We moved to dismiss BCP buyout of NM Gas Company as Blackstone announces plan to buy PNM
- New Energy Economy
- May 27
- 6 min read

Last week Blackstone Infrastructure announced its plan to acquire TXNM, PNM's parent company for $11.5 billion. Blackstone (not to be confused with Blackrock) is one of the largest private equity companies in the world. Blackstone describes itself on its website thusly:
Blackstone is the world’s largest alternative asset manager, with more than $1 trillion in AUM [Assets Under Management]. We serve institutional and individual investors by building strong businesses that deliver lasting value. Our scale – with 12,500+ real estate assets and 250+ portfolio companies – enables us to invest in dynamic sectors positioned for long-term growth.
Not only is Blackstone a major investor in oil and gas, with 85% of its energy portfolio in fossil fuels, the company has been scrutinized for squeezing every last dollar from tenants in its vast portfolio of housing and apartment complexes, and profiting off climate disasters. As the Santa Fe New Mexican editorial board reported in its editorial last week titled "Blackstone's vast interests need intense scrutiny," Blackstone's CEO Steve Schwarzman makes more than $1 billion per year and was one of President Donald Trump's top campaign donors.
How is the long term growth from PNM expected to be generated? We haven't yet dug into the specifics of this deal, but we know that investors are salivating at the prospect of increased electricity consumption from data centers built to power AI, and we know that Blackstone owns Tallgrass energy, the company that has been maneuvering to reinvent the San Juan Generating Station and build a pipeline through the Navajo Nation, first for methane powered hydrogen, and now that the hydrogen tax credits are on the chopping block in Washington, a not so shocking pivot back to methane gas power generation.
Our biggest clue comes from Blackstone's homepage, which reads "From data centers to the energy that powers them, Blackstone is providing the infrastructure to fuel the AI revolution." Blackstone sees big dollar signs in setting up affiliate companies to build data centers and powering those data centers with energy from power plants it owns, sold to a utility it controls, and offered at a discounted price to the data centers it builds. These "affiliate transaction" risks were at the heart of our victory against Avangrid, and Blackstone already has a track record of affiliate self dealing at a utility it owns in Virginia.
Who pays the price of this self-dealing? Ordinary ratepayers like us, who will subsidize the construction of the new generation and transmission infrastructure necessary to generate all this new electricity, and who will pay the price for the climate chaos these companies unleash.
MEANWHILE BCP, THE PRIVATE EQUITY COMPANY TRYING TO BUY NM GAS COMPANY, SOUGHT TO CHANGE THE GAME WITH SIGNIFICANT LAST MINUTE CHANGES TO THEIR OFFER NEW ENERGY ECONOMY JOINED OTHER INTERVENORS IN MOVING TO DISMISS THE CASE
Today New Energy Economy joined the New Mexico Department of Justice, Western Resource Advocates and the New Mexico Affordable Reliable Energy Alliance in a motion to dismiss without prejudice the October 28, 2024 application filed by Bernhard Capital Partners to acquire New Mexico Gas Company. This motion follows a late Friday filing on May 16th by BCP, Emera and NM Gas Company (the Joint Applicants), that, under the guise of rebuttal testimony, sought to make substantive changes to the initial application. This attempt to amend the deal one month before the scheduled hearing is contrary to PRC Rules of Procedure and the November 27 Procedural Order, and is an attempt to deprive the intervenors of their fundamental due process rights in this case.
Parties to the case have already conducted multiple rounds of extensive discovery, attended five depositions, hired experts and filed testimony on the proposed transaction as was presented in the initial Application and the supporting testimonies of four witnesses.
Testimony was filed on April 18th, and proper rebuttal testimony should “explain, counteract, repel, or disprove evidence submitted by another party or by staff.” Instead Joint Applicants introduced entirely new acquisition terms that intervenors are now seeing for the first time. Going forward with a hearing in less than one month on a substantially different proposal deprives the intervenors of the opportunity to conduct adequate discovery and prepare testimony that is responsive to these new proposals.
