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Released November 07, 2017 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Public Service Company of Colorado (PSCo) (Denver, Colorado), a unit of Xcel Energy Incorporated (NYSE:XEL) (Minneapolis, Minnesota), stands ready to make up to $2.5 billion in gas-fired and renewable electric generation investments in Colorado if the price is right and state utility regulators support the utility's request.
Earlier this year, PSCo issued requests for proposals (RFPs) for up to 1,000 megawatts (MW) of new wind generation, 700 MW of new solar generation and 1,000 MW of new gas-fired generation, all of which the utility would like to see built in Colorado. The bids are due by the end of November, according to PSCo spokesperson Michelle Aguayo. She said if building the new generation costs less than continuing to operate 660 MW of coal-fired generation in southern Colorado, the utility will close the existing coal-fired generation and build the new generation.
The coal-fired generation to which Aguayo referred is units 1 and 2 of its Comanche Generating Station, which began operating in the 1970s. The utility has been widely criticized by environmental groups for adding a third coal-burning unit at Comanche a few years ago. The utility is not considering closing Comanche Unit 3, only units 1 and 2, and only if the cost of new renewable generation is lower than the cost to continue operating those two units. If that turns out to be the case, PSCo said Unit 1 would be retired by the end of 2022, and Unit 2 would be retired no later than the end of 2025.
PSCo also said it would only move forward with the plans to build new generation if the costs do not increase customers' electric prices.
If all of that new generation is built, and if Comanche units 1 and 2 were retired, the utility's carbon dioxide (CO2) emissions could be reduced by up to 60% by 2026 compared with 2005 emission levels, the utility estimated.
The RFPs issued by PSCo did not specify where in Colorado the new generation would be built. The new generation PSCo is seeking is separate from the large windfarm it is constructing in eastern Colorado. Construction has begun on the Rush Creek Windfarm, a $1 billion, 600-MW windfarm, and that project is scheduled to begin generating electricity in October 2018.
The Colorado Public Utilities Commission (Denver, Colorado) may issue a decision on PSCo's electric resource plan, which includes the new wind, solar and gas generation, in the next few months, possibly by the end of 2017.
When PSCo filed its "Colorado Energy Plan" with state utility regulators in late August, it highlighted that plans for the new generation were reached as part of a process that included 14 different intervenor groups, including a few the utility has crossed swords with in the past.
"We have a responsibility to meet our customers' energy needs," David Eves, president, Xcel Energy -- Colorado, said in a statement August 29. "Our customers expect us to provide low-cost power and increase the use of cleaner energy. As the state's largest utility, it is important to us that we also support rural areas in Colorado, and this proposal's investment will accomplish this goal. The proposal could increase renewable energy to 55% by 2026, save customers money, and dramatically reduce carbon and other emissions."
The August 29 filing by PSCo "starts a conversation about how Colorado will transition to the clean energy economy of tomorrow," added Erin Overturf, WRA chief energy counsel for Western Resource Advocates (WRA) (Boulder, Colorado). "If approved, the commission will have an opportunity to evaluate transitioning our power production away from coal and toward less expensive, clean renewable resources. We ask the CPUC to consider this plan and welcome an open, collaborative conversation among all stakeholders to create our affordable, clean energy future."
But two powerful Republican state senators blasted the PSCo move. "Renewable energy providers in Colorado already profit from a wide variety of special preferences and handouts, including some of the highest renewable energy mandates in the country, but apparently that's not enough for one utility, which is pulling a bit of a fast one by going to the PUC for something it couldn't get passed through the legislature," said Senate President Pro Tem Jerry Sonnenberg (Republican-Sterling), who chairs the Agriculture, Natural Resources and Energy Committee. "This proposal didn't fly at the Statehouse because Republicans don't believe it's in the interest of Colorado energy consumers to shut down our most affordable and dependable power plants, while subsidizing over-expansion of unreliable, not-ready-for-primetime alternatives."
