DOE Cuts Hit New Mexico — Projects, Reactions, and Political Fallout

A sudden, wide‑ranging action by the U.S. Department of Energy terminated roughly $135 million in funding for 10 New Mexico energy projects as part of a nationwide rescission that canceled about $7.56 billion across 223 projects, a move officials said followed a programmatic review and drew immediate statewide political fire

What was canceled?

New Mexico Institute of Mining and Technology — CarbonSAFE Phase III commercial carbon‑storage hub, $42.7 million.

PNM (Public Service Company of New Mexico) — Virtual power plant enablement, $35.6 million.

Kit Carson Electric Cooperative — Distributed battery storage for grid resiliency, $15.4 million.

Navajo Transitional Energy Company — CO2 capture pilot at Four Corners, $6.6 million.

Pajarito Powder, LLC — Two manufacturing/scaleup awards, $10.0 million and $8.5 million.

Solar Dynamics — Solar thermal biosolids‑to‑fertilizer demo, $3.0 million; plus smaller New Mexico Tech awards for direct air capture and methane mitigation totaling about $13.5 million.

A complete project list and award amounts was compiled and released by Senate offices and circulated to the press.

Political reactions — rapid and blistering

U.S. Senator Martin Heinrich called the cancellations “nakedly political, unhinged, and unlawful,” saying the projects were Congress‑approved investments that create jobs and lower energy costs, and that he had not been warned by DOE leadership before the cuts were announced.

Rep. Teresa Leger Fernandez warned that contractors and utilities could be left holding contractual obligations that may push costs onto ratepayers.

Rep. Gabe Vasquez and other New Mexico Democrats criticized the move for its economic harm to research institutions and regional partners, especially New Mexico Tech, which lost multiple awards

National political coverage framed the removals as part of a broader administration effort targeting projects in Democratic‑led states, drawing cross‑bench commentary about political motivations and fiscal oversight.

New Mexico Republican Party officials stressed the need for transparency from federal authorities and called for state strategies that emphasize private‑sector solutions, tighter budget discipline, and reforms to reduce dependency on federal grants and a need to focus on oil and gas production rather then renewable energy projects. 

Local industry, utility, and academic fallout

Affected utilities and project leads said they were stunned and scrambled to assess exposure: PNM said it was evaluating impacts while assuring customers its Grid Modernization work continues; Kit Carson’s CEO noted the co‑op had already invested millions and planned to appeal any termination notices; New Mexico Tech reported it had not yet received formal termination letters and was assessing next steps for its multi‑partner CarbonSAFE work. Analysts warned the cancellations risk job losses, will stall manufacturing scale‑ups, and delayed grid‑resilience upgrades that could increase long‑term costs for consumers and slow regional clean‑energy industrial growth.

Legal and administrative next steps

DOE gave awardees a limited window to appeal terminations; several recipients signaled plans for administrative appeals and to pursue alternate funding sources, including state support, private investment, or foundation grants. Congressional offices have promised oversight inquiries and are weighing legal and legislative responses as recipients quantify contractual liabilities and workforce impacts.

The cuts ripple beyond project budgets: they strike at workforce pipelines, university‑lab partnerships, rural wildfire‑resilience plans, and manufacturing supply‑chain investments that leaders say would have bolstered New Mexico’s economy and energy security.

The combination of politically charged timing and the scale of funding pulled turned an administrative decision into a flashpoint for state leaders and stakeholders calling for swift remedies and accountability.

Sources: DOE rescission and project lists; statements from Sen. Martin Heinrich and New Mexico congressional offices.

2nd Life Media political researcher Mica Maynard

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