In January 2025, we covered Kit Carson Electrical Cooperative’s (KCEC) $231 million grant award, announcing they’d received from the USDA’s Rural Utility Service’s New ERA program. Following the announcement, the cooperative began the planning, safety, engineering and environmental efforts to move the project forward.

Fast forward a year, the cooperative officially announced they intend to break ground on their planned Green Hydrogen Project in Questa in June of 2026, considering all things goes well with the ongoing reviews of the project. The project is expected to strengthen long-term energy reliability in northern New Mexico, while allowing the cooperative to respond to the growing energy demands across the northern region of the state.

Upon completion, the plant is expected to provide energy to approximately 25,000 homes annually, which will support the grid stability while ensuring a more resilient energy future for the region. Additionally, the project is expected to create 350 or so construction jobs with an estimated $298 million in regional benefit to the economy in the first five years. The project is also estimated to generate approximately $44 million in new tax revenue.

“With funding secured and major milestones completed, we’re moving forward with the project that will strengthen long-term reliability for Northern New Mexico. The Questa Hydrogen and Solar Facility is designed to deliver long-duration energy storage and help ensure our members have resilient, dependable power, especially during extreme emergency events and severe winter conditions,” says Luis A. Reyes, CEO of KCEC.

Mayor John Ortega says that the increased funding could assist in providing a full-time EMS and firefighting workforce and police force for the Questa area. Additionally, the village is expected to increase infrastructure projects and road upgrades to improve the overall community.

As widespread emergencies and climate-related catastrophes continue to impact communities across the nation, community leaders continue to express their support and optimism for the project, to increase community resilience and support local communities.

KCEC has been working to gain stakeholder involvement, hosting public community meetings where community members have been able to attend and address their concerns on the Green Hydrogen Project. Their most recent meeting was held on Wednesday, Jan. 21 at the Village of Questa where a presentation was given on water rights and allocation of water for this project by the former Office of the State Engineer John D’Antonio who is currently Kit Carson’s consultant on water right issues, discussed the process by which water would need to be approved for usage for the project.

Several individuals attending the meeting voiced their concerns about the project, including concerns about if the project could deplete the local water resources and aquifer. The State Engineer D’Antonio continued to reiterate that the water that would be used for this project are active water rights belonging to Chevron and would be reallocated to the project, considering all goes well in the review process.

D’Antonio explained that the Hearing Examiner within the Office of the State Engineer acts independently to schedule a hearing, examine any impairments, review facts and reviews petitions — then writes up a recommendation which will be reviewed by the State Engineer and general counsel of the state.

Several community members grew increasingly frustrated with lack of clear direction on how they could utilize the study for review from the OSE and walked out of the meeting early.

The New Mexico Office of the State Engineer (OSE) says they have not yet received an application for a water rights transfer from Chevron to Kit Carson Electric Cooperative, according to the agency.

The OSE posts all public notices related to water rights applications on its website: https://www.ose.nm.gov/NFP/nfp.php. Once the application from Chevron or Kit Carson Electric Cooperative is submitted, it will be made available through the agency’s online notice system and available for public input.