Tipping Point Achieved in Supreme Court. 100% Renewable May Be Within Reach

PNM is a dinosaur and was exposed as such in the Supreme Court Monday. The judges knew it, the PRC knows it, as evidenced by PNM the very next day releasing an RFP seeking bids to generate 467 KW of energy from solar sources, so does PNM. The tide is turning. This brief blog explains just how much might be possible.

As most of you know, New Energy Economy (NEE) has been battling PNM’s attempt to offload their toxic coal and nuclear assets onto NM ratepayers. NEE has also been challenging PNM’s continuous refusal to increase the percentage of renewables in the state. Currently PNM’s energy portfolio includes only 9% renewables despite NM being the second sunniest state in the nation and having a strong, consistent supply of wind. The reason for PNM’s stance is avaricious greed, pure and simple.  Click here to find out about the perverse economic incentives that motivate PNM to continue to invest in antiquated coal and nuclear facilities when renewable energy is now far cheaper and exponentially cheaper to maintain safely (no pollution controls, no coal ash leaking into the water table, no persistent nuclear waste problem for 100,000 thousand years, – little issues like that). It is very simply explained, but when you are done, you will scratch your head and ask: Who the hell ever agreed to a deal like this? The answer: the Public Regulation Commission and by extension you and I. That is why it is so important that we all become fully informed on the nuances of what we are opposing and what we are proposing as an alternative. It is especially important because PNM has so overplayed its hand and NEE has so clearly exposed this that we may actually be able to achieve something remarkable in a very short time, if we all pull together. Let me explain.

For years, NEE has presented clear evidence of the environmental consequences of nuclear and coal and for years PNM has pointed to the lower cost of these energy sources over renewables. Shockingly, the PRC is not charged with protecting the planet or your health, just our collective pocketbook, so they continuously sided with PNM.  But while they are charged with selecting the energy options that are the cheapest, at least on the surface, they have not done a very good deal of preventing PNM from piling up profit through the strategies described in the link above. But in the last few years, the economics have changed and renewables are cheaper now than either coal or nuclear, even without tax credits or subsidies. The economic wisdom of renewables is even more pronounced when you factor in future risks and liabilities like exorbitant costs of decommissioning the coal and nuclear plants once they are  no longer be operational. PNM is desperately trying to eke out just a few more years of profit, but more importantly they are trying to shift financial responsibility for the clean-up from its share holders to us, the rate payers. I am guessing you are waiting for the good news.

Yesterday, I reported on how Mariel Nanasi and New Energy Economy shredded PNM in the Supreme Court hearing. If you were at the hearing, then you know that this is very dense stuff. Rates, legal precedent, and regulatory rules do not make compelling theatre and when presented by PNM many attorneys there is no question that the intent is to create a dense, impenetrable fog. And PNM has very good lawyers who make a very good fee to make sure that their fog makes the truth hard to find. And for years, they have won with this strategy. And while the PNM attorney’s remain agile, In this last case, it became utterly transparent that they have no case. Logic, economics and simple regard for human priorities are not on their side and Mariel Nanasi exposed this entirely. You could see it in the body language of the judges. You could see it in the penetrating and persistent questions they had for the PNM attorneys. They barely spoke a question without being interrupted with questions from all sides. The mistrust of the judges was apparent. And when Mariel Nanasi spoke without a single interruption and when she was done, not a single question. It was magic. It was also clear that the gig is up. From Nanasi’s citations from the PRC Hearing Examiner, it was also clear that the PRC has seen through the obfuscation.

But NEE’s legal prowess and strength does NOT equal justice. The justice piece is really only in the hands of the people. Legal cases can be won and can be lost, but it is people power that is enduring. NEE does represent the voice of the people, but only people power – the hardest to ignite, the hardest to endure, but the most spiritually treasured and long-lasting.

On Tuesday, there is even evidence that PNM is seeing the writing on the wall. Request for Proposal (RFP) for replacement energy for the closure of the infamous San Juan Generating Station (San Juan) for solar providers to produce 467 KWs of energy, providing meaningful time for independent renewable energy providers to respond.  This is shocking in that this is precisely what NEE has been asking from PNM for three years. Apparently, David and Goliath are switching roles. There may be a new boss in town. What’s more, NEE has three inextricably bound cases pending with the NM Supreme Court and three more at the Public Regulation Commission, and as noted above, neither are feeling all warm and fuzzy about PNM right now.

