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Editorial: PRC should plug into real cost of alternatives

New Mexico’s utility ratepayers deserve clarity in their monthly bills, and the Public Regulation Commission is right to revisit its cost-calculation rule regarding renewable energy costs.

Because the current math includes not only the net costs of solar or wind or biomass and the savings from avoided fossil-fuel purchases, it also factors in any avoided plant construction down the road.

Public Service Company of New Mexico spokeswoman Susan Sponar says, “avoided environmental and capacity benefits are hard to measure. They may be speculative and, to that extent, actually mask the cost to the customer.” But former Commissioner Jason Marks, who supported the calculation, has pointed out “when we figure net cost, should we consider if the utility didn’t have to add 10 megawatts from a new (fossil fuel) plant? I think the answer is obvious.”

PNM, New Mexico Attorney General Gary King, PRC staff and New Mexico Industrial Energy Consumers all asked the PRC to reopen the debate, and four of the five commissioners have agreed. New Commissioner Karen Montoya cast the lone no vote.


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The cost-calculation rule is used to determine whether projects fall within a PRC-imposed price cap on how much utilities can spend to comply with the renewable rules. The state’s renewable portfolio standard requires utilities to derive at least 10 percent of their electricity from renewable sources this year.

It’s important to include somewhere if renewables increase capacity to the point serious capital investments are avoided. But folding that kind of savings into the cost of harvesting and transmitting renewables defeats the transparency and accountability in having renewables line-itemed on bills.

This second round of discussion should not be about renewables vs. fossil fuels — it should be about ensuring ratepayers know exactly how much they are paying, and what they are — and are not — really paying for.

This editorial first appeared in the Albuquerque Journal. It was written by members of the editorial board and is unsigned as it represents the opinion of the newspaper rather than the writers.