A legislative initiative originally presented as a boon for local, resilient energy in underserved communities across New Mexico has instead become a lightning rod for controversy, accused of creating loopholes that facilitate the unchecked expansion of energy-intensive industrial developments, including one of the largest proposed artificial intelligence data centers in the Western United States. State Senator Michael Padilla, a Democrat, championed a bill during the 2025 legislative session, articulating a vision for a modern, thriving New Mexico economy by incentivizing the construction and installation of microgrids. He emphasized that such development, whether for residential subdivisions or data centers, would align with the state’s environmental objectives by fostering clean energy technologies and significantly reducing greenhouse gas emissions.

Globally, and particularly across the United States, electricity demand is surging, pushing existing grids to their limits and leading to widespread concerns about reliability, manifested in rolling blackouts that plague regional energy networks. In response, diverse entities—from critical infrastructure like hospitals and universities to remote small towns, low-income communities, and sovereign tribal nations—have increasingly looked to microgrids as a robust solution. These localized energy systems offer resilient, self-sourced power, often leveraging renewable resources such as solar or wind. Senate Bill 418, as initially conceived by Senator Padilla, appeared to embody this progressive approach, promising decentralized, sustainable energy solutions for New Mexico.

However, the narrative took a sharp turn when Padilla’s original microgrid bill failed to advance, reportedly due to lingering environmental concerns. In a dramatic, eleventh-hour legislative maneuver, a significantly altered and pared-down version of the microgrid proposal was resurrected and passed as an amendment to a broader grid modernization measure, House Bill 93. At the time of the vote, no specific microgrid project was highlighted, leading many legislators to believe it served the original community-centric purpose. It was only in retrospect, months later, amidst escalating local opposition to Project Jupiter—a colossal 1,400-acre AI data center slated for southern New Mexico—that the true intent and beneficiary of the amendment became glaringly apparent: it was tailor-made for large-scale industrial interests.

State Representative Kristina Ortez, a Democrat and co-author of the original House Bill 93, expressed profound dismay, stating she felt "hoodwinked." She had initially supported the amendment, under the impression it would benefit essential local services such as hospitals, schools, and fire departments. The realization that it facilitated a massive industrial project with significant environmental implications struck her forcefully when Project Jupiter’s plans emerged into public discourse, leading her to exclaim, "Oh, my God, this is what that amendment allowed to happen."

The intricate web of influence began to unravel when it was revealed that Jennifer Bradfute, a lobbyist representing Borderplex Digital Assets—one of the key developers behind Project Jupiter—was present alongside Senator Padilla during a committee meeting where he initially described his bill. Padilla introduced Bradfute as an "energy expert," who then spoke about her work on extensive digital infrastructure projects across the Borderplex region, encompassing areas like Las Cruces and Santa Teresa, New Mexico, El Paso, Texas, and Ciudad Juárez in Mexico, as well as in central New Mexico near Isleta Pueblo. Bradfute highlighted the focus on solar power generation and underscored the need for microgrids that could be developed more rapidly than traditional public utility expansions, especially to serve Native American communities currently lacking reliable grid access. In a subsequent hearing, she openly articulated the urgent need for the bill to provide "sufficient legal certainty to invest $5 billion and create 1,000 jobs," clearly signaling the industrial scale of the proposed ventures.

Despite early support, the microgrid bill faced significant environmental opposition, ultimately leading to its demise. Yet, as New Mexico’s 60-day legislative session drew to a close, House Representative Nathan Small, another influential Democrat, convened a critical, last-minute meeting in his chambers. The objective was to push through specific language from the defunct microgrid bill as an amendment to House Bill 93, the grid modernization legislation. This amendment sought to permit the generation and distribution of self-sourced power, enabling "qualified" microgrids to produce 20 megawatts or more of energy—a substantial capacity capable of powering a small city. Crucially, the amendment also stipulated that, unless a microgrid intended to sell energy to a public utility company, it would be exempt from regulation by state authorities.

The intense negotiations in Small’s chambers yielded a critical concession: an added provision requiring all microgrids to conform to the Energy Transition Act (ETA). The ETA is New Mexico’s landmark climate legislation, mandating that all energy generated and sold by public utilities must come from net-zero carbon resources by 2045. This provision was intended to safeguard the state’s ambitious climate goals. However, the legislative process that followed was remarkably swift. Later that same day, Senator Padilla presented the amendment to the state Senate with a brief introduction. Paper copies of the complex language were hastily distributed, and senators were reportedly still reviewing the text when a voice vote was called to incorporate the amendment into the bill. Within minutes, the entire measure passed the Senate, and the following day, the House concurred, approving the amended bill.

