SENATE BILL 209
57th legislature - STATE OF NEW MEXICO - second session, 2026
INTRODUCED BY
Gabriel Ramos and Leo Jaramillo and Anthony L. Thornton
and Luis M. Terrazas
AN ACT
RELATING TO UTILITIES; REQUIRING FINANCIAL ASSURANCE FOR RENEWABLE ENERGY FACILITIES; PROVIDING AUTHORITY TO MANAGE FINANCIAL ASSURANCE FOR RENEWABLE ENERGY FACILITIES; CREATING THE RENEWABLE ENERGY DECOMMISSIONING FUND.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. [NEW MATERIAL] SHORT TITLE.--This act may be cited as the "Renewable Energy Financial Assurance Act".
SECTION 2. [NEW MATERIAL] DEFINITIONS.--As used in the Renewable Energy Financial Assurance Act:
A. "decommissioning" means actions taken to remove, dispose of or recycle equipment or infrastructure and remediate the site of a renewable energy facility, in accordance with rules promulgated by the division;
B. "department" means the energy, minerals and natural resources department;
C. "division" means the energy conservation and management division of the department;
D. "renewable energy facility" means a facility that generates energy using the following resources, with or without storage:
(1) solar;
(2) wind;
(3) geothermal;
(4) hydropower;
(5) biomass;
(6) fuel cells that do not use fossil fuels to create electricity; or
(7) landfill gas and anaerobically digested waste biogas; and
E. "site" means the land on which a renewable energy facility is or was located, including land occupied or disturbed by associated equipment, structures, access roads or facility-owned infrastructure.
SECTION 3. [NEW MATERIAL] AUTHORITY OVER FINANCIAL ASSURANCE FOR RENEWABLE ENERGY FACILITIES--REQUIREMENTS FOR DECOMMISSIONING.--
A. The division has jurisdiction and authority over all matters relating to financial assurance for the decommissioning of renewable energy facilities.
B. The division shall promulgate rules to establish requirements for the decommissioning of renewable energy facilities that ensure:
(1) the removal, proper disposal or recycling of facility equipment and infrastructure;
(2) remediation of the site;
(3) monitoring of the site as necessary;
(4) an appropriate time frame for completion;
(5) that an owner or operator provides financial assurance sufficient to cover costs of decommissioning a renewable energy facility in a form and amount acceptable to the division; and
(6) the implementation of additional measures the division deems appropriate.
SECTION 4. [NEW MATERIAL] FINANCIAL ASSURANCE REQUIREMENT FOR RENEWABLE ENERGY FACILITIES.--
A. The owner or operator of a renewable energy facility shall provide financial assurance to the division as a condition precedent to commercial operation of the facility.
B. The amount of financial assurance provided by the owner or operator of a renewable energy facility shall be sufficient to ensure the decommissioning of the facility, as determined by the division.
C. The form of financial assurance filed by an owner or operator of a renewable energy facility is subject to approval by the division and shall comply with rules promulgated by the division. Acceptable forms of financial assurance include:
(1) surety bonds;
(2) irrevocable letters of credit;
(3) collateral bonds;
(4) cash accounts;
(5) facility-specific insurance policies; and
(6) third-party guarantees.
D. The division shall periodically review financial assurance requirements and adjust them to account for inflation and anticipated changes in decommissioning costs. An owner or operator of a renewable energy facility shall ensure that the financial assurance provided to the division meets any new or expanded requirements.
E. Financial assurance provided by an owner or operator to the division shall remain in force until released by the division. The owner or operator of a renewable energy facility may file an application with the division for the release of all or part of the owner's or operator's financial assurance. The application shall describe the decommissioning measures completed and shall contain an estimate of the costs of the decommissioning that have not been completed. Prior to the release of the owner's or operator's financial assurance, the division shall conduct an inspection and evaluation of the site and decommissioning work involved. The division shall release an owner's or operator's financial assurance when the division is satisfied that the conditions of the financial assurance have been fully performed.
SECTION 5. [NEW MATERIAL] FORFEITURE OF FINANCIAL ASSURANCE.--
A. If the owner or operator of a renewable energy facility fails to comply with financial assurance requirements, the division may order the decommissioning of the facility or forfeiture of the financial assurance, or both, in accordance with rules promulgated by the division. If the owner or operator of a renewable energy facility fails to comply with the order within the time frame set out in the order, the financial assurance shall be forfeited.
B. When financial assurance is forfeited, the division shall give notice to the attorney general, who shall collect the forfeiture without delay.
C. All forfeitures shall be remitted to the division for deposit in the renewable energy decommissioning fund.
SECTION 6. [NEW MATERIAL] INSUFFICIENT FINANCIAL ASSURANCE.--When financial assurance proves insufficient to cover the cost of decommissioning on land other than federal land and money must be expended to meet the additional expenses, the division is authorized to bring suit against the owner or operator in the district court of the county in which the renewable energy facility is located for indemnification of all costs incurred by the division in decommissioning that owner's or operator's renewable energy facility. All money collected pursuant to a judgment in a suit for indemnification brought pursuant to this section shall be deposited in the renewable energy decommissioning fund.
SECTION 7. [NEW MATERIAL] RENEWABLE ENERGY DECOMMISSIONING FUND.--
A. The "renewable energy decommissioning fund" is created as a nonreverting fund in the state treasury. The fund consists of appropriations, gifts, grants, donations, income from investment of the fund and other money credited to the fund. The division shall administer the fund, and money in the fund is subject to appropriation by the legislature to the division to carry out the provisions of the Renewable Energy Financial Assurance Act. Disbursements from the fund shall be made by warrant of the secretary of finance and administration pursuant to vouchers signed by the secretary of energy, minerals and natural resources.
B. Money in the fund may be used by the division to facilitate decommissioning of renewable energy facilities.
- 6 -