NM could get billions in new federal funding
Congress is gearing up to approve the largest federal investments in infrastructure and social programs since the Great Depression in the 1930s, and New Mexico could reap huge benefits.
A two-day visit to New Mexico last week by U.S. Energy Secretary Jennifer Granholm highlighted some of the local industries and communities that could directly benefit from billions in new federal investment in everything from highways, bridges and water infrastructure to transmission development, clean energy projects and environmental remediation.
It’s all part of President Joe Biden’s plan to rebuild national infrastructure to better compete in the global economy and fight climate change at every level. At its core is a “clean energy revolution” that could transform the country’s electric grid to 100% non-carbon generation by 2035, while setting the entire economy on a path to carbon neutrality by mid-century.
As the country’s third-largest oil-producing state, New Mexico will confront immense challenges in the shift away from fossil fuels, and Biden’s investment plans are by no means guaranteed. The president faces huge hurdles in Congress, with Republicans firmly united against much of the massive spending proposed by Democrats. And Democratic legislators themselves are divided over many of the federal initiatives, making the amount of funding that could emerge from Congress uncertain.
But the U.S. Senate already approved a $1.2 trillion infrastructure investment package in a broad bipartisan vote supported by 19 Republicans. And if approved by the House, that package alone would generate billions to shore up New Mexico infrastructure and help diversify the local economy away from its traditional dependence on fossil fuels.
A huge part of all new investments would specifically benefit local communities most affected by the transition to clean energy and most affected by adverse environmental consequences from decades of fossil-fuel production. That’s also at the core of Biden’s plan under an executive order he issued in January known as the “Justice40 initiative,” which requires federal agencies to direct 40% of all climate and clean-energy spending going forward to marginalized, underserved communities in rural and urban areas.
Secretary Granholm highlighted that commitment during her two-day visit last week, which included stops in a low-income community in Albuquerque’s International District, as well as meetings with businesspeople, economic development professionals and political and tribal leaders in the Four Corners area.
“The president is focused on environmental justice,” Granholm told residents at an International District community project that’s turning low-income renters into homeowners. “Those are not just words, but a clear part of the agenda. … The goal is to get 40% of investments into front-line communities that have experienced the worst impacts from climate change.”
‘Where the rubber hits the road’
The community project, spearheaded by East Central Ministries, has assisted 13 families in developing a cooperatively run housing program in which residents make an average monthly mortgage payment of $600 on their homes.
Albuquerque-based Prosperity Works is now heading a project to provide free energy-efficiency upgrades to those homes. That lowers energy consumption, reducing monthly bills and emissions while improving indoor air quality, said Prosperity Works founder Ona Porter, who led Granholm on a tour of one housing unit.
“We’ve already provided energy upgrades for 300 homes in the South Valley,” Porter told the Journal. “This is a new phase of the project in the International District.”
The Senate-approved infrastructure investment bill includes $3.5 billion for similar home-weatherization programs, Granholm told community members. And Sen. Martin Heinrich, D-N.M., who accompanied Granholm, is pushing a new “Zero-Emission Homes Act” that could provide $10 billion more for energy-efficiency efforts nationwide.
The long-term goal is to electrify homes and buildings everywhere, replacing appliances and heating and cooling systems that use fossil fuels such as natural gas with electric-based systems that draw power from renewable energy sources, Heinrich said.
“This project is an excellent example at the local level of what we’re doing at the national level,” Heinrich told community residents.
Democratic House Rep. Melanie Stansbury, who also joined Granholm, said the International District program reflects the type of Justice40-focused investments that will benefit low-income neighborhoods everywhere. Apart from home energy efficiency, federal investments will also upgrade public transportation, water infrastructure, and climate resiliency in underserved communities.
“This is where the rubber hits the road,” Stansbury said. “This shows how efforts to address climate change touches down in our communities and inside our homes.”
Four Corners investment
Apart from low-income urban neighborhoods, the Justice40 investment focus will especially benefit the Four Corners area, where closures of coal mines and coal-fired power plants threaten to eliminate thousands of jobs and local tax revenue.
Granholm held a community round table in Farmington to discuss those issues, and also met with Navajo Nation President Jonathon Nez and members of his Cabinet. The tribe is particularly affected by the shutdown of mines and plants, which employ hundreds of tribal members.
San Juan County is one of 25 coal-heavy regions across the nation that a federal interagency working group is targeting for investment to assist in the transition away from fossil fuels. The group has identified $38 billion in potentially available funding. And in July, the U.S. Commerce Department’s Economic Development Administration allocated $300 million for the targeted coal regions, plus $100 million for tribal communities, using money approved in March for pandemic-relief efforts.
Federal investment could help finance clean energy projects in the Four Corners area, particularly efforts to convert the region into a hydrogen production hub. The Senate-approved infrastructure bill would provide $25 billion for clean energy demonstration projects, including billions for advancing hydrogen technology to lower the costs of production, and to set up at least four hydrogen hubs around the country.
Private investors are already pursuing some large-scale initiatives in the Four Corners that could receive DOE funding. And during her visit, Granholm toured two businesses in Farmington and Albuquerque that are marketing newly developed hydrogen technology.
“We’ll have billions of dollars to fund the hydrogen hubs,” Granholm said. “We want to develop a whole hydrogen supply chain.”
Cleanup, wind development
The Four Corners and the state’s oil patch in southeastern New Mexico will benefit as well from $21 billion in new federal funding to plug orphan oil and gas wells on federal and tribal lands nationwide, clean up abandoned mines, and remediate brownfield and Superfund sites. There are an estimated 708 orphan wells across New Mexico eligible for funding, according to the DOE.
In addition, the infrastructure bill includes $60 billion for transmission development and grid modernization, something that New Mexico is aggressively pursuing to open up the state’s gusty eastern plains for a lot more wind generation.
“Transmission is the foundation to get to 100% carbon-free generation by 2035,” Granholm said during a roundtable discussion on that issue with industry leaders in Albuquerque.
Apart from the infrastructure bill, Congress is also debating a much bigger, $3.5 trillion investment package for education, health care and expanded clean energy programs. It remains to be seen how much will actually be approved, but that bill could include up to $300 billion in new tax incentives for solar, wind and other non-carbon generation, which could spur a lot more renewable development across New Mexico.
