An appeal brought by an electric distribution cooperative against the New Mexico Public Regulation Commission remains in litigation following a closed-session meeting of commission members May 20 to discuss the matter.
"The Commission gave direction to the Office of General Counsel on action to take and did not entertain a recommended decision at this time," NMPRC Chief of Staff Jason Montoya told California Energy Markets in an email after commissioners did not return to the public portion of their weekly meeting.
Socorro Electric Cooperative filed suit at the New Mexico Supreme Court in October to appeal the commission's rejection in September of its December 2018 request for a rate increase, the co-op's first such request since 2011 [18-00383-UT].
SEC requested an annual revenue increase of $1,249,993, or 5.06 percent. The amount includes connection and disconnection fees and other miscellaneous charges in addition to rates. The New Mexico Institute of Mining and Technology, the co-op's biggest customer under its large commercial rate, and the City of Socorro protested the increase. New Mexico Tech's cost increase for the first year under SEC's proposed rates would be almost $49,000.
Former Socorro Mayor Ravi Bhasker said in May 2019 testimony that the city has lost out on economic opportunities due to its high electric rates.
The NMPRC in September approved a hearing examiner's recommended decision to not increase revenue and instead to reallocate base revenue collection among the co-op's rate classes to "gradually move the relative rate of return of each class closer to unity."
Under the commission's order, residential customers would see a 2-percent increase, or about $1.53 per month. SEC spokesman Jimmy Capps said the decision would result in a net reduction of $206 in the co-op's annual revenue because it includes rate decreases for large-customer classes.
In an April 22 filing to the New Mexico Supreme Court, the NMPRC maintains that "SEC has not met its burden of showing that the final order adopting the RD was arbitrary, capricious, not supported by substantial evidence, or otherwise unreasonable or unlawful" [S-1-SC-37948]. In a separate filing with the high court, SEC requested a stay of the NMPRC's order while its decision remains under litigation [S-1-SC-38302].
"The only issue to be decided in this case is the extent of the Public Regulation Commission's authority to interfere with the management of The Socorro Electric Cooperative," SEC said in its May 15 response to the Court requesting oral arguments. The co-op maintains that operational costs have risen significantly since its last rate increase in 2011, and that its proposed 2018 rates are fair and reasonable.
Also at the meeting, the commission unanimously approved a stipulation from Southwest Public Service, an Xcel Energy subsidiary that serves eastern New Mexico and parts of West Texas, to revise its retail electric base rate charges and change the service life of its coal-fired Tolk Generating Station's units 1 and 2. The utility plans to abandon the 1,067-MW units on Dec. 31, 2032 [19-00170-UT]. SPS and the commission settled on a base rate increase of $31 million, or $3.49 per month for the average residential ratepayer. The utility said a cost driver for the increase was Tolk's depreciation rate, which will increase by about $8 million.
Commissioners also approved New Mexico Gas Co.'s 2020-2022 energy-efficiency program featuring five efficiency programs for residential customers and one for commercial customers [19-00248-UT]. The plan was filed in accordance with New Mexico's 2005 Efficient Use of Energy Act, which requires regulated utilities to develop cost-effective energy-efficiency resources. New Mexico Gas will be able to recover associated costs of the plan with a monthly tariff rider, which it estimates will be about 90 cents per month for residential customers.
NMPRC Chief of Staff Montoya told commissioners during a brief discussion at the meeting that in light of the COVID-19 public health emergency he thinks the agency should negotiate a stay of the NMPRC's June 30 eviction from the Public Employees Retirement Association Building in Santa Fe (see CEM No. 1587).
Montoya also proposed a "hybrid" option for the long term that would involve putting field staff on a permanent teleworking schedule and finding a private facility to provide office space for more traditional office-based workers. He said renting private space for all the NMPRC staff would likely be too expensive and lead to budget cuts elsewhere. "I would not recommend sacrificing critical positions to create revenue and money to pay for a private lease," he said. "We just can't afford to not be without the engineers . . . the economists, the lawyers."