AG pulls support for PNM plan as PRC extends deadline

After months of standing with PNM, Attorney General Hector Balderas urges all parties to go back to the table to negotiate a better replacement power plan. He made his statement on the same day that the PRC officially extended PNM's deadline to August 1 to file finalized coal contracts and ownership restructuring agreement at San Juan. 

State Attorney General Hector Balderas on Wednesday said Public Service Company of New Mexico’s controversial proposal for the San Juan Generating Station — which he previously supported — now “isn’t good enough.”

Balderas publicly called on those on all sides of the issue to come up with a better plan, reversing his position from just four months ago when he lauded the utility company’s proposal.

About the same time Wednesday that Balderas said the plan no longer is adequate, the state Public Regulation Commission voted 4-1 to extend the deadline for PNM to file all completed documents related to the ownership restructuring for the generating station near Farmington.

The utility now has until Aug. 1 to file documents from all the owners of the coal-burning power plant. Assuming that is done, the Public Regulation Commission will vote at a later date on PNM’s proposal to close two units at the San Juan station in 2017 but increase the coal-burning capacity of the remaining units to help make up for the lost power.

Balderas’ latest comments on the San Juan Generating Station came at a news conference at Positive Energy Solar, a business in Albuquerque. He said the state’s energy system was “dysfunctional.”

“We have an urgent public safety and public health issue on our hands because the system is focused on representing the interests of wealthy corporations and wealthy special interests rather than looking out for all New Mexico families,” said Balderas, a Democrat in his first year as attorney general.

He called on “all parties, stakeholders and PNM” to go back to the table to negotiate a new plan for the San Juan Generating Station. “The current plan is not good enough, which is why the attorney general is calling on the parties to create a better plan that provides the most affordable, cleanest energy for all New Mexico families,” said Balderas' spokesman, James Hallinan.

But on Feb. 27, pursuant to an order from the hearing officer in the case, Balderas filed a statement in which he called PNM’s plan “fair, just and reasonable because it was the result of serious bargaining among capable parties. It reflects a benefit to customers and the public interest. It protects customers from severe rate shock, while providing PNM and New Mexico with a chance to reduce its reliance on coal both now and in the future.”

Asked for a response to Balderas’ remarks, a spokeswoman for PNM pointed to the attorney general’s previous complimentary remarks.

“We agree with the attorney general that we need to provide customers with reliable, affordable and environmentally responsible electricity,” spokeswoman Jodi McGinnis Porter said. “PNM is a New Mexico company that employs 1,500 New Mexicans in good-paying jobs that support New Mexico families.”

Asked what changed Balderas’ mind, Hallinan, said: “Over the period of months evaluating the case, Attorney General Balderas strengthened his position to better attain affordable, clean energy for all New Mexicans.” Asked what authority Balderas had to get involved in a utility case, Hallinan said, “It is the attorney general’s job to advocate for New Mexico consumers.”

Hallinan later clarified that "clearly by statute, we are a party to all utility rate cases. ... It is our statutory duty."

Balderas had been criticized by environmentalists for his support of PNM’s plan. Earlier this year, more than 40 organizations — including conservation, American Indian, religious and business groups — signed a letter asking Balderas to withdraw his support.

Meantime, one member of the Public Regulation Commission who voted to give PNM the time extension said he doesn’t think the utility will have all its documents ready by Aug. 1.

“In the history of this case, not a single deadline has been met by PNM,” said Commissioner Sandy Jones, D-Williamsburg.

PNM has provided a timeline indicating that all of the owners will have their agreements approved by Aug. 1.

“We are grateful that the commission granted the extension, which will allow PNM to complete the complicated process of ownership restructuring for the plant,” said Pat Vincent-Collawn, PNM chairwoman, president and CEO.

Public Regulation Commissioner Valerie Espinoza, D-Santa Fe, cast the dissenting vote against giving PNM more time to complete its contractual arrangements. After the meeting, Espinoza said she hopes PNM will work with opponents of the plan to come up with a new proposal.

Several Republican state legislators from the Four Corners region attended the Public Regulation Commission meeting to show their support for PNM’s plan. They included Sen. Bill Sharer and Reps. Rod Montoya, James Strickler, Sharon Clahchischilliage and James Townsend. None spoke at the meeting.

“We’re all here for the jobs,” Sharer said afterward. “There are thousands of jobs at stake. Also cheaper electricity for ratepayers in New Mexico. If we have to buy electricity from elsewhere, I’m guessing electric rates would go up.”

Montoya said much the same. “It’ll keep electric rates low for poor people and for businesses,” he said in an interview.

Opponents of the plan dispute that jobs would be lost if PNM’s plans were rejected.

Steve Michel, a lawyer for Western Resource Advocates, one of the environmental groups that intervened in the case, said it’s unlikely PNM would shut down the plant if its coal plan is rejected. And even if it did, Michel said, there would be hundreds of jobs in reclamation on the property where the power plant operated.

Mariel Nanasi, executive director of New Energy Economy — one of the conservation groups that has formally intervened in the case — said even though her organization opposed the time extension, she was encouraged that the details regarding the cost effectiveness of PNM’s plan will be part of the hearing. Nanasi has said her group has done studies showing solar energy is more cost effective than coal and nuclear energy.

PNM’s plans for the San Juan Generating Station, in addition to the extra coal capacity, call for adding a plant fueled by natural gas, nuclear power from the Palo Verde plant in Arizona and some solar power.

Contact Steve Terrell at sterrell@sfnewmexican.com. Read his political blog athttp://tinyurl.com/Roundhouseroundup.

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