Six Years on, New Mexico Still Hasn’t Codified Governor’s Climate Goals

New Mexico’s 2026 legislative session marks the last chance for Gov. Michelle Lujan Grisham’s policy initiatives to become law while she’s still in office: Her term-limited tenure winds up at the end of the year. Meanwhile, the session begins, as ever, with concerns over revenue from the state’s biggest private-sector funder, the oil and gas industry. 

Booming oil production in New Mexico’s portion of the Permian Basin has driven state budgets to record highs in recent years. But in 2025, the state’s oil production rose only slightly while crude oil prices dropped dramatically — down roughly 25% since President Donald Trump returned to office last January. 

In its December revenue report, state economists with the Legislative Finance Committee said, The state’s “current price softness now outweighs production growth as the dominant downward influence on revenue projections.” Put plainly, slower production increases coupled with much lower oil prices will lead to a shallower growth curve in future revenues for the state. 

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Even if it’s slowing, that production still creates a lot of pollution. Lujan Grisham’s third executive order upon taking office in 2019 was to set the state on a path to a 45% reduction in greenhouse gas emissions by 2030 compared to 2005 levels. Despite repeated attempts in the Legislature, that goal has not yet been codified in law. 

Meanwhile, the state’s Climate Action Plan released last month upped the challenge, angling for an 82% reduction by 2050, with carbon offsets covering the remainder to achieve net zero emissions. 

Carbon offsets — in which a company reduces or removes carbon from the environment in one place to offset emissions elsewhere — may be the controversial change that finally gets the governor’s 2019 policy over the line and signed into law.

“This is the session to pass comprehensive climate legislation,” said Camilla Feibelman, director of the Sierra Club Rio Grande Chapter.

Last year’s Clear Horizons & Greenhouse Gas Emissions Act was the latest attempt to codify Lujan Grisham’s executive order. All attempts have died, with last year’s effort being voted down when two Democrats — Sens. Benny Shendo (D-Jemez Pueblo) and George Muñoz (D-Gallup) — joined all Republicans in a Senate committee hearing to kill it. 

Like earlier versions, it called for direct reduction and removal of greenhouse gases at their sources. That requirement met stiff opposition from the oil and gas industry, which would have to dramatically reduce leaks, venting and flaring across the board. The act died following an ad campaign by the New Mexico Oil and Gas Association decrying the bill and the bill’s main sponsor, Sen. Mimi Stewart (D-Bernalillo), who is also president pro tempore of the Senate. 

Stewart again is the main sponsor of a new version of the Clear Horizons & Greenhouse Gas Emissions Act, this year’s attempt to cement the governor’s executive order into law. But the senator’s bill has changed over the past 12 months. She described its main points in a phone call, since it had not been filed as of publication.

“Overall, the bill is shorter and leaner,” she said. In addition, it specifically exempts people or businesses emitting less than 10,000 metric tons of greenhouse gases annually. Earlier versions of the bill “never attempted to scoop in those small emitters,” Stewart said, and the explicit carve-out should make it more palatable to more legislators.

The biggest change comes in how reductions can be counted. The new bill would allow certified reductions through carbon offsets as opposed to direct reductions at the point of pollution. Stewart said offsets could include soil and agriculture improvements or carbon capture projects. She stipulated that the offsets “have to be in New Mexico, and they have to be real, permanent, quantifiable, verifiable and enforceable.”

Stewart added: “The certification process will be in-house, will be in state” and will be conducted by the New Mexico Environment Department. 

“We’re not going to farm this out to a bogus certification company,” she said.

She said the change adding offsets emerged after meetings with small and large oil and gas producers, including EOG Resources Inc., Chevron Corp. and ConocoPhillips Co. Stewart said the Chevron representative was Patrick Killen, a registered lobbyist who for the past few election cycles has been the largest single contributor to New Mexico politicians — more than $2.3 million between 2021 and 2025 — on behalf of his employer, according to state campaign finance records. He did not respond to requests for comment. 

Stewart said she did not meet with the New Mexico Oil and Gas Association. “That was not very helpful last year,” she said. “It’s much better to actually meet with the oil and gas industry themselves.”

Asked about the return of the bill, Missi Currier, president and CEO of the New Mexico Oil and Gas Association, said only, “If [it is] filed, NMOGA will request feedback from membership to determine a position on the bill.”

