Moving to clean energy
The recent Santa Fe New Mexican article about the Public Regulation Commission’s decision on the Public Service of New Mexico’s renewable energy plan didn’t get the Sierra Club Rio Grande Chapter’s position quite right (“PRC approves PNM energy plan despite objections,” Nov. 16). It’s understandable — these cases are packed with convoluted issues complicated by sometimes byzantine rulemaking and rate structures with good and bad consequences, and some of these issues left us conflicted.
We appreciate the vote to approve a new 50-megawatt solar facility for PNM, and extend and improve wind and geothermal contracts. These decisions will help PNM achieve its requirement for 20 percent renewable energy by 2020. Thanks to New Mexico Public Regulation Commissioners Sandy Jones, Lynda Lovejoy and Cynthia Hall for their votes.
We also recognize the concerns of Commissioner Valerie Espinoza and others about PNM’s lack of transparency and due diligence on its solar proposal. The commission should act to standardize how requests for proposals are done and implement cost-effectiveness standards for all utilities.
But we have strong concerns with two other issues on which all commissioners accepted the PRC hearing examiner’s recommendation. These issues could stifle renewable energy for a long time if not addressed.
The New Mexico law that requires 15 percent renewable energy by 2015 and 20 percent by 2020 also protects our pocketbooks by stating that those mandates don’t apply if they cost us too much. The current cost cap on renewable energy for residential electric customers is 3 percent of bills. For big industrial customers, it’s 2 percent or $100,000, whichever is smaller. Unfortunately, some of the savings that renewables provide aren’t counted in the PRC-mandated cost calculation, artificially inflating their price and effectively limiting the funds available for renewables to about 2 percent. The commission missed an opportunity to fix this.
In addition, the Nov. 15 decision gave big energy users like Intel a big break. Already, the largest customers pay much less proportionally than residents do for renewables. The Nov. 15 decision allows big users to say they’re paying the maximum while actually contributing much less, because the considerable fuel savings they enjoy from renewable energy won’t be subtracted from their costs. It’s like paying for a $7 item with a $10 bill, getting your change back, and reporting your cost as $10. This has a whopping effect on how much renewable energy New Mexico gets. While the law currently requires 15 percent, PNM actually expects to provide only about 13.3 percent renewable energy in 2018 and 12.9 percent in 2019 — because of the large-user cap.
It’s smart to limit consumers’ costs in the transition to clean energy. But the largest users enjoy big benefits from renewable energy without contributing their fair share to its growth. Commissioners are trying to do the right thing. These issues are calling out for a fix, and we encourage the commission to work on solutions to keep clean energy blossoming in New Mexico.