Anger at public utility regulators’ decisions, inaction fuels move to reform board

Gov. Michelle Lujan Grisham says officials need to reform the Public Regulation Commission in order to ‘take advantage of our state’s renewable energy potential.’ New Mexican file photo

They’re fed up with the PRC.

Lawmakers, attorneys and the governor are all expressing frustration with recent decisions made by the New Mexico Public Regulation Commission. And now, they want to reform it.

On Tuesday, Gov. Michelle Lujan Grisham announced she will include proposals to reform the powerful elected body on the agenda for the legislative session early next year.

The discontent has been building for years, as the PRC has been plagued by scandals, difficulties in hiring staff and other ills. But it’s the commission’s more recent action — or, as some call it, inaction — regarding the Facebook power line near Los Lunas and a new law aimed at weaning New Mexico off coal power that’s been too much to bear.

“It was the straw that broke the camel’s back for a lot of us,” said House Speaker Brian Egolf, D-Santa Fe. “What they’re doing, and not doing, on the [Energy Transition Act] is outrageous.”

Last month, PRC Chairwoman Theresa Becenti-Aguilar declined to clarify whether the state’s new clean energy law will apply to Public Service Company of New Mexico’s plan to shutter the coal-fired San Juan Generating Station near Farmington.

Parties involved in the issue said the commission’s stance throws a monkey wrench into New Mexico’s plan under the act to transition from coal to renewable energy sources.

“I share the frustration over some of the decisions that have recently been made,” said state Senate Majority Leader Peter Wirth. “We’re at the cusp of a critical transition that involves the Energy Transition Act. What’s going on now at the commission with the [act] is certainly concerning to me.”

The governor said Tuesday in a statement that officials need to reform the commission in order to “take advantage of our state’s renewable energy potential.” She also noted the need to “transition the PRC towards a reliable and professional body capable of acting in the best interest of our families.”

When asked Wednesday, the Governor’s Office didn’t give many details on the proposed legislation, saying the parties involved would hash out various ideas over the coming months.

Some lawmakers were more vocal. Egolf, for instance, said he’ll propose stripping certain functions from the body and giving them to other state departments and branches.

He favors removing commission functions that are akin to judicial proceedings and instead placing them in the judicial branch. Other PRC responsibilities, such as pipeline safety, could be transferred to the Regulation & Licensing Department, Egolf said.

While that may sound quite technical, the proposals could amount to taking some control away from commissioners.

“I think they’re acting outside the scope of their authority,” Egolf said. “By moving certain parts of PRC’s function out of the agency, you’d put it under the control of the governor, who is much more accountable to the people than the commissioners.”

Were such reforms implemented today, for instance, the commission would not have the same authority over the application of the clean energy law, Egolf said.

Wirth, a Democrat from Santa Fe, said divisions within the commission could also be restructured as part of a reform.

At least one commissioner said she would be open to potential reforms, such as moving the body’s judicial functions.

“It’s crossed my mind,” said Cynthia Hall, D-Albuquerque, who noted that she wasn’t aware of the details of a proposed reform. “It’s a judicial function — why isn’t it part of the court? I’d be open-minded about it.”

Hall also said she shared some of the concerns about the efficiency of the commission.

“I can understand being frustrated,” she said. “I get frustrated in the position. I believe there are changes that could be made in the way we regulate that would be much more efficient.”

Other commissioners were tight-lipped.

“I have no comment on that,” Becenti-Aguilar said when asked about the governor’s call for reform. “I’m here concentrating on our work.”

In April, the commission rejected a request by PNM to charge retail customers nearly half the construction costs for a multimillion transmission line that would carry wind energy to Facebook’s data storage facility in Los Lunas, among other users.

Instead, the commission required PNM to bill Facebook for the expense, and Cabinet secretaries said the decision could have a “chilling effect” on statewide economic development.

The PRC said in June that it would reconsider who should pay for the 45-mile transmission line.

In the case of the San Juan plant, the question is whether the state’s largest utility will be able to finance the plant’s shutdown with bonds that would be paid by ratepayers, a plan authorized by the law passed this year by the New Mexico Legislature. PNM wants to recover about $300 million.

The Energy Transition Act also calls for allocating about $40 million for programs to mitigate the economic impact on the Farmington area from abandonment of the old plant and adjacent coal mine.

Attorney Steve Michel, deputy director of the clean energy program at Western Resource Advocates, has said that if the commission decides the Energy Transition Act does not apply to the plan, it would delay funds for economic development and job training for displaced workers at the power plant and coal mine.

He added Wednesday that the way the commission has handled the San Juan case, the Facebook power line and other issues has prompted the need for change.

“The dysfunction and lack of expertise at the commission are stagnating the state’s ability to move forward on important energy issues that affect everybody,” he said.

The Legislature already approved one potential change earlier this year. Lawmakers passed a measure to place a constitutional amendment on next year’s ballot that, if approved by voters, would make the PRC’s members appointees of the governor rather than elected. If it passes, the governor would begin appointing new commissioners in January 2023.

Reporter

Jens Erik Gould covers politics for the Santa Fe New Mexican. He was a correspondent for Bloomberg News in Mexico City, a regular contributor for TIME in California, and produced the video series Bravery Tapes.