New Mexico regulatory staff recommend approval of NM Gas Co sale to private equity firm

New Mexico Public Regulation Commission hearing examiners on Wednesday recommended that the state’s utility regulators sign off on a nearly $1.3 billion sale of New Mexico Gas Company to a subsidiary of a private equity firm.

Wednesday’s announcement was a recommendation — the PRC’s three commissioners still must vote on the proposed sale. Such a vote has yet to be scheduled. Parties involved in the case can file objections to the recommendation, according to a PRC news release.

The recommendation hinges on certain conditions, including issuing rate credits, retaining New Mexico Gas Company employees and spending $10 million on economic development initiatives in the utility’s service areas.

Elected officials and environmental advocates have firmly opposed the sale.

In November, Sen. Harold Pope Jr. (D-Albuquerque), who’s running for lieutenant governor, and state Rep. Matthew McQueen (D-Galisteo), who’s running to be state land commissioner, publicly spoke out against the sale and said the public docket on the case did not contain relevant information about private equity firm Bernhard Capital Partners’ prior violations, fines or audits. 

In December, New Mexico Attorney General Raúl Torrez filed a brief against the sale, which he argued “raises real risks of higher rates, reduced transparency, and long-term financial instability for customers across the state.”

New Mexico Gas Company serves more than 500,000 customers in 27 of the state’s 33 counties.

In a joint statement Wednesday, representatives for Bernhard and New Mexico Gas Company praised the PRC staff’s recommendation.

“This transaction will bring approximately $87 million in benefits to New Mexico Gas customers and to communities across the state, as well as retaining a strong, locally focused utility in New Mexico,” the statement said. “We appreciate the thorough and diligent regulatory review process thus far and remain hopeful that the Commission recognizes the significant value this transaction will bring to communities across New Mexico.”