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It’s official: Global energy giant AVANGRID is walking away from a three-year $8.3 billion plan to acquire New Mexico’s largest utility, PNM.
For three years, PNM Resources, the parent company of PNM, and AVANGRID had pursued a merger agreement that would have sold PNM to Iberdrola’s AVANGRID for $8.3 billion and led to more than $300 million in investments in New Mexico’s energy infrastructure, renewable energy transition and energy efficiency programs. After overcoming initial opposition from major industrial rate payers and skeptical public officials, the parties applied to the state’s Public Regulation Commission which oversees utilities and was required to approve the deal.
But late-breaking opposition led by Santa Fe-based advocates New Energy Economy led the PRC to reject the deal in 2021. PNM and AVANGRID ultimately appealed that decision to the State Supreme Court earlier this year but the clock ran out on a court decision causing AVANGRID to cancel the deal just before the stroke of midnight on December 31.
“Since 2020, Avangrid, a national leader in clean energy, has fought to gain approval of its merger with PNM, a merger that would bring over $300 million in benefits to PNM consumers and communities and utilize the company’s vast experience, and the experience of Iberdrola, S.A., a global leader at the forefront of the energy transition, to help the state achieve its clean energy goals. Avangrid and PNM had obtained all the necessary regulatory approvals for the closing of the merger by the end of 2022 except the approval of the New Mexico Public Regulation Commission. However, with the close of 2023 there is still no clear timing on the resolution of the court review of the New Mexico regulator’s denial of the merger nor any subsequent regulatory actions.
AVANGRID statement on dissolution of PNM merger, December 31, 2023
PNM and AVANGRID had extendeed the initial merger agreement multiple times pending the outcome of the judicial process. In a statement overnight, PNM Resources says that it had proposed a further extension of the agreement while the New Mexico Supreme Court decision remained pending but AVANGRID rejected that offer and chose to walk away.
For its part, PNM says it remains committed to it’s 100% renewable energy transition with or without AVANGRID’s investment. “We had been looking forward to providing customers with the immediate benefits in our agreement and also the longer-term benefits of being part of a larger-scale entity with ties to global innovation and experience in the clean energy transition,” said Pat Vincent-Collawn, PNM Resources Chairman and CEO. “As a standalone company, we will continue our work of meeting the future energy needs of our customers and communities with affordable and reliable energy.”
So, they dispensed with our elected PRC for Avangrid, and now Avangrid is backing out. Can we go back to an elected PRC now?
I’m disappointed in the article. It contains no critical statements about either PNM or Avangrid. Criticisms that have appeared in The Paper, as well as from the Supreme Court, the PRC and especially its experts, and New Energy Economy. PNM has frequently tried and often succeeded in passing the costs of its errors on to the NM ratepayers. Avangrid has an international history of conflict with regulators and ratepayers. The Paper has reported on all of this. But today, the PR departments of PNM and Avangrid have written the article to praise themselves, and The Paper has printed it.