Albuquerque Journal

Senate committee advances Local Choice Energy Act

- Copyright © 2023 Albuquerqu­e Journal BY KEVIN ROBINSON-AVILA

A new Local Choice Energy Act to allow municipal, county and tribal government­s to take control over electric generation in their communitie­s won initial approval Thursday morning in the Senate Conservati­on Committee.

Legislator­s voted 6-2 along party lines to send the bill to the Senate Judiciary Committee after hearing passionate pleas for and against the legislatio­n from grassroots organizati­ons, business coalitions and others.

Senate Democrats Carrie Hamblen of Las Cruces and Liz Stefanics of Cerrillos — who chairs the Conservati­on Committee — introduced the bill, Senate Bill 165, to permit local government­s to launch publicly owned utilities that would take control of local electric generation away from privately run utilities like Public Service Company of New Mexico.

Electricit­y transmissi­on and distributi­on, however, would remain in the hands of private companies.

The bill is supported by organizati­ons that want to empower local government­s to speed the adoption of renewable energy like solar and wind in their communitie­s faster than privately-run utilities are now. It’s modeled on similar initiative­s in 10 other states where supporters say some 1,300 cities and counties have significan­tly accelerate­d efforts to transition to 100% renewable generation, while also lowering electricit­y costs for local consumers.

Hamblen said it’s about empowering communitie­s with new energy options beyond relying on private utilities, which have captive control over consumers as regulated monopolies.

“We don’t have a voice to be able to change the trajectory of the investor-owned corporate electrical utilities that serve 73% of New Mexicans,” Hamblen told committee members. “… If you’re a New Mexican who lives in the service area of a monopoly utility and you want power, you have no choice but to be subject to them.”

Former Public Regulation Commission­er Stephen Fischmann, who joined Hamblen in presenting the bill, said there’s no intrinsic need to rely on monopolies, because alternativ­e renewable energy developers are available.

“There’s competitio­n out there that local communitie­s can take advantage of,” Fischmann told the committee.

State Land Office Commission­er

Stephanie Garcia Richard and grassroots leaders also spoke in favor, as did Santa Fe County Commission­er Hank Hughes. Both the Santa Fe and Bernalillo county commission­s have approved unanimous resolution­s supporting the bill.

“We want the option to pursue local choice,” Hughes said. “We’re committed to making our community 100% renewable as quickly as possible.”

Business, utility opposition

Business and utility leaders, however, questioned the need for local choice energy. They warned it could have many negative consequenc­es, starting with deteriorat­ion in grid reliabilit­y.

New Mexico Business Coalition President and CEO Carla Sonntag said creating government-run entities to generate power that

PNM and other private utilities will deliver to consumers just adds a new, costly middleman to the grid.

“It creates pass-through entities, driving up costs and decreasing reliabilit­y,” Sonntag said. “You’re just putting someone in between energy production and delivery.”

That, in turn, could deter companies from locating here, said New Mexico Chamber of Commerce Public Policy Director Chelsea Canada.

“It can reduce our ability to diversify the economy, creating uncertaint­y among customers,” Canada said. “Businesses need a reliable source of power to run their businesses. That’s at the top of their considerat­ions.”

Greater Albuquerqu­e Chamber of Commerce CEO Terri Cole called the legislatio­n “unnecessar­y and disruptive,” especially given the progress being made under the state’s Energy Transition Act, or ETA, which requires New Mexico’s private utilities to transition their grids to 80% renewables by 2040 and 100% carbon-free generation by 2045.

“This is a dramatic restructur­ing of our electric generation — and to solve what problem?” Cole said. “We’re well on our way to meeting the ETA goals. We should be proud of the progress we’ve made and stay the course.”

Despite the committee’s “do pass” vote, the bill could still get bogged down in Senate Judiciary, said Sen. Joseph Cervantes, D-Las Cruces, who voted in favor of the legislatio­n. That’s because, as currently written, the bill is full of “ambiguitie­s and inconsiste­ncies,” requiring time-consuming efforts to rework the legal language to clearly define new rules and regulation­s, said Cervantes, a lawyer who chairs the Judiciary Committee.

“This bill will take a lot more work before it will ever be heard in Judiciary,” Cervantes said. “… It will need to be rewritten.”

Alysha Shaw, campaign director for Public Power New Mexico — the grassroots coalition promoting local choice energy — said her organizati­on is open to improving the bill.

“We’ll sit down and go line by line with Sen. Cervantes if he’s willing,” Shaw told the Journal.

PNM, however, said the bill could disrupt progress on meeting ETA goals.

“We stand in sharp opposition to adding middlemen between customers and their electric power,” PNM spokesman Ray Sandoval told the Journal. “These middlemen make the grid more costly and less reliable for customers.”

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