Protests and dissent as EIB looks at rolling back environmental protections

By Matthew Reichbach

As the Environmental Improvement Board looks at rolling back environmental rules instituted under former Governor Bill Richardson, protesters from the Occupy Movement and environmental groups have made their voices heard opposing the changes.

The existing environmental rules that the Martinez-appointed board is considering repealing relate to carbon dioxide emissions. Industry groups including Public Service Company of New Mexico (also known as PNM) and the New Mexico Oil and Gas Association, back the repeal of the rules.

Occupy Santa Fe attended the hearing and used a “mic check” to have their voices heard.

During the “mic check,” which involves a large group repeating what one person says to amplify the speech without using megaphones, the Occupy protesters talked about concerns with coal-fired power plants.

“Coal burning electricity causes cancer, asthma, neurological disorders and lung disease,” the protesters said. “Elders and children are most at risk.”

David Van Winkle, Energy Chair for the Rio Grande Chapter of the Sierra Club, testified at the meeting and urged the EIB to not to roll back the environmental protections.

“The existing fleet of fossil fuel based electricity energy sources, specifically coal-fired power plants like the San Juan Generating Station produce significant air pollution,” Van Winkle told the EIB according to a transcript sent by the Sierra Club. “While pollution reduction improvements have been realized at San Juan due to the 2005 Consent Decree actions, carbon and nitrogen oxide pollution continue at high levels.”

Van Winkle urged renewable resources, including solar and wind, as well as energy efficiency as better ways to “serve [the] energy needs” of New Mexico.

A study by New Energy Economy, an environmental organization, found that, “Far from being costly for consumers and the New Mexico economy, we find that the compliance scenario creates jobs and saves money for electricity consumers while reducing greenhouse gas and other pollutant emissions in New Mexico. In our estimation, implementing such a compliance scenario would help to mitigate future increases in electricity bills in New Mexico.”

Industry groups say that complying with the new environmental rules would significantly increase the cost of electricity in New Mexico and that cost would be passed on to consumers.

Showdown at the PRC: Consumers win as PNM’s rate increase is slashed

By J. Daniel

By any standard, it was a stunning upset. PNM lost yesterday and New Mexico consumers won.

As the state’s largest electric utility, Public Service Company of New Mexico (PNM) had grown accustomed to having its way with the 5-member elected body charged with regulating it — the Public Regulation Commission. After two straight years of getting its rate increase requests granted, this year PNM and its army of lawyers and lobbyists decided to go for a three-peat in 2011 — initially asking for a whopping $165 million rate hike.

After months of hearings, including closed-door negotiations from which consumer advocates were excluded, that figure got bumped down to a base rate of $85 million. However, a number of  consumer charges were tacked on in addition to the base rate — masked as extra “riders” to the so-called “stipulated agreement.”

So with customary sign-off by the lawyers from the Attorney General’s office, it looked like smooth sailing for PNM’s third straight rate hike. Soon it would be sending out bills to its residential customers with a hefty new increase tacked on.

But Thursday was decision day, and despite all the behind the scenes machinations of the lawyers, PNM ran into a brick wall of unprecedented customer resistance leading up to the PRC hearing in Santa Fe.

“We received hundreds of calls,” was the refrain voiced by at least two of the Commissioners as they prepared to cast their deciding votes.

And then in quick succession, the PRC rejected three motions favored by PNM (one even failing for lack of a second on a motion by Patrick Lyons). It then voted 3 to 2 and passed a framework put together by Commissioner Jason Marks that granted PNM a $72 million rate increase.

Marks explained it this way:

“It’s important that the company only gets what’s fair for PNM and its customers… We can’t afford to give the company the benefit of the doubt. We’ve got to sharpen our pencils. We’ve got to make sure we’re not asking a ratepayer to pay a dollar more than the law requires.”

As a regulated utility monopoly, PNM has a statutory right from the our legislature to make a profit.  The Commission must adhere to that law.  The true question before the Commission was how much exactly to award.

