Source: United States Senator for New Mexico Martin Heinrich
WASHINGTON (Oct. 28, 2021) – Today, U.S. Senator Martin Heinrich (D-N.M.) participated in the 2021 San Juan Basin Energy Conference where he laid out his innovative vision for New Mexico’s clean energy future, including the San Juan Basin’s potential as a major hub for clean hydrogen production. The theme of the conference hosted at San Juan College in Farmington is “Celebrating our Past and Looking to the Future” and features speakers from the energy industry, government, and academia.
Senator Heinrich, a member of the Senate Energy and Natural Resources Committee, is focused on creating jobs of the future, confronting the climate crisis, modernizing America’s electric grid, and preparing New Mexico for the energy transition. As a national leader in energy policy, Senator Heinrich has championed the development of renewable energy projects on public and Tribal lands, the siting of transformative high-voltage transmission lines, and the research and adoption of innovative energy storage, clean hydrogen, and microgrid technologies.
In addition to laying out his energy vision, Senator Heinrich rebuked the speaker before him in the conference’s schedule, Alex Epstein, the author of The Moral Case for Fossil Fuels and a promoter of misinformation on climate change and the energy industry.
During his remarks, Senator Heinrich acknowledged that in order “to build, maintain, and grow this region’s energy economy leadership – we have to engage in some hard conversations and acknowledge some difficult realities.” Senator Heinrich pointed out that dangerous climate misinformation and disregard for science, like that from Alex Epstein, “only hurts our state’s credibility as an energy leader and holds us back from seizing on the work we need to do moving forward.”
During his remarks, Senator Heinrich announced that he will soon be introducing major new legislation called the Energy Veterans and Communities Act.
“Managing a fair and predictable transition away from our state’s reliance on fossil fuel production and consumption will require thoughtful, long-term planning,” said Heinrich during his remarks. “My bill would create a revolving trust fund to provide a stable and predictable stream of revenue for economic diversification efforts in new industries.”
The Energy Veterans and Communities Act would also guarantee the health care and retirement benefits that energy workers have earned.
In May, Senator Heinrich introduced legislation to assist federal fossil fuel producing states like New Mexico as revenues decline in the coming years due to market forces and policies to curb carbon pollution. The Schools and State Budgets Certainty Act would provide a predictable transition for states, counties, and Tribes and give those governments time to transition their budgets to more sustainable and reliable sources of revenue.
In August, Senator Heinrich led a two-day, clean energy focused tour with U.S. Department of Energy Secretary Jennifer Granholm. During the tour, Senator Heinrich and Secretary Granholm traveled to the Four Corners region to learn more about how San Juan Basin communities will be impacted by the energy transition and see firsthand the region’s potential for hydrogen production. Senator Heinrich is focused on prioritizing targeted, place-specific investments for career re-training and economic diversification in these communities.
Senator Heinrich’s full remarks as prepared for delivery are below.
Good morning everyone.
Thank you to Four Corners Innovations and San Juan College for inviting me to join you today.
Hosting forums like this is an important part of growing this region’s leadership in our energy economy.
It also gives us an opportunity to share information and work together on the strategies that can take New Mexico’s energy economy into the decades ahead successfully.
To do all of this right – to build, maintain, and grow this region’s energy economy leadership – we have to engage in some hard conversations and acknowledge some difficult realities.
I understand the appeal of believing in people who say there’s nothing to worry about, that climate change isn’t real, and that we can just go about doing things the same way we’ve always done them.
But when time is spent on that type of wishful pseudo-science and misinformation, it only hurts our state’s credibility as an energy leader and holds us back from seizing on the work we need to do moving forward.
Here’s the reality: The reservoirs that we rely on for clean water are rapidly shrinking.
The Colorado River Basin has been facing dangerous drought conditions for the last two decades.
This summer, the water levels in Lake Powell and Lake Mead hit such historic lows that the Bureau of Reclamation had to draw down on Upper Colorado reservoirs.
That included drawing down our Navajo Reservoir to keep Lake Powell’s water barely high enough for the hydroelectric power generation at the Glen Canyon Dam.
In fact, since 1999, Lake Powell has dropped nearly 150 vertical feet and lost enough water to supply around 65 million homes.
And in modeling released just a couple days ago, Reclamation is projecting a 37,000 acre-foot shortage for the Navajo Reservoir in 2022.
These enormous shortfalls come alongside wildfire behavior that we’ve never seen before in our state.
