The New Mexico Public Regulation Commission essentially denied the merger between Avangrid and Public Service Company of New Mexico on Wednesday..

The commissioners voted unanimously on Wednesday to reject the stipulated agreement, following a recommendation from the PRC hearing examiner that the potential risks to customers outweigh the benefits.

“This whole deal to me kind of boils down to promises versus actual performance,” Commission Chairman Stephen Fischmann said, highlighting Avangrid’s past performance in New England where it owns several utilities and has faced more than $60 million in fines from regulators.

PNM and Avangrid promoted the merger as an opportunity to transition faster away from fossil fuels through access to Avangrid’s better credit ratings as well as benefits associated with Avangrid’s scale. Avangrid’s large size could lead to lower costs for equipment because the company would be able to buy in bulk.

But several commissioners said the merger is not the way to approach the transition. The commissioners expressed concerns that the merger could lead to higher rates for customers and decreased reliability. While the rate increases would require approval from the commission, the PRC had concerns that if the merger was approved PNM could favor Avangrid resources during the procurement process, which could lead to higher rates.

Related: PRC commissioners have concerns over Avangrid/PNM merger, as companies defend

Executives with Avangrid’s parent company, Iberdrola, are part of a criminal investigation in Spain, and that also weighed into the decision to reject the merger.

The merger proposal did include a variety of benefits for New Mexico, including funding for economic development and a commitment to create 150 jobs in the state.

“I am saddened by this Commission’s decision to reject the agreement reached by the parties. We will continue to evaluate any next steps that could allow us to bring the positive benefits to the people we serve,” said Pat Vincent-Collawn, PNM’s chairwoman, CEO and president, in a statement.

In a statement, PNM said that it is examining all of its options and will wait to review the final commission order before taking subsequent steps.

Avangrid also issued a statement following the vote expressing disappointment with the decision.

“We are evaluating the next steps before us,” the emailed statement from spokeswoman Joanie Griffin said. “While we re-evaluate the path ahead, we remain dedicated to the work we do every day across 24 states to create economic, social and environmental value in all the communities we serve.”

Avangrid further said that it hopes to one day welcome New Mexico into its family.

The vote came following PNM and Avangrid, as well as other intervening parties, asking for the commission to hear oral arguments about the exceptions to the hearing examiner’s recommendation. The commission ultimately rejected that request.

The request for oral arguments came after the deadline to make such a request and after the commission had already begun deliberations. Commissioners expressed concerns that Avangrid and PNM could use the oral arguments as an opportunity to address things that were not in the exceptions. The oral arguments are supposed to be limited to just the exceptions filed to the hearing examiner’s recommendations. 

New Energy Economy was one of the main opponents of the merger. Following the vote, Executive Director Mariel Nanasi said that she thinks “New Mexico dodged a bullet.”

Nanasi voiced a variety of concerns about the merger, including the loss of local control, the risks to customers and the impacts on renewable energy development in the state.

In a phone interview with NM Political Report, she highlighted Avangrid’s testimony about using New Mexico as a “beachhead” for its renewable energy projects. Avangrid has been developing wind resources in the eastern part of the state. 

“This commission just stood up for not only reliability but fair competition within the renewable energy industry market,” she said.

The PRC had previously come under fire for three commissioners expressing their positions and intention to vote against the merger during the Dec. 1 meeting, which Attorney General Hector Balderas criticized during a press conference last week.

But, at the start of the discussions, PRC general counsel Michael Smith addressed that. He said the evidentiary record closed in August and the opinions the commissioners expressed on Dec. 1 were based on the evidentiary record.