PRC Hears Powerful Testimony Critiquing PNM & ETA While Governor Files Suit with Supreme Court. Wow.

In addition to ETA critique, there was heart-wrenching testimony from San Juan County coal miners about a future without coal, jobs, or community resources. It was a powerful opening day. NOTE: Thursday pot luck is cancelled.

Today we offer a few of the powerful comments offered in public testimony at Monday morning’s Public Regulation Commission hearing. In the divide that has emerged between legislators who want to circumscribe the authority of the PRC and activists who support the PRC, commissioners must have felt strongly supported. Look for an important alert later today about a Santa Fe resolution related to a water project that is as complex as it is controversial. I am in the process of sorting out the details from various sources. But we will be asking you to act tomorrow as the City Council is slated to vote on the resolution tomorrow.

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Thursday Pot Luck Cancelled

We had planned a community conversation about YUCCA and the local Extinction Rebellion’s (XR) plans for 2020, a way to explore how Retake could best support their work. But at today’s PRC hearing, I asked Bianca Sopoci-Belknap, Earth Care Co-Director, if we could have a good discussion from YUCCA and she was candid. “You want us to discuss our plans for 2020 on the evening of the Dec. 12. But we’re holding a two-day retreat to figure that out on the 13th and 14th. We won’t have much to say.”

Then I reflected on my participation in an XR meeting last week where it was acknowledged that they were just getting started and needed more meetings to figure out how a local XR chapter would operate.

Since in both instances our partners are not quite ready for the discussion we had hoped to have, we wouldn’t be able to achieve the evening’s purpose: discussion of how we can support their work.

So, we are doing the responsible thing: cancelling the meeting. Our next two meetings will focus on the legislature: Jan. 21, the evening of the opening of the 2020 Legislative Session, and Feb. 18, just days before the close of the session. We will squeeze in a small planning and strategy meeting mid-session. Look for an update on the Legislative Session soon, as more and more bills we may advocate for are surfacing.

PRC Testimony: Dec 9, 2019

Before offering the testimony of several Retake members who offered public comment yesterday. I wanted to alert you that yesterday the Governor asked the Supreme Court to intervene in the PRC hearing that began yesterday, offering the same argument made by PNM when it asked the Supreme Court to intervene and force the PRC to apply the ETA to their decision on the San Juan abandonment case. Essentially both the Governor’s suit and PNM’s ignores the inconvenient truth that the ETA was passed after a docket had been opened on abandonment and so it simply doesn’t apply. I discuss this in my public comment included below. If you want to read the New Mexican report, click here.

I was proud of the number of people wearing Retake buttons, not just in the audience, but offering public comment. Below I provide my public comment along with that of 2-3 others from whom I was able to obtain their comments. Too bad Pelican Lee didn’t keep a digital copy of a great piece of testimony, but what follows is a good sampling.

From Cristy Holden, Taos Ally

“The ETA is unprecedented — as it is the only ‘Securitization’ bill in the country that allows a regulated entity to define the value of its own assets, and the costs of its clean up, and the amount of recoverable costs for itself, without any oversight.”     (truthout.org)

We are here today because of 50 years of failed leadership by governments and industry.  The first Earth Day was in 1973.  The Hubbert Curve of diminished petroleum resources was established in 1956 and reported by the experts of Shell Oil and Exxon Oil to the American Petroleum Institute. The practice of fracking has bought us time, increased corporate profits, polluted our communities, our wells and fields, and the health of our people.  The time granted by fracking was misused solely for additional profits, instead of conversion to renewable sources. There can be no deniability.  This failure of leadership and abdication of responsibility by government and industry leadership now places all of humanity at risk within the next 9 years or less. 

I am Cristy Holden, of Taos, NM.  I am a co-founder of Taos United (500 members), a member of Renewable Taos, Conservation Voters of NM and a life-long member of Sierra Club. 

