Two Democratic state senators on Monday introduced a bill they say would open up New Mexico’s electricity markets to competition and give local communities control over who supplies their energy.
Sens. Jeff Steinborn of Las Cruces and Benny Shendo of Jemez Pueblo said their Local Choice Energy Act would result in more energy from renewable sources such as wind and solar in cities, towns and pueblos throughout the state.
At a Monday news conference at the Capitol, Steinborn said Senate Bill 374 would allow local communities to purchase energy from whatever source they want. “It would allow local governments to tap into the market,” he said, “to get the best deal they can on energy, to get the greenest energy they can, if that’s their desire, and to create great local jobs in the process.”
Steinborn said he expects utilities like Public Service Company of New Mexico, the state’s largest electrical utility, will oppose SB 374. “They fight every reform,” he said. “And I suspect they’re not going to embrace this with a warm hug either because it basically upsets that monopoly power that they enjoy today.”
PNM spokesman Ray Sandoval told the New Mexican that his company has noticed “many technical questions” in the bill. “We intend to discuss those directly with the sponsors,” he said.
Shendo said people who live in rural areas “rely on electrical cooperatives and sometimes those aren’t very reliable. I know with the vast resources and the vast lands that tribes have, the opportunity to create their own economic development is real possible with this act.”
Last month, the idea was endorsed unanimously by the All Pueblo Council of Governors, who in a resolution said, “if the utilities are required to have open competition for the generation of electricity – where the utilities do not own the solar farms – a higher [renewable portfolio standard] cold generate revenue and economic opportunities for Pueblos interested in developing solar energy on their own lands.”
Steinborn said the legislation would mean a big change from the current system. “We have a cost structure in New Mexico’s current energy marketplace that incentivizes building more energy infrastructure rather than conservation,” he said. “So we’re working on creating a better model.”
Local governments, Steinborn said, would be able to put out requests for proposals from energy providers. “Anybody could bid on that,” he said. Communities also could decide to build their own publicly owned utility.
“It could be the existing utility or some new company that crops up to build a wind or solar farm or whatever it is,” he said. “… It’s not preordained what the energy solution will look like.”
Mariel Nanasi, executive director of New Energy Economy, a Santa Fe clean-energy advocacy group that is pushing the bill, said local governments could decide to create a public/private electricity provider, with the government controlling a certain amount of the energy produced and a private company and/or other entities controlling the remaining portions.
According to PNM’s website, of the electricity provided by the utility, less than three percent is from solar energy, while another 7.1 percent is from wind energy. A little over 12 percent comes from natural gas, nearly 22 percent from nuclear energy and just over 56 percent from coal-fired plants. The utility is moving away from coal, however, and plans to close its San Juan Generation Station near Farmington in 2022.
Eight states – California, New York, Ohio, Illinois, Virginia, Massachusetts, New Jersey and Rhode Island – have enacted similar legislation, Nanasi said. Steinborn added, “We have found that in those states, the cost is lower and the energy is greener.”
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