ALBUQUERQUE, N.M. — Public Service Co. of New Mexico wants the state Supreme Court to delay regulatory proceedings on shutting down the coal-fired San Juan Generating Station near Farmington.
The Public Regulation Commission ordered PNM on Jan. 30 to submit an application for plant abandonment by March 1 that details all costs, impacts and plans associated with the shutdown, something the utility had expected to file in mid-2019.
PNM says it’s impossible to comply, since it lacks the basic information needed for such a filing, including selection and cost estimates for alternative energy resources that would replace San Juan. The PRC order could also exceed commission authority by forcing the company to involuntarily initiate an abandonment proceeding of property that’s still serving the public, something that must be a “voluntary act” under state law, according to PNM.
The company filed a motion last week with the PRC requesting it reverse the January order, but the commission failed to act on that request during its open public meeting on Wednesday, triggering PNM’s decision to file for Supreme Court intervention.
The PRC’s lack of action represents a de facto rejection of PNM’s motion, PNM Chairman, President and CEO Pat Vincent-Collawn told investors in a conference call on quarterly earnings Wednesday morning.
“If the motion is not addressed today, it’s deemed denied,” Vincent-Collawn said.
At the heart of the issue are bills under debate in the state Legislature that could fundamentally alter the future of electric generation in New Mexico, particularly Senate Bill 489, known as the Energy Transition Act. That bill would set new mandates for utilities to derive 100 percent of their electricity from carbon-free sources by 2025, including 80 percent from renewable resources.
It also outlines a new financial mechanism known as “securitization” that would allow PNM to recover all its lost, or “stranded,” investments in San Juan by selling secure bonds that would be repaid by customers through a charge on their bills.
PNM says the PRC’s actions interfere with the Legislature’s authority to set policy, creating legal issues about whether the bill, if approved, could be applicable to an open proceeding already under way at the PRC. In any case, PNM needs clarity on future energy policy to plan for San Juan abandonment and the electric resources needed to replace it, Vincent-Collawn said.
“PNM understands that legislation passed this session will affect our statewide energy policy,” Vincent-Collawn told the Journal in an email. “Common sense and good policy dictate that we wait until we have clear guidance from the New Mexico Legislature on how to move forward.”