A press release issued by Prosperity Works, a nonprofit consumer advocacy group, lauded the PRC’s decision:

“Today the Public Regulation Commission was presented with four options to address PNM’s rate increase request. While all four options included rate increases, the one that passed today will have the smallest impact on consumers,” said Carmela Starce, lead council for Prosperity Works.  “We wish to thank Commissioners (Jason) Marks, (Jerome) Block and (Theresa Becenti) Aguilar for their vote on behalf of New Mexico’s consumers.”

Starce pointed out, “Let me be clear, one of the commissioners who voted against the Marks plan did so – not because he was against a rate increase but because he favored the plan that would have cost New Mexicans the most money and put it right into PNM’s pocket.  Today, three commissioners did the best they could with what was before them.  They should be applauded for working on behalf of New Mexicans to make sure that PNM didn’t get a penny more that it could justify.”

Starce estimated that the PRC’s action today will save consumers at least $60 million over the next five years.

PNM has ten days in which to appeal the decision.

More Clearly NM coverage of the PNM rate hike fight here.

(Many thanks to Charlotte Chinana, who contributed to this report.)

PNM Settlement on Rate Hike Rejected

By Tracy Dingmann

The New Mexico Public Regulation Commission has refused to accept a utility rate hike settlement proposed by PNM that some groups called secretive and unfair.

The PRC acted Feb. 17 to reject the settlement, which would have allowed PNM to raise rates by almost eleven percent.

That settlement had been strongly opposed by New Energy Economy and other parties on various grounds including legality, due process and adequate public notice.

In its action yesterday, the PRC said it would only consider an uncontested settlement or stipulation when considering a future rate hike.

Continue reading

Important EPA Hearing Tomorrow on the San Juan Generating Station!

By Tracy Dingmann

The Environmental Protection Agency will hold a public hearing in Farmington tomorrow to determine the scope of a plan to force cleaner operation of the San Juan Generating Station in the Four Corners area.

The San Juan Generating Station is known as one of the dirtiest coal-burning power plants in the nation. The massive 1,848 megawatt coal-fired power plant is owned primarily by Public Service Company of New Mexico, or PNM. The plant, which consists of four coal-fired boilers, is located in northwestern New Mexico near the town of Waterflow.

The power plant is the second largest source of air pollution in New Mexico (right behind the Four Corners power plant). Every year, its air pollution contributes to 33 premature deaths, 600 asthma attacks, 31 asthma-related emergency room visits, and other health impacts, at an estimated cost of more than $254 million.

Its air pollution affects indigenous communities in the region, a number of National Parks and Monuments, and regional smog levels, the nearest being Mesa Verde National Park, which is 30 miles north.

One of the best hopes for cleaning up worsening air quality in the Four Corners region is for the owners of to clean up air pollution from its smokestacks by installing proposed pollution-control upgrades.

Continue reading

Down Low Dealings at PNM Regarding Rate Hikes

By Tracy Dingmann

Six local watchdog groups have filed statements in opposition to PNM’s plan to raise rates for electric service in New Mexico, saying the company negotiated the rate hikes in secret and without input from customers and other parties opposed to the rate hike.

The state’s largest electric utility had announced recently that it would seek a rate hike of as much as 25 percent on residential customers.

Subsequently, executives from PNM, along with members of the Public Regulation Commission and staffers from the office of the New Mexico Attorney General carried out negotiations regarding the rate hike and came up with a figure that appeared much lower.

Now representatives from six citizen’s advocacy groups say the groups negotiated the hike behind closed doors and did not take input from the people who will most be affected – the customers. The groups also say the negotiated agreement contains measures that will make it very easy for PNM to charge customers more again in a few short years.

Continue reading

Public Will Get Chance to be Heard on PNM’s Proposed 25% Residential Rate Hike

by Tracy Dingmann

Are you ready to pay 25 percent more for the same electric service?

Less than a year after two consecutive rate increases, the Public Service Company of New Mexico is planning to ask the Public Regulation Commission for permission to approve a whopping 25% rate hike for residential customers.

The electric company says it needs the money, despite reporting profits of nearly $150 million and paying dividends to shareholders in excess of 30% in 2009.

If regulators cave to what PNM wants, they will have raised PNM’s rates by 50% in just three years.

