Citizens for Fair Rates and the Environment (CFRE) is concerned that the proposed merger between Public Service Company of New Mexico and Avangrid, via N.M. Green Holding Inc., extensively benefits PNMR shareholders and executives without meaningful benefit to ratepayers. The merger does so in violation of N.M. law and to the detriment of our environment and emissions goals. CFRE opposes the merger request.
We hope readers will add their names to our petition at: https://actionnetwork.org/petitions/the-pnm-avangrid-merger-must-benefit-the-people-of-new-mexico?source=direct_link&. The petition opposes the merger; if however the merger does proceed, the petition requests that there be more ratepayer protections and community benefits incorporated into the deal.
Most concerning is:
1. The current merger agreement poses a threat to future regulatory authority and consumer protections because it does not expressly ensure an Independent Examiner be appointed to evaluate all requests for proposals – bidding proposals for resources – or guarantee a majority of board members operate independently of Avangrid/Iberdrola. Iberdrola, a Spanish company, owns 81.5% of Avangrid stock. Multiple layers of foreign company ownership will certainly make regulating the utility company much harder in the future and opens the door to risk from anti-competitive resource procurement practices. It is certainly not in New Mexicans’ best interest to make regulating PNM even harder or to have PNM’s future profits be sent overseas.
2. The merger agreement forces abandonment and securitization of the Four Corners Power Plant at the expense of ratepayers and prevents early closure of the plant, harming our environment and the planet. PNM/Avangrid claim no costs related to the merger will be passed on to ratepayers, but $300 million in cost recovery for imprudent and untimely reinvestment into coal power doesn’t seem like nothing. PNM reinvested in the plant’s coal power generation at a time when renewable energy was less costly than reinvesting in coal power. Ratepayers must not be held financially responsible for PNM management’s lack of due diligence.
3. The rate credits offered to ratepayers, now $50 million, do little to offset the potential harm that will accrue to ratepayers as the new multi-national corporate owners attempt to recoup the $2.355 billion premium – i.e., the amount above fair market value – Avangrid would pay to acquire PNMR. While our petition requests the rate credit should be at least $100 million with a three-year rate freeze, should the merger proceed it would still be bad for ratepayers and bad for New Mexico.
4. The economic development and just transition funds included in the agreement are inadequate and, according to Public Regulation Commission precedent, should be $100 million at a minimum. We request that half of these funds should support rooftop solar for not-for-profit organizations and community solar projects.
5. The merger agreement does not guarantee timely cleanup at San Juan or Four Corners power plants. Cleanup should begin immediately; the costs must not be passed on to future generations.
We are circulating this petition to inform PRC commissioners about the concerns of the public in New Mexico. Let us make clear that we do not want the merger to proceed. If, however, the merger does proceed, (parties) should at least add some meaningful benefits for ratepayers.