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Farmington seeks softer landing from power plant cuts

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By Harold Morgan

The nation’s lowest average residential electric bill comes to New Mexico’s homeowners. Who’d a thunk?
The rates rank 20th nationally, but we use less electricity, the 11th lowest amount. Combine the factors and the average monthly bill becomes the lowest.
This is a federal number, coming from the U.S. Energy Information Administration, courtesy of our Public Regulation Commission. Four PRCers, led by Sandy Jones, commission chair, had a long session July 19 in Farmington with the Legislative Finance Committee and the Revenue Stabilization and Tax Policy Committee at the BP Center for Energy Education at San Juan College. The session ran an hour and 25 minutes beyond the scheduled hour.
The electric bill item, obscure but of interest to all New Mexicans, appeared in an out of the way place making it difficult for the information to circulate. This is an old problem. New Mexico’s large size means a lot of out of sight and out of mind. Even the Center for Energy Education, a gorgeous white building located about four blocks from the main campus, shares the out of sight problem.
The complexity of the overall issue – massive changes coming in energy – adds. Utility regulation seems a closed world with few players: the PRC, utilities, environmental types (typically hating fossil fuels) and some business groups, all using arcane jargon.
Once in a while a head or two seemed to spin among the roughly 25 legislators attending. “Did you really say (that)?” legislators asked. However, the main sub-issue and the reason for the gathering at the BP Center – that the hard parts of changes in the energy production business are going to land in the laps and wallets of San Juan County residents – was clear and had everyone’s attention.
The immediate job losses are 650 direct jobs from the San Juan plant and another 650 indirect jobs, said Rep. Steve Strickler, Farmington Republican. PNM expects to close its San Juan generating plant in 2022, five years away, and the Four Corners Power plant in 2031. Farmington’s population dropped 15,000 between 2000 and 2016.
While Farmington is at the epicenter, the city has company. Sen. Steve Neville, Aztec Republican, observed that it appears all the regional power plants will disappear within 15 years. All of the four transmission lines heading southeast into New Mexico won’t be needed. Some should be taken down.
San Juan County citizens would like to see the plant sites reclaimed, Neville said.
The power business is in a period of disruption, said Rep. Carl Trujillo, Santa Democrat, stating the obvious. The disruption is because of past policy decisions requiring increasing proportions of electricity to come from renewable sources, he said. A collateral effect comes from wind turbine manufacture. Hundreds of pounds of rare earth minerals go into each turbine. China produces about 95 percent of those minerals, Trujillo said. Making wind turbines sends jobs to China.
Tom Mullins of Farmington’s Synergy Operating, LLC, and president of the Independent Petroleum Association of New Mexico, called attention to “marginal wells,” which account for 75 percent of New Mexico’s wells. These wells chug along with modest daily production. Focus on new technology such as horizontal drilling should not mean forgetting these wells.
The framework for these changes is called the “Integrated Resource Plan,” which is 10 years old. The plan should be broadened, Strickler said. “We need more time. This is a Pandora’s Box,” he said.  
The PRC’s Jones said, “This is a testament that we need to modernize. There (are) a lot of things that need to be revisited.”
“We need a softer landing,” said Rep. Rod Montoya, Farmington Republican and a coal company retiree.
Yes, modernized and softer would be better.