SANTA FE – A complex regulatory bill aimed at setting a new energy course for New Mexico – and the state’ largest utility – hit a roadblock Saturday in its first Senate committee.
The Senate Conservation Committee voted 5-4 to table the legislation, though the panel’s chairman, Sen. Joseph Cervantes, D-Las Cruces, said after casting the decisive vote that he’s open to bringing it back during the 30-day session, which ends Feb. 15.
“This is a very confusing piece of legislation that’s been changing all the time,” Cervantes said.
Sen. Jacob Candelaria, D-Albuquerque, one of the bill’s sponsors, said minor technical disagreements should not derail the bill. He also said he’s still hopeful it can win approval.
“This bill is so close to making history,” Candelaria told the Journal after Saturday’s vote. “We need to put party aside and do what’s right for New Mexico this session.”
The measure, Senate Bill 47, would allow the Public Service Company of New Mexico to recoup its investment in abandoned coal plants by issuing low-interest bonds that would be paid off by customers over a 20-year period.
It would also require PNM to procure 50 percent of its energy from renewable sources by 2030 and would create a $19 million economic development fund for San Juan County, where coal plants are located.
Those provisions were added to the bill after hours of closed-door negotiations over the past week, but environmental groups said the legislation still doesn’t go far enough.
“We have the highest expectations when it comes to the future of the Four Corners area and the energy future of our entire state, and PNM’s proposal continues to fall short,” said Ben Shelton, the legislative director for Conservation Voters New Mexico.
Meanwhile, other critics of the legislation described it as a “bailout” for PNM, a charge supporters fiercely contested.
The bill is being supported by an unusual coalition of labor and business groups – including the Greater Albuquerque Chamber of Commerce – that describe it as crucial to providing long-term economic security.
Farmington Mayor Tommy Roberts also testified during Saturday’s hearing, saying, “We’re asking for help … and I’m not ashamed to ask for that help.”
He said energy-reliant San Juan County has already had a population decrease in recent years, due in part to a slowdown in the natural gas industry.
In essence, the framework of the proposed legislation would make it easier for PNM to recover what it originally anticipated earning from the San Juan Generating Station near Farmington, which it now hopes to close in 2022.
PNM also has a smaller ownership stake in the nearby Four Corners Power Plant, which the utility is considering an early withdrawal from in 2031.
Several individuals who spoke against the legislation said the proposal should be reviewed by the five-member New Mexico Public Regulation Commission, which typically regulates utilities. One PRC Commissioner, Cynthia Hall of Albuquerque, even showed up for Saturday’s hearing to testify the bill would undermine the commission’s authority.
But Gerard Ortiz, PNM vice president for regulatory affairs and economic development, said any order allowing the utility to recover less than 100 percent of its investment would probably be appealed.
Now, with just 11 days left in this year’s session, supporters of the legislation will have to race against the clock to try to come up with legislation that could win approval of the Senate Conservation Committee and make it to Gov. Susana Martinez’s desk.
And some lawmakers suggested it might be wise to just wait until 2019.
“This is far too complex an issue for us to be addressing in a 30-day session,” said Sen. Bill Soules of Las Cruces, one of five Democrats to vote in favor of tabling the bill.
Sen. Richard Martinez, D-Española, joined three Senate Republicans in voting against the motion.