New Energy Economy intervened in PNM’s case at the Public Regulation Commission because the retirement of coal at San Juan represents a significant opportunity to make a change in New Mexico’s energy future.
By replacing most of this lost energy with wind and solar, instead of more coal and nuclear, New Mexico would be on a path to clean energy. For once, we wouldn’t be at the bottom of the metrics on jobs, health, ethics and the economy.
The climate, environmental and health benefits of available wind and solar are beyond question. Now, for the first time in history, solar and wind also are far better in terms of cost than coal and nuclear.
Yet, PNM has chosen to replace the closure of coal with the acquisition of more coal and nuclear rather than cost-competitive solar and wind. On Dec. 16, the PRC rubber-stamped PNM’s archaic choices, disregarding the public interest and the moral imperative to act at top speed to revolutionize our energy economy.
Why we fought:
Coal and nuclear are expensive, and PNM’s chief financial officer has admitted that, if their shareholders had to absorb these resources, they would lose money. The real reason PNM wants its coal and nuclear to be used by ratepayers is not because these sources are a good deal for ratepayers, but because PNM wants to turn these losing assets into profitable ones.
In 2008, during the financial meltdown, the mortgages on houses were more expensive than the worth of those houses. So people walked away from their homes because the underlying assets were literally guaranteed to lose money. This situation had a devastating economic fallout: people lost their homes, lost their life savings, individuals went bankrupt and it ultimately led to the greatest economic divide in U.S. history. A phrase was coined: toxic assets.
PNM cannot sell its coal – there are no buyers. Rather than close more coal at the 40-year old plant, PNM decided to offload the unwanted coal on us, the ratepayers, and the PRC was complicit in this discharge. The coal is costly: There will be more and more costs for methane, ozone, water and other regulations coming down the pike. There are capital expenditure costs when the older plant breaks down, pollution controls costs, and increased costs for decommissioning and reclamation, as well.
And these will be borne by the ratepayers and cause rates to continuously rise.
PNM’s chief financial officer also admitted that its nuclear is losing money. It costs PNM 4.3 cents to generate Palo Verde nuclear, but PNM can sell the nuclear for only 2.9 cents. Palo Verde nuclear is another PNM asset that is losing millions of dollars per year.
The PRC also approved of PNM’s nuclear, moving it from the shareholder side of the ledger sheet to the ratepayer side of the ledger sheet, on the backs of ratepayers. PNM will begin by charging ratepayers 5.8 cents and it will rise to at least 8.3 cents. PNM doesn’t dispute this.
Further investment in coal is arbitrary and capricious, and New Energy Economy will appeal PRC’s unconscionable decision. The world has gotten together to address the most serious moral, environmental and financial crisis in human history, and the first fossil fuels that will have to be kept in the ground will be coal because of its dangerous risk to our survival.
We are out of time – we’ve already warmed the globe too much, and we are seeing the extreme weather impacts on a weekly and almost daily basis. People are suffering.
Must we change? Yes. It’s a daunting task, no doubt. The answer from science, and nature itself, says yes we must change.
Can we change? Renewable technologies can compete with legacy investments. A renewable energy economy will ultimately dwarf the status quo. We will change because to do otherwise invites a financial meltdown and a health crisis of unforgivable proportions.
Thousands of New Mexicans have joined New Energy Economy, and your support is the springboard for our hope and resistance. Thank you! Together, we will move beyond PNM and create the energy solutions we need.