Regulators in New Mexico are challenging Facebook’s proposed power purchase agreements (PPAs) designed to power its Los Lunas data center.

Local utility Public Service Company of New Mexico (PNM) and Facebook, through its Greater Kudu LLC subsidiary, have signed PPAs for 50MW of solar energy from Encino North Solar Energy Center, 190MW of solar from Sky Ranch Solar Facility, and 100MW of four-hour energy capacity (400MWh) from Sky Ranch Energy Storage Facility.

However, when the PNM sought approval from the local energy regulator, the New Mexico Public Regulation Commission (PRC) ruled that the design of the agreements’ current structures are not in the public interest and issued an order of continuance.

“While PNM’s current proposal could result in economic development benefits and renewable energy benefits that may be in the public interest, PRC staff found that they could not conclude that there would be “no net adverse impact” on PNM’s other customers, as required by the special services contract,” according to the order.

The Commission found that the arrangement, as currently written, could result in annual revenue shortfalls ranging in the millions of dollars, which other customers would have to cover due to the credits that could completely zero-out Facebook’s bill.

“The Commission noted this is not logical— that a customer could reduce its bill by using more resources,” it said.

The PRC wants PNM and Greater Kudu to address the Commission’s concerns with the proposed financial transaction.

District 1 Commissioner Cynthia Hall said she saw “no reason for many of the provisions [in the proposal] other than to make it complicated.” Commissioner Hall called on PNM and Greater Kudu, LLC, to create “a simple agreement…that is separate and distinct from PNM serving their remaining customers in New Mexico.”

Sky Ranch Solar, a subsidiary of NextEra Energy Resources LLC, is planning to build a 1,600-acre solar farm in the Rancho Cielo area south of El Cerro de Los Lunas. The project will have a capacity of up to 190MW of solar energy and 100MW of battery energy storage. The Valencia County News Bulletin the company is looking to negotiate an Industrial Revenue Bond worth about $273 million for its construction.

Facebook opened a third data center at its Los Lunas facility last year, with three more planned between now and 2023. In February the social network giant said it planned to build two additional buildings on the site, though locals voiced concerns about the company’s water use. In 2018, the company announced it was investing in two 50MW solar farms to help power the data center campus.

FB recently had energy troubles in Oregon after a complaint about its energy supplier’s renewable energy offerings threatened to cut off the company’s only source of renewable energy in the state. In May the local Commission ruled in the social network’s favor and allowed it to stay on the tariff in question.

Facebook last week said it had joined the European Union’s Climate Pact.