PRC examiner snubs PNM solar, geothermal proposals
Utility’s renewable energy procurement plans under fire
A New Mexico Public Regulation Commission hearing examiner is opposing Public Service Company of New Mexico’s plan to hire a local company to build 50 megawatts of new solar plants that PNM would own and operate.
The examiner, Carolyn Glick, has also rejected a PNM plan to amend its current contract to procure electricity from the Lightning Dock geothermal plant in southern New Mexico, increasing the amount purchased and extending the contract through 2042.
Those proposals are part of PNM’s 2018 renewable energy procurement plan, submitted in June and discussed in September in a public hearing under Glick. PNM filed the plan to comply with the state Renewable Portfolio Standard, which requires public utilities to derive 20 percent of their electricity from renewable sources by 2020, up from 15 percent now.
But the Santa Fe environmental group New Energy Economy, PRC staff and the Albuquerque Bernalillo County Water Utility Authority objected to PNM’s solar procurement proposal, which calls for Albuquerque-based Affordable Solar to build five 10 MW plants as turnkey projects on land owned by PNM.
The utility chose Affordable through a request for proposals last spring that excluded bids by independent power producers to own plants on PNM’s preselected sites. Those bidders instead were forced to offer separate sites with full transmission plans and a fixed price structure laid out in advance.
Opponents said that exclusion clause stacked the deck for PNM to choose turnkey projects with Affordable that the utility itself could own and run. In addition, they said the RFP’s 31-day limit on responses made it difficult for independent producers to submit alternative, thirdparty power purchase agreements to PNM.
The hearing examiner agreed, calling PNM’s RFP process “unfair and
uncompetitive.”
“PNM failed to show, as required, that the Affordable Solar project is PNM’s most cost effective solar resource procurement among available alternatives because the 2017 RFP process did not give (power purchase agreement) bidders a fair opportunity to participate and compete,” Glick wrote in her recommendation to PRC commissioners this week.
The five commissioners must rule on PNM’s plan before the end of November.
Glick also rejected the proposal to amend the Lightning Dock contract. She said the utility didn’t consider potentially cheaper alternatives, including a separate bid by another provider in 2016 to offer geothermal power to the utility.
On the other hand, Glick did recommend that commissioners accept PNM’s proposal to extend its current power purchase agreement for electricity from NextEra’s Wind Energy Center in eastern New Mexico by 17 years, following facility upgrades to increase output.
PNM says it will appeal Glick’s recommendation to reject the Lightning Dock and Affordable solar contracts.
“These initiatives clearly benefit customers, the environment, local communities and the state as a whole,” said PNM spokesman Pahl Shipley in an email to the Journal. “... PNM plans to file strong exceptions to the hearing examiner’s recommendations next week.”