NMSC: PRC May Not Compel Public Utility to File an Abandonment Proceeding

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Last week the New Mexico Supreme Court issued an opinion in State ex rel. Egolf v. New Mexico Public Regulation Commission. Although this is a case about the PRC, it is not an appeal from a PRC decision. Instead, both houses of the legislature, the Governor, and the President of the Navajo Nation asked the Court to order the PRC to apply what they viewed as the correct law to an abandonment proceeding. The Court, concluding that the PRC had exceeded its statutory authority and was considering actions which would violate the separation of powers, agreed.

Facts

This case is about a four-unit coal-fired power plant in northern New Mexico. The PRC had already approved the abandonment of two of the four units, and PNM had informed the PRC that PNM intended to petition to abandon the remaining two in the second quarter of 2019.

Before PNM could do so, the PRC by itself opened a new case initiating an abandonment proceeding for the remaining two plants. The PRC entered an order in the new case requiring PNM to apply to abandon the plants by March 1, 2019. During the subsequent litigation, the Governor signed into law the Energy Transition Act (“ETA”), which went into effect on June 14, 2019.

On July 1, PNM filed an application for abandonment. The PRC, however, believed that it had already initiated a valid abandonment proceeding when it opened the January 2019 case. The difference was important: due to the timing, the ETA (which became effective in June) would not apply to the January case, but would apply to the July case. The PRC would not clarify whether it would apply the ETA, and the parties eventually petitioned the Court for mandamus to compel the PRC to apply the ETA to the abandonment proceedings.

Analysis

Mandamus is one of the areas in which the Court has original jurisdiction. In other words, a party can file a petition for mandamus directly at the Supreme Court, without starting in the district courts. The New Mexico Constitution gives the Court the power to issue writs of mandamus against all state officers to compel the performance of an act that the official is required by law to perform.

The Supreme Court has original jurisdiction to hear “writs of mandamus.” Mandamus is an unusual remedy that allows the Court to order a party to do or not to do a thing. It is also an extraordinary remedy, meaning that it is not one which is liberally granted. However, it is particularly appropriate when one branch of the government seeks to restrain another branch from encroaching on or interfering with its powers. Although mandamus is an extraordinary (and therefore uncommon) remedy, it is particularly appropriate when the petitioner seeks to restrain one branch of government from interfering with another. Here, the Court viewed the PRC’s possible decision not to apply the ETA as an invasion of the Legislature’s authority, making mandamus appropriate.

Having concluded that it had jurisdiction to hear the mandamus petition, the Court addressed the main question: did the PRC have authority to start an abandonment proceeding on behalf of PNM? The commission argued that it was the Legislature that was improperly interfering with the PRC, because the original abandonment began before the ETA was passed. However, this argument could only succeed if the PRC had the power to initiate an abandonment proceeding.

The Court concluded that the PRC could not initiate abandonment proceedings by itself. The PRC relied on NMSA 1978, Section 62-9-5, which prohibits utilities from abandoning certain facilities without the PRC’s approval. The PRC argued that this statute gave it the power to initiate its own abandonment proceedings or to compel utilities to file such proceedings. But existing caselaw had already decided that issue against the PRC.

The Court also rejected the PRC’s argument that an earlier order it had entered gave it the power to start an abandonment proceeding. But since the PRC lacked the authority to do so under the statute, it could not create that authority by means of the order. And, although Section 62-12-1 provided a mechanism to enforce PRC orders, the PRC chose not to use it in this case. Because the PRC lacked the authority to initiate the abandonment proceeding, the Court vacated the PRC’s abandonment order.

Finally, the Court wrote to express its view that the PRC’s actions violated the separation of powers doctrine. Refusing to apply the law, it explained, would intrude into areas within the Legislature’s exclusive domain.

The opinion has an interesting contrast between two separate constitutional provisions. One one hand, Article IV, Section 34 prohibits the Legislature from interfering with pending cases. And on the other hand is the doctrine of separation of powers in Article XI, section 2. Both provisions seek the same goals. In this case, the Court weighed them in favor of the Legislature.

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