The Public Regulation Commission voted unanimously Wednesday to approve PNM’s application for abandoning the San Juan Generating Station and using securitization bonds to recover some of the investment PNM will lose in the process. The decision, which was widely expected, came after the state Supreme Court ordered the PRC to apply law changes made by the Energy Transition Act towards PNM’s exit of the coal-fired plant. The ETA, which requires all the state’s utilities to transition to “net zero” electricity generation by 2050, enabled PNM to use securitization as a mechanism to help pay for its transition away from coal. But PRC commissioners were previously hesitant to apply the new law to PNM’s plans for exiting the San Juan Generating Station. PNM announced its plan to close the plant in 2017, but didn’t submit the application to do so until after the ETA was in effect.
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The PRC’s decision was widely lauded by a coalition of clean energy and environmental justice advocates who say the securitization will reduce customers’ utility bills, provide financial support to the coal-dependent communities in San Juan County, and help create new clean energy jobs.
A proposal to restructure the Public Regulation Commission died in the Senate Corporations and Transportation Committee after a two-plus hour debate. The bill was tabled by a vote of 5-4. Democratic Reps. Nathan Small of Las Cruces and Linda Trujillo of Santa Fe presented HB 11 to the committee Tuesday afternoon. Small and Trujillo told the committee the bill would help address staffing issues at the PRC and make the commission more efficient.
A bill to make big changes to the Public Regulation Commission (PRC) passed its first committee despite lingering questions over the proposal. After a length debate, the House Energy, Environment and Natural Resources Committee passed the bill Thursday with a vote of 8-5 along party lines. Democratic Reps. Nathan Small of Las Cruces and Rep. Linda Trujillo of Santa Fe presented HB 11 to the committee. The legislation would restructure the PRC with the aim of streamlining operations and improving efficiencies that Small and Trujillo contend are holding the state back and hurting New Mexico residents.
The New Mexico Supreme Court put to rest some of the on-going drama about Public Service of New Mexico’s (PNM) plans for closing down the San Juan Generating Station. The Supreme Court ruled Wednesday that the Public Regulation Commission (PRC) must apply the Energy Transition Act (ETA) to PNM’s case for shuttering the coal-fired San Juan Generating Station, granting a writ of mandamus requested by a group of stakeholders, including Speaker of the House Brian Egolf, Senator Jacob Candelaria, Gov. Michelle Lujan Grisham, Navajo Nation President Jonathan Nez and others. A writ of mandamus is an order from a court to a subordinate government body or lower court to fulfill official duties required by law or correct an abuse of discretion. In December 2019, Lujan Grisham and others asked the court to force the PRC to apply the ETA to the San Juan Generating Station case. The decision comes after six months of back-and-forth between the PRC and investor-owned PNM on the applicability of the ETA on PNM’s plans for phasing out its coal-based energy generation.
Democratic lawmakers on Tuesday unveiled legislation that would dramatically alter the structure of the state’s Public Regulation Commission, shifting nearly every division currently under its authority to a department within the governor’s administration. Although the PRC is a state commission, it is an entity not under the control of the state’s governor. Legislation proposed by state Reps. Linda Trujillo, D-Santa Fe, and Nathan Small, D-Las Cruces, would change that, and comes amid frustration from Gov. Michelle Lujan Grisham and some lawmakers over disagreement with the PRC on whether the Energy Transition Act applies to plans from the state’s largest utility to abandon and recover investments into a coal-fired power plant near Farmington. The energy act, signed into law by the governor in 2019, would allow Public Service Company of New Mexico to recover investment costs sunk into the San Juan Generating Station and requires the state to shift to zero-carbon electricity production by 2045.
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.
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.
A group of organizations filed a lawsuit in the 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.
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.
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.