Energy Transition Act

Supreme Court declines to rule on constitutionality of ETA

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The New Mexico Supreme Court denied a request to determine the constitutionality of the Energy Transition Act (ETA) on Tuesday. The decision was released without an opinion. In August, the advocacy nonprofit New Energy Economy (NEE) filed a writ of mandamus asking the Court to rule on whether portions of the ETA are unconstitutional. The writ alleges that wording in the ETA removes the Public Regulation Commission’s (PRC) regulatory oversight of Public Service of New Mexico (PNM) and proposed rate increases. New Energy Economy’s executive director, Mariel Nanasi, announced the court decision at a panel discussion in Santa Fe Tuesday evening. 

“We believe the ETA is unconstitutional, especially in regards to its eviscerating the regulatory authority [of the PRC],” Nanasi said.

Cynthia Hall

Dysfunction at the PRC puts New Mexico’s clean energy plan at risk

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Dysfunction and a lack of expertise within the New Mexico Public Regulation Commission (PRC) threaten to undermine the state’s ambitious plan to flip the switch from coal to reenewable power. 

The Energy Transition Act — the centerpiece of Gov. Michelle Lujan Grisham’s agenda to rein in greenhouse gas emissions — phases out coal, turbocharges solar and wind development, and provides funding to retrain displaced coal plant and mine workers. It has been hailed as one of the strongest climate measures in the country. 

But six months after Lujan Grisham signed the bill into law, its success appears jeopardized by the very regulatory body charged with overseeing its implementation. 

The powerful commission must vet every aspect of the plan: the closure of the San Juan Generating Station coal plant; the complex financing to pay for decommissioning and worker assistance; and every new energy project that will provide the replacement power. But when the first proposals came before the PRC in July, the commission chose to ignore the new law, leaving the state’s energy transition in limbo. The unusual move has sparked a political furor, pitting the PRC against the governor and Legislature and leading to calls for impeachment of three of the commissioners as well as a proposal by the governor to convert the PRC from an elected body to an appointed one. 

The law’s supporters say the commission’s handling of the plan reflects deep dysfunction that could slow the state’s renewables ramp-up and jeopardize aid for displaced workers. Lujan Grisham says she finds the PRC’s actions “baffling” and suspects that long-standing tensions between the commission and Public Service Co.

Energy Transition Act

Suit alleges ETA a ‘deregulation law’ for PNM

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A group of organizations filed a lawsuit in state Supreme Court this week that alleges the Energy Transition Act is a deregulation law for PNM, and are challenging provisions in the law as unconstitutional. The suit from New Energy Economy, a Santa Fe-based advocacy nonprofit, and six other groups claims the ETA removes some of the authority given to the Public Regulation Commission (PRC) to regulate the Public Service Company of New Mexico (PNM) and its proposed rate increases associated with its fossil fuel assets. PNM is an investor-owned utility that operates as a monopoly in parts of New Mexico. As a utility, the company has an obligation to serve its customers—the ratepayers—in the most efficient manner and at the lowest possible cost. But as a publicly-traded company, PNM also has an obligation to its shareholders to generate profit.

Quick Reads

Voters could convert PRC to appointed body

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Next year could be the last time New Mexicans find any candidates for the long-troubled Public Regulation Commission listed on election ballots if voters approve a proposed constitutional amendment that sailed through the Legislature with bipartisan support. On Thursday the House passed Senate Joint Resolution 1, which would turn the Public Regulation Commission — which currently consists of five elected members representing different geographical districts — into a three member body whose members would be appointed by the governor and confirmed by the state Senate. The measure, sponsored by Senate Majority Leader Peter Wirth, D-Santa Fe, Senate Republican Whip Bill Payne of Albuquerque and Sen. Steve Neville, R-Aztec, passed the House by a vote of 59-8. It previously cleared the Senate by a 36-5 vote. Because it’s a proposed constitutional amendment, SJR 1 does not need the governor’s signature.

2019 Legislative Session

Energy bill seeks to aid switch from coal to renewables

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Gov. Michelle Lujan Grisham and several environmentalist groups on Thursday praised legislation aimed at ensuring the shuttering of the coal-burning San Juan Generating Station near Farmington and establishing ambitious targets for pushing New Mexico toward more reliance on renewable energy sources. The bill is intended to soften the financial hit both to the community surrounding the aging power plant and to Public Service Company of New Mexico, the state’s largest utility and majority owner of the plant, which is a major source of employment in Northwestern New Mexico. State Sen. Jacob Candelaria, D-Albuquerque, on Thursday introduced the 83-page Energy Transition Act, which proposes to allow PNM to recover investments through selling bonds that would be paid off with a new “energy transition” charge for customers. It also seeks to provide funds to assist and re-train workers who lose jobs from the shutdown and sets a 2030 deadline for investor-owned utilities and rural electric co-ops in the state to derive 50 percent of their power from renewable sources such as solar and wind energy. “The bill lays out the road map that will lead New Mexico from a fossil-fuel-based economy to a green economy,” Candelaria said in an interview.

