Renewables and battery storage have become cheaper than coal power, and according to a Sierra Club expert, they are now cheaper and a better option for New Mexico than gas, as well.
Separate from the Public Regulation Commission case concerning the financing and retirement of San Juan Generating Station is a case to determine how PNM will replace San Juan’s coal power to keep customers’ lights on.
The Sierra Club is participating in both cases, and our attorneys and experts have been analyzing which energy scenarios would provide the best climate benefits at the lowest cost to consumers.
When it filed its proposal to retire the San Juan coal plant in June, PNM proposed four replacement scenarios with varying amounts of renewable energy and gas. Its preferred scenario included gas and renewables.
After months of analysis, Sierra Club on Dec. 13 filed testimony by Michael Goggin, a utility and clean-energy consultant who found that the cheapest replacement for the 497 MW of San Juan coal is a mix of renewable energy and battery storage.
There is some dispute over whether the Energy Transition Act requires 450 MW of replacement resources to be located in the same school district as the coal plant (to help replace the plant’s tax contribution). Goggin recommended one portfolio if the ETA is interpreted as requiring 450 MW in the school district and another if the location restriction is not imposed.
In both cases, Goggin’s top recommendation contained no new gas.
One of Goggin’s recommended scenarios cost less than PNM’s favored gas-and-renewables portfolio. And across most reliability metrics, Goggin’s top scenario is actually more reliable than PNM’s preferred portfolio. Goggin’s alternate recommendation is more reliable than PNM’s preferred option across some reliability metrics.
The Coalition for Clean Affordable Energy also recommended two replacement scenarios, neither of which included gas.
This is all very good news for our climate; but in order for any of these all-clean scenarios to come to fruition the Public Regulation Commission must allow the retirement of San Juan Generating Station to move forward.