New Mexico Supreme Court upholds Community Solar Act

A New Mexico judge upheld rules that prevent utilities from deducting transmission costs from solar bill credits received by customers.

March 13, 2024 Anne Fischer

Image: QuinceCreative, pixabay

The New Mexico Supreme Court ruled against three investor-owned electric utilities in their challenge of the state’s community solar program.

A state policy passed by the Public Regulation Commission allows for the interconnection of community solar up to 200 MW of capacity, split by utilities: the Public Service Company of New Mexico is allocated 125 MW; Southwestern Public Service has 45 MW; El Paso Electric has 30 MW. There is also a stipulation that 30% of electricity produced by a community solar facility be earmarked for low-income subscribers.

“As a proud sponsor of The Community Solar Act, I applaud the New Mexico Supreme Court for doing right by the people and honoring the Act’s legislative intent. Community solar will continue to play a crucial role in advancing state clean energy goals and this is a step towards cementing our role as a national leader,” said State Senator Liz Stefanics.

Investor-owned utilities, however, were not in favor the rule that restricts utilities from deducting transmission costs from solar bill credits received by customers. The appeal was brought to the New Mexico Supreme Court by Southwestern Public Service, an Excel Energy Subsidiary and supported by the other utilities Public Service Company of New Mexico and El Paso Electric.

Attorney Jason Marks argued on behalf of the Coalition for Community Solar Access, the Renewable Energy Industries Association of New Mexico, the Coalition of Sustainable Communities New Mexico, New Energy Economy and the city of Las Cruces. He referred to the 45 community solar projects that were “in limbo” due to the appeal. According to the Coalition of Sustainable Communities New Mexico, those projects that were expected to come online in the next year have all committed to allocating at least 50% capacity to low-income subscribers and will offer discounts to low-income subscribers of an additional 20% to 30% of the solar bill credit, for at least five years.

The joint brief filed on behalf of the five parties states that “the Community Solar Act provides community solar subscribers with a statutorily defined credit for each kWh of solar energy they cause to be generated, but also requires them to pay for all investor-owned utility supplied generation.”

The brief explains that community solar can access these benefits “regardless of their renter-versus-homeowner status, their income, or the suitability of their rooftop for hosting solar,” unlike rooftop solar owners. The brief also notes that the program will also accelerate the state’s decarbonization goals, “while providing long-term savings opportunities to all customers in the form of future avoided utility costs”.

Supreme Court Justice C. Shannon Bacon ruled in support of the Community Solar Act, issuing a stay for the rules of the program approved two years ago by state legislators.

“This decision from the New Mexico Supreme Court is monumental as we work to democratize solar energy in New Mexico,” said Kevin Cray, Mountain West senior director for CCSA. “This program will create a more equitable and resilient grid, enable new communities to embrace clean energy, and save money for hard-working families. We look forward to working closely with our partners in the state to continue rolling out the first phase of this program and further expand it in the future so more people can access its benefits.”

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