2021 New Mexico Statutes
Chapter 62 - Electric, Gas and Water Utilities
Article 3 - Public Utility Act; Preamble and Definitions
Section 62-3-3 - Definitions.
Unless otherwise specified, when used in the Public Utility Act [Chapter 62, Articles 1 to 6 and 8 to 13 NMSA 1978]:
A. "affiliated interest" means a person who directly or indirectly, through one or more intermediaries, controls or is controlled by or is under common control with a public utility. Control includes instances when:
(1) a person is an officer, director, partner, trustee or person of similar status or function;
(2) a person owns directly or indirectly or has a beneficial interest in ten percent or more of voting securities of a person;
(3) a person has a level of ownership of securities other than voting securities that the commission establishes as creating a presumption of control; and
(4) the possession of the power to direct or cause the direction of the management and policies of a person exists in fact, notwithstanding the lack of ownership of ten percent or more of the person's voting securities;
B. "commission" means the public regulation commission;
C. "commissioner" means a member of the commission;
D. "municipality" means a municipal corporation organized under the laws of the state, and H-class counties;
E. "person" means an individual, firm, partnership, company, rural electric cooperative organized under Laws 1937, Chapter 100 or the Rural Electric Cooperative Act [Chapter 62, Article 15 NMSA 1978], corporation or lessee, trustee or receiver appointed by any court. "Person" does not mean a class A county as described in Section 4-36-10 NMSA 1978 or a class B county as described in Section 4-36-8 NMSA 1978. "Person" does not mean a municipality as defined in this section unless the municipality has elected to come within the terms of the Public Utility Act as provided in Section 62-6-5 NMSA 1978. In the absence of voluntary election by a municipality to come within the provisions of the Public Utility Act, the municipality shall be expressly excluded from the operation of that act and from the operation of all its provisions, and no such municipality shall for any purpose be considered a public utility;
F. "securities" means stock, stock certificates, bonds, notes, debentures, mortgages or deeds of trust or similar evidences of indebtedness issued, executed or assumed by a utility;
G. "public utility" or "utility" means every person not engaged solely in interstate business and, except as stated in Sections 62-3-4 and 62-3-4.1 NMSA 1978, that may own, operate, lease or control:
(1) any plant, property or facility for the generation, transmission or distribution, sale or furnishing to or for the public of electricity for light, heat or power or other uses;
(2) any plant, property or facility for the manufacture, storage, distribution, sale or furnishing to or for the public of natural or manufactured gas or mixed or liquefied petroleum gas for light, heat or power or other uses; but "public utility" or "utility" shall not include any plant, property or facility used for or in connection with the business of the manufacture, storage, distribution, sale or furnishing of liquefied petroleum gas in enclosed containers or tank truck for use by others than consumers who receive their supply through any pipeline system operating under municipal authority or franchise and distributing to the public;
(3) any plant, property or facility for the supplying, storage, distribution or furnishing to or for the public of water for manufacturing, municipal, domestic or other uses; provided, however, that nothing contained in this paragraph shall be construed to apply to irrigation systems, the chief or principal business of which is to supply water for the purpose of irrigation;
(4) any plant, property or facility for the production, transmission, conveyance, delivery or furnishing to or for the public of steam for heat or power or other uses;
(5) any plant, property or facility for the supplying and furnishing to or for the public of sanitary sewers for transmission and disposal of sewage produced by manufacturing, municipal, domestic or other uses; provided that "public utility" or "utility" as used in the Public Utility Act does not include any utility owned or operated by a class A county as described in Section 4-36-10 NMSA 1978 either directly or through a corporation owned by or under contract with such a county; or
(6) any plant, property or facility for the sale or furnishing to or for the public of goods or services to reduce the consumption of or demand for electricity or natural gas, and is either a public utility under the definitions found in Paragraph (1) or (2) of this subsection, or is an alternative energy efficiency provider as described in Section 62-17-7 NMSA 1978;
