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 V.20 No.17 | April 28 - May 4, 2011 

Neverending Stories

Utilities Protest Carbon Caps

Greenhouse gas rules in New Mexico just can’t catch a break. After escaping Gov. Susana Martinezand demise in the Legislaturethey’re in the crosshairs of utility companies.

The death-defying regulations have a singular goal: to reduce carbon emissions in the state.

Don Brown, spokesperson for PNM, says that’s an expensive proposition. “We’re concerned this would increase the cost of living here, as well as hamper the ability to recruit business here,” he says. “The concern is that it puts us at an economic disadvantage.”

“It’s not popular to say this, but those who think solar and wind can, overnight, replace other resources, it’s just not possible. The technology isn’t there today.”

Don Brown, spokesperson for PNM

PNM isn’t the only utility with its sights trained on these carbon caps. Tri-State Generation and Transmission Association has jumped into the fray, too, along with Independent Petroleum Association of New Mexico and a handful of others.

Here’s how it all works. The state’s Environmental Improvement Board approved two rules near the end of last year, one of which is a straight cap for greenhouse gas emissions, and the other a cap-and-trade agreement. But Brown says PNM doesn’t believe the board has the authority to regulate carbon. If the Court of Appeals agrees, the greenhouse gas rules will be overturned.

The board still has the chance to defend itself, but that’s where things get a little trickyall seven board members who approved the rules have been replaced. Right after Martinez tried to halt one of the rules, she proceeded to fire the board and appoint a new one.

The Environmental Law Center decided to get involved because it doesn’t believe Martinez’ recruits will defend the actions of the old board, says Bruce Frederick, a staff attorney with the center. If allowed to intervene, the center’s client, New Energy Economy, will be able to argue the merits of the greenhouse gas rules in court.

Jim Casciano, one of the new board members, declined to comment since the matter is still in litigation.

The state Supreme Court decided earlier this year that Martinez couldn't stop the carbon cap with an executive order [“Guv + Dairy Industry = BFFs?” Feb. 3-9]. But in this year’s legislative session, several bills were introduced that tried to circumvent the pending greenhouse gas regulations. Bills such as HB 579 and SB 489 proposed that it should be illegal to create emissions guidelines tougher than federal requirements. All of the bills died during the session.

PNM spokesperson Brown says the utility supports the idea of regulating greenhouse gas emissions at a federal level but not at a local one. “From our perspective, we’re looking to keep electricity as affordable as we possibly can,” he says. “It’s not popular to say this, but those who think solar and wind can, overnight, replace other resources, it’s just not possible. The technology isn’t there today.” He adds that PNM is moving forward with alternative energy, but it’s trying to do so “responsibly.” Brown estimates that the cap-and-trade rule would raise its utility rates by “a nominal amount” in 2012 but by as much as $85 million annually by 2020 (a rise of about 1 percent per year). The NEE rule would potentially raise costs by $8 million along the same timeframe.

Frederick, of the Environmental Law Center, says he doesn’t think it’s a good idea to wait for federal regulation. “Climate change is the biggest issue of our time,” he says. “Climate change is real. ... We need to do something about it.”

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