Hell No to HB 12, the 2023 Version of Hydra Hydrogen!

HB12 Advanced Energy Technology Act is one of the worst bills of this or any session, and this blog has required 3-4 complete revisions to wind up as it is. Sadly, there is no black and white here, only gauzy grey. Here we analyze the bill, offer important backstory, and link to speaking points and contact info for members of House Energy, Environment & Natural Resources. But to advocate effectively, it helps to know the important backstory to HB 12 and the insidious way it evolved. So, to understand how we got here, first the backstory.

HB 188 to HB 12: The Backstory

HB 188 was an excellent bill developed by the coalition Power4New Mexico, which includes some very progressive, people-focused, and credible organizations like the Native American Voters Alliance, Olé, and Somos Un Pueblo Unido. The bill is sponsored by Reps. Kristina Ortez and Angelica Rubio, two pretty solid legislators. Unfortunately, for reasons we will explain, HB 188 stalled and Rep. Nathan Small offered to include important parts of HB 188 in his bill, HB 12. The resulting bill is co-sponsored by the two most prominent hydrogen advocates in our legislature, Reps. Patty Lundstrom and Nathan Small. While purporting to set up a fund to be used in support of “advanced energy technology,” a closer review reveals potential problems. Big ones. But first, more on HB 188.

House Bill 188 would have appropriated a total of $13.385 million from the general fund to the Economic Development Department for the purpose of creating an Economic Transition Division. The new division would be tasked with providing programmatic, funding, administrative, and logistical support for communities and workers in economic transition. Imagine that: a division in the Governor’s administration explicitly representing the priorities of impacted communities. The Division’s support would be targeted to aid disproportionately impacted communities and workers transitioning from natural resource extraction industries. The division would also be responsible for preparing and publishing an economic transition action plan with 15 components.

HB 188 would also have created a non-reverting economic transition fund designed for grants and loans, as well as administrative and reimbursable costs incurred by EDD, subject to legislative appropriation. It required an annual report on the grants and loans approved, status of repayment obligations, money used for administrative and reimbursable costs, and status of the overall fund.

In short, developed by organizations who represent impacted communities, HB 188 advanced very worthwhile goals. Unfortunately it encountered pushback from the governor’s office, whose stated concern included that the administration was creating too many new divisions to manage. Do you buy that?

In any case, bill sponsors, recognizing that the bill was not going to advance, pulled the bill and shortly thereafter Rep. Nathan Small offered to include much of the language from HB 188 in HB 12 bill, and that is how we arrived at the HB 12 we’re considering today. 

***We want to note that positive workforce development and just transition provisions were rolled into HB12 from HB188. We support these provisions – and the workers calling for them but cannot support a bill that extends our state’s dependence on fossil-fuel extraction at the expense of frontline communities’ health and the environment and the climate. 

The real intent of HB12 may be buried in the definition of “advanced energy technology,” which includes “carbon capture, sequestration, transport utilization and storage systems” (CCS). Unbelievably, it also includes nuclear energy. But CCS is at the heart of all grey hydrogen production because the economic and environmental viability of hydrogen production rests with successful sequestration of CO2, which is something that has never worked anywhere in the world.

While sections 17 to 20 of HB 12 include language directly from HB 188, HB 12 also includes language that requires amendment. While there are enough good reasons we outline below for opposing the bill outright, ultimately, as of today, allies feel we are between a rock and a hard place. We will describe the very good reasons why we may need to pass HB 12 in an amended form, rather than just defeat it.

To explain why amendments might be better than killing the bill entirely: HB 2, the house budget bill, has passed the house and is now in the Senate. It includes $50 million for “advanced energy projects,” and in the absence of some kind of definition of what those projects are, Representative Lundstrom and her allies can use that money for hydrogen hub development, sequestration or whatever her hand-picked board determines worthwhile. As a result, it is not enough to remove carbon sequestration and nuclear from the list of eligible activities but we need to advocate for an amendment that includes language that explicitly excludes both carbon sequestration projects and nuclear projects from being considered advanced technology projects and from receiving any funding or benefits that accrue from HB 12.

One might ask why would Representative Small agree to amendments that restrict or impede advancing hydrogen projects, as that is the entire point of his HB 12? The answer is Rep. Small understands that the level of opposition to hydrogen projects in the house is nowhere near as strong as the opposition in the Senate and he probably realizes that a bill explicitly promoting hydrogen is not going to get through the Senate, so he may accept an amendment that prohibits expenditures for sequestration or nuclear. And the best way to convince Small that he must take our amendments is if he is facing such fierce opposition to the bill that he is fearful he won’t get it through its first House hearing this Saturday, Feb. 25, in House Energy, Environment and Natural Resources without making serious concessions.