  1. We all need to covert to renewable energy as fast as possible. 
  2. The renewable goals listed in the ETA are not do-able financially, as written. These goals will require a billion dollars of additional state funds to realize and scores of private investments. State Dollars currently allocated via the ETA for PNM bailout, could be redirected to renewable resources.  Further the goals of the ETA are too modest to address this fast moving crisis.  50% renewable energy sources by 2045 will not save us. 
  3. We all want a fair and just transition for San Juan Generating Plant workers and the Farmington community.
  4. The ETA seeks to over-ride the PRC authority and process.
  5. The ETA diverts public funds to cover for the long-term planning errors of PNM and allows a deceptive insertion of nuclear energy into NM.
  6. Several Environment groups have allowed PNM to lead them into a corrupt agreement, which penalizes PNM rate payers and enriches PNM shareholders. The best assumption is their naïve belief that this legislation was a “good beginning for renewable energy” or that something was better than nothing. The facts of this rush by an extremely profitable corporation, in a supposed partnership with unsophisticated, easily misled and far-too-trusting nonprofit groups, fails to hold a dirty energy group accountable for its decisions, its exploitation of workers, its desecration of our earthly resources, and their responsibility to adequately repair its damage to workers, to the health of families in the Farmington community.  This rushed law, flawed in its approval legislators and Governor, and passed without sufficient review of community needs and analysis of actual costs for closing this utility coal facility, is a travesty to those to whom costs have been transferred: the rate payers of PNM and citizens of our state. 
  7. In fact, this is one of several “securitization” bills being considered by several states. There is a concerted effort to transfer corporate costs to state governments in each of these bills.  Other states, and many public utilities are watching New Mexico, to take advantage of similar proposals, if once again, New Mexico, is naively convinced by energy companies to allow our resources and trust to be exploited in their pursuit of profits. There is nothing wrong with profit. But let us not mistake the mission of business: enrichment of investors, not protections for clients.  The mission of government is to serve the people.  When we naively assume business is being helpful, we are wrong. 
  8. Under the ETA, allocating Public Funds to bailout PNM, a billion dollar corporation, is a dangerous precedent for our state and our country.  The concept of “stranded assets” and “securitization” is nothing more than robbery from critically needed state funds.  This is corporate welfare; an attempt to ‘excuse’ 50 years of failed leadership and accountability by leaders and industry. An attempt to persuade the gullible that business “cares”.  There is also an implicit threat that if we the citizens, do not go along with corporate bailouts, these industries will leave our state.  Shut off the lights, stop drilling, and depart. 

This is absolutely not true. There are monies to be made in New Mexico, by companies legitimately providing utility services with full accountability and without deception. There are monies to be made by clean responsible & accountable drilling. In a resource scarce marketplace, the longer the oil and gas  is in New Mexico ground, the more valuable it will be.  Instead we are seeing a savage business model akin to the pillage of self-interested pirates and robber barons.  There is nothing new here (other than the death of all life on our planet).  All civilizations experience this crisis- harvesting of profits prior to disaster.  What is tragic is the failure of elected leaders to protect and defend the people from this plunder. 

9. At this moment it is the prevue of the PRC to defend the people from corporate greed.  Justice for displaced workers and their families and communities, justice for rate-payers, appropriate allocate of state funds for the legitimate benefit of state citizens, and if possible, a renewable energy future —- all of this rests in the decisions of the PRC.  Your mission is to be the deliberative voice of reason. 

10. Last, it is the role of the people to be skeptical, in light of what is presented. It is the role of the elected to be adamant in their function — the provision of the state with needed providers of essential services.  It is the role of businesses to create a fair exchange with their customers, for the pursuit of opportunities to enrich our lives and our communities.  It is the role of nonprofit organizations to mindfully solicit for the needs of those they serve; not the companies who would co-opt their mission.  And it is the role of those governed, we the citizens, to show up, stand up, and speak up, when our current and future needs are abandoned by government leaders, corporate pirateers, and exploiters of our resources.  Our collective tomorrow depends on this.

From Lynette Kessler, Retake Climate Action Team

In 2015 no one was betting on coal. The California utilities exited the San Juan plant because at that time coal was a dying industry and there was ample evidence that coal was killing us. But PNM ignored that evidence — and worse — lied to this Commission about the costs of gas, solar, and wind. It doubled down on coal and invested millions of our money on pollution controls. PNM bought the California utilities’ coal shares at the San Juan plant and increased their percentage ownership share, which was also bad because that increased the liability for clean up! PNM lied to this Commission and told you and us that PNM found a coal company, Westmoreland, to buy the mine from BHP Billiton. But Westmoreland didn’t have the money so PNM lent it $125 million but failed to disclose that shady transaction! Its all a financial game to them.