H. "rate" means every rate, tariff, charge or other compensation for utility service rendered or to be rendered by a utility and every rule, regulation, practice, act, requirement or privilege in any way relating to such rate, tariff, charge or other compensation and any schedule or tariff or part of a schedule or tariff thereof;
I. "renewable energy" means electrical energy generated by means of a low- or zero-emission generation technology that has substantial long-term production potential and may include, without limitation, the following energy sources: solar, wind, hydropower, geothermal, landfill gas, anaerobically digested waste biomass or fuel cells that are not fossil fueled. "Renewable energy" does not include fossil fuel or nuclear energy;
J. "service" or "service regulation" means every rule, regulation, practice, act or requirement relating to the service or facility of a utility;
K. "Class I transaction" means the sale, lease or provision of real property, water rights or other goods or services by an affiliated interest to a public utility with which it is affiliated or by a public utility to its affiliated interest;
L. "Class II transaction" means:
(1) the formation after May 19, 1982 of a corporate subsidiary by a public utility or a public utility holding company by a public utility or its affiliated interest;
(2) the direct acquisition of the voting securities or other direct ownership interests of a person by a public utility if such acquisition would make the utility the owner of ten percent or more of the voting securities or other direct ownership interests of that person;
(3) the agreement by a public utility to purchase securities or other ownership interest of a person other than a nonprofit corporation, contribute additional equity to, acquire additional equity interest in or pay or guarantee any bonds, notes, debentures, deeds of trust or other evidence of indebtedness of any such person; provided, however, that a public utility may honor all agreements entered into by such utility prior to May 19, 1982; or
(4) the divestiture by a public utility of any affiliated interest that is a corporate subsidiary of the public utility;
M. "corporate subsidiary" means any person ten percent or more of whose voting securities or other ownership interests are directly owned by a public utility;
N. "public utility holding company" means an affiliated interest that controls a public utility through the direct or indirect ownership of voting securities of that public utility;
O. "voting securities" means securities that carry the present right to vote for the election of directors or other members of the governing body ultimately responsible for the management of the organization; and
P. "future test period" means a twelve-month period beginning no later than the date a proposed rate change is expected to take effect.
History: 1953 Comp., § 68-3-2, enacted by Laws 1967, ch. 96, § 3; 1980, ch. 85, § 1; 1982, ch. 109, § 7; 1987, ch. 52, § 2; 1993, ch. 282, § 21; 1993, ch. 308, § 3; 1993, ch. 351, § 2; 1996, ch. 83, § 3; 1998, ch. 108, § 45; 2003, ch. 336, § 6; 2005, ch. 339, § 2; 2005, ch. 341, § 12; 2009, ch. 113, § 1.
ANNOTATIONSRepeals and reenactments. — Laws 1967, ch. 96, § 3, repealed former 68-3-2, 1953 Comp., relating to definitions for the Public Utility Act, and enacted a new 62-3-3 NMSA 1978.
Cross references. — For Public Utility Act repealing repugnant provisions of Rural Electric Cooperative Act, see 62-3-2 C and 62-15-32 NMSA 1978.
For definition of terms "public utility" or "utility", see 62-3-3 NMSA 1978.
For the Efficient Use of Energy Act, see Chapter 62, Article 17 NMSA 1978 et seq.
Compiler's notes. — Sections 62-3-1 to 62-3-5 of the Public Utility Act are still effective as the repeal of Chapter 62, Article 3 by Laws 1998, Chapter 108, Section 82, effective July 1, 2003 was repealed prior to taking effect by Chapter 23, Section 1, Laws 2003. Although Laws 2003, Chapter 336, Section 8, amended Laws 1998, Chapter 82, as amended, an amendment of a repealed section is ineffective. See Quintana v. N.M. Dep't of Corrs., 100 N.M. 224, 668 P.2d 1101 (1983). Laws 2003, Chapter 416, Section 5 also repealed Laws 1998, Chapter 108, Section 82, as amended, a second time, however, that repeal is of no effect as the section had previously been repealed by Chapter 23, Section 1, Laws 2003.
Laws 1937, Chapter 100, referred to in the first sentence in Subsection E, was repealed in 1939.
The 2009 amendment, effective June 19, 2009, added Subsection P.