HB 12 either needs to be rejected outright or it must be substantially amended to address concerns outlined below. But to be clear, without these amendments or equivalent amendments from Power4NM we strongly oppose this gas and oil fantasy.

What Should We Do?

This blog outlines the backstory and context which is important to understanding the importance of blocking this effort. This discussion will help you understand the moving parts in a very complex process. But for speaking points you need brief statements, not paragraphs. What follows borrows heavily from the alert from Indivisible ABQ and from discussion with Tom Solomon, cofounder of 350NM. We should also note that Power 4NM leadership is working with Small and the other bill sponsors, seeking amendments, likely very similar to what we are proposing. Between now and Saturday’s hearing, an amended bill may be published and we will need to review that very closely. We will be having conversations with allies as well, to identify a unified front. So Read On, but Stay Tuned. We need to act in advance of Saturday’s hearing, but we may need to reframe our messaging as things evolve.

What Is HB 12?

HB 12 is basically a gray hydrogen bill, with a bunch of other really bad stuff added. Listed below are our biggest concerns:

  • The bill defines nuclear energy and carbon capture and sequestration as “advanced energy technology projects.”
  • The bill rewards failure. HB 12 allows the state to take over failed projects from companies and pay those companies for their failure– essentially offering incentives for industry to invest in risky projects–for which carbon sequestration certainly qualifies.
  • The Bill guts consumer protections. HB12 makes numerous exceptions to the procurement code, making that code meaningless.

Details and Commentary on Changes Needed

Definition of advanced energy technology projects needs amendment. HB 12 defines “Advanced Energy Technology projects” with a wide range of innovative technology options for producing energy, including nuclear energy and carbon capture and sequestration (big words that mean hydrogen produced from fossil fuels, coal, natural gas and even nuclear energy!)

The science is clear on carbon capture and sequestration — it uses fossil fuels to produce hydrogen, and also uses a commercially unproven process to capture the emissions from that production process. These carbon capture technologies have failed to achieve results over and over. With help from allies at Renewable Taos, Retake published a two-page summary of the research on hydrogen and the failed efforts to capture carbon. Click here to review this research. The net result is that greenhouse gas emissions are NOT reduced by this technology.

Fix the bill by removing carbon capture and sequestration and nuclear energy from the definition of “advanced energy technology” and make a specific statement that nuclear and carbon sequestration do not qualify.

The bill rewards failure and encourages investment in high risk projects, not “advanced Energy Technology projects” If this bill passes, it allows the state to enter into public/private partnerships with companies to produce hydrogen (or any other project) and take over projects from companies when they fail (uncured default). If a company’s project fails, and another company’s technology succeeds, the state can pay the failed company ”reasonable compensation”. [Sec 3, D, (9) & (11)]. This definition is overly broad and could mean that even if a project has been in operation for many years, the state can still take it over and put taxpayers on the hook for paying the company back. There are no monetary limits mentioned in the bill or how may failed projects would be covered. Since carbon capture and sequestration technology has repeatedly failed, New Mexico taxpayers would certainly be on the hook. This provision seems likely a response from industry seeking protection from losses on carbon sequestration doomed to failure. If passed, this provision would allow private partners to profit from state and federal investments and then, when the project fails, seek further compensation from the state. It amounts to corporate welfare. Fix the bill. Remove this provision entirely.

Restore Procurement Code Protections. The New Mexico Procurement code protects New Mexico taxpayers by requiring competitive bids, ensuring minority and women-owned businesses have a chance to compete for state projects and more. HB12 asks for exemptions to the Procurement Code for agreements and contracts entered into pursuant to the Advanced Energy Technology Act. Fix the bill. These protections are in place for a reason. So remove the Procurement Code exemptions for Advanced Energy Technology projects.

So there you have it. The Governor signals her objection to HB 188, a very good bill. Bill sponsors pull the bill, only to find a beckoning Nathan Small willing to “help” by including some of HB 188 in HB 12. The result, a bill with a bit of the original HB 188, but also, a totally unacceptable bill authorizing and securing funds for nuclear and carbon sequestration projects. And this is how sausage gets made in the Roundhouse.

For concise speaking points and contact inf, click here. Please write to all members of the House Energy, Environment & Natural Resources Committee tonight or tomorrow. And plan to attend their hearing on Saturday, in person, if at all possible, but certainly by Zoom. We need to send a loud message that we are paying attention and will persist.

In solidarity & hope,

Paul & Roxanne

Categories: Environmental Justice

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1 reply

  1. Sausage making indeed!

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