Board of Public Utilities Work Session – August 5, 2026

Summary

The Board of Public Utilities (BPU) held a work session on Wednesday, August 5, 2026, from 5:30 PM to approximately 9:30 PM. The meeting included a detailed presentation on pathways to zero natural gas usage, a public hearing on a corrected water rate ordinance, status updates on the Electric Coordination Agreement (ECA) and plug-in solar policy, and the annual wastewater systems update. Remaining business items were postponed to a future meeting.

Public Comments & Testimony

• General Public Comment (start of meeting): No public comments were made.
• Public Comment on Natural Gas Study: Former BPU member Dave (1732 Ponderosa Street) shared his experience living in a 1960s home with a 30-year-old gas furnace. He cited high upfront costs ($20,000–$25,000 to go all-electric), concerns about electric grid reliability in winter, and the need for a decision within the next year.
• Public Comment on Water Rates: None.
• Public Comment on Plug-In Solar: None.
• Public Comment at End of Meeting: None.

Presentations and Discussion Items

Pathways to Zero Natural Gas Usage – UNM & NMSU Study

Professor Yu Ting Yang and her team presented findings from a year-long study commissioned by the utility. Key findings:

• Household willingness: 96% of households still use natural gas; 88% are satisfied with gas appliances; 75% have no current plan to switch.
• Barriers: Upfront costs and electric panel upgrades (needed in ~75% of homes, costing $2,000–$8,000) are the largest barriers.
• Choice experiment results: Households value efficiency gains and bill savings more than carbon reductions when considering electrification. A 10% increase in appliance efficiency equates to willingness to pay $20/month; a 50% carbon reduction equates to $75/month.
• Solar rebound effect: After installing solar, grid purchases drop 21% but total electricity use rises 19% (largest in winter, +65% across whole day). Actual carbon reduction is ~1 ton/year versus an engineering estimate of 3.9 tons – a 75% offset.
• Load projections: Achieving zero natural gas by 2070 would increase electricity demand by ~61% (from 62 GWh to 100 GWh), with a sharp winter peak. Solar adoption at 40% of homes would only trim grid load by ~5%.
• Policy implications: Near-term focus on panel upgrades, information outreach emphasizing savings and performance, and targeting homes with aging equipment (1/3 of systems are >20 years old).

Board members asked detailed questions about efficiency definitions, model stability (appendix figures C.4/C.5), the rebound effect vs. weather correlation, and the need for integrated gas‑electric pricing models. The team acknowledged limitations (no EV data, no climate change projections) and offered to revisit the study in 5–10 years.

Water Rate Ordinance (Public Hearing)

Deputy Utility Manager Joann Gentry presented a corrected ordinance (No. 02-387) to amend water service rate schedules. The correction only changed effective dates after an administrative error; no rate changes were made (the 8% increase and other adjustments remain as approved in April/June 2026). The ordinance was introduced without objection. Board members noted the heavy work required to correct the record.

Electric Coordination Agreement (ECA) Update

Ben Olbrich reported ongoing negotiations with DOE/NSA. The main issue is the "termination for convenience" clause, which limits termination payment to the current contract allotment ($6 million vs. $424 million total value). County and DOE attorneys are working on options. Other issues include a short 30‑day extension notification period (to be mitigated by adjusting operating committee procedures to plan 3 years ahead), fixed costs for the combustion turbine generator (unchanged from 2023), exhibit G reporting (minimal effort, no cost allocation issue), and EDAM market cost flexibility. Staff will bring a revised ECA for approval at the August 19 BPU meeting.

Future Plug-In Solar Policy

Ben Olbrich presented four interconnection options and three export credit approaches. He recommended: (1) no interconnection agreement/registration for plug-in photovoltaic (PIPV) systems, (2) no credit for exported energy, and (3) proactive public education on safety and risks. Board members largely agreed, with comments to monitor state legislation (SB 157 introduced in NM) and to include a disclaimer that policy may change as technology and regulatory environments evolve. No formal action was taken; staff will draft documents based on board input.

Annual Wastewater Systems Update

Clay Moseley provided an update on the wastewater collection and treatment systems:

• Collection system: 32,000 LF of vitrified clay pipe (VCP) in townsite and White Rock aging and failing. Priority is replacing VCP with PVC/PE. 25 lift stations mostly upgraded. New SCADA and sonic detection tools improving efficiency. Nighttime flushing operations implemented.
• Treatment plants: Los Alamos plant (online 2007) undergoing phased upgrades (blowers, SCADA, fine screen rebuild in-house saved $445,000). White Rock plant (new) experiencing a corrosion issue in sludge basin mixing pumps – stray current suspected, consultant engaged. Both plants produce high-quality Class 1A effluent. Staffing is adequate but could use more for collections.
• Future focus: Shift capital projects from lift stations to pipe replacement. Aggressive internal training and apprenticeship programs underway.

Board members asked about stormwater separation (confirming no combined system) and staffing needs. Staff noted the aggressive pipe replacement program should reduce overflows and workload over time.

Postponed Items

The following items were postponed to future meetings due to time constraints:

• 6.d. Transactional Survey Report (January–June 2026)
• 6.e. Annual Review of BPU Procedural Rules
• 6.f. Open Meetings Act and Inspection of Public Records Presentation

Key Outcomes

• Agenda approved (4-0).
• Water rate ordinance introduced (no vote required; will return for adoption).
• ECA update received; staff will return on August 19 with revised language for board recommendation to council.
• Plug-in solar policy direction: Board consensus aligns with staff recommendations (no registration, no export credit, public education). Staff to prepare documents.
• Wastewater annual update accepted; staff encouraged to continue in‑house projects and training.
• Remaining business items (transactional survey, procedural rules, OMA training) postponed to next work session.

Next regular meeting: August 19, 2026 (consideration of ECA and possibly postponed items).