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Regulators have rejected efforts by New Mexico’s largest utility to recover from customers millions of dollars in investments made in coal-fired power plants in northwestern New Mexico.
ALBUQUERQUE, N.M. — Regulators Wednesday sought to recover from customers millions of dollars invested in a coal-fired power plant in northwestern New Mexico and a nuclear power plant in neighboring Arizona. rejected the efforts of the electric power company.
The Public Regulatory Commission’s decision requires New Mexico Public Service Company customers to cover some of the costs associated with PNM’s interests in the Four Corners Generating Plant near Farmington and the Palo Verde Generating Plant outside Phoenix. It means to disappear. Commissioners said such an investment was unwise.
Overall, residential customers will see lower rates, rather than the 9.7% increase the utility was seeking.
The commission said in a statement that PNM will continue to be able to return a reasonable return on its investments while providing reliable service to more than 500,000 customers across the state.
PNM will submit its first rate hike request in years in late 2022, raising $64 million as part of a long-term plan to recoup $2.6 billion in investments needed to modernize the power grid and meet state transition obligations. He said additional income was needed nearby. Keep away from coal and natural gas.
The utility also noted that its lease for power from the Palo Verde power plant is expiring and that it hopes to refinance its debt to take advantage of lower interest rates.
A Public Regulation Commission hearing officer who reviewed the case recommended in December that the commission deny Palo Verde costs associated with the sale of the lease to a third party. He also said PNM’s 2016 decision to invest in extending the life of the Four Corners plant was unwise.
PNM officials said late Wednesday that they were reviewing the commission’s order. The utility has until February 2nd to request a rehearing from the commission.
Consumer advocates and environmental groups welcomed the commission’s choice to deny some of the costs associated with PNM’s investments.
“PNM failed to conduct due diligence before reinvesting in Four Corners since 2016, when there were clear indications that coal was an expensive and dangerous fuel,” Sierra Club senior attorney Matthew Gerhart said in a statement. The committee acknowledged that.”
The utility was attempting to exit Four Corners by transferring its stock to a Navajo energy company. However, regulators rejected the proposal, a decision later upheld by the New Mexico Supreme Court.
The Four Corners Plant, located on the Navajo Nation, is operated by the Arizona Public Service Company. The company owns a majority stake in the remaining two units of the factory.
Navajo Transitional Energy argues that preventing early plant closures will help soften the economic blow to communities that have long relied on tax revenue and jobs associated with coal-fired power generation. , was aiming to take over PNM shares.
The nearby San Juan Power Plant closed in 2022, sending economic ripples through the surrounding area. PNM operated that factory for decades.
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