With President-elect Joe Biden about to take office, New Mexico and other states are preparing for a tectonic shift in the battle against climate change.
Most see it as a watershed moment – one that could fundamentally alter national and local economies through a flood of new climate-related policies and programs to mobilize broad action against carbon emissions across the country.
That includes a massive federal push to replace fossil fuels with renewable generation of all kinds, from utility-scale solar, wind and battery storage systems to offshore wind farms and emerging technologies like advanced hydrogen production as a clean alternative fuel.
It also includes a broad effort to upgrade the grid, expanding and modernizing existing infrastructure while building out new state-level and regional transmission lines to carry renewable electricity from rural areas to large population centers.
And it means expanding climate policies to fight carbon emissions well beyond the electric industry to include nearly every sector of the economy, said Rep. Melanie Ann Stansbury, D-Albuquerque.
Stansbury is a water and natural resources specialist who worked on climate issues in the White House under former President Barack Obama. She’s now working on climate-action bills for New Mexico’s upcoming legislative session.
“Our entire dependence on carbon needs to be altered across the board, not just in electric generation, but in transportation and industry in general,” Stansbury said. “We need comprehensive action against our climate footprint.”
Under Obama, such comprehensive action had already gained a lot of momentum. But it came to an abrupt halt under President Donald Trump, who pulled out from the international Paris Accords on climate change and then stalled or rolled back national programs and policies that aimed to limit carbon emissions, Stansbury said.
With Biden now promising to immediately rejoin the Paris Accords and launch aggressive action to build a clean energy economy, the U.S. is playing catch up compared with other countries.
“For me, the ‘watershed moment’ already came when the U.S. signed the Paris Accord with other nations,” Stansbury said. “But under Trump, the U.S. hit the pause button for four years while momentum continued in the international community. Now we’re behind the curve.”
New Mexico’s role
New Mexico will play an outsized role in building the clean energy economy going forward, both as a leader in the energy transition, and because potential oil and gas-related policies under Biden could immensely impact that industry here.
Biden talked during the campaign about possible bans on new leasing, permitting and drilling for oil and gas on federal lands, where far more New Mexico production takes place than in other oil-producing states. Industry leaders and supporters say such bans could cripple activities here, potentially pushing the state into a fiscal crisis.
“That issue is way more important for New Mexico than any other Biden action on renewable energy,” said Paul Gessing, president of the Rio Grande Foundation, a free market think tank. “It’s easily the most directly impactful policy that the Biden administration could impose.”
It’s not yet clear whether Biden will actually pursue such policies once in office, and Gov. Michelle Lujan Grisham has said the state will seek a waiver if any moratorium is imposed.
But on most other fronts, New Mexico stands to benefit a lot from federal efforts to push clean energy development, according to public officials, environmentalists, and others.
The American Clean Power Association released a study in December that forecasts massive investment and job creation in New Mexico and around the country if the Biden administration pursues a federal goal of 50% renewable energy across the national grid by 2030.
The report, compiled by international energy consultancy Wood Mackenzie, outlines concrete actions the federal government could take. To achieve 50% renewables in 10 years, Biden would need congressional support for things like tax incentives, funding for programs and projects, setting a fee on carbon emissions, or imposing mandatory targets for renewable generation.
But even without congressional backing, the federal government could reach 37% renewable generation just through executive action. That includes new regulations and permitting processes to promote more renewable development on federal lands, accelerate transmission construction, increase federal procurement goals for renewables, and establish environmental policies to enforce more carbon reduction in electric generation.
Striving for 50% renewables could generate $1 trillion in new investment nationwide over ten years, creating one million new jobs and $64 billion in new taxes and lease payments to land owners, according to the report.
New Mexico alone would net $17 billion in new investments and 13,700 jobs by 2030, plus $467 million in land-lease payments and $329 million in new state and local taxes, said John Hensley, Clean Power Association vice president of research and analytics.
Even if congressional opposition forces a lower 37% goal, it would still bring nearly $700 billion in investment and about 600,000 jobs nationally, according to the report. And New Mexico would still reap substantial benefits.
“New Mexico is blessed with a great set of renewable resources for solar and wind development, and it’s located close to big markets like California, making it a potential nexus for clean energy in the West,” Hensley said. “As demand for renewable generation grows, New Mexico will continue to be a prime location for development to supply local and regional markets.”