The passage of this legislation has since opened the floodgates for Project Jupiter and other major industrial developments that starkly diverge from the localized, community-focused microgrid solutions initially envisioned. Beyond Project Jupiter, other significant industrial players have emerged. Near a residential subdivision in Rio Rancho, Castileon Corp. is constructing "Project Ranger," a sprawling 1,000-acre hypersonic missile manufacturing facility. This project has raised serious safety concerns, particularly regarding the potential for dangerous chemical fires, as highlighted by investigative reports. Concurrently, Pacific Fusion has broken ground on a $1 billion research and manufacturing campus near Albuquerque, dedicated to building modular nuclear fusion power plants primarily for nuclear weapons research. Both projects promise hundreds of high-paying local jobs, yet they introduce substantial environmental and safety risks to their respective communities.

Project Jupiter’s proposed microgrid is designed to generate an astonishing amount of energy—approximately the same as New Mexico’s largest public utility, PNM, enough to power half a million homes. This capacity is more than 100 times the 20-megawatt minimum specified in the amendment. The core of this immense power generation will come from fuel cells that convert natural gas into electricity. While fuel cell technology is often touted for its efficiency, relying on natural gas as a primary fuel source presents a significant challenge to New Mexico’s net-zero carbon aspirations, as it still involves the combustion of fossil fuels and associated greenhouse gas emissions.

Project Jupiter’s next significant hurdle is securing an air quality permit from the New Mexico Environment Department (NMED). Following NMED’s rigorous questioning regarding the "accuracy of emissions testing" in the initial permit application, Project Jupiter’s developers, Oracle Cloud Infrastructure and Yucca Growth Infrastructure, announced a voluntary reduction in projected emissions by 35%, from 8.8 million tons to 5.7 million tons per year. Mahesh Thiagarajan, executive vice president and head of Oracle Cloud Infrastructure, asserted that NMED’s staff had asked "hard technical questions" and pushed the developers to address public concerns. It is important to note that while the data center campus is already under construction, the microgrid, a distinct facility requiring the air quality permit, has not yet commenced building.

However, even with the reduced emissions, the projected 5.7 million tons of annual greenhouse gases are comparable to the total pollution generated by the cities of Albuquerque, Santa Fe, and Las Cruces combined, according to Mariel Nanasi, a senior attorney and executive director of New Energy Economy, a Santa Fe-based nonprofit advocating for clean energy and environmental justice. Nanasi’s organization has filed a motion to dismiss Project Jupiter’s air quality permit application, emphasizing that these emissions would be concentrated in the Paso del Norte region, which includes Santa Teresa—an "already vulnerable environmental justice community" disproportionately impacted by environmental burdens. Nanasi unequivocally described the microgrid amendment to HB 93 as "the precursor to Project Jupiter," arguing it was an "end run around public regulation." She pointed out that before this amendment, a 2019 state law mandating public utilities’ transition to renewable energy would have granted the Environment Department and the Public Regulation Commission (PRC) oversight over entities causing a "material increase" in greenhouse gas emissions. While a single household’s solar panels or a hospital’s backup generator would not trigger such oversight, Project Jupiter’s monumental emissions certainly would have, effectively bypassing critical environmental review.

In the subsequent 2026 legislative session, Senator Jeff Steinborn, a Democrat, introduced a microgrid oversight bill aimed at restoring state authority to regulate these systems, requiring adherence to renewable energy standards, and preventing adverse impacts on utility rates. Although it successfully passed the Senate, the bill inexplicably failed to secure a hearing in the House, leaving the regulatory vacuum largely unaddressed.

Much of the groundwork enabling Project Jupiter unfolded with minimal public awareness. In late 2024, state officials from the Environment Department and other key agencies secretly convened to draft the terms of a memorandum of understanding with Jennifer Bradfute, the lobbyist for Borderplex Digital Assets. This clandestine planning culminated in an official signing ceremony in February of the following year, where Governor Michelle Lujan Grisham publicly announced a "groundbreaking partnership" projected to inject $5 billion in investment and create 1,000 jobs in the Borderlands region through construction, IT, and equipment purchases. Senators Padilla and Small were both present at this announcement. Save for this official declaration, Project Jupiter and Borderplex Digital Assets, an Austin-based tech company, remained virtually unknown to the public as the 2025 legislative session commenced. The company has since declined multiple requests for comment.

