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NM lawmakers push energy initiatives

Landmark Supreme Court rulings, controversial trade and nuclear weapons deals and a long-overdue rewrite of the No Child Left Behind education law have dominated the headlines over the first half of a busy Washington summer.

Beyond the glare of the national media spotlight, two New Mexico lawmakers have been working on legislation related to energy production – a subject central to the state’s economy.

Sen. Martin Heinrich, D-N.M, has introduced several bills to boost clean energy production and make it accessible to more Americans. Meanwhile, over in the U.S. House, Rep. Steve Pearce is pushing legislation that would prevent the Bureau of Land Management from raising royalty rates paid by oil and gas companies to extract the traditional fuels from federal land.

Heinrich last week introduced a bill that would extend the Residential Energy Efficient Property Tax Credit by five years. The tax credit helps families pay for residential clean energy equipment, such as solar photovoltaics, solar hot water heaters, geothermal heat pumps and small wind turbines.

“This legislation puts solar energy within reach for more Americans,” Heinrich said. “Families with solar panels on their rooftops already know firsthand how solar can reduce energy costs at home. With more than 300 days of sun in New Mexico, this tremendous resource should continue to be harnessed as an economic engine for our state. Extending the solar tax credit for families is a great way to achieve that.”

A week earlier Heinrich introduced a bill to encourage community solar projects similar to New Mexico’s first community-owned solar garden at Taos Charter School. The bill would add a new federal standard – described by his office as a suggestion, not a mandate – for states to consider adopting. If Congress approved the standard, states could require utilities to allow community solar projects up to 2 megawatts in size to be connected to their power distribution system.

The legislation would require the utility to allow the electricity produced by the community solar facility to be credited directly to each of the consumers that owns a share of the system, offsetting the cost of electricity normally billed by the utility to the consumer. Currently, 12 states and the District of Columbia have shared renewable energy policies in place, Heinrich’s office said.

“Shared solar projects have the potential to allow more Americans who lack sunny roof space or startup capital to truly benefit from solar energy and take personal ownership over their own energy use and carbon footprint,” Heinrich said.

It’s unclear if Sen. Lisa Murkowski, an Alaska Republican who chairs the Senate Energy and Natural Resources Committee, will include the bills in her major energy package expected later this year, but she has a bipartisan reputation and seems receptive to clean energy proposals, as well as supporting traditional fuels.

Meanwhile, Pearce this month convinced the U.S. House to include an amendment to the House Interior spending bill that would bar any increase in royalty rates that energy companies are compelled to pay to the federal government for oil and natural gas extracted on government lands.

The amendment passed 231-198, with the overall Interior bill still pending a final vote. New Mexico collected $479 million from the royalties in the 2013 fiscal year – no small chunk of change.

Pearce, a former oil industry executive who is among the top congressional recipients of campaign contributions from the energy industry, noted that in April, the Department of Interior’s Bureau of Land Management posted official notice of a rule change that he said would effectively raise the cost of producing oil and natural gas on federal leases.

“Increasing BLM royalty rates will not increase federal revenue, because it will push production off federal lands,” Pearce said. “This will stifle energy development, cost jobs, reduce energy security and lower the money coming back to New Mexico. Schools, universities, public hospitals, law enforcement and infrastructure projects depend on federal royalty revenue payments funneled back to the state.”

Opponents of the amendment, including the Center for Western Priorities and some members of Congress, argue that raising the rates could increase government revenue by billions of dollars. Rep. Chellie Pingree, D-Maine, said boosting the rates would give the public “a fair return from the production of oil and gas from federal leases.”

Interior Department spokeswoman Jessica Kershaw told me late Friday that the agency is wary of efforts such as Pearce’s.

“While we haven’t been asked to formally testify before Congress on this, generally the department opposes efforts to curb our authority to set royalty rates which provide a fair return to the American people,” Kershaw told me in an email.