, , , ,

The Battle for New Mexico’s Energy Future

The Battle for New Mexico’s Energy Future

A common message from liberal Democratic candidates this year involves the promotion of renewable energy, a notable shift in political messaging strategy. Up until recently, the conventional wisdom was that climate change and related issues were the concern of only a limited number of environmentalist activists but not a concern to the average voter. In this election cycle, ads from Senator Martin Heinrich, Congressional hopeful Deb Haaland, and Gubernatorial candidate Michelle Lujan Grisham all support expanding renewable energy in our state (in fact Lujan Grisham’s ad was recently featured in a New York Times piece covering the expansion of climate change political messaging). It’s true that our state’s sunny climate is well suited for solar and wind energy, but there is a glaring omission of the biggest negative side effect of mandating increased use of renewable energy: substantially higher electricity costs.

While the shift in political messaging strategy in New Mexico is rather new, the renewable energy push is not, and is part of a national effort by environmentalist groups, activists like billionaire Tom Steyer, and others who have drank the Kool-Aid and have been hoodwinked into believing their propaganda that falsely claim renewable energy mandates will lower energy costs.

In the 2016 presidential election cycle, Steyer and his wife gave $65,000 directly to Democrats running for the New Mexico Legislature and Secretary of State according to state campaign finance records. The League of Conservation Voters, a Washington, D.C group with close ties to Steyer with a New Mexico chapter called Conservation Voters NM (CVNM), spent another $185,000. Through September of this year, CVNM Verde Voters Fund, a independent expenditure PAC connected to CVNM, has spent $429,000 attacking Republican candidates.

Unfortunately, other states like New York and California have already been duped into energy regulations requiring electric utilities to increase solar and wind energy production. The Wall Street Journal recently did a study that showed that in California, those regulations have resulted in electricity rates that are 53% higher than the national average (and California Governor Jerry Brown recently signed into law a measure requiring the state to produce 100% of its electricity from renewable sources by 2045, up from the current 33%). This November, Arizonans are voting on Proposition 127 (an effort spearheaded by Tom Steyer), which would require the state’s utilities to produce half of their energy from solar and wind sources.

Even though New Mexico does not currently have a similar question on the ballot, the influence of environmentalist groups in our state is unmistakable. If those out of state environmentalist groups have their way (and clearly they have a receptive audience in some of the candidates running for office) New Mexico will impose similar renewable energy mandates.

Tragically, the hardest hit by higher energy costs will be low income families and those on a fixed income. To make matters worse, these households pay three to five times more of their income on energy costs than rich households. This is especially a concern in New Mexico where a significant portion of the state’s population is low income. Make no mistake: higher electricity costs are an incredibly regressive tax that those living in ivory towers are willing to impose on the poor in order to subsidize the rich. Ironically, a common refrain from liberals is that they support the poor and the working class, but enacting renewable energy mandates hurt the very same folks they claim to be fighting for.

Make no mistake: higher electricity costs are an incredibly regressive tax that those living in ivory towers are willing to impose on the poor in order to subsidize the rich.

The political environment this election cycle favors Democrats and it is almost assured they will gain seats in Santa Fe, which translates into greater power for environmental activists like billionaire Tom Steyer and his allies. Public Service Company of New Mexico, the electrical utility serving most of New Mexico, has apparently seen the writing on the wall and revealed that ahead of the 2019 Legislative Session they are willing to accept a 50% renewable energy mandate in exchange for PNM to issue low-interest bonds as part of a closure of the coal-fired San Juan Generating Station (this is achieved by securitization, which means having the state underwrite the loans, reducing risk, and thus reducing the required interest rate).

The corporate mentality at PNM seems to be “if you can’t beat them, join them” since as a government regulated monopoly, the company is assured a profit, regardless of the amount of renewable energy in our state. Unfortunately for New Mexico families, this means higher electricity rates are coming, putting a significant financial strain on those who can least afford it. For New Mexico’s economic future the stakes are high, and sadly, New Mexico’s energy future seems to already be determined.

Disclosure: I am employed by PNM, the state’s largest electrical utility.