Sandra Ely, director of the New Mexico Environment Department’s Environmental Protection Division, says this is a “decisive decade” in terms of climate change.

Ely is one of the “key architects” of a proposed climate bureau within NMED, according to Secretary James Kenney. Ely and Kenney spoke to NM Political Report this week about the climate bureau. 

The amount of what Kenney describes as “seed money” that the environment department could launch this bureau depends on the state Legislature. 

The governor and the Legislative Finance Committee have released proposed budgets that include vastly different numbers. Gov. Michelle Lujan Grisham asked for $2.5 million for the climate bureau, which would fund 15 full time positions. In contrast, the LFC has proposed between $200,000 and $400,000, which would support three to seven full time positions depending on what happens with the Hydrogen Hub Act and clean fuel standards.

Both the executive and LFC budget proposals call for increased spending following a year of good revenues from the oil and gas sector. The governor’s proposal for the overall general fund recurring budget is $8.45 billion, an increase of 13.4 percent. The LFC’s proposal is slightly higher at $8.46 billion, an increase of 14 percent. But where the spending is directed differs between the two proposals.

Ben Shelton, the political and legislative director for Conservation Voters New Mexico, and Brittany Fallon, policy director for New Mexico Wild, said the LFC budget focuses more on one-time expenditures while the governor’s budget includes more recurring investments into areas like the environment and climate change.

In the LFC budget message, Sen. George Muñoz, D-Gallup, and Rep. Patty Lundstrom, D-Gallup, both emphasized the volatility of the oil and gas economy and the ongoing impact the COVID-19 pandemic has on the state.

Shelton said the LFC budget proposals have tended to be more conservative when it comes to the environment than Gov. Michelle Lujan Grisham’s proposals, but he said the difference in funding between the two of them for environment-related projects like the climate bureau was disappointing. He said the LFC proposal “zeroed-out” climate investments.

The climate bureau is only one area where the executive budget and the LFC budget recommendations have stark differences. The governor’s budget calls for nearly $2.4 million for water protection, including increasing water resiliency. Meanwhile, the LFC proposal includes $240,000 for that purpose. Under the governor’s proposal, NMED would receive $2.3 million and 19 full time employees to ensure edible and topical recreational cannabis is safe. The LFC proposal calls for $239,000 and six full time employees for cannabis safety.

Officials say climate bureau is needed to implement current, future policies and legislation

Ely has been working on climate change related topics with NMED since 2005 and said the environment department has “skirted along the best we can.”

“We have a lot of passion and a lot of desire, but we haven’t had a lot of resources to do the work that needs to be done,” Ely said. “Now in this decisive decade, when we see the impacts of climate all around us, it is imperative that we as a state finally step up and dedicate the resources and the staff we need to reduce emissions. And that’s what this is about.” 

Ely and Kenney said the climate bureau will help implement existing policies including the ozone precursor pollutant rules as well as new rules, regulations and legislation that is coming down the pipe. This includes the Zero Emissions Economy Act that will be introduced this legislative session and calls for reducing emissions to 50 percent below the 2005 levels by 2030 and net zero emissions by 2050. A draft discussion copy of the bill was released on Wednesday.

Shelton said the difference between what New Mexico could accomplish with a 15-person climate bureau compared to a three to seven person climate bureau becomes obvious when looking at this draft legislation.

If this legislation passes, both NMED and its sister agency, the Energy Minerals and Natural Resources Department, will be required to submit annual reports about the state’s progress to meeting the greenhouse gas emissions limits the bill sets forth. Those reports would be required to include an inventory of statewide greenhouse gas emissions.

Additionally, the legislation would require NMED to petition the Environmental Improvement Board by the end of June 2025 to create rules to reduce greenhouse gas emissions from sources that are subject to the Air Quality Control Act.

Ely said the climate bureau will also be tasked with developing an analysis outlining how the state can reach its 2030 emissions targets.

The Hydrogen Hub Act, which will be introduced this session, will also require additional NMED resources and staff that the climate bureau could provide.

This legislation has received push back from members of the environmental community who say it prolongs the use of natural gas and its related emissions. That is because hydrogen would likely be produced from methane, a primary component of natural gas. The carbon would be separated from the hydrogen molecules. That is not the only way to get hydrogen fuel. Hydrogen can also be produced from water using electrolysis, but it is more expensive. Some environmentalists are also skeptical that New Mexico is the right place for hydrogen produced using electrolysis because of the scarcity of water resources.

Kenney said the hydrogen industry is coming to the state and, if left unchecked, it could grow in a way that would undermine the advances New Mexico has made in reducing emissions. Creating legislation focused around hydrogen now could not only help prevent that from happening, but could also provide a way to decarbonize sectors like transportation, he said.

Kenney said while New Mexico does not have much fresh water to spare, it does have brackish water that could potentially be used for hydrogen production. 

Kenney and Ely further said the future climate bureau will create economic development opportunities and signal to the rest of the world that New Mexico is serious about combating climate change.  Kenney said companies that are looking to expand are watching New Mexico as a potential place to locate in part because of policies to address climate change.

When asked where he sees the climate bureau accomplishing in the next decade, Kenney said the state will see increased economic growth as new policies and legislation are implemented that rely on the climate bureau. He gave the example of clean fuel standards, which the legislature will take up this year. This could bring thousands of new jobs to the state and result in an estimated $450 million of investments into communities around the state.

He said biomass, such as woody fuels, could be turned into diesel to meet the clean fuel standards. This would result in lower gas prices and less intense forest fires, which in turn will lead to cleaner drinking water.

“It’s not a fairy tale,” Kenney said. “Other states have done it.”

While NMED looked at what other states like Washington have done while creating the climate bureau proposal, Ely said the department “New Mexico-ized” it to meet the state’s needs.