Mar. 01, 2012
PNM: Court Decision on Stay Request Renews Focus on EPA
Albuquerque: The U.S. Court of Appeals for the 10th Circuit in Denver today denied requests by PNM and others to put on hold a new U.S. Environmental Protection Agency visibility requirement on the company’s primary power source, the San Juan Generating Station near Farmington, N.M.
The court will now consider the merits of appeals of the requirement by PNM, the N.M. Environment Department and New Mexico Gov. Susana Martinez. Those parties maintain EPA’s mandate would cost New Mexico electric ratepayers and others about $750 million or more while a New Mexico plan could meet the same federal visibility rules for $77 million, or about one-tenth of the cost.
Today’s ruling is a decision by the court not to put implementation of EPA’s plan on hold while the issue is considered by the court.
“We remain committed to resolving this issue and, ultimately, to installing the most cost-effective, new visibility controls on the San Juan power plant,” said Pat Vincent-Collawn, chairman, president and CEO of PNM parent company PNM Resources. “In the meantime, we have a strong case to make that EPA violated the Clean Air Act and its own regulations in determining the best available retrofit technology for the plant.”
Vincent-Collawn added: “Today’s decision does increase our focus on convincing EPA administrators to quickly approve the New Mexico plan and, prior to taking that action, put the EPA requirement on hold. These actions are consistent with the Clean Air Act and EPA’s regulations and will serve interests of New Mexico’s economy and its electric consumers. The EPA has full, discretionary authority to grant that stay today.”
EPA’s aggressive, five-year compliance deadline for the San Juan plant to install the agency’s chosen technology, selective catalytic reduction (SCR), requires PNM to begin preparing to install that technology now even though the court ultimately could find it unnecessary.
PNM on Jan. 27 issued a request for proposals for design and construction of SCR technology at San Juan. According to PNM estimates, about $246 million of the total expected project cost will be spent through 2013 – a timeframe in which the matter could still be pending in court. As owner of 46 percent of the plant, PNM’s portion of these initial SCR costs total about $22 million through the end of this year and about $113 million in total through the end of 2013.
New Mexico has approved a plan to meet the federal visibility rules by installing a different technology, selective non-catalytic reduction (SNCR), on all units at the San Juan plant. PNM supports that plan, which would reduce San Juan's emissions of nitrogen oxides (NOx) by 20 percent annually. Combined with reductions resulting from a major environmental upgrade completed in 2009, this would represent an annual NOx reduction of 73 percent from 2006 levels.
PNM customers interested in learning more about this issue or taking action in support of the state visibility plan can visit New Mexicans for Common Sense Environmental Policy.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements made in this news release that relate to PNM's expectations, projections and estimates are made pursuant to the Private Securities Litigation Reform Act of 1995. Readers are cautioned that all forward-looking statements are based upon current expectations and estimates and PNM assumes no obligation to update this information.