The 2005 amendment, effective April 7, 2005, added Subsection G(6) to provide that public utility includes a plant, property or facilities for the sale or furnishing of goods or services to reduce the consumption or demand for utilities and is a public utility or an alternative emergency efficiency provider.
The 2003 amendment, effective June 20, 2003, inserted present Subsection I and renumbered subsequent subsections accordingly.
The 1998 amendment, effective January 1, 1999, deleted "Words and Phrases" in the section heading; substituted "public regulation" for "New Mexico public utility" in Subsection B; in Subsection C, substituted "commissioner" for "commissioners" near the beginning and deleted "any" preceding "a member of" near the end; substituted "a" for "any" near the beginning of Subsection D; in Subsection E, substituted "an individual, firm, partnership, company" for "individuals, firms, partnerships, companies" near the beginning, substituted "cooperative" for "cooperatives" near the middle of Subsection E, substituted "corporation or lessee, trustee or receiver" for "as amended, corporations and lessees, trustees or receivers" near the middle, and substituted "'Person' does" for "It shall" in two places in Subsection E; near the end of Subsection G, deleted "now does or hereafter"; and made minor stylistic changes throughout the section.
The 1996 amendment, effective March 6, 1996, substituted "utility" for "service" in Subsection B; inserted "class A counties as described in Section 4-36-10 NMSA 1978" in Subsection D; added the proviso at the end of Paragraph (5) in Subsection G; and made stylistic changes throughout the section.
The 1993 amendment, effective June 18, 1993, rewrote Subsection A and made stylistic changes in Subsection M.
The 1987 amendment, effective June 19, 1987, in Subsection G, substituted "stated in Section 62-3-4 and 62-3-4.1 NMSA 1978" for "hereinafter stated" in the opening clause and added Paragraph (5) and made minor language changes throughout the section.
Franchise fees are not rates. — Franchise fees charged by counties pursuant to Section 62-1-3 NMSA 1978 are not rates as defined in Section 62-3-3 NMSA 1978 and do not fall within the jurisdiction of the public regulation commission. El Paso Elec. Co. v. N.M. Pub. Regulation Comm'n, 2010-NMSC-048, 149 N.M. 174, 246 P.3d 443.
Franchise fees are not taxes. — Franchise fees charged by counties pursuant to Section 62-1-3 NMSA 1978 are not taxes that the public regulation commission may consider when setting rates. El Paso Elec. Co. v. N.M. Pub. Regulation Comm'n, 2010-NMSC-048, 149 N.M. 174, 246 P.3d 443.
Franchise fees are not items included in adjustment clauses. — Franchise fees charged by counties pursuant to Section 62-1-3 NMSA 1978 are not within the jurisdiction of the public regulation commission by analogy to fuel and purchased power adjustment clauses, over which the commission has jurisdiction under Section 62-8-7 NMSA 1978. El Paso Elec. Co. v. N.M. Pub. Regulation Comm'n, 2010-NMSC-048, 149 N.M. 174, 246 P.3d 443.
Line item charge for franchise fees. — The public regulation commission did not have jurisdiction to enter an order requiring a public utility to stop including on customer's bills the franchise fee charges paid by the utility to a county for the right to use county right-of-way to deliver utility service to county residents and businesses. El Paso Elec. Co. v. N.M. Pub. Regulation Comm'n, 2010-NMSC-048, 149 N.M. 174, 246 P.3d 443.
United States and governmental agencies are not "persons". — The legislature, under this section, did not see fit to include or even mention the United States or governmental agencies as "persons." Southern Union Gas Co. v. N.M. Pub. Serv. Comm'n, 1971-NMSC-035, 82 N.M. 405, 482 P.2d 913, overruled on another point by De Vargas Sav. & Loan Ass'n v. Campbell, 1975-NMSC-026, 87 N.M. 469, 535 P.2d 1320.
The words "person or corporation" do not in their ordinary signification mean a sovereign government. Southern Union Gas Co. v. N.M. Pub. Serv. Comm'n, 1971-NMSC-035, 82 N.M. 405, 482 P.2d 913, overruled on another point by De Vargas Sav. & Loan Ass'n v. Campbell, 1975-NMSC-026, 87 N.M. 469, 535 P.2d 1320.
