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NM governor calls for reforming state Public Regulation Commission

Gov. Michelle Lujan Grisham announced her intent to propose legislation in January 2020 to make the New Mexico Public Regulation Commission more responsive with respect to implementing the state's recently adopted 100% clean power law.

Addressing the 2019 Energy Summit: Building New Mexico's Clean Energy Future on Aug. 6 at the Albuquerque Convention Center, Lujan Grisham said reforming the PRC is essential to ensure the success of the Energy Transition Act that sets renewable energy goals and requires emissions-free electricity by 2045.

With Lujan Grisham's March 22 signature on that law, New Mexico became the third U.S. state to target complete decarbonization of its power system. The measure increased the state's renewable portfolio standard from 20% by 2020 to 50% by 2030 on the road to reaching the carbon-free power goal.

However, the governor is concerned about certain of the PRC's recent actions, which she fears are attempts to delay implementation of the new law, according to Lujan Grisham's press spokesman, Tripp Stelnicki. Lujan Grisham's description of her plan to propose changes at the PRC was short on specifics, but Stelnicki said the governor wants to create an environment at the agency more suited to carrying out the landmark law.

Voters will decide on PRC changes too

In addition to the Energy Transition Act, the state legislature approved a resolution in March to establish a ballot measure that would have voters consider a proposed constitutional amendment to change the PRC from a five-person elected body to a three-person agency with members chosen by the governor from a list of candidates compiled by a nominating committee.

The question will be put on the Nov. 3, 2020, general election ballot, but the ballot question has not yet been prepared, according to New Mexico Deputy Secretary of State Sharon Pino.

While the governor has not publicly endorsed the amendment, she supports its aim to have qualified regulators with more professionalism and expertise, Stelnicki said. However, the amendment, if passed, would not take effect until Jan. 1, 2023, which is just after terms expire for three of the most recently elected commissioners.

Lujan Grisham is concerned that the state cannot afford to delay implementing the new clean power law to await the outcome of the PRC ballot question, so she wants to propose measures sooner that will spur the PRC to quicker action, Stelnicki said.

PRC's delay of San Juan measures the last straw

A key part of the clean power law is allowing PNM Resources Inc. and other owners of the San Juan Generating Station to recover plant investments and decommissioning costs by selling bonds backed by utility customers.

PNM subsidiary Public Service Co. of New Mexico on July 1 submitted an application for closing the San Juan plant near Farmington, N.M., including closure, securitization financing, benefits to workers who will be displaced, steps to help the community impacted by the plant closing, and options for replacement power. Those options include plans for developing a 280-MW gas-fired plant and solar facilities at the coal plant site.

But the PRC bifurcated the application to weigh the plant abandonment and financing of its closure in one proceeding and consider options for replacing the plant's output with other resources in another proceeding that will take months longer to resolve. The move upset the governor and some legislators who are concerned that a delay could compromise the utility's plans to replace the plant with new resources in a timely manner.

Stelnicki said the PRC's handling of the San Juan case has caused consternation in the governor's office and the legislature. The PRC has had problems for many years, including scandals and staffing problems, but this was "the straw that broke the camel's back," he continued.

The governor wants to make sure the commission does not derail progress in implementing the clean energy law, including providing benefits to San Juan County, he said.

According to PRC Interim Chief of Staff Jason Montoya, the commissioners are aware of the governor's energy summit comments and the proposed constitutional amendment appears to be in line with what the governor is proposing. However, the PRC will not comment on the situation because of statutory restrictions on ex parte communications regarding matters that could impact specific cases before the commissioners, he said.

Montoya noted that PRC Chairwoman Theresa Becenti-Aguilar made comments to the legislature opposing the ballot resolution and that the Associated Press ran her March 2 op-ed article saying the constitutional amendment would make the state's most powerful regulatory agency less representative and less responsive to the public. Appointees would be more susceptible to influence of special interests since voters no longer would have the final say concerning PRC actions, Becenti-Aguilar said.