New Mexico urges swift San Juan coal plant action

Spanish Market: Coal, Electricity
25/06/15

New Mexico state utility regulators are urging the state's largest utility to quickly finalize ownership and coal supply arrangements for the 1,684MW San Juan generating station.

"Since the case started [last year], we keep pushing the deadline" for closing the deal, Public Regulation Commission member Sandy Jones said yesterday at the agency's public meeting.

Utility Public Service of New Mexico (PNM) asked for and yesterday received an extension of the deadline until 1 August to negotiate with eight other owners of the San Juan plant before submitting the agreements for the state agency's approval. State regulators last month directed PNM to finalize the agreements by 1 July, with a possible extension until 1 August if good cause is shown. PNM initially promised to complete the arrangements by 1 May but said the approval process by the plant's small municipal owners took longer than expected.

Another key piece of San Juan's future is already secured as Westmoreland Coal's board this week approved the proposal to buy the San Juan mine that supplies the adjacent power plant from BHP Billiton and enter into a new long-term coal supply agreement with PNM.

Units 2 and 3 of the San Juan plant must close by the end of 2017 to comply with New Mexico's plan for regional haze abatement. PNM will have to give up the 418MW it owns at those units. PNM wants to buy another 132MW in unit 4. The utility following that acquisition will own 517MW at San Juan once units 2 and 3 shut. PNM also is investing in natural gas and solar generation and plans to make greater use of the 134MW of capacity it owns at the Palo Verde nuclear plant in Arizona.

New Mexico commissioners ordered PNM to submit copies of the coal supply agreement and any agreements with power plant owners as soon as they are signed, instead of waiting for the 1 August deadline. "We are looking at something that will have a far-reaching impact at the Four Corners area, so we must have all the information necessary," commission vice chairwoman Lynda Lovejoy said.

The resolution of San Juan's ownership will assist the agency in ruling on a separate issue of sharing the cost of replacement power with retail consumers. The cities of Albuquerque and Santa Fe as well as environmental groups have raised opposition to the plan. Commission chairwoman Karen Montoya said several commissioners recently received death threats over the San Juan case, saying the agency is taking those threats seriously and has taken protective measures.

PNM promised yesterday to have agreements with Tucson Electric Power and the City of Farmington, New Mexico, by 1 July and with the remaining municipal utility owners by 1 August.

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06/04/26

Meta funds El Paso nat gas plant as interim power fix

Houston, 6 April (Argus) — Tech giant Meta is paying to build a natural gas-fired plant to power its El Paso data center, but regulatory filings show the agreement is temporary, raising questions about how Texas ratepayers will be protected once the initial five-year period ends. El Paso Electric (EPE) plans to supply the data center through McCloud Generation, a 366MW plant with 813 modular gas generators located next to the site, according to a filing with the Public Utility Commission of Texas (PUCT). Starting in 2027, the plant would power the data center exclusively for an initial five-year "bridge period" and remain separate from EPE's transmission system, with all costs recovered from Meta under a commission-approved rate. The arrangement aligns with the White House-backed Ratepayer Protection Pledge , which calls on large technology companies to pay for the power and infrastructure needed to support their data-center loads rather than shifting those costs onto other customers. But the filing also shows that much of the ultimate risk allocation is deferred, with decisions about long-term cost recovery left to future regulatory proceedings once the temporary structure ends. "I don't think we have much precedent for this type of temporary arrangement," said Joshua D. Rhodes, an energy researcher at the University of Texas, noting that utility-owned generation built as a time-limited bridge for a single customer is largely untested in regulatory practice. The bridge arrangement is needed because the data center's load is expected to ramp up faster than the utility's system can currently accommodate, EPE said in the filing. Meta, through its subsidiary Wurldwide LLC, originally requested 220MW from EPE and the commission approved rates based on that load. Projected demand has since increased to more than 440MW by 2027 and potentially to 1GW by 2029, the filing said. Meta recently announced it would invest $10b to grow the data center to 1GW, a decision that required EPE to amend its filing. The project has drawn opposition from local community organizations and lawmakers, who say Meta previously indicated the El Paso facility would be powered by renewable energy. Meta has since said it plans to pay for the development of renewable generation elsewhere to match the entirety of the data center's electricity use. Once the transmission and generation capacity is expanded to meet Meta's higher load requirements, EPE will request approval to connect the McCloud generation facility to the grid "and incorporate the cost of the plant into jurisdictional cost of service and retail rates", the utility said. The filing does not specify who will pay for the remaining costs associated with the generation. "Once generation is incorporated into a utility's cost of service, regulators still have to decide how operating costs, maintenance and depreciation are allocated," said Rhodes, the UT researcher. "Those decisions don't disappear just because a customer paid to build the facility." Meta and EPE did not respond to emails requesting comment. By Jasmina Kelemen Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Trump budget targets climate, clean energy programs