And don’t forget that while PNM’s top execs take home six-figure bonuses, the electric company has slashed its workforce by 15%.

When will it stop?

If the PRC rolls over to PNM’s increase request once again, what incentive will PNM have to exercise fiscal responsibility or good corporate citizenship?

Any time it under-budgets, or is fined for pollution violations, or manages its business poorly, it won’t be PNM’s shareholders or execs that feel the consequences. PNM can simply raise rates and pass its mistakes, bad management, and poor judgment on to PNM’s customers – who are held hostage to PNM’s profiteering.

In these economic hard times, when so many New Mexican households are struggling simply to keep their homes and put food on the table, a 25% electric rate increase is an outrage and an insult. It’s already happened twice in the last three years. Tell the PRC that under no circumstances can it happen again!

You’ll get you chance to speak up tomorrow (Wednesday, January 26) at 2 and 6 p.m. at the African American Performing Arts Center and Exhibit Hall, 310 San Pedro NE at Expo New Mexico in Albuquerque.

Close New Mexico’s Tax Loophole For Out-Of-State Corporations

Do people who support combined reporting just not understand combined reporting?

That’s what big business lobbyist Richard Minzner claimed during Thursday’s meeting of the House Business and Industry Committee.

The committee met to discuss HB 62, which was sponsored by Rep. Ray Begaye and would require out-of-state businesses with more than 250 employees to report and pay taxes on the income they make in New Mexico. A similar measure, SB 90, is being sponsored by Sen. Peter Wirth.

Supporters of combined reporting believe the millions of dollars that would be generated by closing the tax loophole for out-of-state corporations and making them pay their fair share could go a long way toward closing New Mexico’s looming budget gap for 2011. Many of the corporations that do business in New Mexico already pay higher tax rates in other states.

The revenue raised would help New Mexico stave off the drastic cuts to education, healthcare and other state services some legislators are proposing now.

Opponents of combined reporting, including out-of-state-corporations and their New Mexico lobbyists, hang their hat on the absurd argument that implementing combined reporting would cause businesses like Wal Mart, Target, Bank of America and Comcast to leave the state or decline to do business here. That comes in the face of a report here from the Center of Budget and Policy Priorities that notes that most of companies who do business in New Mexico already do business in other states with combined reporting.

At Thursday’s meeting, a parade of those supporting the very biggest corporations spoke about how making them pay income taxes in New Mexico “demonizes” them simply for being large. That came from Art Hull, a lobbyist for the Association for Commerce and Industry.

Greater Albuquerque Chamber of Commerce president Terri Cole jumped on the jobs meme, saying that combined reporting would somehow discourage both small and large business from bringing jobs to New Mexico – even though the bill would in fact level the playing field for small, locally-owned businesses in the state.

And the list went on, with lobbyists from Chevron, Public Service Company of New Mexico, the oil and gas industry, retailers, manufacturers and more all opposing combined reporting or asking for “carve-outs” for their industry only.

Several legislators spoke against combined reporting, too, including Democratic Rep. Sandra Jeff of Crownpoint,  Republican Rep. Tom Taylor of Farmington and particularly Republican Rep. Keith Gardner of Roswell, who said New Mexicans should be thanking companies like Wal Mart for doing business here.

Most interesting though, was former state Tax and Revenue Secretary Minzner, who is now a lobbyist and perhaps the most outspoken opponent of combined reporting.

Supporters of combined reporting just don’t understand it, he says. Making out-of-state corporations pay income taxes in New Mexico will just encourage them to give themselves a tax cut by reducing their investments in the state.

That’s not what’s happened in the many other states all around New Mexico that have combined reporting – here’s a report that directly refutes his claim –  but that’s what Minzner keeps saying, to anyone who will listen.

Let’s hope the legislators don’t.

HB 62 will be heard again on Tuesday in the B and I committee.

Stay tuned to this spot to see what happens as it makes it way through the Legislature.

PNM Revises Its Solar Incentive Program

While I usually take the critical role when writing about PNM, I do have to give them kudos for working recently with local solar and business advocates to refine their solar procurement plan to expand their solar incentive program instead of capping it off like they had originally sought to do.

