EPA Grants A 90-Day Stay For San Juan Generating Station

PNM Resources’ (NYSE: PNM) New Mexico utility, PNM, yesterday was notified that the Environmental Protection Agency granted a 90-day stay in the effectiveness of the federal plan for San Juan Generating Station to meet visibility requirements of the Clean Air Act in New Mexico.

“Yesterday’s announcement provides a fresh opportunity to consider alternative approaches to meet the regional haze requirements at San Juan Generating Station,” said Pat Collawn, PNM Resources chairman, president and CEO. “We believe the state plan works for the environment and for the people in our state, but we are open to other balanced approaches that consider customer costs, environmental benefit, and the economic impact to the citizens of the state, particularly the Four Corners Region. We welcome this new development and look forward to a collaborative effort to identify effective alternatives for moving forward.”

Background

Two different plans were developed for New Mexico to meet regional haze requirements of the Clean Air Act: one by the state and the other by the EPA. Both plans meet the requirements of the Clean Air Act, but provisions of EPA’s plan related to San Juan Generating Station are estimated to cost significantly more than the state’s plan, with almost no discernible difference in visibility.

On Oct. 21, 2011, the New Mexico Environment Department (NMED) and New Mexico Governor Susana Martinez petitioned EPA to issue a stay of the implementation of the federal plan. On Sept. 16 and Oct. 21, 2011, PNM petitioned EPA to issue a stay of the rule. On April 26, 2012, Gov. Martinez sent a letter to EPA Administrator Lisa Jackson reiterating the state’s request for a stay and encouraging consideration of alternative approaches.

At the same time, PNM has taken its case to federal court to appeal EPA’s mandate. The Governor of New Mexico and the NMED are also in federal court appealing EPA’s decision to adopt a federal plan. The court has not yet ruled on the matter.

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