Group raises concerns over New Mexico's landmark energy law

Proponents of New Mexico's energy industry say emails exchanged among environmentalists and a key member of Gov. Michelle Lujan Grisham's cabinet represent a conflict of interest as the state was creating landmark legislation that set ambitious new renewable energy goals.

In one email, state energy secretary Sarah Cottrell Propst asked a renewable energy trade group to review some of the bill's language related to energy storage policies.

Officials with the organization Power the Future say the emails — recently obtained through a public records request — show the secretary was coordinating with several groups that included the same renewable energy firm she led before taking her job with the state.

"It's concerning. It looks like out-of-state environmental groups were major players in writing this bill," said Larry Behrens, Power the Future's western states director.

Power the Future argues that the environmentalists didn't have the interests of average working New Mexicans in mind.

"This bill, from our point of view, is going put thousands of people out of work. It's going to raise electric bills, and so that's why it's important that New Mexicans know who's behind it," said Behrens, who previously worked for former Republican Gov. Susana Martinez.

With much fanfare, the current Democratic governor signed the energy act in March, codifying the requirement that investor-owned utilities and rural electric cooperatives get at least half of their electricity from renewable sources by 2030. That would jump to 80 percent by 2040.

A 100% carbon-free mandate would kick in five years later for utilities. Electric co-ops would have until 2050 to meet that goal.

Aside from the renewable energy quotas, funds will be established to help ease the economic pains of closing the coal-fired San Juan Generating Station near Farmington.

Critics have described the new law as a boon for Public Service Co. of New Mexico, which operates the power plant. Language in the law allows the utility and other owners of San Juan to recover investments in the plant by selling bonds that will be paid off by utility customers.

At least one environmental group, New Energy Economy, also is concerned the law strips state regulators of their constitutional responsibilities to review utility plans and decide which costs can be passed on to the ratepayers and which must be absorbed by the utility.

Cottrell Propst is defending the law and her role in the legislative process. She said the administration has been clear about its renewable energy agenda and that there were dozens of stakeholders involved.

Cottrell Propst described a flood of emails and conversations surrounding proposed provisions a few days ahead of when the bill was introduced.

One exchange involved the secretary, a legislative staffer and representatives of Environment New Mexico, the Natural Resources Defense Council and Western Resource Advocates. One of the representatives also was a board member of Interwest Energy Alliance, the firm Cottrell Propst worked for.

There were references in the emails to whether utilities would have heartburn over certain renewable energy mandates. One message mentioned the makeup of the independently elected Public Regulation Commission, suggesting the state would have a "responsible" commission by the time the mandates kicked in.

Cottrell Propst said it was her job to shepherd the bill on behalf of the governor's office. She said the priority was boosting New Mexico's renewable portfolio standard and establishing a carbon-free goal.

"There were just lots and lots of people to coordinate with," she said. "I certainly wasn't trying to somehow advantage my former employer. They just happened to be the entity that has the expertise."

Cottrell Propst said her emails were being singled out to "make something out of nothing."

Environmentalists were critical of the energy secretary under the previous Republican administration. They often complained about Ken McQueen's ties to oil and gas, suggesting the former energy executive's policies were favorable to the industry.

Similar complaints were made on the national level about former Vice President Dick Cheney's employment history with oil giant Halliburton.

State House Minority Whip Rod Montoya of Farmington, who previously worked in the coal mining industry for decades, said the same concerns can be raised about Cottrell Propst and her connections to the renewable energy industry. He suggested Democratic officials are going after coal with the energy law and that natural gas and crude oil are next.

"If this is how things are going to be run, I'd like to see that energy secretary step down," he said.

Cottrell Propst said she has worked with industry to reach consensus on other legislation and that the administration is focused on solving problems without steamrolling anyone.

"That's what I do," she said, "so if that sometimes crosses paths with a renewable energy company or even my former employer, I'm not going to run away from it."