United Water New Mexico, Inc. v. New Mexico Public Utility Commission:: Why rules governing the condemnation and municipalization of water utilities may not apply to electric utilities

Despite substantial activity surrounding the municipalization of electric utilities as a means of obtaining lower electricity prices, when the New Mexico Supreme Court first confronted a case of the municipalization of a private utility by condemnation it dealt with a wafer and sewage utility. The court concluded that the New Mexico Public Utility Commission had no jurisdiction over Rio Rancho's condemnation of its local water utility. That decision, though good for water utilities, which often serve as a means for communities to control growth, may have detrimental effects on some of New Mexico's electricity consumers. Unlike water utilities, electric utilities are usually large and interconnected to numerous other communities. When one community leaves a system,the remaining communities will likely pay both financially and in terms of a decrease in service quality. Without oversight from the Public Utility Commission, those effects are not taken into consideration and balanced with other concerns when deciding when and how a community can leave a system. Las Cruces' municipalization of El Paso Electric's systems within its borders could require the remaining customers to pay higher rates, a concern that should be addressed by the Commission.