Questions in a recent merger proposal hearing that included whether board members might someday hail from Syria or Russia offended the Public Service Company of New Mexico's chief executive.
Pat Vincent-Collawn, president and CEO of the Public Service Company of New Mexico, said she found some comments made during the hearing earlier this month about the proposed merger with Avangrid and Iberdrola inappropriate.
"I was stunned by some of the remarks that I would call racist," Vincent-Collawn said Tuesday in a meeting with The New Mexican. "I was embarrassed. … I was offended."
She later softened her stance. "I can't get into anybody's mind," she said. "I don't ascribe any motive."
A few hours after the meeting, PNM spokesman Ray Sandoval wrote in an email Vincent-Collawn's comments reflected her own opinion and were not an official position.
Executives of PNM and Iberdrola, of Spain, said Tuesday they generally were pleased with the hearing and expressed confidence the Public Regulation Commission would approve the merger. If that fails, Vincent-Collawn said, the matter probably would be taken to the state Supreme Court, but she added that would be Avangrid's decision.
The merger proposal has run into a variety of thickets. Among those have been questions about an Avangrid subsidiary's service record in Maine, an investigation involving Iberdrola executives in Spain and several other items.
But Vincent-Collawn said the three companies — Iberdrola is Connecticut-based Avangrid's parent company — made a strong case for the customer benefits of the proposal. Those include $67 million in customer rate credits, 150 jobs and other incentives.
"Those are direct customer benefits," she said. "I would be surprised if the commission says no given all the protections" for reliability.
The seven-day hearing, overseen by Public Regulation Commission hearing examiner Ashley Schannauer, covered an array of topics raised by attorneys for organizations of numerous interested parties. Schannauer will make a recommendation to the commission about the merger proposal.
Attorney Jeff Albright of Albuquerque, representing Bernalillo County, two weeks ago asked Iberdrola and Avangrid executives about how the proposed utility company's board would be selected if the merger took place.
Pedro Azagra Blázquez, Iberdrola's chief development officer, said the board would be made up entirely of New Mexico residents. Don Tarry, a PNM executive who will replace Vincent-Collawn at the top if the merger takes place, made the same observation.
Albright asked Blázquez and Avangrid President Robert Kump during the hearing if those might be New Mexico newcomers from Syria, Russia, Qatar, Spain or Afghanistan. Blázquez said he didn't think that was realistic.
Albright couldn't be reached Tuesday afternoon by email or telephone.
Blázquez and Kump have pledged various incentives, including specific reliability provisions and penalty formulas. They also increased their state economic development contributions to $25 million over 10 years compared to $15 million over five years; and $10 million for customers behind in their payments, up from $6 million.
Vincent-Collawn said the PNM board knew a few years ago that the company needed lower capital costs and stronger technological expertise. PNM is big in New Mexico, she said, but comparatively small as a utility firm.
The size of Avangrid and Iberdrola is appealing, she said, because the companies have a huge balance sheet and excellent access to capital.
She joked about PNM's relationship with the two giant utility companies. Some people call those companies "big brother," she said. "I say, 'rich boyfriend.' " Iberdrola is often referred to as the world's third-largest electric utility company.
Blázquez, who also is on Avangrid's board, presented Iberdrola as long committed to clean energy as opposed to polluting energy sources.
He said Tuesday Iberdrola has a history of "fighting against coal, fighting against gas" when other utility companies weren't. "We're very comfortable with what we have done," he said.
Avangrid subsidiary Central Maine Power has been criticized by some in that state who have proposed to replace the electric companies there with a consumer-owned company.
Blázquez said the problems at Central Maine Power are attributable to a billing system put in place a few years ago. That has been corrected, he said.
As for the investigation in Spain of two Iberdrola leaders, Blázquez said he was confident nothing would come of it.
"Anybody can request an investigation," he said. "It's very common in Spain."
He said Iberdrola has done two internal analyses and brought in two outside companies to review the matter. They concluded they don't expect any problem for Iberdrola, he said, adding that is his view as well.