They made a bad bet in this financial game — their dirty coal plant was not economic then, and it’s worse now. So let them suffer the consequences! They can’t make a bet with our money and, when it turns out to be a losing bet, continue to charge us for the money they wanted to make for the next 30 years. Whoever heard of any coal plant that was running for 75 years? Sounds like an imprudent plan and financially irresponsible.

If PNM ever had to take a hit for their own arrogance and wrongdoing maybe they’d consider not doing it again. But PNM has a string of irresponsible investing — they are repeat offenders: at the Four Corners coal plant, and with the Palo Verde nuclear generating station. We need this to end.

You are the Public Regulation Commission — the body constitutionally empowered to protect us from PNM’s relentless greed. Governor Lujan Grisham wanted renewable portfolio standard headlines but she and the legislators sold out the people to get the higher renewable portfolio standard. Maybe they didn’t understand what they were doing. But you do. You know what’s at stake — our environment, our money, and corporate accountability.

Please decide that the ETA shouldn’t apply because the PRC is the rightful regulator of the utility not the legislature. The legislature held no hearings on the merits of the abandonment case and it has no idea about the issues involved in this case.

Please decide that PNM should be held responsible for its ridiculous risky business investments and decide that PNM shareholders get zero dollars from the people. We literally get nothing, not even dirty electricity, but they want us to pay for the next 25 years? That’s unfair.

Lastly, I ask that this body hold your decision regarding reimbursement from ratepayers for clean up until the New Mexico Environment Department does a comprehensive assessment to determine the extent of contamination and the appropriate remediation. Please make a formal request for an investigation to the New Mexico Environment Department for the San Juan plant and Energy Minerals Natural Resources Department for the mine. Thank you for your courage. Please stand with the ratepayers.

From Paul Gibson

I’ve been attending Public Regulation Commission (PRC) hearings for 5 or 6 years and I’ve heard PNM make claims and assertions that consistently misstate the facts, the numbers, and the real purpose behind their claims. PNM has a long history of stating sincere interest in responding to the needs of ratepayers, while carefully crafting their proposals to benefit shareholders.   

  • Recall how PNM mislead the PRC and the San Juan community saying San Juan generating station would run “indefinitely” and that it was cost effective for the next 20 years — convincing the Commission to approve their reinvestment of 132 megawatts in San Juan. Then 14 months later, PNM told shareholders what New Energy Economy (NEE) had argued and what the evidence showed — that the plant was uneconomic — and that they were closing it.
  • I’ve lost track, but I think NEE has identified over $1 billion of PNM mistakes in their calculations, “mistakes” that allowed PNM to argue for the prudence of investment in nuclear, coal, and natural gas—all at ratepayer expense.
  • Indeed, they’ve twice proposed gas plants/pipelines that were found to be unnecessary — and thankfully were denied by the PRC.
  • PNM has artificially inflated solar, wind, and gas prices and added a laughable 2% escalator cost factor per year on those resources – grossly inflating their real costs and advancing arguments that were entirely contrary to market realities, artificially constraining the amount of renewables in their models to justify their reinvestment in coal & nuclear.
  • They’ve made imprudent investment in Four Corners.
  • They’ve made imprudent investment in Palo Verde (nuclear).
  • PNM also failed to tell the Commission about the loan they gave to Westmoreland Coal to finance ($105 million of the $127 million purchase) the acquisition and continuation of the mine. 

I share this with you today because many Commission members are new. I no longer have to sit in the audience and watch Sandy Jones and Patrick Lyons smirk as they listen to testimony they know they will ignore. Now there are Commissioners who weigh the facts and consider the history. And that history is one of PNM lies and dissembling, intentionally misleading the PRC to their great profit. And it is important for Commissioners to know who they are dealing with.

I think PNM knew that this Commission would not give them a pass, that this Commission would hold them accountable. And that is precisely why PNM suddenly took an interest in New Mexico’s RPS. That is why PNM suddenly took an interest in the well-being of the generating station and mine employees after they had used them up and eviscerated their community. So we had PNM at the 2019 legislature allowing the Energy Transition Act to pass. PNM had never before sat silent while a bill was debated that on the surface would commit the state to a “carbon-free” future.