Public Service Company of New Mexico. — Although considered a "public utility" under this section, the Public Service Company of New Mexico (PNM) is essentially a private corporation, not a public governmental agency, and its works are not to be considered as "public works" projects. Cnty. of Santa Fe v. Pub. Serv. Co., 311 F.3d 1031 (10th Cir. 2002).
Readiness to serve public is principal characteristic of public utility. — The principal determinative characteristic of a public utility is that of service to, or readiness to serve, an indefinite public (or portion of the public as such) which has a legal right to demand and receive its services or commodities. Llano, Inc. v. Southern Union Gas Co., 1964-NMSC-257, 75 N.M. 7, 399 P.2d 646.
In determining a public utility question, the test is whether or not a person holds himself out, expressly or impliedly, as engaged in the business of supplying his product or service to the public, as a class, or to any limited portion of it. Griffith v. N.M. Pub. Serv. Comm'n, 1974-NMSC-024, 86 N.M. 113, 520 P.2d 269.
The public or private character of the enterprise does not depend on the number of persons by whom it is used, but on whether or not it is open to the use and service of all members of the public who may require it, to the extent of its capacity. Griffith v. N.M. Pub. Serv. Comm'n, 1974-NMSC-024, 86 N.M. 113, 520 P.2d 269; Llano, Inc. v. Southern Union Gas Co., 1964-NMSC-257, 75 N.M. 7, 399 P.2d 646.
Sufficient part to clothe operation with public interest. — The phrase "to the public" means sufficient sales to the public to clothe the operation with a public interest and does not mean willingness to sell to each and every one of the public without discrimination. Griffith v. N.M. Pub. Serv. Comm'n, 1974-NMSC-024, 86 N.M. 113, 520 P.2d 269.
Class II transaction not found. — Electric utility's investment in building non-utility facilities for paper company in exchange for the company's promise to reimburse the utility over time through charges for steam and water service was not a purchase of a "security" under Subsection K(3) (now Subsection L(3)), and therefore did not constitute a Class II transaction, so as to require prior commission approval. Plains Elec. Generation & Transmission Coop. v. N.M. Pub. Util. Comm'n, 1998-NMSC-038, 126 N.M. 152, 967 P.2d 827.
Corporation not serving public is not public utility. — Where corporation had not held nor was holding itself as ready, willing and able to provide natural gas service to or for the public or any segment thereof, it could not be considered a public utility. Llano, Inc. v. Southern Union Gas Co., 1964-NMSC-257, 75 N.M. 7, 399 P.2d 646.
Water association in control of developer of subdivision is public utility, as the character of the use is to serve all members of the public who buy lots from the developer, and the extent of the use is that an entire housing development is dependent upon the association for a prime necessity of life. Griffith v. N.M. Pub. Serv. Comm'n, 1974-NMSC-024, 86 N.M. 113, 520 P.2d 269.
Formerly, cooperatives did not come within definition of "public utility". Socorro Elec. Coop. v. Pub. Serv. Co., 1959-NMSC-105, 66 N.M. 343, 348 P.2d 88.
Public service (now public regulation) commission was not required to delineate an electric cooperative's service area where part of its system was in an area previously certificated to another utility. Lea Cnty. Elec. Coop. v. N.M. Pub. Serv. Comm'n, 1965-NMSC-057, 75 N.M. 191, 402 P.2d 377, cert. denied, 385 U.S. 969, 87 S. Ct. 506, 17 L. Ed. 2d 433 (1966).
Cooperatives may not be made utilities but excepted from regulations upon others. — Laws 1961, ch. 89 (repealed), insofar as it attempted to place rural electric cooperatives under the Public Utility Act by including them within the definition of "public utility" constituted an arbitrary and unreasonable classification in violation of the equal protection clauses because cooperatives were included in the act though not required to render service to the general public and no provision was made for complete regulation of rates charged by them or securities issued by them, whereas other electric utilities had to render service to the public and their rates and financing were completely supervised and controlled. Community Pub. Serv. Co. v. N.M. Pub. Serv. Comm'n, 1966-NMSC-053, 76 N.M. 314, 414 P.2d 675, cert. denied, 385 U.S. 933, 87 S. Ct. 292, 17 L. Ed. 2d 213.
