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Merger hearing concludes - concerns abound

The Ricobaya reservoir was drained by Iberdrola in pursuit of higher profits.

Well we survived the two-week evidentiary hearing on the merger and have miraculously found time (in the wee hours of the night) to prepare for the Four Corners case, which started yesterday. It's been a whirlwind and the pace and volume of the work has been pretty insane - even for our regular sprinters. Rather than allaying some of our concerns and fears about a future with Avangrid/Iberdrola - the hearing confirmed that trouble is afoot and this is a corporation that shouldn't be trusted. One of the images we were left with was this idea of Avangrid/Iberdrola using New Mexico as a "beach-head" - you'll see why we're disturbed in a moment.... On August 12th Hearing Examiner Schannauer asked Avangrid President Robert Kump "What is it about acquiring PNMR and PNM that is important to you in terms of your ability to do other things in the southwest?" His answer was telling:

Well, you know, as we speak today, the investments we have are strictly on a renewables basis; right, with a couple of wind farms. But again, we see the move to decarbonization growing across the country, and we see it particularly here in a state that has tremendous resources, renewable resources, and we find that very attractive. We find that, if you would, a potential beachhead for further growth in the region as we move forward.

A beachhead is defined as "a position taken from the enemy by landing forces, from which an attack can be launched," and that is precisely what Avangrid and Iberdrola are attempting to accomplish in New Mexico. An attack on:

  • New Mexico's autonomy - testimony at the hearing clarified that the proposed merger had two make or break conditions - Avangrid/Iberdrola control over the Board of Directors and any "Material Adverse Effects" that could change the economic prospects of the merger (failure to securitize $300M in losses at Four Corners, for example.) Various parties settled with Avangrid in exchange for some nominal independent control of certain decisions by the PNM Board of Directors, though they could not get the company to agree to a majority independent board. Through a close reading of testimony and discovery, however, New Energy Economy has discerned that even these compromises were essentially empty because all financial authority will actually reside with the board of the holding company, PNMR or otherwise. Parties settled for empty promises that will not protect New Mexicans from corporate decisions that prioritize the profits of Avangrid and Iberdrola over the people and land we love.

  • New Mexico's air and water - by requiring consummation of the Four Corners Power Plant sale contract with NTEC, which will prevent closure of the plant until at least 2027, the merger agreement will potentially lead to at least seven more years of operation - at least 57.5M tons of additional carbon emissions and more than 4 billion gallons of New Mexico's freshwater resources are at stake.

  • New Mexico's economic potential - the "further growth" in the region that Avangrid and Iberdrola envisions is inevitable - the transition to renewable energy is an economic and political certainty as the price of solar, wind and battery storage drives energy decisions in tandem with the climate disasters that are finally compelling political change. The question is whether that growth will benefit Wall Street investors or New Mexican families. With Public Power those hundreds of millions in energy profits that Avangrid and Iberdrola are willing to pay a premium to purchase could instead solve the perpetual revenue trap that keeps New Mexico captive to the oil and gas industry.

We just filed our statement of positions in the case - and are preparing our post-hearing brief. The Hearing Examiner will be reviewing all of the evidence and will make his recommended decision in the next few months. Once there's a Recommended Decision the PRC will make a final ruling - and there your voices will have an important impact.

In the meantime, we are working to defeat the transfer of Four Corners to NTEC and $300 million bailout of PNM for its imprudent investments in the plant. We are also exploring the alternative to this corporate robber baron model - working on the public power option - a chance to leave NM's energy colony days behind. We feel motivated to keep up the fight everyday as we watch in horror - the devastating impacts of climate injustice.


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