New Energy Economy appeals PNM rate case to NM Supreme Court

New Energy Economy has appealed state regulators’ decision in the Public Service Company of New Mexico’s recent rate case to the state Supreme Court. The consumer and environmental advocacy group argues that the rate decrease should be even greater because the utility imprudently invested in the Four Corners Power Plant as well as the Palo […]

New Energy Economy appeals PNM rate case to NM Supreme Court

New Energy Economy has appealed state regulators’ decision in the Public Service Company of New Mexico’s recent rate case to the state Supreme Court.

The consumer and environmental advocacy group argues that the rate decrease should be even greater because the utility imprudently invested in the Four Corners Power Plant as well as the Palo Verde Nuclear Generating Station.

Ray Sandoval, a spokesman for PNM, said in an email statement that parties to the New Mexico Public Regulation Commission’s proceedings have a legal right to file an appeal.

“PNM will participate in the appellate process and will continue to focus on the next steps in our transition to a carbon-free grid,” he said.

NEE has been a vocal opponent of coal and nuclear power and is a frequent critic of PNM.

While the PRC found that PNM had made imprudent investments, it allowed the utility to recover some of those costs. NEE Executive Director Mariel Nanasi said PNM should not be allowed to recover any of that money through rates.

“Ratepayers are to be held harmless for the imprudence of utility management,” she said.

In the case of the Four Corners Power Plant, a past commission during the 2016 rate case left unresolved the question of whether the investments into the coal-fired power plant in northwest New Mexico were prudent. That question had to be addressed in the most recent rate case. 

In between the two cases, PNM was able to collect money from customers to pay for those investments.

In the most recent rate case, the PRC allowed PNM to partially recover the costs of investments into Four Corners Power Plant. Those investments included pollution controls.

PNM is a partial owner of the Four Corners Power Plant, which currently only operates during summer months to help meet peak demands. The utility previously attempted to transfer its shares in the Four Corners Power Plant to Navajo Transitional Energy Company, but state regulators denied that application.

Nanasi said that PNM’s decision about a decade ago to continue receiving electricity from the Four Corners Power Plant cost ratepayers $240 million, yet PNM is still allowed to recover the majority of its investment into the facility.

“We’ve been overpaying for seven years on Four Corners,” Nanasi said.

The PRC cited the time that passed without an answer in regards to the prudency of the Four Corners investment as one of the reasons why the utility should be able to partially recover its investments.

While the PRC found continuing use of the Four Corners Power Plant was not prudent, the state regulators acknowledged that ratepayers did benefit from the facility which provided reliable baseload power.

The decision to continue using Four Corners Power Plant was made in 2013 following an analysis that was done more than a year earlier. State regulators criticized the utility for not performing another analysis closer to the time that it signed the fuel contract for Four Corners Power Plant, stating that a lot changed between May of 2012 and December 2013. 

Additionally, NEE says PNM should not be permitted to recover all of the stranded costs related to Palo Verde. Stranded costs occur when a utility ends the use of an asset before it finishes paying for investments into the facility.

NEE argues that it is illegal to include stranded costs in rates and that, because investments into Palo Verde were done imprudently, the facility has not been “used and useful,” which is required if a utility is going to recover those investments through rates.

And, NEE states, the PRC should address the future decommissioning costs of Palo Verde and determine who will be responsible for paying those currently unknown expenses.

“The issue, if anything, is overripe to the point that it is becoming moldy,” the group states in a document stating the issues on appeal.

Nanasi said she believes Palo Verde will close within the next decade, likely due to water scarcity. Palo Verde is located in Arizona and nuclear generation requires large amounts of water.

She said that when Palo Verde does close, it could leave PNM with an enormous bill. 

Nanasi used San Onofre Nuclear Generating Station in California as an example. Decommissioning that facility costs billions of dollars. 

The costs to decommission Palo Verde could be borne by customers decades in the future who never received power from the facility should state regulators determine that PNM has the right to recover those costs through rates.

Nanasi said she believes the legacy of nuclear power production will be one of the biggest environmental disasters the country is facing. That is in part because the United States has not found a permanent solution for dealing with the radioactive waste generated by those power plants.

One temporary option may be storage at a facility in New Mexico; however, the state and various communities along the railroad lines that would be used to move the nuclear waste to the facility have vocally opposed such an initiative.

“It’s a ticking time bomb and there’s no answer to the waste and nobody wants it,” Nanasi said.

We're ad free

That means that we rely on support from readers like you. Help us keep reporting on the most important New Mexico Stories by donating today.

Related

Both Republicans and Democrats skeptical of guv’s proposals for special session

Both Republicans and Democrats skeptical of guv’s proposals for special session

A representative from Gov. Michelle Lujan Grisham’s office outlined on Thursday the bills the governor’s office will back during the upcoming special session, but…
Senators throw support to embattled Ivey-Soto

Senators throw support to embattled Ivey-Soto

By Justin Horwath, New Mexico In Dept Sen. Daniel Ivey-Soto is running for a fourth term despite the state Democratic Party’s decision to censure…
AG announces legislative priorities for upcoming special session

AG announces legislative priorities for upcoming special session

Attorney General Raúl Torrez announced on Thursday his legislative priorities for July’s special legislative session, including the creation of a crime victim’s unit to…
SCOTUS rejects proposed resolution to Rio Grande water dispute

