Evidentiary hearings in the Four Corners Power Plant (FCPP) Abandonment Case wrapped up this week, exposing the lie at the heart of PNM's proposed sale and transfer of its shares of the coal plant to Navajo Transitional Energy Company (NTEC). Going into the hearing we knew that the proposed deal would:
1. keep coal burning longer due to a clause in the contract forbidding PNM from voting for early closure of the plant, important because closure requires unanimous consent of all owners.
2. foist $300M in imprudent costs onto ratepayers through application of the ETA, in direct contradiction to the law that states ratepayers must be held harmless for management malpractice. (Long time readers might enjoy this clip in which the Hearing Examiner gets PNM's witness to admit that management "should have done" the kind of financial analysis they recently submitted when they made their bad investments in 2013!)
PNM argued that the abandonment of Four Corners was a net public benefit (the legal standard) because using cheaper sources of electricity will save between $30M and $300M going forward. This is an explicit admission that PNM's coal investment IS costing ratepayers more than if the company had invested or will invest in dramatically cheaper (and healthier) renewables (what we have been arguing since at least 2014).
But PNM knew that they had a problem in the Four Corners case: how were they going to turn their sale of Four Corners to NTEC, that will guarantee the continued burning of coal, into a "net benefit"? So PNM came up with an idea that at first blush looks good: PNM entered into a "seasonal operation agreement" with the other owners at Four Corners.
This is PNM's testimony about the seasonal operation agreement:
Under seasonal operations, only a single FCPP unit will operate on a year-round basis, but both units 4 and 5 will operate during the summer peak season from June through October when customer needs are highest. Based on these operational characteristics, it is estimated that carbon emissions will be reduced by 20 to 25 percent.
Who wouldn't want 20-25% reduction in emissions? No one. As with most schemes by PNM, however, it isn't actually as good as it appears.
Check this out:
The seasonal operation agreement in fact forces full operation of the plant during open seasons, and includes a clause extending the time to closure from 24 months to 48 months beyond a consensus vote. At minimum two additional years of coal. An egregious example of greenwashing.
Bill McKibben said it best:
We call it “greenwashing,” but that’s too technical a term. We should call it what it is: people with a vested interest are learning how to slow-walk this crisis. They’ve done it with a thousand other crises, too, of course—one thinks of how, following the Supreme Court’s ruling in Brown v. Board of Education, segregationists managed to delay action for a decade or more, focusing on a single phrase in the decision: “with all deliberate speed.” But here they’re doing it in the face of an absolute deadline imposed by science. As the United Nations’ Intergovernmental Panel on Climate Change has made clear, we must cut emissions in half by 2030 or our chances of meeting the targets that we set in Paris just six years ago fall by the wayside. Slow-walking is sabotage—smiling, and deadly.
Careful, thoughtful, articulate, incisive, and quick, Expert witness Jeremy Fisher concisely deconstructs PNM's rationale for the FCPP "abandonment" and sale and then exposes the falsity of the claims in their application. Here is a short snippet from this star witness:
Now we get to work writing our briefs and the Hearing Examiner will make a recommendation to the commission for their critical decision - will PNM be allowed to continue their slow walk exit from coal? And who will be made to pay for their imprudent extension of and investments in the FCPP?
Our position: NO Four Corners sale to NTEC! NO $300M foisted on the people for PNM's imprudent investment decisions; Close the climate polluting and environment destroying plant down!
Call your PRC Commissioner. Write your Commissioner. Reference Case No. 21-00017-UT.