SB0156

SENATE BILL 156

57th legislature - STATE OF NEW MEXICO - first session, 2025

INTRODUCED BY

Elizabeth "Liz" Stefanics and Kristina Ortez and Andrea Romero and Peter Wirth and Patricia Roybal Caballero

AN ACT

RELATING TO ENERGY; ALPHABETIZING DEFINITIONS AND ADDING A DEFINITION FOR "LOW-INCOME CUSTOMER" TO THE PUBLIC UTILITY ACT; EXEMPTING LOW-INCOME CUSTOMERS FROM RATE RIDERS FOR NEW INTERCONNECTED CUSTOMERS; PROVIDING INSTRUCTIONS FOR THE QUALIFICATION OF LOW-INCOME CUSTOMERS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 62-3-3 NMSA 1978 (being Laws 1967, Chapter 96, Section 3, as amended) is amended to read:

"62-3-3. DEFINITIONS.--Unless otherwise specified, when used in the Public Utility Act:

A. "affiliated interest" means a person who directly or indirectly, through one or more intermediaries, controls or is controlled by or is under common control with a public utility. Control includes instances when:

(1) a person is an officer, director, partner, trustee or person of similar status or function;

(2) a person owns directly or indirectly or has a beneficial interest in ten percent or more of voting securities of a person;

(3) a person has a level of ownership of securities other than voting securities that the commission establishes as creating a presumption of control; and

(4) the possession of the power to direct or cause the direction of the management and policies of a person exists in fact, notwithstanding the lack of ownership of ten percent or more of the person's voting securities;

[B. "commission" means the public regulation commission;

C. "commissioner" means a member of the commission;

D. "municipality" means a municipal corporation organized under the laws of the state, and H-class counties;

E. "person" means an individual, firm, partnership, company, rural electric cooperative organized under Laws 1937, Chapter 100 or the Rural Electric Cooperative Act, corporation or lessee, trustee or receiver appointed by any court. "Person" does not mean a class A county as described in Section 4-36-10 NMSA 1978 or a class B county as described in Section 4-36-8 NMSA 1978. "Person" does not mean a municipality as defined in this section unless the municipality has elected to come within the terms of the Public Utility Act as provided in Section 62-6-5 NMSA 1978. In the absence of voluntary election by a municipality to come within the provisions of the Public Utility Act, the municipality shall be expressly excluded from the operation of that act and from the operation of all its provisions, and no such municipality shall for any purpose be considered a public utility;

F. "securities" means stock, stock certificates, bonds, notes, debentures, mortgages or deeds of trust or similar evidences of indebtedness issued, executed or assumed by a utility;

G. "public utility" or "utility" means every person not engaged solely in interstate business and, except as stated in Sections 62-3-4 and 62-3-4.1 NMSA 1978, that may own, operate, lease or control:

(1) any plant, property or facility for the generation, transmission or distribution, sale or furnishing to or for the public of electricity for light, heat or power or other uses;

(2) any plant, property or facility for the manufacture, storage, distribution, sale or furnishing to or for the public of natural or manufactured gas or mixed or liquefied petroleum gas for light, heat or power or other uses; but "public utility" or "utility" shall not include any plant, property or facility used for or in connection with the business of the manufacture, storage, distribution, sale or furnishing of liquefied petroleum gas in enclosed containers or tank truck for use by others than consumers who receive their supply through any pipeline system operating under municipal authority or franchise and distributing to the public;

(3) any plant, property or facility for the supplying, storage, distribution or furnishing to or for the public of water for manufacturing, municipal, domestic or other uses; provided, however, that nothing contained in this paragraph shall be construed to apply to irrigation systems, the chief or principal business of which is to supply water for the purpose of irrigation;

(4) any plant, property or facility for the production, transmission, conveyance, delivery or furnishing to or for the public of steam for heat or power or other uses;

(5) any plant, property or facility for the supplying and furnishing to or for the public of sanitary sewers for transmission and disposal of sewage produced by manufacturing, municipal, domestic or other uses; provided that "public utility" or "utility" as used in the Public Utility Act does not include any utility owned or operated by a class A county as described in Section 4-36-10 NMSA 1978 either directly or through a corporation owned by or under contract with such a county; or

(6) any plant, property or facility for the sale or furnishing to or for the public of goods or services to reduce the consumption of or demand for electricity or natural gas, and is either a public utility under the definitions found in Paragraph (1) or (2) of this subsection, or is an alternative energy efficiency provider as described in Section 62-17-7 NMSA 1978;

H. "rate" means every rate, tariff, charge or other compensation for utility service rendered or to be rendered by a utility and every rule, regulation, practice, act, requirement or privilege in any way relating to such rate, tariff, charge or other compensation and any schedule or tariff or part of a schedule or tariff thereof;

I. "renewable energy" means electrical energy generated by means of a low- or zero-emission generation technology that has substantial long-term production potential and may include, without limitation, the following energy sources: solar, wind, hydropower, geothermal, landfill gas, anaerobically digested waste biomass or fuel cells that are not fossil fueled. "Renewable energy" does not include fossil fuel or nuclear energy;