SCOTUS rejects proposed resolution to Rio Grande water dispute

In a 5-4 decision, the U.S. Supreme Court rejected a proposed settlement that would have ended the more-than decade-long dispute between Texas and New…
FWS says two Rio Grande fish do not warrant listing under Endangered Species Act

FWS says two Rio Grande fish do not warrant listing under Endangered Species Act

The U.S. Fish and Wildlife Service found that two fish species found in New Mexico do not meet the criteria for listing them as…
Want to know what Albuquerque’s climate might be like in 2080? Head to Roswell

Want to know what Albuquerque’s climate might be like in 2080? Head to Roswell

Thanks to climate change, the Albuquerque of the future may feel a bit more like present-day Roswell. That’s according to a new web app…
Stansbury outlines funding secured for early childhood and youth services programs

Stansbury outlines funding secured for early childhood and youth services programs

U.S. Rep. Melanie Stansbury secured $8.3 million for childhood development and youth services in the 1st congressional district through federal community project funding. Stansbury,…
Amid new graduation requirements, what do high schoolers want to learn?

Amid new graduation requirements, what do high schoolers want to learn?

By Margaret O’Hara, The Santa Fe New Mexican The main things that bring Brayan Chavez to school every day: Seeing, talking to and engaging with…
Special ed teachers hope lawmakers OK pay raises, admin changes

Special ed teachers hope lawmakers OK pay raises, admin changes

By Margaret O’Hara, The Santa Fe New Mexican Brittany Behenna Griffith has a laundry list of adjectives to describe the ideal special education teacher:…
Heinrich questions FDA leadership on baby formula safety, mifepristone

Heinrich questions FDA leadership on baby formula safety, mifepristone

U.S. Food and Drug Administration Commissioner Dr. Robert Califf answered questions about the safety of human milk formula and mifepristone on Wednesday. Sen. Martin…
Health workers fear it’s profits before protection as CDC revisits airborne transmission

Health workers fear it’s profits before protection as CDC revisits airborne transmission

Amy Maxmen, KFF Health News Four years after hospitals in New York City overflowed with covid-19 patients, emergency physician Sonya Stokes remains shaken by…
Lujan Grisham, Biden admin announce $10 million in federal funds for tribes, pueblos

Lujan Grisham, Biden admin announce $10 million in federal funds for tribes, pueblos

Gov. Michelle Lujan Grisham announced Friday $10 million in funding from the federal American Rescue Plan Act was awarded to six tribal nations and…
Abortion medication access remains after Supreme Court ruling

Abortion medication access remains after Supreme Court ruling

The U.S. Supreme Court ruled against the Texas-based Christian group trying to restrict access to abortion medication on Thursday. The case, FDA v. the…
How abortion care has changed since Dobbs 

How abortion care has changed since Dobbs 

In the month of March 2024 alone, 1,650 clinician-provided abortions took place in New Mexico, according to the reproductive research organization, the Guttmacher Institute.…
Many Democrats endorsed by reproductive rights group won primaries

Many Democrats endorsed by reproductive rights group won primaries

With nearly 53 percent of the precincts reporting as of 11 p.m. Tuesday, most of the legislative candidates endorsed by Planned Parenthood Votes New…
New Mexico food banks say food insecurity is on the rise

New Mexico food banks say food insecurity is on the rise

Food insecurity is on the rise as state benefits have decreased and the future of federal benefits have an uncertain future.  Sonya Warwick, director…
Abortion medication access remains after Supreme Court ruling

Abortion medication access remains after Supreme Court ruling

The U.S. Supreme Court ruled against the Texas-based Christian group trying to restrict access to abortion medication on Thursday. The case, FDA v. the…
How abortion care has changed since Dobbs 

How abortion care has changed since Dobbs 

In the month of March 2024 alone, 1,650 clinician-provided abortions took place in New Mexico, according to the reproductive research organization, the Guttmacher Institute.…
Republican Herrell signs onto what critics call anti-transgender message

Republican Herrell signs onto what critics call anti-transgender message

Republican candidate Yvette Herrell, who is running against Democrat Rep. Gabe Vasquez for New Mexico’s 2nd Congressional District seat, committed herself to a message…
Post-primary, Biden leads Trump in NM

Post-primary, Biden leads Trump in NM

President Joe Biden leads former president Donald Trump in the race for New Mexico’s five electoral seats, according to a poll commissioned by NM…
Democrats announce spending on CD2 race

Democrats announce spending on CD2 race

The Democratic National Committee announced on Monday that it will spend $70,000 for organizing staff to aid U.S. Rep. Gabe Vasquez, the Democrat trying…
SCOTUS rejects proposed resolution to Rio Grande water dispute

SCOTUS rejects proposed resolution to Rio Grande water dispute

In a 5-4 decision, the U.S. Supreme Court rejected a proposed settlement that would have ended the more-than decade-long dispute between Texas and New…
FWS says two Rio Grande fish do not warrant listing under Endangered Species Act

FWS says two Rio Grande fish do not warrant listing under Endangered Species Act

The U.S. Fish and Wildlife Service found that two fish species found in New Mexico do not meet the criteria for listing them as…
NM voters support abortion rights

NM voters support abortion rights

A majority of New Mexicans believe that New Mexico’s abortion laws should be less restrictive or should remain about the same as they are…

GET INVOLVED

© 2023 New Mexico Political Report