No distinction made between utilities based on form of ownership. — The New Mexico legislature has made no distinction between public utilities operated as individuals, firms, partnerships, companies or corporations. Nowhere in the New Mexico Public Utility Act is the commission given authority, for the purpose of rate-making, to make a distinction between a public utility operated as a corporation from one operated as a sole proprietorship. Moyston v. N.M. Pub. Serv. Comm'n, 1966-NMSC-062, 76 N.M. 146, 412 P.2d 840.
Municipality not an "interested electric utility." — The definition of "person" in Subsection E of this section controls the meaning of "interested electric utility" in Section 62-6-25B NMSA 1978 and, thus, a municipality that had not elected to come within the terms of the Public Utility Act was not authorized to seek wheeling orders from the commission. Pub. Serv. Co. v. N.M. Pub. Util. Comm'n, 1999-NMSC-040, 128 N.M. 309, 992 P.2d 860.
Regulation of "optional utility programs." — Commission had jurisdiction to require utility to establish a corporate subsidiary for purposes of instituting gas and electric "optional utility programs," which included surge suppression, maintenance and repair services, information services, and power quality solutions. PNM Elec. Servs. v. N.M. Pub. Util. Comm'n, 1998-NMSC-017, 125 N.M. 302, 961 P.2d 147.
Unregulated municipalities must comply with liquefied petroleum gas statutes. — Inasmuch as municipally operated and owned utilities are not subject to regulation by the public service commission (now public regulation commission) (unless they so elect), a village is required to comply with provisions relating to liquefied petroleum gas. 1948 Op. Att'y Gen. No. 48-5156.
Obligation of state agency. — A state agency, like any other user of utility service, has the statutory obligation to pay the rates therefor, including any late charges, under schedules approved by the commission, since late charges fall within the definition of "rate" in this section. 1988 Op. Att'y Gen. No. 88-80.
Extent of undertaking limits obligation to serve. — One who undertakes to serve the public undertakes an obligation which is limited by the extent of his profession, and he cannot be compelled to serve beyond the limits of that profession. Gas utility not required to serve city constructing line to utility's line. 1957 Op. Att'y Gen. No. 57-277.
Corporation may subject itself to regulation by selling electricity for resale to public. — When one utility sells electrical energy to another utility only, and not to the public, it is not subject to the provisions of this section, but notwithstanding the fact that by such operation it does not become a public utility, it subjects itself to regulation by the public service commission (now public regulation commission) when sale of the electricity is for resale to the public, to the extent necessary to determine that the cost to the utility shall be reasonable. 1952 Op. Att'y Gen. No. 52-5618.
Corporation may subject itself to regulation by selling water to municipal utility. — An individual operating a water service and selling at wholesale to a municipally-owned utility would be a public utility to the extent his operation affects the public interest and as such is subject to the jurisdiction of the public service commission (now public regulation commission). 1953 Op. Att'y Gen. No. 53-5715.
Law reviews. — For article, "Cost of Service Indexing: An Analysis of New Mexico's Experiment in Public Utility Regulation," see 9 N.M. L. Rev. 287 (1979).
For comment, "Regulation of Electric Utilities and Affiliated Coal Companies - Determining Reasonable Expenses," see 26 Nat. Res. J. 851 (1986).
For 1984-88 survey of New Mexico administrative law, see 19 N.M. L. Rev. 575 (1990).
Am. Jur. 2d, A.L.R. and C.J.S. references. — 64 Am. Jur. 2d Public Utilities §§ 1, 2, 82.
Irrigation company as a public utility, 8 A.L.R. 268, 15 A.L.R. 1227.
Conclusiveness of charter, as regards character of corporation as a public utility corporation, 119 A.L.R. 1019.
Incidental provision of utility services, by party not in that business, as subject to regulation by state regulatory authority, 85 A.L.R.4th 894.
73B C.J.S. Public Utilities §§ 2, 3, 15.