J. "service" or "service regulation" means every rule, regulation, practice, act or requirement relating to the service or facility of a utility;

K. "Class I transaction" means the sale, lease or provision of real property, water rights or other goods or services by an affiliated interest to a public utility with which it is affiliated or by a public utility to its affiliated interest;

L. "Class II transaction" means:

(1) the formation after May 19, 1982 of a corporate subsidiary by a public utility or a public utility holding company by a public utility or its affiliated interest;

(2) the direct acquisition of the voting securities or other direct ownership interests of a person by a public utility if such acquisition would make the utility the owner of ten percent or more of the voting securities or other direct ownership interests of that person;

(3) the agreement by a public utility to purchase securities or other ownership interest of a person other than a nonprofit corporation, contribute additional equity to, acquire additional equity interest in or pay or guarantee any bonds, notes, debentures, deeds of trust or other evidence of indebtedness of any such person; provided, however, that a public utility may honor all agreements entered into by such utility prior to May 19, 1982; or

(4) the divestiture by a public utility of any affiliated interest that is a corporate subsidiary of the public utility;

M. "corporate subsidiary" means any person ten percent or more of whose voting securities or other ownership interests are directly owned by a public utility;

N. "public utility holding company" means an affiliated interest that controls a public utility through the direct or indirect ownership of voting securities of that public utility;

O. "voting securities" means securities that carry the present right to vote for the election of directors or other members of the governing body ultimately responsible for the management of the organization; and

P. "future test period" means a twelve-month period beginning no later than the date a proposed rate change is expected to take effect]

B. "Class I transaction" means the sale, lease or provision of real property, water rights or other goods or services by an affiliated interest to a public utility with which it is affiliated or by a public utility to its affiliated interest;

C. "Class II transaction" means:

(1) the formation after May 19, 1982 of a corporate subsidiary by a public utility or a public utility holding company by a public utility or its affiliated interest;

(2) the direct acquisition of the voting securities or other direct ownership interests of a person by a public utility if the acquisition would make the utility the owner of ten percent or more of the voting securities or other direct ownership interests of that person;

(3) the agreement by a public utility to purchase securities or other ownership interest of a person other than a nonprofit corporation or contribute additional equity to, acquire additional equity interest in or pay or guarantee any bonds, notes, debentures, deeds of trust or other evidence of indebtedness of a person other than a nonprofit corporation; provided that a public utility may honor agreements entered into by that utility prior to May 19, 1982; or

(4) the divestiture by a public utility of any affiliated interest that is a corporate subsidiary of the public utility;

D. "commission" means the public regulation commission;

E. "commissioner" means a member of the commission;

F. "corporate subsidiary" means a person with ten percent or more of voting securities or other ownership interests that are directly owned by a public utility;

G. "future test period" means a twelve-month period beginning no later than the date a proposed rate change is expected to take effect;

H. "low-income customer" means a residential customer of an electric public utility with an annual household income at or below eighty percent of the county area median income, as published by the United States department of housing and urban development;

I. "municipality" means a municipal corporation organized under the laws of the state and H-class counties;

J. "person" means an individual, a firm, a partnership, a company, a rural electric cooperative organized under Laws 1937, Chapter 100 or the Rural Electric Cooperative Act, a corporation or a lessee, a trustee or a receiver appointed by any court. "Person" does not mean a class A county as described in Section 4-36-10 NMSA 1978 or a class B county as described in Section 4-36-8 NMSA 1978. "Person" does not mean a municipality as defined in this section unless the municipality has elected to come within the terms of the Public Utility Act as provided in Section 62-6-5 NMSA 1978. In the absence of voluntary election by a municipality to come within the provisions of the Public Utility Act, the municipality shall be expressly excluded from the operation of that act and from the operation of all its provisions, and the municipality shall not be considered a public utility for any purpose;

K. "public utility" or "utility" means every person not engaged solely in interstate business and, except as stated in Sections 62-3-4 and 62-3-4.1 NMSA 1978, that may own, operate, lease or control a plant, property or facility for the:

(1) generation, transmission or distribution, sale or furnishing to or for the public of electricity for light, heat or power or other uses;

(2) manufacture, storage, distribution, sale or furnishing to or for the public of natural or manufactured gas or mixed or liquefied petroleum gas for light, heat or power or other uses; but "public utility" or "utility" shall not include a plant, property or facility used for or in connection with the business of the manufacture, storage, distribution, sale or furnishing of liquefied petroleum gas in enclosed containers or tank trucks for use by others than consumers who receive their supply through a pipeline system operating under municipal authority or franchise and distributing to the public;

(3) supplying, storage, distribution or furnishing to or for the public of water for manufacturing, municipal, domestic or other uses; provided that nothing contained in this paragraph shall be construed to apply to irrigation systems, the chief or principal business of which is to supply water for the purpose of irrigation;

(4) production, transmission, conveyance, delivery or furnishing to or for the public of steam for heat or power or other uses;

(5) supplying and furnishing to or for the public of sanitary sewers for transmission and disposal of sewage produced by manufacturing, municipal, domestic or other uses; provided that "public utility" or "utility" as used in the Public Utility Act does not include any utility owned or operated by a class A county as described in Section 4-36-10 NMSA 1978 either directly or through a corporation owned by or under contract with such a county; or

