PNM’s Integrated Resource Plan – Expect More Large Electricity Rate Increases

The CCAE protest of the NM IRP was filed on August 17. The complete document is attached to this webpage

July 18 - “PNM’s Integrated Resource Plan (IRP) continues the same strategies that have caused the huge rate increases realized by PNM customers. PNM has already raised rates by 25% in recent years and is currently asking the Public Regulation Commission (PRC) for another 20% rate increase, bringing the total to 50% (1.25 x 1.20 = 1.50) in just a few years. At the same time, PNM is not doing nearly enough to mitigate future rate increases driven by its continued investment in old, dirty fossil-fuel power plants. New Mexicans would be better served by a more much aggressive implementation of energy efficiency and clean renewable energy.” Don Hancock, Chairman of the Coalition for Clean Affordable Energy, said Monday.

The Integrated Resource Plan (IRP) defines the utilities plan to support electricity needs for the next 20 years. The PNM IRP that has just been filed with the PRC continues the same business strategies that have caused rates to increase rapidly in recent years.

In April 2011, PNM requested the PRC to approve an historic $156M rate increase or 20% above existing bills. When added to the prior 25% rate increases, PNM will have raised rates by 50%. Most of this rate increase has resulted from investments in their aging infrastructure, especially coal plants that are over 30 years old now, and in natural gas-fired plants that expose customers to increases in gas prices in the future. They have under invested in energy efficiency and clean energy.

In the PNM IRP, energy savings due to energy efficiency would unnecessarily decline after 2020. The PNM IRP also calls for too small of an investment in clean energy. The Renewable Energy Act requires that 20% of PNM’s energy will be renewable by 2020. The PNM IRP achieves only 13% of its energy as renewable, even by 2030. It is hard to understand what PNM was thinking when you consider the vast amounts of inexpensive wind resources in eastern New Mexico.

The PNM IRP process continues the same business strategy that invests in old dirty coal plants and new gas plants that have the significant risk. These coal plants, which adversely impact the health of New Mexicans, will likely need to make major investments to improve air quality.

“Investments in energy efficiency save rate payers money,” Tom Singer of Natural Resources Defense Council said. “It is well known in the utility industry that investments in energy efficiency are at least 50% cheaper than building new energy sources, such as power plants and transmission lines. The PNM Integrated Resource Plan actually reduces energy efficiency in the later years of the plan. We encourage PNM and the PRC to adopt more aggressive energy-efficiency measures to stop this upward spiral of rate increases.”

David Van Winkle of the Rio Grande Chapter of the Sierra Club said “To meet the requirements of the Renewable Energy Act, PNM should plan to take advantage of inexpensive wind energy in eastern New Mexico and abundant solar energy. Both technologies would stimulate job growth for New Mexicans.”

CCAE is comprised of the following organizations: A Center Advancing Sustainable Architecture (CASA), Environment New Mexico, Natural Resources Defense Council, New Mexico PIRG, Rio Grande Chapter of the Sierra Club, Southwest Energy Alliance, Southwest Energy Efficiency Project, Southwest Research and Information Center, Western Environmental Law Center, and Western Resource Advocates. CCAE uses strategic advocacy, scientific analysis, and grassroots organizing to advance clean energy policy and programs.

Wind turbines
Protest PNM IRP 8-17-11 FINAL.pdf440.07 KB