Colorado Hits Pedal on Transition from Coal with Nearly $3 Billion in Renewable Projects

Researched by Industrial Info Resources (Sugar Land, Texas)--Colorado's legislators are pushing harder than those in other Rocky Mountain states to reduce its reliance on coal-fired power generation, and power producers are making strides in adopting new sources. While coal provided just more than 50% of Colorado's net generation in 2017, according to the U.S. Energy Information Administration (EIA), renewables had more than doubled since 2010 to nearly 25% of the state's output, led by wind power. Industrial Info is tracking nearly $3.5 billion in active power-generation projects in Colorado, more than 80% of which is renewable-sourced.

Click on the image at right to see a graph detailing the top 10 Colorado counties for power-generation projects, by investment value.

The gloomy future for fossil fuels is bedeviling Xcel Energy Incorporated (NASDAQ:XEL) (Minneapolis, Minnesota), which faced a tough audience earlier this month when it petitioned the Colorado Public Utilities Commission for a rate increase. Although it has agreed to retire units 1 and 2 at its Comanche coal-fired power plant in Pueblo, Colorado, earlier than initially scheduled, critics still believe the company still gets too much of its energy from fossil fuels, including 40% from coal, according to The Denver Post. For more information on Comanche, see Industrial Info's plant profile.

Xcel, which has vowed to go carbon-free by 2050, can point to a pair of projects in the Centennial State that indicate its trajectory: the $800 million Cheyenne Ridge Wind Project near Cheyenne Wells, which will generate 500 megawatts (MW) from more than 200 Vestas turbines, and the estimated $30 million closure of two coal ash landfills near the Pawnee Power Station in Brush. The latter project is intended to comply with the U.S. Environmental Protection Agency's (EPA) Coal Combustion Residual rule; although the EPA recently proposed rolling back the regulation, Xcel would be unlikely to substantially change the project if the agency were to do so.

The Cheyenne Ridge project is under construction and is set to wrap up at the end of 2020, while the Pawnee project is not expected to begin until late 2022, at the earliest. For more information, see Industrial Info's reports on the Cheyenne Ridge and Pawnee projects.

Tri-State Generation & Transmission Association (Westminster, Colorado), a wholesale power provider, announced last month that it would hit the accelerator on its own transition from coal. "We don't see a future beyond 2030 for coal production and generation," Duane Highley, the chief executive officer of Tri-State, told the Colorado Public Utilities Commission in mid-October.

Colorado also is home to a slew of solar projects, including three that are nearing or under construction: Duke Energy Corporation's (NYSE:DUK) (Charlotte, North Carolina) $125 million Palmer Solar Plant, and NextEra Energy Incorporated's (NYSE:NEE) (Juno Beach, Florida) $70 million Grazing Yak Solar Plant in Calhan, which will generate 60 and 35 MW, respectively, from photovoltaic (PV) modules; and DEPCOM Power Incorporated's (Pelham, Alabama) $32 million Rawhide Solar/Battery Plant in Wellington, which will generate 22 MW from PV modules and include a battery-energy storage system.

The Palmer and Grazing Yak projects began construction earlier this year and are expected to wrap up toward the end of December; the Rawhide project is set to kick off in the first quarter of next year and to be completed over the summer. For more information, see Industrial Info's reports on the Palmer, Grazing Yak and Rawhide projects.

Among the solar projects proposed to begin construction later next year is Cypress Creek Renewables LLC's (Santa Monica, California) estimated $136 million Sundance Solar Park in Kiowa, which is designed to generate 75 MW from 333,000 PV panels. For more information, see Industrial Info's project report.

Hydropower currently edges solar for energy produced in Colorado. Two notable projects are under construction and set to wrap up toward the end of the year: Southeastern Colorado Water Conservancy District's $20 million addition at the Pueblo Dam, which would add a 7-MW powerhouse to the facility, and the U.S. Bureau of Reclamation's $8.5 million refurbishment at the Green Mountain Hydro Power Station in Silverthorne, which will extend the service lives and improve the reliability for the penstocks on two units. For more information, see Industrial Info's reports on the Pueblo Dam and Green Mountain projects.

In addition to the above-mentioned capital-spending projects, Industrial Info is tracking more than $96 million in maintenance-related projects planned for power-generation facilities across Colorado. Click here for a list.

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