That includes a lot of new transmission construction, which is critical to tap wind energy on New Mexico’s gusty eastern plains, plus solar potential in other areas.
“The Biden administration can do fast-tracking authority for transmission construction right out of the gate, setting up strategic development corridors to expand wind generation from eastern New Mexico and Texas right up to the Dakotas, while also strengthening solar development all along the Sunbelt,” Hensley said. “It’s an opportunity for the renewable industry to help lead economic recovery from the pandemic in New Mexico and the nation.”
NM’s running start
New Mexico has already embraced renewable development through the state’s Energy Transition Act, which requires electric utilities to achieve 50% renewables by 2030, 80% by 2040, and 100% carbon-free generation by 2045. Some massive projects are now coming online, with a lot more in development.
In December, Xcel Energy inaugurated the state’s largest solar facility to date – a $900 million, 522-megawatt project in Roosevelt County to supply customers in eastern New Mexico and West Texas. Avangrid also completed a 306-MW wind complex in Torrance County, including a 166-MW wind farm to supply Facebook’s data center in Los Lunas, and a 140-MW facility to supply Public Service Co. of New Mexico customers.
In addition, PNM plans to replace the coal-fired San Juan Generating Station near Farmington in 2022 with 650 MW of solar farms and 300 MW of backup battery storage. And Pattern Energy began construction this month on a massive, 1,000-MW wind complex in central New Mexico, plus a new 150-mile transmission line. It’s investing $1.5 billion in the project, employing about 1,000 construction workers this year, plus some 150 permanent jobs when it comes online in the fall.
Public officials, environmentalists and local research institutions are now pushing to expand New Mexico’s climate action well beyond the electric industry to include most sectors of the economy. The Santa Fe Institute, an interdisciplinary research center that analyzes complex issues, released a report in October with strategies for state action to build a comprehensive climate plan. That includes everything from electrifying the transportation industry to converting homes, buildings, and commercial and industrial facilities from natural gas to electric heating.
An all-encompassing approach is not only critical to stem climate change, but it also broadens opportunities to diversify New Mexico’s economy, said report co-author and Institute professor Cristopher Moore.
“There are huge opportunities to replace fossil fuels with green energy across the economy,” Moore told the Journal. “New Mexico can play a huge role in solving the climate crisis across the Southwest while generating an enormous number of jobs in the process.”
Converting transportation and heating systems to renewables means more local business opportunities, and as those transitions gain momentum, demand for electricity will increase exponentially in New Mexico and states like California that are pursuing similar strategies, Moore said. That, in turn, could spur a lot more wind and solar development here for export to other states.
“It’s a gateway to a new phase of growth and economic diversification,” Moore said.
New Mexico is also poised for leadership roles in emerging technologies, including carbon capture, clean hydrogen production, and alternative energy storage systems.
Enchant Energy and the City of Farmington are now pursuing a massive project to transform the San Juan plant into the world’s largest coal-based carbon-capture facility after PNM abandons the generating station in 2022.
That project is controversial, since most environmental organizations oppose carbon capture for coal. But that technology is also critical for other applications, such as lowering industry emissions in things like cement and steel production, or sequestering carbon from natural gas generation.
State government is already pursuing broader carbon initiatives. When Gov. Lujan Grisham took office in January 2019, she immediately ordered New Mexico to join a national coalition of states seeking to combat climate change to make up for a lack of federal action at that time. The order called for New Mexico to cut its carbon emissions by 45% below 2005 levels over the next decade, setting up an executive-led climate change task force to develop strategies and recommendations.
Now, legislators and environmental groups want to enshrine the governor’s executive order in mandatory legal statutes to set an overall carbon emissions cap for the entire economy, while also also building “climate resilience” strategies to help New Mexico communities cope with impacts of climate change, said Rep. Stansbury. That could include things like reforestation to capture carbon, and new methods to protect forests against wildfire.
That’s critical for New Mexico, which Stansbury called “ground zero” for water-related climate impacts from rising temperatures and severe drought.
“One of the most intense droughts in state history is forecast for next summer, and agricultural folks are sounding the alarm,” Stansbury said. “We’re looking at serious water conditions now and in the future. Climate change isn’t coming – it’s already here. It’s happening, and we have to prepare our communities for it.”