New Mexico Governor Bill Richardson has directed the Energy, Minerals and Natural Resources Department to file a legal brief with the New Mexico Public Regulation Commission in support of small New Mexico solar energy developers. The brief provides a detailed analysis that concludes that small New Mexico solar energy developers should not be regulated in the same manner as large-scale investor owned utilities like Public Service Company of New Mexico.
Cabinet Secretary Joanna Prukop filed the brief on July 30, 2009. The brief also concludes that it would be an incredible barrier to the growth of distributed solar and other renewable energy resources in New Mexico if third party developers are subject to the complexity and cost of Public Regulation Commission regulation.
“Third party energy developers can serve an important role in the development of renewable energy generation in New Mexico,” Governor Bill Richardson said. “Supporting small New Mexico solar energy developers in their quest of distributed generation of renewable energy will advance New Mexico as a national leader in renewable energy technology, manufacturing, and generation.”
Third party developers build and operate renewable energy generating equipment (typically solar photovoltaic, or “PV”) on premises belonging to a utility customer. The energy developer finances the cost of the generating equipment and is able to take advantage of financial incentives under federal and state laws. The energy developer then sells the electricity generated from the equipment to the customer who owns or occupies the premises.
This arrangement is beneficial for certain homeowners and small businesses who, even with net metering and state and federal incentives, cannot afford to install renewable energy generating equipment on their property. It is even more beneficial to organizations that do not qualify for state and federal incentives, such as governmental entities, schools, churches and other non-profit organizations.
“We believe strongly that the law as written does not burden third party energy developers with the regulatory framework necessary to oversee large utilities that are granted service monopolies and guaranteed rates of return on their investment,“ said Joanna Prukop, Cabinet Secretary for Energy, Minerals and Natural Resources Department. “Unlike the utilities, these New Mexico renewable energy developers work within the framework of market forces and competition, and could move this state toward the next level of energy self-sufficiency.”