His state senate colleague, John Cooke (Republican-Greeley), said backroom deals might have been struck between the utility, political leaders and the leaders of the groups supporting PSCo's plan. "Colorado energy users and ratepayers need to know whether these ostensibly independent and unbiased entities are acting with their interests in mind, or whether they're being improperly influenced to rubber-stamp this unwise and consumer-unfriendly proposal by the company, the governor, his staff, or anyone else who stands to benefit politically or financially," said Cooke, who has filed an open records request to obtain documents and communications among the parties pertaining to the PSCo plan.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
Earlier this year, PSCo issued requests for proposals (RFPs) for up to 1,000 megawatts (MW) of new wind generation, 700 MW of new solar generation and 1,000 MW of new gas-fired generation, all of which the utility would like to see built in Colorado. The bids are due by the end of November, according to PSCo spokesperson Michelle Aguayo. She said if building the new generation costs less than continuing to operate 660 MW of coal-fired generation in southern Colorado, the utility will close the existing coal-fired generation and build the new generation.
The coal-fired generation to which Aguayo referred is units 1 and 2 of its Comanche Generating Station, which began operating in the 1970s. The utility has been widely criticized by environmental groups for adding a third coal-burning unit at Comanche a few years ago. The utility is not considering closing Comanche Unit 3, only units 1 and 2, and only if the cost of new renewable generation is lower than the cost to continue operating those two units. If that turns out to be the case, PSCo said Unit 1 would be retired by the end of 2022, and Unit 2 would be retired no later than the end of 2025.
PSCo also said it would only move forward with the plans to build new generation if the costs do not increase customers' electric prices.
If all of that new generation is built, and if Comanche units 1 and 2 were retired, the utility's carbon dioxide (CO2) emissions could be reduced by up to 60% by 2026 compared with 2005 emission levels, the utility estimated.
The RFPs issued by PSCo did not specify where in Colorado the new generation would be built. The new generation PSCo is seeking is separate from the large windfarm it is constructing in eastern Colorado. Construction has begun on the Rush Creek Windfarm, a $1 billion, 600-MW windfarm, and that project is scheduled to begin generating electricity in October 2018.
The Colorado Public Utilities Commission (Denver, Colorado) may issue a decision on PSCo's electric resource plan, which includes the new wind, solar and gas generation, in the next few months, possibly by the end of 2017.
When PSCo filed its "Colorado Energy Plan" with state utility regulators in late August, it highlighted that plans for the new generation were reached as part of a process that included 14 different intervenor groups, including a few the utility has crossed swords with in the past.
"We have a responsibility to meet our customers' energy needs," David Eves, president, Xcel Energy -- Colorado, said in a statement August 29. "Our customers expect us to provide low-cost power and increase the use of cleaner energy. As the state's largest utility, it is important to us that we also support rural areas in Colorado, and this proposal's investment will accomplish this goal. The proposal could increase renewable energy to 55% by 2026, save customers money, and dramatically reduce carbon and other emissions."
The August 29 filing by PSCo "starts a conversation about how Colorado will transition to the clean energy economy of tomorrow," added Erin Overturf, WRA chief energy counsel for Western Resource Advocates (WRA) (Boulder, Colorado). "If approved, the commission will have an opportunity to evaluate transitioning our power production away from coal and toward less expensive, clean renewable resources. We ask the CPUC to consider this plan and welcome an open, collaborative conversation among all stakeholders to create our affordable, clean energy future."
But two powerful Republican state senators blasted the PSCo move. "Renewable energy providers in Colorado already profit from a wide variety of special preferences and handouts, including some of the highest renewable energy mandates in the country, but apparently that's not enough for one utility, which is pulling a bit of a fast one by going to the PUC for something it couldn't get passed through the legislature," said Senate President Pro Tem Jerry Sonnenberg (Republican-Sterling), who chairs the Agriculture, Natural Resources and Energy Committee. "This proposal didn't fly at the Statehouse because Republicans don't believe it's in the interest of Colorado energy consumers to shut down our most affordable and dependable power plants, while subsidizing over-expansion of unreliable, not-ready-for-primetime alternatives."
His state senate colleague, John Cooke (Republican-Greeley), said backroom deals might have been struck between the utility, political leaders and the leaders of the groups supporting PSCo's plan. "Colorado energy users and ratepayers need to know whether these ostensibly independent and unbiased entities are acting with their interests in mind, or whether they're being improperly influenced to rubber-stamp this unwise and consumer-unfriendly proposal by the company, the governor, his staff, or anyone else who stands to benefit politically or financially," said Cooke, who has filed an open records request to obtain documents and communications among the parties pertaining to the PSCo plan.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