The clandestine nature of these proceedings extended to the legislative process itself. Representative Small, a powerful figure in the New Mexico Legislature, held a pivotal "eleventh-hour" meeting with environmental advocates who had previously opposed the original Senate bill. Small reportedly conveyed to the advocates that reaching an agreement was the only viable option, characterizing the unnamed project as a significant economic boon for southern New Mexico and a strategic move to diversify the state’s economy away from its reliance on oil and gas. Present at this tense negotiation table were Bradfute, representing Borderplex Digital Assets, and Cholla Khoury, the chief of staff of the Public Regulation Commission. After hours of intense discussion, the advocates reluctantly conceded to the amendment, but only on the critical condition that it explicitly include language mandating adherence to the Energy Transition Act’s 2045 renewables deadline for any energy generated and sold by a qualified microgrid. For some, this concession offered little solace. Later that evening, Bradfute made a few final revisions via email, indicating she would forward them to the "drafter"—the legal professional responsible for transforming the language into statute. Less than an hour later, the amendment was already being put to a vote in the Senate.

This intricate timeline and the details of these negotiations have been pieced together through extensive interviews with over a dozen individuals and a meticulous review of emails obtained via public records requests. Representative Small, in a statement, defended his involvement, asserting that as Chair of the House Appropriations and Finance Committee, he is frequently invited to meetings by stakeholders, including environmental advocates, to discuss legislation with significant fiscal implications. He maintained that without this bill, the state would face greater difficulty in regulating the burgeoning number of microgrids and controlling energy costs for New Mexicans. A spokesperson for the Public Regulation Commission confirmed Chief of Staff Cholla Khoury’s attendance at the March 20, 2025 meeting, stating it was "to provide information regarding PRC authority and regulation of investor-owned utilities in New Mexico," and clarified that the PRC "provided information only and did not support any agreement or subsequent legislation." Jennifer Bradfute has consistently declined to comment on these matters.

Representative Ortez recounted that she was engaged in debating another bill on the House floor when the critical closed-door meeting took place. She only learned about its existence afterward from some of the environmental advocates who were present, including Tammy Fiebelkorn, government affairs manager for Western Resource Advocates and an Albuquerque City Councilor. Fiebelkorn later testified about the secretive meeting during an interim committee hearing, under questioning from House Representative Micaela Lara Cadena, whose district encompasses the area targeted by Project Jupiter. Representative Cadena did not mince words, declaring to hearing participants that this was "one of the dirtiest pieces of politics I’ve now seen and felt in our political body." Western Resource Advocates declined to comment further on the issue.

Senator Padilla, who was present at the hearing, vehemently denied any "underhanded" dealings, asserting that he had engaged in "very detailed conversations" with Ortez in the lead-up, ensuring she "knew exactly what we were doing on the Senate side." However, Ortez directly contradicted this claim, telling reporters, "I don’t remember having an in-depth conversation with him. I surely did not have the conversation that this was for a data center. Absolutely that did not happen."

The saga also raised questions about campaign finance and potential influence. Representative Ortez disclosed that another lobbyist associated with Borderplex Digital Assets, Vanessa Alarid, a controversial figure, sent her a $10,000 campaign donation, which Ortez said she promptly returned. (This donation is not reflected in publicly available campaign finance records.) Representative Small, records show, received a $10,000 donation from Borderplex Digital Assets in August 2025, which he returned in June 2026, after the primaries. Small stated that he returned the contribution "in response to the environmental and community concerns I heard from constituents in our district about this new, fast-moving industry," adding that he now supports a temporary moratorium on data center construction. Alarid did not respond to requests for comment. Senator Padilla, meanwhile, received multiple campaign donations totaling $42,400 on a single day from a cluster of individuals linked to Alarid. Of these donations, he simply stated, "I raise money from a lot of different sources. I don’t know who she’s connected to or not connected to."

While the initial concept of an amendment enabling microgrids to operate in the state could genuinely have been a "good thing," offering a sustainable alternative to traditional electrical utility monopolies, Ortez cautioned that microgrids can also serve as "Trojan horses for industry," particularly for energy-intensive ventures like data centers. When asked if the microgrid amendment served as a lesson for other states grappling with similar energy and development pressures, Ortez’s response was stark: "Hell yeah, this is a cautionary tale. As a legislator, when there are amendments that you don’t know the ramifications of, you have to continually ask." The New Mexico experience underscores the delicate balance required to foster economic development, ensure energy security, and uphold environmental integrity, especially as states navigate the complex demands of emerging industries and the imperative of climate action.