NEW MEXICO (KRQE) –New Mexico’s Attorney General is asking the state’s Public Regulation Commission to make a decision in a longstanding dispute between PNM, environmentalists, and the state. The Attorney General is concerned about potentially increased electricity rates.
The Public Service Company of New Mexico (PNM) has been working with New Mexico’s leaders to ease the state away from coal-fired electricity. State lawmakers set the legal framework for doing so, called the Energy Transition Act, which is aimed at minimizing the cost impact of the transition towards renewable energy.
But for some time now, there’s been debate over the exact responsibilities laid out by the Energy Transition Act. So, New Mexico’s Attorney General is asking the Public Regulation Commission to settle some of the disputes.
The Attorney General, as well as groups like the Western Resource Advocates, claim PNM was supposed to have already issued investment bonds to help cover transition costs and protect consumers from rate increases. PNM has previously argued that it’s not doing anything illegal and that there’s no set date by which PNM is required to issue bonds.
The Attorney General’s latest motion asks the Public Regulation Commission to declare that PNM isn’t in compliance with past Public Regulation Commission orders. The Attorney General claims that PNM’s actions could raise utility costs for the public.
“My office has a duty to protect the ratepayers in the state of New Mexico,” Attorney General Raúl Torrez said in a press release. “The Energy Transition Act and the Public Regulation Commission laid out a clear process that would have afforded PNM the opportunity to issue bonds upon the closure of the San Juan Generating Station, and that would have provided ratepayers with substantial cost savings. Because PNM chose to delay their bond issuance, there is now extraordinary economic uncertainty. What is certain is that now PNM cannot issue the bonds at the expense of ratepayers.”
Raymond Sandoval, PNM’s director of corporate communications and brand management, says that PNM hasn’t issued the bonds because of the pandemic. Issuing the bonds goes along with a request to adjust electricity rates, Sandoval explains. But PNM didn’t want to adjust rates as New Mexicans were recovering from the economic impact of the pandemic, Sandoval says.
Sandoval adds that if PNM issued the bonds without going through a rate adjustment, it would have allowed PNM to collect money from the bond as well as rate money from the no-longer-functioning San Juan Generating Station. Because PNM didn’t want to double-charge New Mexicans, Sandoval explains, they waited on issuing bonds.
PNM is looking to increase rates by the early months of 2024. Sandoval says that on paper, the average residential increase to the base rate could be about 9.7%. But, at the same time, PNM expects the fuel surcharges on customers’ bills to decrease significantly with the shutdown of the San Juan Generating Station. As a result, the total bill increase to customers might only be a 1% increase or so, Sandoval says.