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Pat Davis is an owner and publisher of The Paper. He also serves as an Albuquerque City Councilor and former chair of the governor's cannabis legalization work group.

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El Paso Electric’s proposed gas plant locks NM into climate destruction for decades. Is New Mexico ready to butt heads with JPMorgan and make the utility accountable to the public?

El Paso Electric (EPE) filings with the Public Utility Commission (PUC) of Texas and the New Mexico Public Regulation state the new generator is needed to allow them to retire three, inefficient 60-year-old generating units and meet future peak electric demand.

Late last year El Paso Electric ceased to be a publicly-traded company and morphed into a private equity firm when it was sold for $4.3 billion to the JPMorgan Chase-tied Infrastructure Investments Fund (IIF). With an investment firm controlled by JPMorgan in charge of EPE, the utility has potentially become less accountable and less amenable to the community’s clean energy demands. JPMorgan stands to profit both from extracting natural gas from the Permian Basin in western Texas and southeastern New Mexico through fracking and selling these fossil fuels to consumers through gas plant electric generators.

In July, EPE filed applications to add the 228-megawatt generator (Newman 6) to the Newman power plant by May 2023 with New Mexico and Texas regulatory commissions. EPE provides electricity to more than 436,000 customers in the El Paso and Las Cruces areas.

In New Mexico filings the New Mexico attorney general proposed the utility use the old generators for a longer period to “allow EPE time to elicit new proposals for generating resources that are superior for EPE’s customers, system reliability,and planning horizon.”

El Paso lawyers and its energy consultant Scott Norwood argued in filings with the PUC that El Paso Electric’s years-old analysis justifying the need for the new generator is no longer relevant since of the economic downturn caused by COVID-19. “The company’s proposal to move forward with construction of Newman 6 before the impacts of COVID-19 are known, places far too much economic risk on customers.”

The city of El Paso’s filings also stated EPE’s analysis did not take into account a new environmental law in New Mexico requiring the utility to supply 100 percent of its power to its New Mexico customers from carbon-free sources by 2045. This fact has the potential to reduce Newman 6’s economic value, and potentially shift more costs of the unit to El Paso-area customers, Norwood said

EPE rejected extending the lives of its three, 60-year-old generators, arguing that the new Newman 6 generator will reduce operating costs, is more environmentally friendly and makes the utility’s system more reliable.

The city of Las Cruces filings argued that EPE should have evaluated the effects of the new environmental law on the Newman 6 project prior to seeking approval from regulators.

The lack of such an evaluation is “alone grounds for denial of the company’s [New Mexico] application.”

New Mexico’s new environmental regulation law passed in 2019 didn’t play a part in EPE’s 2018 selection of a portfolio of new power projects. That includes any solar projects that will help meet New Mexico’s new requirements James Schichtl, EPE’s vice president of regulatory affairs, said in filed testimony.

EPE won’t file with the state commissions the rate increases they need to provide electricity to its customers in the Las Cruces and El Paso areas until after the new generator goes into operation. JPMorgan Chase Bank was fined $410 million for manipulating electricity prices in 2010 and is considered the largest financier of the climate crisis.

Environmental concerns are that by building the new El Paso gas plant JPMorgan locks New Mexico and Texas into climate destruction for the next 20 years. Methane is the largest component of natural gas and released at every step of the oil and gas process. Methane is also 86 times more powerful than carbon dioxide as a greenhouse gas. Reducing methane now can slow global warming.

Environmental groups Vote Solar and the Coalition for Clean Affordable Energy are opposing Newman 6 in the New Mexico regulatory case. Vote Solar argued in its filings that the EPE “failed to justify its selection of Newman Unit 6 over less costly and less risky alternatives that would have been better aligned with New Mexico’s clean energy policy.”

Another possible way to create electricity for communities in the El Paso and Las Cruces areas is to tap into the abundant solar energy in both states by collecting the sun’s heat and transforming it into electricity. Las Cruces averages 294 days of sunshine every year; El Paso, the “Sun City,” is the world’s 10th sunniest city with an average of 302 days of sunshine. Currently EPE only uses 3 percent solar energy in its production of electricity.

Solar thermal power plants utilize the heat from the sun to create steam, which can be used to generate electricity. For- decades, across New Mexico, it has been shown that solar panels can harness thermal energy from the sun and are used for lighting and heating water in homes, public buildings and swimming pools.

Newman 6 approval sits with the Texas and New Mexico regulators. The New Mexico Public Regulation Commission staff, the PUC staff and a Texas administrative law judge who conducted a one-day hearing in the PUC case in June have all recommended the utility’s plan be approved.

The EPE Newman plant application is scheduled to go to the Texas commission for a vote Oct. 16; the New Mexico Public Regulation Commission is expected to vote in mid-November. EPE will also need the Texas Commission on Environmental Quality’s approval for revisions to the Newman plant’s air-quality permits.

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