Committee tables bill to tax renewable energy production after hours of testimony

A House Energy, Environment & Natural Resources Committee voted 6-4 to table HB45, the Renewable Energy Production Tax Act, after hours of testimony and debate on whether imposing an excise tax on renewable energy would hurt development and local jobs.

The bill, sponsored by Representative John Block, would impose an excise tax on utility-scale renewable production — described by the sponsor during the hearing as "an excise tax of 3.3 or 3.75%." The panel first adopted a sponsor amendment described as cleanup language and then took the substitute motion to table the bill, which passed by a 6-4 margin.

Supporters said the measure would place renewables on the same tax footing as oil and gas and provide a new revenue stream as the state pursues large-scale energy transition goals. Opponents — including renewable-industry groups and environmental organizations — said the tax would slow investment, reduce job growth and undermine New Mexico’s ability to compete for projects.

Representative John Block, the bill sponsor, said the proposal was modeled on prior legislation and sought parity with fossil-fuel taxation: "This is not a severance tax on, renewables. It is merely an excise tax of 3.3 or 3.75%." He told the committee the measure would diversify state revenue as New Mexico increases renewable generation and pursues targets under the Energy Transition Act.

Industry and environmental witnesses urged rejection. Melissa Bernardin of the Sierra Club Rio Grande chapter said, "We're here in opposition to HB 45, which is a tax on New Mexico renewable energy that will slow our state's ability to lead a clean energy transition." Ricky Lee Chavez of the Inner West Energy Alliance told the committee the sector already pays a range of taxes and that additional levies would weaken the state’s competitiveness.

Other opponents included the Renewable Energy Industries Association of New Mexico, Pattern Energy and trade representatives who described ongoing investments in wind and solar and warned of lost projects if costs rose. Marco Gonzalez, a registered representative for INB Energy and Pattern Energy, said the groups opposed the bill despite conversations with the sponsor.

Several committee members pressed on local impacts and budget trade-offs. Representative Cortez, who represents oil-producing areas, emphasized the role fossil-fuels revenues have played in the state budget and argued for parity in taxation, while Representative Small and others pointed to examples from other states where taxes were followed by declines or pauses in development. Representative Montoya and Representative Dixon raised concerns about workforce effects in communities that rely on extractive industries.

The committee first considered and adopted a sponsor amendment described as cleanup and reformatting of tax-code text. Later, a substitute motion to table prevailed on a recorded voice roll call (yes to table: Representative Abeta, Representative Dixon, Representative Grolla, Representative Small, Representative SeraNana, Chair McQueen; no to table: Representative Cortez, Representative Henry, Representative Montoya, Representative Murphy). The clerk announced the bill was tabled by a vote of 6 to 4.

The committee hearing included extended public comment and questions from members; discussion referenced a fiscal-impact report, possibilities that ratepayers could see higher costs, and the larger policy question of how to replace oil-and-gas revenues if the state accelerates emissions reductions.

With HB45 tabled, the committee did not advance the measure. The record shows substantial disagreement among members and stakeholders about whether the state should begin taxing renewable production now or defer until the industry is more established.