06/04/26

Trump budget targets climate, clean energy programs

Houston, 6 April (Argus) — The 2027 budget proposed by President Donald Trump would cut billions in funding for renewable and clean electricity development as part of a continued push to eliminate what he dubs "Green New Scam" policies put forward by the administration of former president Joe Biden. The 2027 fiscal year budget would eliminate $15.2bn allocated to the US Department of Energy (DOE) under a 2021 bipartisan infrastructure package "to deploy unreliable intermittent energy infrastructure, remove carbon dioxide from the air, and buy other costly technologies burdensome to ratepayers and consumers", according to the proposal put forward by the Trump administration on 3 April. The budget would similarly repurpose $4.7bn granted to the DOE under the 2021 law, allocating $3.5bn to "rapidly deploy firm baseload power", tacitly technologies such as natural gas, coal and nuclear which, unlike solar and wind, can generate electricity around the clock. Another $1.2bn would go toward artificial intelligence computing. The administration also aims to eliminate $1.1bn for climate change research conducted by the DOE's Office of Science and cancel $150mn for DOE studies on technologies like electric vehicles and direct air capture systems. The proposal would end renewable energy programs worth $45mn at the US Department of the Interior, with the administration endeavoring among other things to "put a stop to disastrous offshore wind energy projects". In addition, it would eliminate $1.6bn for the National Oceanic and Atmospheric Administration after its educational grant programs "consistently funded" initiatives that "radicalize students against markets" and promoted "baseless environmental alarm", according to the administration. The budget would also cut $204.5mn from the US Treasury Department's community development financial institutions fund, which uses federal and private money to support economically disadvantaged areas. The reductions will prevent tax revenue from supporting policies to which the administration is opposed, including "wind farms that degrade America's natural landscape and fail to serve American energy consumers". Senate minority leader Chuck Schumer (D–New York) criticized the cuts, including "massive" reductions to energy affordability, while promising that Democrats would fight "tooth and nail" to prevent the budget from becoming law. "Trump is already spending massive sums on never-ending wars abroad, and now he's pushing for a record-breaking $1.5 trillion in defense spending while slashing programs that Americans and seniors care about and rely on," Schumer said. By Patrick Zemanek Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