Many of the substantive changes are belated attempts to make the Application somewhat consistent with the precedents established by the PRC in prior acquisition cases that define the factors to be considered when determining whether a buyout is in the public interest. Three of these Joint Applicants, NMGC, TECO and Emera, were parties to those prior applications and therefore knowingly filed an Application that was deficient on its face. BCP's lack of experience operating utilities of any significant size, the lack of synergies that could produce savings for customers, and the failure to include other important customer benefits like a rate freeze, a rate credit and corporate governance measures to protect ratepayers belied any claims that the deal was in the public interest.
The Applicants Friday filing belatedly made the following substantive changes to their initial Application:
A $15 million rate credit over 12 months after closing, instead of no rate credit, p. 8; (a sum that amounts to a whopping $2.27 per month per customer for one year.)
A rate freeze until the end of 2027, instead of no rate freeze, (but includes a regulatory asset for claimed under-recoveries that negates any benefit from the freeze), pp. 10, 29;
A commitment to hold NMGC for at least 10 years, instead of 5 years, p. 11;
An increase of shareholder funded economic development to $10 million over 7 years, instead of $5 million over 5 years, pp. 13-14;
Shareholder funding of educational and apprentice training focused on engineering, management, finance and other workforce skills at an unspecified level, instead of no such funding, p. 14;
Maintaining current shareholding funding of assistance to low income for payment of heating bills up to a total of $190,000 annually, p. 17;
Adopting “most of the ring-fencing and corporate governance provisions approved in Case No. 19-00234-UT”, going beyond what is currently required of NMGC, pp. 18-19;
An entirely new shared services plan operated by the recently acquired Delta Utilities, instead of shared services during a transition period, p. 21-22,;
The extension of the current shared services agreement from 18 months to 2 years; p. 23;
A reduction in new the hires needed to replace shared services with TECO from 51-61 to 20 full-time employees, p. 22;
An agreement to maintain NMGC’s current level of employees for 36 months following closing instead of the 18 months stated in the Joint Application, p. 22;
New claims of BCP utility operating expertise based on the purported expertise of a number of employees at the newly acquired (as of March 2025) Delta Utilities, pp. 34-37.
While an improvement, none of these changes make up for the risks inherent in the transfer of critical public infrastructure to a private company with no experience operating a gas utility.
In addition to using their rebuttal testimonies to improperly amend their initial Application, the Joint Applicants filed rebuttal of two new witnesses that attempted to argue why private equity ownership of a public utility is in the public interest.
There is simply not enough time before the start of the scheduled hearing on June 23rd for Staff and other parties to propound written discovery on the Joint Applicants’ new proposals, to depose the new witnesses, and to re-depose the original witnesses on their changed positions.
Hearings before the PRC should not be trial by sandbag, with one party withholding information for their own benefit, but a fair opportunity to raise issues and present facts so the Commission can adequately weigh the issues and determine if there is a net public benefit or not. Joint Applicants’ posture in this case instead will “encourage sandbagging and gamesmanship” among litigants.
Together we, the Joint Movants, moved that the case be dismissed, or in the alternative, that the Hearing Examiners:
a. Place the current case schedule in abeyance;
b. Require the Joint Applicants to refile their October 28th Application with terms, conditions and customer benefits and protections that are, at minimum, consistent with the Final Orders in Case Nos. 13-00231-UT, 15-00327-UT, and 19-00234-UT; and
c. After the filing of an amended Application, establish a date for a prehearing conference to set a schedule for the case going forward.
Why are these private companies swooping in to buy up energy utilities in New Mexico?? Because our sun, our wind, our resources, have the potential for so much energy production, and the world is hungry for that energy. Instead of exporting the profit from our resources to private shareholders and investors, the people of New Mexico should own their energy and decide how to use it and what to do with the revenue it generates.
Comments