After decades as one of the nation’s poorest states, New Mexico finds itself awash in revenue from the state’s oil-and-gas boom — so much so that Gov. Michelle Lujan Grisham last month proposed free tuition for residents at state universities.
The influx of cash, though, hasn’t stopped her administration from embracing one of the fossil-fuel industry’s biggest threats: the climate-change movement.
Behind the scenes, the governor’s staff is working closely with national climate groups seeking to phase-out natural gas in power plants, transportation, even homes, according to emails obtained by the free-market Energy Policy Advocates.
Not only is New Mexico part of the 25-state U.S. Climate Alliance, but state officials participated in an off-the-record blue-state conference in July held by the Rockefeller Brothers Fund, a Keystone XL pipeline foe and advocate for fossil-fuel divestment, where topics included how to “reduce and eliminate petroleum and natural gas.”
“The top line Challenge-Opportunity is to move away from the use of natural gas in buildings as a first priority, then electricity, and industry, while simultaneously moving quickly to move transportation systems off petroleum,” said a background memo for the meeting at the RBF’s Pocantico Center in New York.
The involvement of New Mexico, where the development of the oil-rich Permian Basin has led to a $900 million budget surplus, illustrates the unique economic and political challenges for the rare “trifecta” blue state — one where Democrats control the governor’s mansion and both legislative houses.
Ms. Lujan Grisham credited fossil fuels Tuesday for making her free-tuition plan possible, saying the boom has provided “significant resources” to the small state.
“We are in a very good situation currently — oil and gas, we’re an extractive industry state, and so we’re seeing a billion dollars in revenue,” she told MSNBC.
Paul Gessing, president of the free-market Rio Grande Foundation in Albuquerque, said the Democratic governor finds herself in a “tricky spot.”
“She’s got a whole laundry list of things she wants to spend the money on, but she wants to kind of play footsie with the radical left,” Mr. Gessing said. “She’s in a bit of a tricky spot, and it’s unfortunate and disturbing that she’s sending people up to New York to meet with some of these really radical voices on these issues.”
The only comparable state would be Colorado, a far wealthier state with a diverse economy better able to withstand Gov. Jared Polis’s recent crackdown on fracking. In New Mexico, the industry accounts for at least 35% of the state budget.
“Gov. Lujan Grisham’s administration, while rhetorically embracing the energy industries that not only employ thousands of New Mexicans but underwrite so much of that state’s public services including education, is quietly working with activists to kill that golden goose,” said Chris Horner, an attorney who represents Energy Policy Advocates in numerous open-records cases.
“Her staff are being flown across the country to New York — to sit in apparently frigid air conditioning at the old Rockefeller place — to plot the demise of these industries specifically targeted in the activists’ own memos sent to staff,” he said.
‘Even-handed and collaborative’
Lujan Grisham spokesman Tripp Stelnicki denied that she has worked at cross-purposes with the state’s top industry, citing the governor’s recent summit on industry technology and innovation in Santa Fe, which was co-hosted by Descartes Labs and attended by the Permian Basin Petroleum Association as well as environmentalists.
“The Lujan Grisham administration has been even-handed and collaborative in its approach to the oil and gas industry,” said Mr. Stelnicki.
Mr. Gessing agreed that the Democratic governor took a “hands off” approach during the legislative session, signing a renewable energy standard of 50% by 2030 for electricity utilities but taking no action against producers.
A week ago, however, she unveiled aggressive vehicle mileage standards, proposing to increase the average fuel economy starting with model year 2022 vehicles to 52 miles per gallon by 2025, as part of the U.S. Climate Alliance’s Clean Car Promise.
“To combat climate change, to keep New Mexico’s citizens safe, to protect the air we all breathe, it’s essential we adopt more stringent clean car standards that increase fuel economy and reduce emissions,” she said in her Sept. 24 statement during Climate Week.
New Mexico’s industry helped propel the state budget from $6.3 billion to $7 billion, and the figure could rise to $8 billion in the next fiscal year, according to the Albuquerque Journal, despite the slowdown this year in the U.S. shale production.
“The mileage thing is not a direct shot at the Permian producers, because you’re obviously talking about the demand side versus the production side, but it is a direct shot in that oil-and-gas workers aren’t driving Priuses,” Mr. Gessing said. “They’re driving pick-up trucks that don’t get 52 mpg, rest assured.”
The July 17-18 Pocantico meeting, which included state officials from a dozen Democratic “trifecta” states, was also sponsored by Rockefeller grantees such as the Georgetown Climate Center, the Center for the New Energy Economy at Colorado State University and the Rocky Mountain Institute.
The move from coal to natural gas in power-plant generation has been credited with reducing U.S. carbon-dioxide emissions, which fell by 12.4% between 2005-17, but gas was in the crosshairs at the Rockefeller gathering.
“We are well past the point of using natural gas as a transition fuel, and new policies and programs should explicitly avoid further ‘lock-in’ investments like natural gas fueled municipal buses or energy efficiency funding for natural gas equipment,” said the memorandum.
In a May 23 email, a staffer with the New Mexico Energy Conservation and Management Division asked the U.S. Climate Alliance about receiving a “sub-grant” to bring on a “Climate Fellow,” which would “provide much needed assistance to our clean energy and climate efforts in New Mexico.”
The concept of bringing on staff funded by climate advocacy groups is similar to the climate “special assistant attorneys general” paid by the Bloomberg-funded State Impact Center at New York University, but USCA’s Julie Cerqueira said no such fellows have been assigned, although two states have requested them.
“Some states have indicated that capacity constraints are a challenge to meeting their climate goals, and that additional staff capacity is needed,” said Ms. Cerqueira in an email. “That’s what you will see in the released emails. As you see from below, we don’t have a program currently stood up (nor did we previously, despite Horner’s ‘expose’).”
Questions have been raised about whether such privately funded state staffers are appropriate, or even legal, but the New Mexico email said that state law allowed the department to apply for private funds “to carry out its programs, duties or services.”
New Mexico was one of six states to go “trifecta” blue in the 2018 election after Ms. Lujan Grisham succeeded term-limited Republican Gov. Susana Martinez.
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