India coal auction prices rise on seaborne volatility

06/04/26

India coal auction prices rise on seaborne volatility

Singapore, 6 April (Argus) — Premiums at India's domestic coal auctions rose sharply in March with industrial buyers moving to secure supply following a surge in seaborne coal prices and freight rates, led by the US–Iran conflict and pre-summer restocking by power utilities. State controlled Coal India (CIL) — which meets about three-quarters of India's coal needs — recorded an average premium of 45pc in its March electronic auctions over the notified prices applied to long-term contracted sales, it said last week. This compares with an average premium of 35pc in February. Meanwhile, the overall average premium stood at 38pc for the April 2025-March 2026 financial year. The rise in premiums reflects the rising cost of imports, prompting buyers to actively seek domestic coal sold through spot electronic auctions, also known as single window mode agnostic e-auctions. These auctions accounted for 14pc of CIL's sales in the previous financial year. Coal and petroleum coke prices, along with freight rates, have risen sharply following supply-demand imbalances, amplified by geopolitical tensions in the Middle East. Argus assessed Indonesian GAR 4,200 kcal/kg coal at $59.51/t fob Kalimantan on 2 April for Supramaxes, up by about 10pc from $54.31/t on 27 February, just before the tensions escalated. Prices have also risen by 33pc from $44.91/t at the start of the year. Newcastle NAR 5,500 kcal/kg coal rose by 1.9pc to $87.59/t fob on 2 April, compared with late February and is up by 24pc since the beginning of the year. South African NAR 5,500 kcal/kg coal was assessed 7.4pc higher at $96.11/t fob Richards Bay on 2 April compared with that of 27 February, with prices 31pc higher on a year-to-date basis. Indian utilities typically import Indonesian coal that meets technical parameters of most coastal power plants. Delhi has already asked all thermal power utilities to prepare for a harsher summer . Meanwhile, India has directed private-sector utility Tata Power to restart its 4GW imported coal-fired utility in western Gujarat state . Sponge iron producers prefer coal from South Africa with a high fixed carbon content, while cement makers prefer petroleum coke, and switch to coal during price surges. Cfr India 6.5pc coke was assessed 24pc higher since the start of the war at $160/t on 1 April. The prices are also up by 36pc on a year-to-date basis. Currency volatility has added to landed costs. The Indian rupee averaged at 92.90 rupee to a dollar in March, compared with Rs90.76 in February. It has slipped further to Rs93.46 so far in April, implying additional cost in rupee terms. But coal auctions are priced in rupees, shielding buyers from foreign exchange swings. Auctions Among CIL's subsidiaries, Northern Coalfields recorded the highest March auction premium at 80pc, followed by South Eastern Coalfields (SECL) at 70pc and Eastern Coalfields at 48pc. Individual auction results show a 25-171pc premium growth over the notified price. The highest growth in premium was for a G10 or GAR 3,100-3,400 kcal/kg domestic coal from SECL's Amadand mine, with a deal closing at Rs3,682/t free on rail/road (for) basis, up by 171pc above its notified price. The coalfield also achieved a 45pc premium over the notified price, selling a G6 or GAR 4,200-GAR 4,400 kcal/kg coal at Rs4,014/t on for basis — the domestic market equivalent of fob prices. The prices are still sharply lower than international fob and delivered coal prices. Single window auctions are dominated by industrial buyers, but some independent power producers also participate for small spot volumes. Utilities rely primarily on long term CIL contracts or linkage auctions. Sponge iron, cement costs rise The domestic coal blend in sponge iron production has risen to about 80pc from 30-40pc earlier in key industrial hubs, with some non-integrated units switching entirely to domestic coal to protect margins. Rising auction premiums have pushed up production costs, raising sponge iron prices in key centres like Raipur by 5-7pc, according to Anil Nachrani, president of the Chhattisgarh Sponge Iron Manufacturers' Association. Cement producers are also feeling the impact. The cost of NAR 4,000 kcal/kg coal parcel bought in the auction has risen by 11pc to about Rs8,000/t for delivering the cargo to the plant, increasing per unit energy costs from Rs1.60/unit to Rs1.85/unit, a cement company official said. But the prices are still cheaper compared with Rs2.40/unit on the basis of $150/t cfr price of buying NAR 6,900 kcal/kg Northern Appalachian or NAPP coal. If this uncertainty in the seaborne market prolongs, the premium will increase further, raising the cost of production and potentially cement prices, another cement company official said. By Saurabh Chaturvedi and Ajay Modi Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Iranian drone hits Kuwaiti power and desalination plant

03/04/26

Iranian drone hits Kuwaiti power and desalination plant

Dubai, 3 April (Argus) — A power and water desalination plant in Kuwait sustained "material damage" as a result of an Iranian attack in the early hours of Friday, the country's electricity ministry said. The ministry did not disclose which specific facility was hit, saying only that "some components" were damaged in the attack. The ministry did not immediately respond to a request for comment. Kuwait has eight major power plants dotted along its coast, the majority of which also include desalination units that supply a significant portion of the emirate's fresh water. This is the second attack on Kuwait's power and desalination facilities in less than a week. A service building at an unnamed power and water desalination plant sustained "significant material damage" in an attack in the early hours of Monday . Iran has been responding to US and Israeli strikes on its territory, facilities and infrastructure by launching missiles and drones against targets in Israel and across the Mideast Gulf. Iran's armed forces regularly claim they are targeting regional assets and facilities that have links with Israel or the US, but many of the targets being hit clearly do not. Kuwait, in particular, has been experiencing a spike in hits on its critical infrastructure in recent days. The 346,000 b/d Mina al-Ahmadi refinery came under attack for the third time in two weeks early on Friday. The country's 454,000 b/d Mina Abdullah refinery was also struck in the middle of March. Kuwait International Airport has also been repeatedly struck by Iranian drones over the past month. Fuel depots were most recently hit on 1 April and 25 March, while the airport's radar system was struck on 28 March. Kuwaiti airspace has been closed since the start of hostilities on 28 February. Seven overhead power lines in several parts of Kuwait were also taken out of service late last week after debris falling from intercepted drones damaged the network. This caused partial power outages in some parts of the country. By Nader Itayim Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Brazil climate plan cites risks to grid, fuels

