PRC grants rehearing on renewable charge
Government entities, industry seek to keep fuel savings from renewable investments
Large-scale electric customers have won a fresh chance to convince state regulators to let them keep fuel savings that they currently receive as a result of Public Service Co. of New Mexico’s investments in renewable energy.
The Public Regulation Commission voted 5-0 on Dec. 23 to vacate an earlier decision that would have forced industrial and governmental energy users to repay those savings to PNM. The issue will be reheard on Jan. 13 by the full commission, which could still decide to uphold its original order from November.
“I don’t know how it will shake out in the end, but the large-scale consumers will have another hearing to get these issues addressed,” said Commissioner Sandy Jones. “All sides will be able to make their arguments, and the commission will either leave its November order in place or amend it.”
Industrial consumers and the Albuquerque Bernalillo County Water Utility Authority filed motions opposing the PRC’s November decision, which ordered about two dozen industrial users, ABCWUA and the University of New Mexico to pay a combined total of about $2 million in annual fuel savings back to PNM.
The PRC ruled that those customers are receiving “windfall” benefits through lower fuel charges on their PNM bills without paying their fair share for the renewable investments that have allowed PNM to lower its consumption of fossil fuels.
Residential and commercial customers pay for PNM’s renewable investments through a rate rider on their bills that in 2015 amounted to a 2.32 percent monthly charge.
State statutes, however, limit the amount large industrial consumers pay to just 2 percent of their annual electric consumption — with a hard cap of $99,000 per year — to protect them against excessive costs for renewables.
ABCWUA and UNM, meanwhile, are entirely exempt from renewable charges because they are committed to investing at least 2.5 percent of their annual electric consumption to build their own renewable systems.
The industrial and governmental consumers say the statutes insulate them from having to repay PNM for fuel savings.
The PRC will now hear those arguments, but it’s unclear if commissioners will actually alter their November decision.
“We decided to re-hear this to see if we missed anything, but I don’t know if in the end the decision will be any different than before,” said Commissioner Pat Lyons.
Commissioners will be under pressure from environmental groups, which want industrial customers to pay back fuel savings so PNM can redistribute them to residential consumers. Environmentalists, however, want UNM and the water utility to keep their savings, since those entities are building more renewable systems, and, as governmental entities, any fuel savings they receive benefits taxpayers in general, said Steve Michel, chief attorney for Western Resource Advocates.