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Confused whether the PNM/Avangrid merger was approved - it wasn't, but they want you to think it was

Updated: Sep 21, 2022

The above advertisement is egregious not only because it hypocritically declares "We care!" about rising energy costs while PNM simultaneously makes every possible effort to squeeze the most out of its customers (including collecting $650 million plus interest, plus millions in clean-up costs for two aged-out, decrepit, toxic coal plants), but also because it violates the New Mexico Unfair Practices Act and the Public Regulation Commission (PRC)'s order denying the proposed merger between PNM and Avangrid.

Prompted by several emails from confused New Mexican's wondering if they had missed something, New Energy Economy found that not only are PNM and Avangrid advertising as if one entity on Youtube, but also on TV, radio, and through sponsorship of major events including the Governor's upcoming Statewide Conference on Economic Development, where they are presented as a single sponsoring entity. Could Avangrid actually be making PNM worse? It appears that PNM via its relationship with Avangrid is becoming more brazen in its disregard for the law.

This was, in fact, a key reason for the PRC's rejection of the proposed merger: Avangrid and it's parent company Iberdrola have a history internationally, nationally and here in New Mexico of flouting the law, and of using their position as monopoly utilities to manipulate the market, cornering the development of solar and wind generation projects for their own affiliates and subsidiaries at the expense of ratepayers.

Today New Energy Economy filed a Motion to Show Cause at the PRC, requesting an investigation of the deceptive and misleading co-branding PR strategy being employed by PNM and Avangrid/Iberdrola because they believe that the PRC’s decision is no more than a small pothole on the way to the merger that they are hell-bent on accomplishing.

The necessary elements of proving a deceptive trade practice under the Unfair Practices Act are: (1) the offender made a statement or representation that was false or misleading; and (2) the false or misleading statement or representation was knowingly made in the regular course of their business; and (3) the statement or representation was of a “type that may, tends to, or does deceive or mislead any person.” We believe that such deception is at the heart of their PR strategy, another reflection of the manner in which Avangrid and Iberdrola would conduct business in New Mexico if their appeal at the Supreme Court is successful, or if a newly appointed PRC were to approve the proposed merger in the future.

In case we needed further reminders of their unethical and exploitive business practices, the following fines and investigations have been announced in just the past year since the PRC denied their merger application:

  1. Spanish court orders Iberdrola to dismantle 60% of 500 MW operational PV solar plant – building a plant on property that was illegally expropriated - reminiscent of Avangrid’s beginning construction in Maine on its transmission line before the company had a Certificate of Public Convenience and Necessity (“CPCN”).

  2. Mexican regulator fine Iberdrola $466 million for violating energy permits issued by Regulatory Agency. Iberdrola/Avangrid has perfected this: creating shell corporations (also known as affiliates or affiliate interests) sometime with the exact same board members, managers, etc. and then skirts regulations and laws applicable to the parent company. In a scheme the companies have been working for more than 25 years, Iberdrola created false self-supply companies with electricity buyers (large users), bypassing the laws that prohibited the purchase and sale of kilowatts between private generators and industrial consumers (Kimberly Clark, Heineken, GM and a lot of big businesses, Mexican, American and Spanish alike) to avoid paying the high voltage transmission to the Federal Electricity Commission and other fees.

  3. Spain’s Prosecutor’s Office requesting a fine of 84.9 M for Iberdrola and prison for four of its directors for inflating energy costs and draining a reservoir; Iberdrola accused of market manipulation of energy prices.

  4. Avangrid suing their customers and garnishing wages during COVID to collect electric bills contrary to Regulatory Order instituting a moratorium. Connecticut’s Office of Consumer Counsel (“OCC”) contend that “Avangrid has referred over 21,000 customers to its legal collections firm since April of 2020.” OCC’s investigation found that “Avangrid’s legal collections firm has attempted to contact customers regarding their outstanding balances over 110,000 times since April of 2020.” A settlement of $3M was approved by Connecticut’s Public Utilities Regulatory Authority.

  5. Avangrid utilities in New York an impediment to economic development, failing to provide meters within a reasonable time. Home buyers and builders say they are dealing with months-long delays in connecting utilities to new homes and properties. Home builders and property owners say it has gotten worse, and the utility companies have been more difficult to reach.

No wonder they feel the need for a deceptive and misleading PR strategy!

New Energy Economy is requesting the following remedies:

  • Require PNM and Avangrid to detail the joint advertising and sponsorship that has been conducted and ensure that no costs for such advertising be recoverable from ratepayers;

  • Require PNM and Avangrid to take out advertising in every venue it has placed advertising (in whichever format) explaining its deceptive advertising and correcting the same, which shall be reviewed by the Commission before it has been submitted;

  • Award a $300 penalty, plus costs and attorneys’ fees, and interest, for violating consumer protection laws under the Unfair Practices Act.

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