By Hannah Grover
New Mexico’s three investor-owned utilities say they are prepared for the increased summer electricity demands this year. That means the utilities will have enough electricity to meet customer demands and New Mexicans will not need to worry about rolling blackouts due to lack of resources.
The Public Service Company of New Mexico, El Paso Electric and Southwestern Public Service Company — a subsidiary of Xcel Energy — spoke to the New Mexico Public Regulation Commission about seasonal readiness on Wednesday.
Commission Chairman Pat O’Connell said New Mexico tends to have higher demands for electricity in the summer and the commission wanted to get a better understanding about what the utilities are anticipating.
“I think it’s helpful to kind of do a pulse check and see where we are for the summer,” Commissioner Gabe Aguilera said.
All three of the utilities spoke about past challenges, including high demands in 2023, as well as current trends.
The utilities are in the process of phasing out fossil fuel generation and replacing it with renewable resources, as required by the Energy Transition Act.
“I think we’re in pretty good shape for the summer of [20]25,” Laurie Williams, the Vice President of PNM’s Integrated Planning, said.
She said several of the projects intended to replace the former generation the utility received from the coal-fired San Juan Generating Station as well as some nuclear generation that PNM retired are now coming online.
On Friday, PNM plans to energize the TAG solar and battery storage project, which is owned by Exus Renewables North America and is located in Sandoval County, west of Albuquerque. The utility has power purchase and energy storage agreements with Exus.
PNM also plans to use the regional day-ahead and real-time power markets to trade electricity, including acquiring more electricity when needed to meet demands.
Williams said PNM expects to have an approximate 10% reserve margin over the summer.
Steven Maestas, PNM’s director of wholesale marketing, said the challenges PNM faces can be tied to other states’ electricity usage and the impacts on the markets.
“When California is peaking…typically when the market’s tight and when you’re trying to lean on the market to procure additional supply, that’s when things can get rough,” he said.
He said the California Independent System Operator — which oversees much of California’s power system, transmission and markets — has built up battery storage, which could reduce the impact that peak demand in California has on PNM’s ability to access power from the market.
Jim Schichtl with El Paso Electric spoke about challenges that heat waves can create. In 2023, the combination of a large increase in customer growth and a heat wave created challenges for the utility. He said the utility saw both a record peak and record heat. Last year, the peak remained higher than prior to 2023.
The utility told regulators that heat waves in California or the Pacific Northwest can drive up the costs of power purchased from the market.
Meanwhile, SPS officials said the Xcel subsidiary has different demands than PNM and EPE face because it is a member of the Southwest Power Pool.
“We’re pretty sufficiently prepared for summer of 2025 from a capacity standpoint, we have sufficient resources on the system to not only meet our summer 2025 load, but also the required planning reserve margin minimum that’s established in the SPP for this upcoming season,” Brook Trammell, regional vice president for regulatory and pricing, said.
Trammell said SPS is facing increasing load growths as well as SPP requirements for larger planning reserves at the same time that it is retiring generation assets. Some of the increased demand in SPS’ service territory comes from a push to electrify oilfield infrastructure in the Permian Basin.
Commissioner Greg Nibert asked about shortages experienced on SPS’s system a few weeks ago.
Trammell said on March 31, SPS saw what she described as an “unfortunate load shed.” She said this was due to both planned and unplanned generation and transmission outages as well as other factors.
Trammell said SPS has met with the SPP several times since the incident.
“We’ve discussed the events leading up to the event,” she said.