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PRC transmission line re-hearing set for Thursday

The state Public Regulation Commission will discuss this Thursday whether it should reconsider its decision to charge Facebook nearly half the cost of a new $85 million transmission line.

The PRC ordered Public Service Company of New Mexico in April to bill Facebook $39 million for the line and recover the remaining costs from wholesale customers, prohibiting any charges on general ratepayers. That’s because a PNM executive testified during hearings in February that the line would only serve Facebook by carrying electricity from a new wind farm near Encino to its data center in Los Lunas, plus wholesale customers who sell to markets outside the state.

But PNM has since corrected that testimony, calling the line a “network upgrade” that benefits everybody. It requested a re-hearing on April 30, arguing that the costs should be shared equally among wholesale and retail customers.

The line, which will run between Clines Corners and a new substation in Sandoval County, will carry electricity from the forthcoming La Joya wind farm now under construction to Facebook’s data center. But at Thursday’s open public meeting, PNM will discuss a new 140 MW wind project it’s planning in eastern New Mexico that will also use the transmission line, known as the BB2 project, to transport renewable electricity to all customers.

The company needs that wind energy to meet the state’s current renewable portfolio standard, which requires public utilities to derive at least 20 percent of their electricity from renewable resources by 2020.

“PNM has finalized a contract to purchase 140 MW of renewable energy from a New Mexico wind project, at one of the lowest rates seen across the country,” said PNM spokesman Ray Sandoval in an email to the Journal. “This contract would rely on the BB2 transmission project to deliver energy to PNM customers … PNM anticipates executing the contract in May and filing for PRC approval of this new renewable resource by June 1st.”

The BB2 line is the first of what could be many transmission projects to bring more wind power from New Mexico’s gusty eastern plains to customers throughout New Mexico and elsewhere. More transmission capacity is critical to meet mandates under the state’s new Energy Transition Act, which requires public utilities to derive 50 percent of their electricity from renewables by 2030 and 80 percent by 2040.

Even without PNM’s new 140 MW project, the BB2 line still benefits all customers by strengthening grid capacity and reliability, according to the Coalition for Clean Affordable Energy and New Mexico Industrial Energy Consumers, both of which petitioned the PRC re-hear the case. Only transmission lines built specifically to connect an individual customer to PNM’s grid can be billed exclusively for construction, not projects that serve the grid in general, they said in filings at the PRC.