New Mexico lawmakers want to amend new renewable energy law as utilities seek rate hikes

(The Center Square) – A trio of Democratic New Mexico legislators is challenging the state’s Energy Transition Act, contending it strips the power of state regulators to protect residents from unwarranted rate increases.

And, one of the legislators said, there’s more to come.

ETA guides the state’s move away from oil and gas toward renewable energy such as wind and solar.

The act sets a statewide renewable energy standard of 50 percent by 2030 for New Mexico’s investor-owned utilities and rural electric cooperatives, and a goal of 80 percent by 2040. It also sets zero-carbon resources standards for investor-owned utilities by 2045 and rural electric cooperatives by 2050.

“The fact supporters of this disastrous bill now admit it will cause electric bills to substantially increase is cold comfort to New Mexico’s struggling families,” said Larry Behrens, western states director of Power the Future, a nonprofit that aims to improve the national energy conversation.

“Supporters of the Energy Transition Act were warned the law would destroy jobs and raise electric bills, but instead they decided to listen to their radical environmentalist allies and now our families will be left holding the bill. New Mexico’s Green New Deal should be fully repealed.”

Xcel Energy, he pointed out, is already seeking permission to boost electric rates. Xcel serves more than 100,000 New Mexico residents.

Xcel wants to increase rates to recoup more than $1 billion in investments the utility has made since 2019, triggered in part by the completion of its Sagamore Wind Project. The Roosevelt County project has a 522-watt capacity and 240 wind turbines.

The senators behind the bill are Antoinette Sedillo Lopez and William Tallman, both from Albuquerque, and Elizabeth Stefanics from Cerrillos. They contend that ETA guarantees recovery of 100 percent for PNM’s investments in coal plants as well as its closing of other fuel facilities in some instances, essentially removing oversight by the Public Regulation Commission to consider PNM investments before recovery is approved.

The bill looks to make changes where the legislators say the wording of the ETA would create problems for rate protection, softening the wording of the guarantee and giving power back to the commission.

“We want to restore the PRC’s authority,” Tallman said. “It takes away the PRC oversight. Why is that? Nobody is giving me a good answer on that.”

Tallman added that in his view, PNM, an investor-owned utility, should be publicly owned. PNM, he suggested, “wrote this bill and they wrote it in such a manner that it would be subject to a lot of interpretation. It was an 85-page bill and it was very complex. The bottom line is clarification. We just want clarification.”

Tallman also promised that this action is only the beginning.

“There is going to be more coming out on this,” he said. “I can’t tell you now what it is, but there’s going to be more developments.”

Critics say this new piece of legislation is driven by an environmental advocacy group called New Energy Economy, which opposes the ETA. New Energy Economy, along with Citizens for Fair Rates and the Environment are in the midst of a lawsuit seeking to overturn the law through the state Supreme Court.

Paul Gessing, president of the Rio Grande Foundation, an economic think tank in Albuquerque, said he believes “what the bill is doing is kind of fruitless in the way they are attacking the issue.”

“If you are going to make a statement, which is ultimately what this is all about, then make a statement that is not half-baked,” he said.

Indeed, the way to truly protect New Mexico residents, Gessing said, would be to cap rates.

“If you are going to do all of this, you should protect the rate payers, at least do something that has teeth. Cap the rates at X rate for X number of years,” he said.

“It’s unfortunate we don’t have more of a rate payer movement.”

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