PRC orders PNM to answer coal mine loan complaint

The Santa Fe New Mexican

April 14--State regulators voted unanimously Wednesday to require Public Service Company of New Mexico to respond to a complaint by a clean-energy advocacy group over its loan to another company for the purchase of the San Juan Coal Mine.

Earlier this year, PNM revealed that it had to form a subsidiary company, New Mexico Capital Utility, to loan Westmoreland Coal Co. $125 million to purchase the mine on property adjacent to the San Juan Generating Station near Farmington. The mine is the sole coal provider for the power plant, which is mostly owned by PNM.

The state Public Regulation Commission last month voted against a request by New Energy Economy -- a nonprofit that is opposed to coal power -- to investigate PNM's dealings in the mine purchase.

But on Wednesday, the commission decided to allow a new complaint by New Energy to move forward. PNM will have 20 days to answer the complaint.

The complaint says it "strains credibility" that Westmoreland didn't disclose to PNM, or to any of the other owners of the San Juan plant, that it needed a loan for the mine purchase until after Dec. 16 -- just 15 days before the coal company was scheduled to close on the mine purchase.

Mariel Nanasi, executive director of New Energy, said she's concerned that ratepayers could end up having to pay if Westmoreland defaults on the loan.

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