NEW MEXICO (KRQE) – A surge in demand across power-hungry southeast New Mexico has the electric utility there trying to keep up. In the next seven years, Xcel Energy now estimates it will have to roughly double its energy production in the area. “We’ll need approximately 5 to 10 gigawatts of new generation on the system by the end of this decade,” said Regional Vice President of Planning and Policy for Xcel Energy in Texas and New Mexico, Zoe Lees.
Xcel Energy is looking to add more power in eastern New Mexico and west Texas by 2030 amid big growth in the area. It’s a lot more than the current peak demand of around 6 gigawatts. “We need to bring on more generation onto the system to ensure grid reliability. Everyone likes it if the lights stay on,” said Lees.
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Xcel has more than 400,000 customers across New Mexico and Texas. The need for more power comes with more people moving to the region along with the growth in Permian basin oil production. Some old coal and gas plants are also going offline. “When we build something, they don’t last forever and we need to responsibly run them and then responsibly take them offline and then replace them with something else,” added Lees.
One of those coal plants, The Tolk Power Plant in Texas will stop producing in five years. Ahead of the changes, Xcel said it filed a resource plan with the New Mexico Public Regulation Commission in October. They’re planning on possibly building new solar plants and wind energy to fill the gaps. If the plan is approved, construction could start on some of those projects by 2027.
“We also have increasing renewable energy standards in the state that we’ll be looking to meet. We’re already doing a great job at 39% of the energy we provide in Texas and New Mexico is already served by renewable energy,” mentioned Lees.
Under newer requirements from the state’s 2019 Energy Transition Act, Xcel energy is aiming to go carbon-free by 2045. It hasn’t said yet if New Mexico customers could face a rate increase to do that.