Two giant utility companies that hope to merge in New Mexico appear to have won over some, but not all, of their critics.
Public Service Company of New Mexico and Avangrid of Connecticut announced Wednesday they made concessions and reached an initial agreement with several of the organizations and government bodies that weighed in on the proposed merger.
Three main concessions relate to utility rates, economic development contributions and job creation. The two companies said they would increase their proposed ratepayers’ benefits from $24.6 million to $50 million, up their economic development donations to the state from $2.5 million to $7.5 million and raise their number of jobs added from 100 to 150.
The New Mexico Public Regulation Commission is expected to have the final word on the merger this year.
Some critics had called the initial proposal’s benefits to ratepayers and the state economic development donation chintzy.
The merger would place PNM, the biggest energy company in the state, under the umbrella of Avangrid and Iberdrola of Spain, the company that owns a large share of Avangrid. PNM and Avangrid welcomed the initial agreement Wednesday. It amounts to a tentative settlement with some of the groups involved, including the New Mexico Attorney General’s Office.
“PNM and Avangrid share in the excitement about the possibilities for New Mexico’s future in the global transition to clean energy,” PNM said.
The Sierra Club, the city of Albuquerque and Bernalillo County are among the groups that haven’t signed.
One of the staunchest critics, Mariel Nanasi of New Energy Economy of Santa Fe, remained a critic Wednesday.
“They didn’t get what they wanted,” Nanasi said of the organizations that signed on. “But they settled and it’s unfortunate … they settled because they didn’t think they were going to get something better in litigation.”
Nanasi expressed disappointment with Attorney General Hector Balderas’ part in the agreement. “And it’s not the best thing for ratepayers,” she said.
Balderas said in a statement the agreement “prioritizes electricity to neglected tribal communities and securing additional resources for union workers and coal miners who have lost their jobs.”
Balderas said other issues “can still be addressed as the case proceeds.”
The agreement calls for $12.5 million to go to community groups in the Four Corners region, where PNM plans to abandon its participation in the Four Corners Power Plant. PNM also proposes renewable replacement energy for the Navajo Nation in the Four Corners area.
And it calls for a $2 million investment to improve access to electricity to remote areas of the state.
Albuquerque City Attorney Esteban Aguilar Jr. said Balderas “is the lead on this case, and we are confident in his work to resolve the matter.”
Steve Michel, deputy director of the clean energy program at Western Resource Advocates, said the energy companies made some concessions that are important to his group.
They include forming a carbon reduction task force, hiring a chief environmental officer and attaching some executive compensation to carbon reduction. “So it aligns their management goals with the important climate goals that we need to achieve,” said Michel, of Santa Fe.
Bernalillo County said in an email it was “open to receiving and reviewing new proposals.” The county hasn’t signed on. “It’s a complex matter and the county needs the appropriate time to do the necessary due diligence required to look out for the consumer.”
The Sierra Club said it was evaluating the offer and hadn’t taken a position.
Dennis V. Arriola, chief executive of Avangrid, said in a news release that “we listened to local leaders, customers and other stakeholders to learn more about the unique circumstances in New Mexico. As a result, we are proud to put forward this agreement, with strong local support.”
Nanasi offered no support. “I think that we’ll do better in litigation,” she said.