El Paso Electric

PRC rushes to approve solar project

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ALBUQUERQUE, N.M. — A hearing for a proposed community solar project near Las Cruces is scheduled for next month, even after El Paso Electric attempted to withdraw its proposal. New Mexico’s Public Regulation Commission has put the hearing on its calendar, despite opponents’ successfully arguing that the original proposal showed favoritism to the utility company over independent solar contractors. Mariel Nanasi, executive director of the group New Energy Economy, said when utilities are given an automatic advantage by the PRC, customers don’t get the lowest price for solar energy. “The law is, you’re supposed to get the most cost-effective among feasible alternatives,” Nanasi explained. “Well, one of the other alternatives is to allow independent power producers to compete against the utility – and when they do, they’re often much cheaper.”

El Paso Electric

NM renewable energy group awaits conflict-of-interest decision

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SANTA FE, N.M. – New Mexico needs more affordable solar, but a renewable energy group says two members of the Public Regulation Commission have a conflict of interest and should not be allowed to participate in the decision. Mariel Nanasi, an attorney with New Energy Economy, says commissioners Sandy Jones and Lynda Lovejoy should not vote on a PRC solar contract decision because they’re up for re-election and they received campaign contributions from the company. The PRC will decide on an application by El Paso Electric to purchase a $4.5 million solar farm to be built by Affordable Solar. The company’s registered lobbyist is also the campaign consultant for Jones’ and Lovejoy’s re-election bids. Nanasi maintains the two commissioners should recuse themselves from the decision.

San Juan Generating Station

Bill to ease plant closing impact heads to House floor

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In a case of strange political bedfellows, a conservative lawmaker from San Juan County and the leader of a Santa Fe environmental group not known for compromising came together Tuesday to back a bill aimed at easing the economic woes of New Mexico communities hit by the closing of large coal-burning power plants. The House of Representives voted 44-25 to pass Rep. Rod Montoya’s House Bill 325, designed to help a large school district keep most of its tax base if Public Service Company of New Mexico closes the San Juan Generating Station by 2022. To become a reality, the measure would also have to clear the Senate before the Legislature adjourns at noon Thursday. “Are you going to refer to me as an environmentalist activist,” Montoya joked with a reporter Tuesday. Endorsing the bill was Mariel Nanasi, executive director of New Energy Economy, a Santa Fe-based non-profit that has fought many PNM rate increases and other proposals before the state Public Regulation Commission.

2018 Legislative Session

New House bill would ease impact of power plant shutdown on county

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After a Senate committee last week poured cold water on a bill allowing Public Service Company of New Mexico to sell bonds to pay for the expenses of shutting down a coal-burning plant in San Juan County, a Farmington legislator has introduced a new bill aimed at easing the impact of the plant’s closure on county residents and government institutions. House Minority Whip Rod Montoya, R-Farmington, told The New Mexican on Thursday that his legislation, House Bill 325, would require the state Public Regulation Commission to consider the economic effects on communities when deciding cases involving the shutdown of large power sources, such as the San Juan Generating Station. The bill also would require a utility to build any replacement power source in the same community as the facility it is planning to close. Many proponents of the original measure tied to PNM, Senate Bill 47, argued during a lengthy hearing Saturday that it would offer aid to residents of San Juan County who heavily rely on jobs at the power plant and a nearby coal mine that supplies it. “The school district in Kirtland, New Mexico, gets about $37 million a year from the power plant,” Montoya said Thursday.

Environmental Project

PNM, enviro groups hammer out funding for ‘abandoned’ coal plant

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A bill scheduled to come before the Senate Conservation Committee on Saturday has some environmental groups and the state’s largest electric utility facing off over financing the retirement of a coal-fired power plant. If passed, the bill would create a bond financing mechanism allowing Public Service Company of New Mexico, or PNM, to recover “stranded” costs associated with its planned closure of the San Juan Generating Station near Farmington. The bill would allow the utility to form a subsidiary that could issue low-interest “energy redevelopment bonds” and recover more than $300 million. Senate Bill 47 is sponsored by Albuquerque Democratic Sen. Jacob Candelaria, an attorney, and Republican Sen. Steven Neville, a real estate appraiser from Aztec. Its counterpart, House Bill 80, is also a bipartisan bill, sponsored by Rep. Roberto Gonzales, D-Ranchos de Taos, and Republican Minority Whip Rod Montoya, a miner from Farmington.