So where does that leave us?  NEE is fighting inter-related cases with lots of thorny issues at stake:

  • The Replacement Power for San Juan Generating Station Units 2&3 and the viability of that plant, pending before the New Mexico Supreme Court
  • The relationship between New Mexicans and the Four Corners Plant – will we continue to prop up this unreliable and dirty plant and continue lining PNM’s pockets? Or will their shareholders have to pay the price for their risky and irresponsible investments? This case is pending before the NMPRC
  • And on Monday, October 30 NEE challenged PNM’s proposed extension of the relationship between New Mexico and the Palo Verde Nuclear Plant in Arizona. Will PNM be able to continue to sucker NM into assuming more shares and more exposure to the liabilities and risks, even though nuclear is the most-expensive form of energy on the market today? Or will PNM have to take the loss? Will NM pay a premium for the energy that is killing our planet, putting our health at risk, and that PNM has failed to prove is even cost-effective? Or can we protect ourselves by demanding that our regulators protect us?

I am told that a Supreme Court perhaps even this week the Supreme Court may render its decision on the first case related to San Juan. That PNM is not expecting good news is evident in their release of an RFP for solar to replace energy from San Juan. The PRC has been signaling its dissatisfaction with PNM and so it may be that that case will also go against PNM.  And based upon what I saw and heard Monday, I’d be surprised if the Court didn’t reverse the PRC and deny all of PNM’s entirely unsubstantiated claims for costs related to Palo Verde. If these three cases go against, PNM this will amount to almost $750 million in lost but anticipated revenue. That is a big loss for a $2.4 billion company. What’s more, they will have been utterly exposed by the wisdom of seeking renewable alternatives will have been validated by the NM Supreme Court and the PRC. Two more pieces need to fall into place: a Democratic Governor in 2018 and a Roundhouse with the spine to stand up to Coal, Nuclear, Gas and Oil because if Community Choice Aggregation is passed in the Roundhouse and signed by the Governor, jurisdictions throughout the state can change their energy use much more quickly than you might have expected.

Community Choice:  The Opportunity We Have Been Thirsting For

The following graph makes it very clear what the different means are of a jurisdiction obtaining energy. CCAs are a hybrid between municipal utilities and standard investor-owned utilities (IOU), as depicted in Figure 1. Typically, utilities (whether investor-owned or municipal) are responsible for purchasing and distributing power, grid maintenance, and customer service. This is the situation in much of New Mexico just substitute PNM for IOU. In this scenario, when we turn on our lights, we have no choice about the mix of energy used to power our homes. Under a CCA program, the CCA, which is administered by the local government, purchases the power from a wide range of energy providers, while the incumbent IOU maintains the grid and provides customer service. In most jurisdictions the way this plays out is that customers like you and I could choose:  PNM’s energy mix, something like 50% renewable or an even greener standard of 100% renewable. What’s more, since under CCA there is no need to wait to develop a statewide renewable grid, as jurisdictions would just purchase the solar and wind on the open market. While it would be nice to free ourselves entirely from PNM, building a statewide energy transmission system is a very long-term and expensive project. The CCA short-cuts that entirely. This isn’t a fantasy. CCA’s are in place in seven states in the US and thousands of customers are turning on lights powered 100% by renewables. It can happen.

But let’s be clear, PNM is not just going to sit back and agree to the loss of probably 90% of its source of profits. PNM profits greatly from making our energy choices for us. So that is where the battle begins. The most important piece is political will. But click here to read about how other states are making CCA a reality and how it could happen here in NM.  New Energy Economy, 350.org, Retake Our Democracy and others will be joining forces, developing a powerful lobbying strategy and pressing Roundhouse legislators to approve CCA. We will keep you posted as to how that unfolds. But in a world filled with threats of nuclear war, tweets from an increasingly irrational president, and the dismantling of any semblance of a healthcare system, ain’t it great to be able to anticipate New Mexico with viable renewable energy options. It could happen, folks. Stay tuned.

In solidarity,

Paul & Roxanne

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