August 8, 2021

PNM, Avangrid merger hearing starts Monday

A New Mexico Public Regulation Commission hearing regarding the Public Service Company of New Mexico merger with Avangrid is set to kick off Monday morning via Zoom. The hearing will also be broadcast on YouTube. A link to the YouTube livestream will be posted online a few minutes before the hearing begins.

The first day is set aside for public comment and people wishing to comment must register by 8:30 a.m. Monday. This can be done by contacting Ana.Kippenbrock@state.nm.us.

Following the public comment session, the formal evidentiary hearing is set to begin at 9 a.m. Wednesday.

The hearing will span approximately two weeks and will provide an opportunity for the various intervening parties to provide witnesses and cross-examine other parties’ witnesses. Following the hearing, the hearing examiner will review the testimony and arguments presented and will issue a recommendation to the regulatory commission. The commissioners will later issue a final ruling in the matter.

Related: Connecticut-based utility company agrees to buy PNM Resources

In 2020, the state’s largest utility announced that it would be acquired by Avangrid, a U.S. subsidiary of the Spanish utility giant Iberdrola. Regulated utilities like PNM require PRC approval for mergers. PNM’s parent company, PNM Resources, also operates in Texas and Texas regulators have already approved the merger.

The PRC approval is the final hurdle that Avangrid faces in the acquisition, but it faces opposition from parties who point to an Avangrid subsidiary’s poor service record in Maine as well as an ongoing investigation into criminal espionage related to Iberdrola executives.

Related: Iberdrola executives named in criminal espionage investigation

Some of the environmental community also have concerns about PNM transferring its share of the Four Corners Power Plant to Navajo Transitional Energy Company.

Avangrid has stated that it has no intention of being a long-term owner of a coal-fired power plant and that the transfer of the Four Corners Power Plant shares was crucial for the acquisition. But, by transferring the shares to NTEC, PNM gives up the ability to vote to close the power plant early and NTEC, which also owns the Navajo Mine that supplies the power plant with coal, has a vested interest in keeping the plant open.

Related: Critics say PNM, Avangrid merger could hurt ratepayers, environment

Additionally, the hearing examiner disqualified Iberdrola’s attorney Marcus Rael on Friday due to a conflict of interest because Rael has also represented the New Mexico Attorney General and Bernalillo County on other matters. Both the attorney general and the county are intervening parties in the case. Iberdrola has stated that when it contracted with Rael’s law firm in February it did not believe there was a conflict of interest, highlighting that Rael only represents the firm in a limited capacity and that he is not representing either the state attorney general or the county in the merger case.

The hearing examiner’s order came one day after the New Mexico Supreme Court’s Disciplinary Board found that Rael does not a conflict of interest.

A tentative schedule for the hearing has Iberdrola’s Corporate Development Director Pedro Azagra Blazquez and Avangrid’s Deputy CEO and President Robert Kump kicking off the witness schedule on Wednesday. The PRC staff will be the final witnesses and are tentatively scheduled to provide testimony and answer questions on Aug. 20.

Public comments can also be submitted at any time in writing by emailing prc.records@state.nm.us. The docket number for the case is 20-00222-UT.

This story has been updated to include that the state’s Supreme Court’s Disciplinary Board found that Marcus Rael, an attorney contracted by Iberdrola, doe not have a conflict of interest.