severance and retirement benefits due to the change in control resulting from the Merger.



Depreciation and Amortization



Beginning in the second quarter of 2000, TNP began amortizing goodwill associated with the Merger over 25 years.  Goodwill amortization was $2.9 million for the three months ended March 31, 2001.



Interest Charges



TNP incurred interest charges of $10.9 million for the three months ended March 31, 2001, on the debt issued to finance the Merger.  TNP incurred less than $0.1 million in pre-merger interest expense
during the three months ended March 31, 2000.



Dividends on Preferred Stock



TNP issued preferred stock to finance the Merger.  Dividends on preferred stock were $3.9 million for the three months ended March 31, 2001.



Financial Condition



TNMP Liquidity



The main sources of liquidity for TNMP are cash flow from operations and borrowings from its credit facility.  TNMP's cash flow from operations was $35.8 million higher in the first quarter of 2001
as compared to the first quarter of 2000 due to higher receipts from customers, resulting from higher sales and increases in TNMP's fuel factor in Texas.  The increase was partially offset by higher payments for fuel and purchased power costs.



As discussed in "Results of Operations," above, TNMP established a $315 million credit facility in October 2000.  As of March 31, 2001, TNMP had the ability to borrow an additional $74
million under the $315 million credit facility, subject to compliance with covenants in this facility as well as covenants in TNP's revolving credit facility discussed below.

TNMP has an under-recovered balance of fuel and energy-related purchased power costs in Texas of $27.9 million as of March 31, 2001.  TNMP's request to increase its fuel factor is discussed in Note 3.

TNMP has sufficient liquidity to satisfy the possibility of any known contingencies.  Management believes cash flow from operations and periodic borrowings under its $315 million credit facility
should be sufficient to meet working capital requirements at least through 2001.

TNP Liquidity



TNP's main sources of liquidity, and its ability to service the debt issued to finance the Merger, depend primarily on the earnings of TNMP and the distribution of those earnings in the form of cash
dividends, as well as tax payments from TNMP due under a tax sharing agreement between TNP and TNMP.  TNP has a $25 million revolving credit facility that will be used to provide working capital and meet other requirements.  The revolving credit facility
was put in place at the time of the Merger.  As of March 31, 2001, TNP had no borrowings against the revolving credit facility, and the entire $25 million was available to TNP, subject to compliance with covenants in this facility.



Cash dividends from TNMP to TNP are limited by restrictions included in TNMP's debt indentures and bank agreements.  In addition, the regulatory orders from the PUCT and the NMPRC approving the
Merger contain additional restrictions on TNMP's ability to pay cash dividends to TNP.  For the three months ended March 31, 2001, TNMP has paid dividends of $4.0 million to TNP.  In April 2001, TNMP paid a $12.0 million dividend to TNP that had been
declared in March 2001.



During the three months ended March 31, 2001, TNMP made tax sharing payments to TNP of $2.0 million.



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During the first quarter of 2001, TNP's cash flow from operations was $33.6 million higher than in the first quarter of 2000 due to TNMP's higher cash flow from operations as discussed above, offset
by interest payments on the debt issued to finance the Merger.



Management believes that dividends from TNMP, payments from TNMP under the tax sharing agreement, and periodic borrowings under its revolving credit facility should be sufficient to meet TNP's
working capital requirements at least through 2001.



Other Matters



Retail Pilot Project.Beginning June 1, 2001, First Choice Power, Inc. (First Choice), the retail electric provider affiliate of TNMP, and a wholly owned subsidiary of TNP will participate in
a retail pilot in the state of Texas.  The pilot is being conducted in anticipation and preparation for the commencement of full-scale competition on January 1, 2002, and is intended to provide all participants in the retail electric market with the
opportunity to test systems and processes to be used in the competitive market.  In this pilot, up to five percent of each class of customers now served by investor owned utilities in Texas (i.e., industrial, commercial and residential) may elect to
participate in the pilot.  First Choice is actively working to acquire customers for the pilot program.  Participation in the pilot by TNMP's commercial and industrial customers has been fully subscribed, as has been the case with commercial and
industrial customers throughout Texas.  A relatively small number of TNMP's residential customers have chosen to participate in the pilot.

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PART II - OTHER INFORMATION



Item 1.  Legal Proceedings.



Power Resource Group.  On March 8, 2001, the judge of the 345th District Court of Travis County, Texas entered a Final Judgment in which he granted summary judgment in favor of
TNMP and dismissed the case in the suit styled Power Resource Group, Inc. v. Public Utility Commission of Texas and Texas-New Mexico Power Company.  On April 5, 2001, Power Resources Group filed a Notice of Appeal with the court appealing the judgment to the Court of Appeals for the Third
District of Texas.



See Notes 2 and 4 for information regarding additional regulatory and legal matters.



Item 5.  Other Items



Changes in Management



Jack V. Chambers was elected Chairman, President and Chief Executive Officer of Texas-New Mexico Power Company, effective April 8, 2001.  Kevern Joyce resigned such offices as of the same date.
Mr. Joyce continues as an advisor to senior management and the Board of Directors.  In that capacity he will advise the Board on transition to competition matters and on transmission and distribution expansion opportunities.



Manjit Cheema was elected as President of First Choice Power, Inc., a wholly owned subsidiary of TNP Enterprises, Inc., effective April 18, 2001, following the resignation of Michael Matte.  First
Choice Power, Inc. is the retail electric provider affiliated with TNP Enterprises and Texas-New Mexico Power Company.



Proposed Sale of TNP One



On March 29, 2001, TNMP announced its decision to sell TNP One, its lignite-fueled generating facility located in Robertson County, Texas.  That decision is in response to the Texas Electric Choice
Act (Senate Bill 7), which became effective September 1, 1999, and requires electric utilities to separate their business activities into a power generation company, a retail electric provider, and a transmission and distribution utility.  TNMP began
soliciting indications of interest from potential purchasers in April 2001, but has not yet received any offers.  TNMP expects to complete the sale in 2002.



Item 6.  Exhibits and Reports on Form 8-K.



(a)    Exhibits



The following exhibits are filed with this report:



(18)  Letter from Independent Accountants regarding preferability of accounting change.



(b)    Reports on Form 8-K: None.



Statement Regarding Forward Looking Information



The discussions in this document that are not historical facts, including, but not limited to, future cash flows and the potential recovery of stranded costs, are based upon current expectations.
Actual results may differ materially.  Among the facts that could cause the results to differ materially from expectations are the following: our ability to adapt to open market competition enacted by our legislators and regulators or a delay in
implementing retail competition; the effects of accounting pronouncements that may be issued periodically; changes in regulations affecting TNP's and TNMP's businesses; decisions in connection with current regulatory proceedings; the sale of TNP One;
insurance coverage available for claims made in litigation; the effect of a Texas Supreme Court decision on the limitations of any actual damages awarded in currently ongoing litigation;



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|SIGNATURES                                                                                                                                                                              
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|                                                                                                                                                                                        
|(Registrant)                                                                                                                                                                            
|                                                                                                                                                                                        
|                                                                                                                                                                                        
|Date: May 8, 2001                                                                                                                                                                       
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|Date: May 8, 2001                                                                                                                                                                       
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|Date: May 8, 2001                                                                                                                                                                       
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