By - Jim Vess

Xcel Energy proposes replacing two coal-fired plants with mix of wind, solar and natural gas

Energize Weekly, September 6, 2017

Xcel Energy is proposing closing two Colorado coal-fired plants and adding wind, solar and natural gas-fired generation—raising its proportion of renewable electricity production in the state to 55 percent by 2026.

“We are very committed to decarbonizing when the technology and policy choices make it possible to do so,” said David Eves, president of Xcel’s Colorado subsidiary. “It’s all about the economics.”

If the utility goes forward with the program, it could lead to $2.5 billion in clean energy investments, primarily in rural Colorado, Eves said.

Eves said this proposal to consider amending the company’s electric resource plan, which is now before the Colorado Public Utilities Commission (PUC), is “in response to our customers both large and small” who want more clean energy.

One element spurring the plan is an attempt to get wind and solar projects locked in before the federal tax subsidies for these types of generation expire in 2021.

Xcel will not go ahead with the plan unless it also reduces customer bills and the bids for new generation come in lower than the cost of the coal-fired units, Eves said.

The plan, which the PUC must approve, calls for:

  • Retiring 660 megawatts (MW) of coal-fired generation at its Comanche Generating Station, in Pueblo, Colo., about 10 years early and seeking accelerated depreciation on the units.
  • Issuing bids for 1,000 MW of wind, up to 700 MW of solar and 700 MW of natural gas or storage.
  • Reducing of a rider used to finance renewable energy projects to 1 percent from 2 percent on a customer’s monthly bill.
  • Construction of a new switching station for a southern Colorado transmission “energy resource zone” to help foster the further development of renewable generating resources in rural Colorado.

“If this plan materializes, we would reduce carbon emission 60 percent by 2026 below 2005 level,” for the company, Eves said.

The proposal is being supported by independent power producers and the solar energy industry in Colorado, as well as major industrial and commercial customers, unions and environmental groups. The Colorado Office of Consumer Counsel, which represents residential ratepayers, also supports the proposal.

“We hope this agreement will make more room for affordable clean solar energy on the Xcel Energy system, while protecting the rights of customers to generate their own solar energy and receive fair credit,” Rebecca Cantwell, executive director of the Colorado Solar Energy Industries Association, said in a statement.

Erin Overturf, an attorney with Western Resource Advocates, an environmental policy group that supports the plan, said, “This is the beginning of a conversation among Coloradans about how Colorado will transition to a clean energy future.”

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