That’s our new normal.
Some of you know that I was trained as an engineer.
Despite being an elected official, I’m not enamored by political rhetoric and ideology.
Because rhetoric doesn’t solve problems.
I try to follow facts and data.
In this case, the facts are all around us and they are clear.
We are in a climate emergency.
And what’s causing it?
Global warming is a direct result of the hydrocarbons that you and I are burning.
This fact, combined with the rapidly declining costs of cleaner energy sources, has fueled a major energy transition.
I recognize the desire by some to question this point, but the facts leave no room for debate and the transition is well under way.
For the sake of our own success, we must plan and act based on this reality.
The San Juan Basin has been a world leader in energy production for more than a century.
We now face major challenges as the world transitions away from coal and hydrocarbons.
It’s felt most acutely by communities that have long powered their local economies by producing exactly the fuels we are transitioning away from.
Within a few hours driving distance of Farmington, there are six coal-fired power plants and five coal mines.
In the past two years, they have either shut down, shuttered early, or been scheduled for closure.
I won’t sugarcoat how difficult this transition is and will continue to be for our families and communities who have long relied on the jobs at facilities like the San Juan Generating Station or the Escalante Power Plant in McKinley County.
When I think about these changes, I always think about my own father, who built his career as an IBEW lineman.
Because of his career, my sister and I were able to go to college.
My dad’s career in the utility industry provided our family a ticket to a strong middle-class life, and I will never forget that.
It’s because of him, really, that I have so much respect for the energy workers and laborers in the Four Corners region who, just like my dad, dedicated their life’s work to keeping our lights on and powering our economy.
We need to do right by them and their families.
As we grapple with this transition, we should never leave these workers and these communities behind.
That’s precisely why I introduced the State and School Budgets Certainty Act.
And that’s why I’m about to introduce major new legislation called the Energy Veterans and Communities Act.
This legislation recognizes that New Mexico still receives over $2 billion in direct revenue from severance taxes and other revenues from coal, oil, and fossil gas production.
These revenues fund critical services in education, health care, and public safety.
But our reliance on these revenues has also left New Mexico and similar energy producing states vulnerable to fluctuations in commodity prices that then cause wild swings in our state budget.
Managing a fair and predictable transition away from our state’s reliance on fossil fuel production and consumption will require thoughtful, long-term planning.
My bill would create a revolving trust fund to provide a stable and predictable stream of revenue for economic diversification efforts in new industries.
In New Mexico, we are seeing major growth in a number of diverse fields, from clean energy and outdoor recreation to film and directed energy technology.
The Energy Veterans and Communities Act would also guarantee the healthcare and retirement benefits that energy workers have earned.
It would incentivize states to adopt policies to strengthen their rainy-day funds to withstand short and long-term economic downturns.
And it would reward states like New Mexico that are developing long-term investment strategies to prepare for the inevitable decline in revenues from fossil hydrocarbons.
New Mexico cannot rely on the unpredictable and unsustainable revenue that is currently generated by fossil fuels.
And our climate cannot continue to withstand endless emissions.
We need to be honest about what we are facing.
And we need to make sustainable and forward-looking investments in the success of our state’s children, families, and communities.
That’s how we will emerge from this moment of transition stronger than ever before.
If we can make the right decisions right now, I’m confident we can position communities like Farmington and Aztec to thrive in the emerging energy landscape.
I strongly believe that New Mexico is uniquely poised to benefit from the growth of the clean energy economy, the widespread electrification of our homes and businesses, and advances in new technologies.
This transition will create new careers for New Mexicans and bring major economic benefits to every corner of our state.
The infrastructure legislation we’re working to pass in Congress will make significant investments in modernizing the transmission infrastructure that keeps the lights on in our homes and businesses.
I’ve been especially focused on delivering powerful incentives and predictable permitting policy so we can build more of the high-voltage transmission lines that are key to expanding our capacity for new clean energy projects.
Building new transmission lines like Western Spirit and SunZia, and others that are on the drawing board and attracting investors right now, will be key to maintaining New Mexico’s position as a national leader in energy production.
These lines will allow us to build many more clean generation projects, particularly in rural New Mexico, that will generate much, much more clean power.
We can establish New Mexico as a major producer and supplier of the clean power that consumers in our neighboring states are demanding.
There is no reason we can’t export clean electrons to hungry energy markets and import billions of dollars of private investment and thousands of good-paying jobs into our communities.