Michael Coleman, director of communications for Lujan Grisham, said, “The governor is interested in all technologies that can help reduce our carbon footprint, and she appreciates [Stewart’s] work to provide options for companies doing business and technology development in the state.”

For years now globally, carbon offsets have been a controversial form of greenhouse emission reduction that often don’t meet stated goals and have been tainted by allegations of fraud. Industrial-scale carbon capture and sequestration projects also have a checkered history of not meeting either budgetary or sequestration goals.

Erik Schlenker-Goodrich, executive director of the nonprofit Western Environmental Law Center, said that his group will not take a position on the bill until it is publicly filed. But, he said, “Offsets are fraught with peril and deeply problematic.” He pointed to the history of verification problems associated with them and added, “We also don’t like them because the fossil fuel industry uses them to greenwash their operations.”

However, the offsets may be “a necessary concession to secure buy-in from certain industry-friendly legislators,” he said.

“I do understand the political logic,” Schlenker-Goodrich said. “The question is whether the logic works.”

If the bill passes this session, it would require implementation rules to be drawn up and approved by the Environment Department’s Environmental Improvement Board. 

Schlenker-Goodrich said the new rules wouldn’t be “a guarantee of success by any means, but it does provide some assurance that the bill would be implemented in a pragmatic and effective manner.” There will be “lots of angels and devils in the details,” he said. 

“Offsets can mean a lot of different things, and with strong, technical rulemaking I think we can avoid the worst,” Feibelman said.

The new Clear Horizons Act isn’t the only climate- and oil-and-gas-related bill that will be debated this session. Stewart said she will propose a big bump in tax credits for new solar installations, increasing the current 10% state tax credit to 30% to make up for the loss of a federal 30% credit that was killed by the Trump administration. 

The New Mexico Oil and Gas Association is also looking forward to some legislation. Last session, regular public comments called for the industry to clean up abandoned well sites and other infrastructure. Republican legislators pushed back, arguing that money from the state Reclamation Fund — the purpose of which is, in part, to pay those costs — was siphoned off to pay for items in the state’s general budget.

Reporting last year by Capital & Main highlighted how oil and gas producers can fail, leaving behind unplugged wells and leaking equipment to degrade in New Mexico’s high desert climate. Depending on the size of the failure, a cleanup can cost state and federal agencies millions. A report published last summer by the Legislative Finance Committee warned that the state could be responsible for $700 million to $1.6 billion in cleanup costs in coming years. In April last year, the Reclamation Fund had $66.7 million, its highest balance ever, according to the report.

Currier and others want to update the fund to make sure more of that money goes toward oil and gas field cleanup. 

“The Reclamation Fund, funded exclusively by the oil and gas industry, is the state’s best and most underutilized resource to ensure our lands are returned to their native state safely and efficiently,” she said. 

*   *   *

Last year’s legislative session ended in March with four huge numbers:

• $10.8 billion.
• $10 billion.
• $400 million.
• $300 million.

The first figure is the total state budget passed by the Legislature in 2025 — a record.

The second is the amount Rep. Derrick J. Lente (D-Sandia Pueblo) claimed oil and gas companies made in profits in New Mexico in 2024. He brought this up during a committee hearing as an argument in favor of an increase in oil taxes so they would match the tax paid on natural gas extracted in the state. 

The third is the amount that the proposed oil tax increase could have added to state coffers this year had it passed in its original form, according to the Legislative Finance Committee. That proposal, following several debates, shrinkage and its addition to another tax bill, eventually died.

And the last number is the amount that the Rio Grande Chapter of the Sierra Club tallied as money spent on climate change mitigation and economic programs in the state’s final budget last year.

It’s unclear if the oil tax change will reappear at this session. Its sponsors, Reps. Nathan Small (D-Doña Ana) and Meredith Dixon (D-Bernalillo), did not respond to requests for comment.

It is clear that New Mexico faces another warm and dry winter. “This winter has just been the epitome of what a climate change winter is,” said Feibelman, the Sierra Club director. “There is no explanation for what’s going on except for climate change”

December 2025 was the warmest December on record for many towns and cities in New Mexico. The year was the fourth-warmest on record for the country and the third-warmest for the planet.

“It’s just no longer possible to ignore what climate change looks like or the people who power climate change,” Feibelman said.

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