(6) sale or furnishing to or for the public of goods or services to reduce the consumption of or demand for electricity or natural gas and is either a public utility under the definitions found in Paragraph (1) or (2) of this subsection or is an alternative energy efficiency provider as described in Section 62-17-7 NMSA 1978;

L. "public utility holding company" means an affiliated interest that controls a public utility through the direct or indirect ownership of voting securities of that public utility;

M. "rate" means every rate, tariff, charge or other compensation for utility service rendered or to be rendered by a utility and every rule, regulation, practice, act, requirement or privilege in any way relating to the rate, tariff, charge or other compensation, including a relating schedule or tariff or a part of a schedule or tariff;

N. "renewable energy" means electrical energy generated by means of a low- or zero-emission generation technology that has substantial long-term production potential and may include, without limitation, the following energy sources: solar, wind, hydropower, geothermal, landfill gas, anaerobically digested waste biomass or fuel cells that are not fossil fueled. "Renewable energy" does not include fossil fuel or nuclear energy;

O. "securities" means stock, stock certificates, bonds, notes, debentures, mortgages or deeds of trust or similar evidences of indebtedness issued, executed or assumed by a utility;

P. "service" or "service regulation" means every rule, regulation, practice, act or requirement relating to the service or facility of a utility; and

Q. "voting securities" means securities that carry the present right to vote for the election of directors or other members of the governing body ultimately responsible for the management of the organization."

SECTION 2. Section 62-13-13.2 NMSA 1978 (being Laws 2010, Chapter 102, Section 2 and Laws 2010, Chapter 103, Section 2) is amended to read:

"62-13-13.2. INTERCONNECTED CUSTOMERS--UTILITY COST RECOVERY.--

A. Upon request of an investor-owned utility in any general rate case, the commission shall approve interconnected customer rate riders to recover the costs of ancillary and standby services pursuant to this section only for new interconnected customers, except that a utility may seek approval of interconnected customer rate riders in the utility's renewable energy procurement plan filing before January 1, 2011, to be in effect until the conclusion of the utility's next general rate case. In establishing interconnected customer rate riders, the commission shall assure that costs to be recovered through the rate riders are not duplicative of costs to be recovered in underlying rates and shall give due consideration to the reasonably determinable embedded and incremental costs of the utility to serve new interconnected customers and the reasonably determinable benefits to the utility system provided by new interconnected customers during each three-year period after which new interconnected customer rate riders go into effect. The benefits to the utility system, as applicable, include avoided renewable energy certificate procurement costs, reduced capital investment costs resulting from the avoidance or deferral of capital expenditures, reduced energy and capacity costs and line loss reductions.

B. In a filing made pursuant to Subsection [G] H of Section 62-8-7 NMSA 1978, a rural electric cooperative may implement rates or rate riders by customer class, giving due consideration to reasonably determinable costs and benefits of interconnected systems, that are specifically designed to recover from interconnected customers the fixed costs of providing electric services to those customers.

C. Nothing in this section shall be interpreted as preventing the utility from charging rates designed to recover all of its reasonable costs of providing service to customers.

D. As used in this section:

(1) "ancillary and standby services" means services that are essential to maintain electric system reliability and are required by or are a consequence of interconnecting distributed generation facilities to a utility's system and may include, among other services, regulation and frequency response, regulation and voltage support, spinning reserves and supplemental reserves;

(2) "interconnected customer" means a utility customer that is also interconnected to non-utility distributed generation facilities; and

(3) "new interconnected customer" means a customer that became an interconnected customer after December 31, 2010 or a customer whose renewable energy certificate purchase agreement entered into prior to January 1, 2011 is no longer in effect, but does not include a low-income customer."

SECTION 3. A new section of the Public Utility Act is enacted to read:

"[NEW MATERIAL] QUALIFICATION AS A LOW-INCOME CUSTOMER-- NOTICE.--

A. A customer of an electric public utility may qualify as a low-income customer by providing to the utility that provides the customer's service:

(1) a signed self-attestation that the customer's household income and household size qualify the customer as a low-income customer;

(2) proof of residence in a low-income or affordable housing facility; or

(3) proof of current enrollment in a low-income program facilitated or administered by the state or federal government, including:

(a) the federal medicaid program;

(b) the federal supplemental nutrition assistance program;

(d) a state or federal first-time homeowner or housing rehabilitation program;

(e) the federal temporary assistance for needy families program;

(f) the federal supplemental security income program;

(g) the federal special supplemental nutrition program for women, infants and children;

(h) the federal food distribution program on Indian reservations;

(i) the federal section eight housing choice voucher program;

(j) the federal solar for all program; or

(k) any other state or federal program that provides assistance for people who would qualify as low-income customers, as determined by the commission.

B. By December 31, 2025 and in the month of December of each year thereafter, an electric public utility shall notify its customers of the requirements to qualify as a low-income customer and instructions on how to submit any required documentation. An electric public utility shall not require a customer who has qualified as a low-income customer to requalify as a low-income customer within five years of the customer's last qualification."

- 16 -