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CCSD Files Motion to Intervene and Motion for Rehearing in PRC Case Regarding Energy Transition Act

June 21, 2024

Shiprock, NM - Today, the Central Consolidated School District (CCSD) filed a Motion to Intervene and a Motion for Rehearing in Public Regulation Commission (PRC) Case No. 23-00353-UT. When the Energy Transition Act (ETA) was passed in 2019, the San Juan Generating Station, together with the Four Corner’s Plant and attached mines, provided more than 80% of CCSD’s property tax revenues. These property tax revenues have been a critical source of CCSD funding.

The ETA specifically includes a provision to help reduce the impact to CCSD from the loss of those property tax revenues. The law states that PNM must locate “up to four hundred fifty megawatts of nameplate capacity identified by the qualifying utility as replacement for a qualifying generating facility, and may include energy storage capacity; provided that such resources are located in the school district in New Mexico where the abandoned facility is located, are necessary to maintain reliable service and are in the public interest as determined by the commission.” § 62-18-3(D) NMSA. 

In Case No. 19-00195-UT the PRC approved a plan that included 430 MW of “replacement resources” to be located in CCSD, the “school district in New Mexico where the abandoned facility” was located. Under that plan, a 300MW resource has moved forward. However, a 130MW resource, the Rockmont project, was ultimately delayed and canceled. Even though PNM has not sought to replace the Rockmont project within the taxable area of CCSD, PNM recently requested additional resources from the PRC but failed to mention that the additional resources being requested were actually SJGS “replacement resources”.  The resources included in this case comprise the largest capacity resource acquisition since the Rockmont failure and should have included resources located in CCSD’s taxable boundary. As regulators, the PRC must hold PNM accountable, rather than ignore the requirements of the ETA and Case 19-00195-UT; PNM has left San Juan County and the CCSD with a significant shortfall. 

Abandonment of the SJGS has had a significant impact on students of CCSD due to job loss in the region, including a 700% increase in student homelessness since the closure of the SJGS and the associated mine. CCSD’s student population is about 95% Native American. On average, over 30% of CCSD’s students do not have electricity, running water, indoor plumbing or access to the internet. In the more remote settings of CCSD, it is estimated that 70% of our students do not have access to these basic necessities. As a result of these impacts, CCSD is currently engaging in restructuring, reduction in force measures and potential school closures in order to ensure that CCSD’s limited resources are being spent directly on the needs of our students.

In the subject case the PRC approved hundreds of MW of solar and battery storage resources located primarily in Bernalillo County. Though artfully couched otherwise, these resources are clearly intended to replace the capacity of the San Juan Generating Station. Yet PNM’s application failed to identify the company’s outstanding obligation for 130 MW of ETA “replacement resources” in CCSD. Instead, PNM claimed it was not addressing that issue in this proceeding, and the Commission unfortunately took their claim at face value. We argue that:

The Commission should not permit the failure of the utility to explicitly identify the resources as “replacement resources” to determine that the Energy Transition Act does not apply to this docket. That rationale would allow PNM to decide if and when the Energy Transition Act applies, rather than the regulator applying the law to the regulated entity.
PNM’s application and testimony reveals that there were resources in the CCSD that could have potentially served as “replacement resources,” but PNM rejected the CCSD bid by requiring a new pricing term after bids had already closed. PNM subsequently filed an application for a resource in another case and reported to the Commission that the fixed pricing term in that contract would have no adverse impacts on rates or customers. The CCSD bids are still alive and the Commission should require PNM to extend these bids for 6 months at its own cost.
In the Final Order in this docket the Commission approved 60 MW of excess capacity over what PNM needs to achieve its current reliability standards. Approving excess resources above the amount needed for reliability means CCSD will have to wait even longer for the next resource need to present an opportunity for a “replacement resource” in CCSD.

We are calling for the Commission to vacate the Order in this case and assign a hearing examiner to conduct further proceedings to enforce the ETA and the Final Order on Recommended Decision Replacement Resources, Part II, Case No. 19-00195-UT.

Said Steve Carlson, Superintendent of the Central Consolidated School District, “Without adequate bonding capacity and property tax revenues, CCSD will be unable to correct years of historic underfunding of school facilities in our District.  This puts CCSD in a “rob Peter to pay Paul” scenario where educational operational funding must be used to subsidize much needed improvements to educational facilities.”  

Said Suzette Haskie-Oberly, School President for CCSD, “Our children, families and communites have borne the brunt of the energy transition for long enough.  Our school district has been hit hard by the closure of SJGS.  Since closure of SJGS, our student homelessness rates have increased up to 700% and we are now having to restructure and consolidate schools in order to make sure that our dwindling funds benefit the education of our students.  PRC Commissioners, we call on you to avoid any further delay in requiring PNM to comply with the ETA by placing resources in CCSD’s taxable boundary.  Enough is Enough!”

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