Southeast New Mexico is carrying one of the heaviest economic loads in this state, but the power infrastructure needed to support that growth is struggling to keep pace.
For once, regulators left Santa Fe and came directly to the communities that depend on reliable power to keep our economy moving. That matters. Too often, decisions affecting rural regions are made hundreds of miles away in the Roundhouse without firsthand understanding of the industries, families, and workers who live with the consequences.
Right now, Southwestern Public Service Company (SPS), a subsidiary of Xcel Energy, has asked the New Mexico Public Regulation Commission to approve a new generation portfolio that includes additional power generation and battery storage resources for customers in eastern and southeastern New Mexico. The filing, part of the utility’s long-term planning process to secure reliable electricity through the end of the decade, would add needed capacity to a region already experiencing significant growth in demand.
The proposal is currently before the commission in Case No. 25-00066-UT, where SPS is seeking certificates of convenience and necessity for multiple new generation and battery storage projects.
The need for that capacity is not theoretical. It is already here.
Southeast New Mexico sits at the heart of the Permian Basin, one of the most productive oil and gas regions in the world. New Mexico has become the second-largest oil-producing state in the nation, trailing only Texas. That industry supports tens of thousands of jobs and generates billions of dollars in revenue for our state every year.
Those revenues do not stay in the Permian Basin. They benefit every community in New Mexico.
More than 97 percent of the Severance Tax Permanent Fund, one of the state’s most important financial reserves supporting schools, infrastructure, and public services, has been built from oil and gas revenues. Those dollars help pay for road construction, school buildings, public safety infrastructure, and capital projects across New Mexico. If you drive anywhere in this state and see orange construction barrels along a highway project, there is a good chance oil and gas revenues helped make that project possible.
When Southeast New Mexico thrives, the entire state benefits.
But keeping that engine running requires reliable power.
Today, electricity demand is rising rapidly across the Southwest. Population growth, electrification, industrial expansion, and emerging technologies such as data centers are pushing demand to levels utilities have not seen in decades. Some projections suggest states like Arizona may need to double their generation capacity over the next decade—an amount of infrastructure that originally took more than a century to build.
In Southeast New Mexico, the strain is already visible. Because of limited grid capacity and delays in bringing new generation online, many oil and gas operators have had to rely on diesel generators at well sites to power operations. That is not a preferred solution for anyone. Companies across the Permian Basin have made major commitments to reduce emissions and improve efficiency, but without access to affordable and reliable grid power, they are forced to rely on temporary alternatives simply to keep production moving.
That is why the SPS proposal matters.
Additional generation and battery storage would help stabilize the regional grid, provide power for growing communities and industry, and reduce dependence on diesel generation in the field.
Expanding the grid is not just an economic issue. It is also an environmental one.
At the same time, New Mexico must be honest about the challenges created by its current regulatory framework. Policies such as the Energy Transition Act set aggressive mandates that make it increasingly difficult to build certain types of dispatchable generation within our state. If those resources cannot be built here, utilities will continue looking to neighboring states, particularly Texas, where permitting processes move faster and regulatory hurdles are lower.
The electricity may still flow into New Mexico, but the jobs, tax base, and economic development tied to those projects will happen somewhere else.
That should concern every New Mexican.
We all want a cleaner energy future, but reliability and affordability must remain part of that conversation. Achieving all three requires practical solutions, not ideological battles that delay critical infrastructure.
The goal should not be ideology from either side. It should be reliability, affordability, and practical generation policy that protects New Mexico jobs while keeping the grid strong.
Southeast New Mexico has long powered this state’s economy. Ensuring that region has the electricity it needs to continue doing so is not just a regional priority. It is a statewide responsibility.
The Public Regulation Commission now has an opportunity to make a decision that supports reliability, economic growth, and responsible energy development.
For the sake of New Mexico’s future, they should move forward.
About Michael Perry: Vice Chair, Chaves County Commission | Former Assistant Commissioner, New Mexico State Land
Office | Candidate for New Mexico Commissioner of Public Lands