PNM seemingly was forced to come up with a better solution to their solar incentive program as they moved to cap the program off, yet were met with a large pushback from a variety of renewable energy advocates.  And from the looks of it, the solution PNM has come up with will allow them to continue on with their customer-owned solar program.

Not only now will it continue, but the program now has an opportunity to expand from 2 megawatts to up to 24 megawatts now.  To allow them to continue on with the program it seems PNM had to make some changes to the way they distribute the renewable energy credits (REC) back to their customers who produce more energy than they use from their renewable energy system.

Before customers would be given a ranged credit (dependent on the size of their system) for the energy they gave back to the grid, but now that has changed.  From an Albuquerque Journal Business Outlook article:

The new program would dispense with the REC and net metering credits. It would place the small and large PV programs under a newly named Solar Performance Program that will offer a customer a one-price credit for energy production.

Initially, credits would vary from 22 cents to 26 cents per kilowatt hour, based on the size of the system, with smaller systems in general receiving larger credits. Residential systems, typically under 10 kilowatts, would qualify the owner for a credit of 26 cents per kilowatt hour.

As customer participation levels are met, the credits would decline over time to no lower than 16 cents for new participants in the program.

“The declining payments help control the overall cost impact of the program and reflect expectations that the cost of installing solar power will continue to decline,” said PNM spokeswoman Cathy Garber.

This is indeed a much better solution for both PNM’s customers and the many hardworking renewable energy based businesses in the state.  The program will still allow customers to gain credits from their renewable energy system that they have on their home or business and gives solar installation companies confidence in the deal as it aims to be sustained for many years to come.

I’m glad to be able to give kudos to PNM making moves in the right direction in regards to helping make renewable energy use more accessible to their customers.  Now if I can only convince them to consider hiring local solar installers for their newly proposed solar generating plant. . . .

New Mexico Energy Titans File Lawsuit Against Emission Case

Did you know that the titans of New Mexico’s energy industry joined together to file a lawsuit yesterday to keep the state Environmental Improvement Board from setting a cap on greenhouse emissions?

Public Service Company of New Mexico, El Paso Electric Co., and Tri-State Generation and Transmission Association, along with three state lawmakers and other industry groups, claim the board does not have the authority to regulate greenhouse admissions.

Besides the power companies, the plaintiffs include Sens. Carroll Leavell, R-Jal, and Gay Kernan, R-Hobbs; Rep. Donald Bratton, R-Hobbs; the New Mexico Oil and Gas Association; Dairy Producers of New Mexico; the New Mexico Rural Electric Cooperative Association; the New Mexico Farm & Livestock Bureau; and the New Mexico Petroleum Marketers Association.

In the suit, filed Jan. 13 in state district court in Lea County (heart of the state’s oil producers) they ask the court to halt administrative hearings into a petition that directs the board to adopt the regulations.

The petition asking the board to regulate was filed by a Santa Fe group called New Energy Economy, which says it believes the state has the authority to regulate the emissions.

John Fogarty, executive director of the New Energy Economy, said the group’s petition has gained the support of many in the medical and business communities.

“It is critical that we move forward to address what is quickly becoming the most important public health problem that society faces. If the federal government isn’t going to act, it’s going to be incumbent upon states and municipalities to act,” he said.

You can read the full story in the Huffington Post.

Here’s also another local perspective from journalist Peter St. Cyr

Yes! Another PNM Rate Increase

Did you catch the sarcasm? Good. Because I know my utility bills are already taking up an increasingly large chunk of my earned dollars this year.

Yes, PNM has been on quite the rate-raising roll. And guess what – all of us PNM customers are about to get another increase – this time to pay for a $300,000 audit the company was required to undergo last year.

I read about the audit in this Saturday’s Albuquerque Journal in an article called “Taking a Hard Look.”

The story talks about how last year the NM Public Regulation Commission forced PNM to perform an audit in response to PNM’s request to implement a fuel adjustment clause.

What’s a fuel adjustment clause? Well, according to the story, it’s a move that “gives utility companies a mechanism to cope with fluctuations in the costs of fuel for generating power by passing them on to customers.”(emphasis mine).

Continue reading