02/04/26

Brazil climate plan cites risks to grid, fuels

Sao Paulo, 2 April (Argus) — Brazil's long-delayed climate plan issued in March highlighted how extreme weather stemming from climate change could hurt its power grid and biofuels production, setting it back in achieving climate targets. The plan is Brazil's first comprehensive roadmap for meeting its nationally determined contribution (NDC) under the Paris agreement, with a goal of reducing greenhouse gas emissions by 59-67pc by 2035, from 2005 levels. Reaction to the plan from environmentalists was mixed. Amazon environmental research institute IPAM hailed the plan as a "reflection of Brazil commitment to mitigating climate change" and to "positioning the country as a global supplier of low-carbon products". But Brazilian climate think tank Observatorio do Clima called the plan unambitious and argued that it "caters to agribusiness". It also criticized the plan for failing to mention the phase out of fossil fuels. The plan underscores rising risks to the power sector owing to climate change, focusing on the impact that extreme weather is already having on generation, distribution and transmission. These threats include increased frequency and duration of droughts, more extreme rainfall, catastrophic wind events and more numerous heat waves. Drought is a top risk in the plan, owing to Brazil's continued dependence on hydroelectricity for its power supply. Even with the expansion of solar and wind generation, hydroelectricity met over 62pc of Brazil's power demand in 2025, according to the electricity sector clearinghouse CCEE. A recent study from the mines and energy ministry demonstrated that average water levels for hydroelectric reservoirs have declined sharply in the past decade: The 10-year moving average from 2023-2012 was 68pc, while the average from 2013–2022 fell to just 41pc of maximum capacity. The proposal seeks to expand and modernize existing hydroelectric plants to improve energy efficiency and increase installed capacity, with the goal of expanding installed capacity by 6.3GW by 2025. The plan also calls on the government to update electricity regulations to expand the use of energy storage batteries and pumped hydro plants. Reinforcing the grid The plan also foresees growing risks to the power transmission sector, which has suffered an increased number of outages because of extreme weather events, including flooding, high winds and fires. Record flooding in Rio Grande do Sul state in 2024, which resulted in extended power outages for more than 1mn people, forced the government to reassess its power transmission expansion plans for the state to increase resilience of infrastructure. The plan warned that transmission infrastructure is not designed to withstand extreme weather events and that poor engineering projects, combined with limited preventive maintenance, has increased the vulnerability of the grid. The plan includes the addition of more than 30,000km (18,640 miles) of transmission lines by 2035 and suggested that the new infrastructure be assessed to minimize the risk of weather. The plan also calls on the government to include new technologies for grid stabilization, such as reactive power support to control voltage, secondary frequency control to balance supply and demand, and self-restoration mechanisms that help restore power quickly after power outages. The plan also examines potential risks for the supply of biofuels, which play a central role in the decarbonization of Brazil's transport sector under the NDC. The plan calls for mandatory ethanol and biodiesel blends of 30pc and 20pc respectively in 2030, rising to 35pc and 25pc by 2035. To guarantee adequate supply, the plan calls on the government to promote research for the biofuels sector, focusing on the development and improvement of new crop varieties and diversification of feedstocks to produce biofuels. This includes crops that can grow in different regions and that are more resilient to climate change. It also calls on the government to promote irrigation in areas prone to drought, in an effort to limit its impact on production of sugarcane and other biofuel feedstock crops. Brazilian power generation by source % Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

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