The northwestern part of our state has a long and established track record of leading on energy production.
But if we want this region to succeed in the coming decades, we need to be focused on the way energy will be produced in the future.
That’s why I am working closely with local leaders in the San Juan Basin to identify and invest in new opportunities for growth in the region’s energy economy.
I’m particularly focused on hydrogen for this region.
Even as we move our power sector toward clean and carbon pollution-free generation, there will still be difficult to decarbonize sectors like heavy trucking, aviation, and parts of the industrial sector.
Many leading energy researchers believe that clean hydrogen production will prove to be a critical solution to many of these challenges.
And if we can play our cards right, clean hydrogen production has major potential to become a quickly growing economic driver in this region.
New Mexico, and San Juan County in particular, have all the components to become a Hydrogen Center for Excellence.
Wind, solar, and geothermal energy are abundant in New Mexico, which can help with facilitating zero-emission hydrogen production from electrolyzers powered by clean electricity.
We can leverage our state’s national labs and research institutions to assist with demonstration projects.
We have a proven local workforce of union power plant workers, coal miners, and oil and gas workers whose talent and skillsets translate well to hydrogen production.
And we have excellent job training for new energy careers right here at San Juan College’s School of Energy.
I want to do all I can to help grow this new industry in our state.
I worked hard to include funding in the Bipartisan Infrastructure bill specifically to stand up the first few hydrogen hubs.
And I am optimistic that additional hydrogen production incentives will be passed as part of the budget bill.
I want to see two of these hubs established in New Mexico, one in San Juan Basin and the other in the Permian.
The awards for these projects are going to be very competitive, and New Mexico will face stiff competition from other energy producing states with similar resources and workforces.
But I am confident in the case we can present, and in our ability to lead in this growing field.
In August, I invited Secretary of Energy Jennifer Granholm to join me for a visit to the Four Corners to see this potential firsthand.
We toured PESCO, a local family-owned business, and met with owners Jim and Kyle Rhodes.
I wanted Secretary Granholm to see the hydrogen generator under construction using PESCO’s skilled workforce and technology developed by New Mexico’s BayoTech, with help from Sandia National Labs.
In addition to BayoTech and PESCO, we are also seeing other promising hydrogen development projects.
In McKinley County, a Texas-based private equity firm has committed nearly a half billion dollars to convert the Escalante coal-fired power plant into a hydrogen facility.
That plant closed last year, seven years ahead of its original schedule.
The Escalante H2 Power Project still has to overcome some obstacles, but it has the Governor’s support and my support in navigating this new opportunity.
And we hope to see the New Mexico Legislature pass legislation early next year to provide additional support to grow the hydrogen industry in our state.
Through my new role on the Senate Appropriations Committee, I am also working to deliver a major investment to San Juan College to create a new hydrogen workforce development program – in addition to a new Electric Vehicle technician program.
That funding is not final yet, but I’m doing all I can to steer it through the Appropriations process.
The bipartisan Infrastructure Bill that we’ve already passed in the Senate also includes funding to plug and remediate orphaned wells on federal, state, Tribal, and private lands.
The Federal Reserve estimates as many as 5,000 New Mexico oil and gas workers were laid off during the pandemic.
The Infrastructure bill would immediately get some of those workers back out in the field plugging the more than 600 orphaned wells in New Mexico and support small businesses in both the San Juan and Permian Basins.
This will help us address our long-running methane pollution challenge. And it will restore our public lands that are key to growing this region’s outdoor recreation economy.
I also want to say how grateful I am to those in the industry here in New Mexico who have worked with the state to implement strong methane rules.
I hope that the leadership you have shown here in New Mexico will serve as a model as the administration seeks national solutions to fugitive methane.
I am doing everything in my power to make sure we pass all of the major investments we are actively negotiating in Congress.
We have been right in the thick of finalizing these major pieces of legislation over these last weeks, and the news today is heartening.
I’m confident that we will be able to deliver meaningful investments that will matter to northwest New Mexico.
More fundamentally, these investments are about setting a strong foundation for future competitiveness and success.
All of us in New Mexico should be focusing on how our state can plan proactively, responsibly, and thoughtfully for the energy and climate future that is already here.
I look forward to working with each of you in setting a strong foundation for our state’s future success.
While we may not agree on every step along the way, I know our end goal is the same: Success for New Mexico, the Four Corners region, and the families who call our communities home.
Thank you.