Fossil fuels have played a large role in the well being of New Mexico for decades. Jobs, economic growth, and revenue for the state are all the result of the abundance of coal, oil, and natural gas in the state.

However, in recent years the United States’ and New Mexico’s governments have both launched an assault on these vital economic sectors of New Mexico’s economy. To understand the consequences of what has been happening, I sat down with Carla Sonntag, the president of the New Mexico Business Coalition, to get her thoughts on recent events.

Sonntag explained that the Coalition’s interest in the traditional energy sector was because “if that industry continues to produce, and it is one of the top producers in the United States, that is good for our state.” She also pointed out that because the industry provides up to 40% of New Mexico’s revenue, that means “if they are doing well, then we are doing well, because that requires less tax revenue from everyone else.” 

Sonntag also noted the importance of the state’s ability to take advantage of its natural energy resources because “we all use that energy and we are dependent on that energy for everything that we do.” 

Not everyone in New Mexico, however, values the production of energy from these traditional energy sources. Sonntag explained that “there is a sector of people that want to shut the industry down. But I don’t believe that is good for America, and I definitely don’t think it is good for New Mexico.” 

“We have a governor right now and some legislators that would like to shut down the industry entirely,” she added. “What they have done is started putting requirements on the industry that are some of the most stringent in the nation. This has had the effect of shutting down many of the smaller producers in New Mexico.”

The effects of this effort is not just being felt in the oil and gas industry sector, though. The closing of a number of coal-fired electric generation units in recent years, including the San Juan generating station in October, has had repercussions for both people and the reliability of the state’s electric grid. 

According to Sonntag, “high paying jobs, in the coal industry and in the plant itself,” has been one casualty of the effort by Governor Michelle Lujan Grisham to eliminate the use of traditional energy sources. This has particularly affected Native Americans, who were the workers primarily employed in the coal industry and plants in the Four Corners area of the state.

Something similar happened in Arizona when the Navajo Generating Station coal-fired power plant in Arizona closed after a 45-year run in 2019. Jobs were lost not only at the plant but also at the coal mine that supplied it. 

The closing of the San Juan unit is also likely to affect the reliability of New Mexico’s electric grid. “The utility told the New Mexico Public Regulation Commission that they did not have enough power production from solar and wind to cover the needs during the summer,” Sonntag said. The company wanted to build a natural gas-fired plant to make up for the loss–a reliable source of energy that is abundant in New Mexico. But the Commission turned them down. 

Sonntag explained that the new plant “would have been good for New Mexico, it would have been good for that industry, it would have been good for power production, and it is a clean burning fuel.” 

The failure to allow the use of natural gas to generate electricity “leaves customers in the lurch,” Sonntag added. “What is going to happen if we don’t have enough resources from wind and solar is that they may need to buy power off the grid, which is going to be very costly. It is going to be the consumer who is going to pay the price.”

Bill Peacock is the policy director for the Energy Alliance, an organization highlighting the aspects of energy markets that matter most to consumers: reliability, affordability, and efficiency.