Why shouldn’t New Mexico invest in its largest electricity provider?

Every month, New Mexicans pay their PNM bill to keep the lights on. Right now, decisions about who profits from that bill, and who has a say in how the utility is run, are being made in corporate boardrooms hundreds of miles away.

With Blackstone still seeking to acquire TXNM, PNM’s parent company, the question of who should own our state’s largest electric utility is far from settled.

Last year, a Blackstone affiliate bought $400 million in TXNM Energy stock without getting the approval New Mexico law requires first. In July, state regulators ruled the sale illegal and ordered it undone. The companies subsequently unwound the transaction, and TXNM sold new shares to repay the loan it used to return Blackstone’s money. Now Blackstone is trying to sweeten its offer, increasing rate credits and proposing changes to the company’s board. But PNM customers are already paying more for electricity, including a $6.23 monthly increase that took effect in April, more than the roughly $3 a month in rate credits Blackstone is proposing.

That particular opportunity has passed, but the larger question remains: Why shouldn’t New Mexico explore becoming an investor in its own largest electric utility?

New Mexico should evaluate whether acquiring a meaningful minority stake and board representation at TXNM Energy could be a sound long-term investment that also gives the state a greater voice in the future of its largest electric utility, and a say in decisions about wildfire prevention, reliability, affordability, clean energy, economic development, and major new industrial loads.

This approach also protects the workers who keep the lights on. Because it is a minority investment, not a takeover, PNM would remain privately operated and its employees remain employees of a private company. Their existing collective bargaining agreements stay intact.

This isn’t a new idea. More than 1,500 New Mexicans have already signed a petition from groups like Organized Power in Numbers (OPIN), YUCCA, and United Academics UNM calling on state leaders to explore state investment in TXNM. There’s also a strong financial case for investing in PNM.

Utilities are attractive long-term investments precisely because they operate regulated monopolies and earn PRC-approved returns on prudent capital expenditures. Instead of those returns flowing to Wall Street, why shouldn’t New Mexico evaluate whether they could strengthen our permanent funds and benefit generations of New Mexicans?

State Investment Council (SIC) officials have argued that investing in TXNM could put the interests of ratepayers at odds with the Council’s responsibility to earn strong returns. But why should we accept that as a given fact? Utilities make money while operating under regulations that are supposed to protect consumers every day. New Mexico should be able to ask whether it can earn a responsible return on an investment in its largest electric utility while also having a greater stake in keeping power affordable and reliable.

There are legitimate legal and financial questions to work through. But those are questions for state leaders to answer, not reasons to dismiss the idea before they have seriously explored it.

New Mexico’s permanent funds hold more than $75 billion, and the SIC already invests in infrastructure, private equity, real estate, and other businesses throughout the United States and around the world in pursuit of long-term returns.

The question is simple: if New Mexico’s money can be invested in infrastructure and companies across the country and across the globe, why shouldn’t we consider investing it here at home—in an essential state utility that New Mexicans depend upon every day?

PNM is not an ordinary corporation. It holds a monopoly on power for hundreds of thousands of New Mexicans. Its infrastructure, rates and investment decisions affect virtually every aspect of our economy.

Yet its future is still tied up in Blackstone’s proposed acquisition of TXNM.

There is another path. We are asking our elected officials to seriously explore whether New Mexico, not wealthy private equity investors, should benefit from our state’s resources and ratepayer dollars.