Why the silence? Well, as is almost always the case with PNM, you need to look beneath the surface. The ETA explicitly allows PNM to build a gas plant as part of its replacement power plan, an utterly unnecessary, utterly imprudent investment that is only “carbon free” if you ignore the fracking required to produce the gas.

What’s more, the ETA carefully and very intentionally circumscribes the Commission’s authority, removing its capacity to review and approve or disapprove PNM claims. The state Attorney General has underscored this point, stating that the ETA essentially allows PNM to regulate itself. Thankfully, a docket had been opened on the San Juan closure months before the ETA was even introduced in the legislature, ensuring that the ETA need not handcuff the PRC.

Realizing this, what has PNM done? PNM disingenuouly opened a second docket after the passage of the ETA and claimed that this is the docket that should govern PRC’s decisions about reimbursing PNM for stranded assets.  Why would they do that? Simple, the ETA prevents the PRC from doing its job and allows PNM to fleece the ratepayers. Again.

New Energy Economy and many of those advancing their case this week tried to fix the ETA, but those who supported it would not consider amendments. And there was a reason: to have fixed the bill would have allowed the PRC to do its job and would have constrained PNM’s greed. Giving PNM its way was the political price to be paid for a shiny RPS. Thankfully, this docket is open, the PRC can do its job, and then the Supreme Court will do theirs and declare parts of the ETA unconstitutional.

Cindy Wheeler Offered a Tremendous Analogy

Cindy Wheeler is a member of Retake’s Climate Action Team. While I couldn’t get her full transcript, I wanted to include a great analogy she included in her testimony — what Jonas Salk said about humanity: “Our greatest responsibility is to be good ancestors.” She went on to point out how PNM has one responsibility: to make profits. She was careful to frame this not as an accusation or a criticism, but just as fact. PNM has one responsibility: profit. That is capitalism. But Cindy went on to say that PNM is not unlike a three-year-old looking at a jar full of cookies. They want the cookies, all of them. Now. But she then pivoted to state that this is why we need adults in the room, to curb PNM’s hunger. The PRC Commissioners are the adults in the room. A beautiful and apt analogy.



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7 replies

  1. Kudos to everyone involved in the excellent testimony before the PRC as reported by Paul Gibson. I continue to be impressed by Paul’s ability to assimilate and publish large amounts of information on disparate subjects.

    I would like permission to copy the testimony (duly credited) to my Facebook group, https://www.facebook.com/groups/216421425383192/

  2. “Wow” is right! Excellent stuff. Thanks for reporting on the hearing, Paul.

  3. Paul
    Let’s be accurate to your readers:
    There were approximately 68 individuals that gave public comment. Of the 68 individuals that gave comment:
    – Two commentators were in favor of keeping the plant open
    – Four were in favor of carbon capture technology,
    – Nine were in favor of closing the plant and holding PNM (not ratepayers) accountable for the reclamation expenses,
    – Twenty-five were either in favor of PNM’s plan to close the plant and/or supported the ETA, and
    – Nineteen spoke out against the ETA
    – Four had some other issue.

    Thanks,
    Ray

    • About what I would expect from a PNM communications staffer…note how the 19 who spoke out against the ETA are not included in those who want to hold shareholders accountable. While not everyone opposed to the ETA may have said that they wanted PNM shareholders to pay at least half, I suspect they do….and so do you. But the truth is not in how many this or that. The truth is in when the PRC rules that shareholders pay half or more and then when the Supreme Court supports that finding. My question for you: What do you tell your grand kids when they ask what you did during climate crisis? I suppose you will find ways to paint a nice face on PNM. I suppose if you can lie to the public you can lie to a grandchild. But in your heart you will know the truth. PNM has been dragging its feet and dissembling for years.

      • Paul, I guess when the facts (and the all the other environmental organizations) are not on your side, you attack the person’s charter and regurgitate rhetoric. Disappointing…

  4. Excellent testimony from all.. If you haven’t seen, there is an interesting article in NYT titled “Finland is a capitalist paradise” that reiterates that capitalism doesn’t have to be what we experience in the USA.

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