Confronted with the biggest plan for brand spanking new electrical energy technology and transmission within the state’s historical past, the Colorado Public Utilities Fee on Wednesday expressed issues in regards to the scale and timing of the Xcel Power proposal.
PUC Chairman Eric Clean, whereas stressing deliberations are simply starting on the $15 billion plan, recommended the producing capability of the proposal may very well be trimmed about 26% to five,835 megawatts.
This could enable a number of the almost $3 billion in transmission initiatives, which commissioners referred to as a “shock” addition to the plan to even be delayed.
The fee is anticipated to make a last resolution on the plan earlier than the top of the yr.
The Xcel Power useful resource plan — which should meet buyer wants and reduce greenhouse gasoline emissions — contains 3,400 MW of wind, 1,100 MW of photo voltaic, 1,400 MW of photo voltaic with storage, 600 MW of standalone storage and 600 MW of pure gasoline capability.
“Finally, I believe we’re going want all that wind and photo voltaic in addition to the storage and new transmission,” Clean mentioned. “However I believe delaying a number of the new technology till subsequent summer season’s useful resource acquisition plan supplies for potential advantages.”
“By delaying a number of the new technology it might enable us to higher perceive the fee, worth, timing and wish for the brand new transmission earlier than we’re dedicated to constructing it,” Clean mentioned.
One other concern voiced by wind and photo voltaic business representatives and unbiased energy producers, is that Xcel Power will personal two-thirds of the brand new producing capability. Clean mentioned that the choice portfolio would deliver possession nearer to 50-50 between the utility and unbiased energy firms.
Xcel Power evaluated 137 proposed initiatives, some by the corporate, some by unbiased energy producers. A pc-optimization of initiatives did give desire to the corporate proposals, however an unbiased evaluator, chosen by the fee, mentioned the choice course of had been truthful and with out bias.
“That’s one thing from our perspective, is essential to emphasise,” mentioned Robert Kenney, CEO of Xcel Power’s Colorado subsidiary. “As a result of as you already know, if the utility owns any portion of this, there’s liable to be some stage of skepticism.”
All three commissioners recommended Xcel Power for growing a plan that may deliver the utility to 80% clear energy in 2030 and reduce greenhouse gasoline emissions by greater than 80% over 2005 ranges to adjust to state legal guidelines. In 2005, Xcel relied on fossil fuels for 96% of its electrical energy.
“Many people bear in mind in 2004 after we have been advised … 10% renewables on the system have been completely unreliable,” Commissioner Tom Plant mentioned.
Clean mentioned, “the corporate is doing an unbelievable factor right here.”
Nonetheless, the commissioners expressed concern about balancing the transition to scrub vitality and the prices.
“We’re on a tightrope right here,” Commissioner Megan Gilman mentioned. “These selections are extremely consequential and the margin for error is comparatively small.”
On the one hand we threat under-investing and miss a chance,” Gilman mentioned. “On the similar time if we overinvest, we threat the affordability of the system, particularly contemplating many Coloradans are already susceptible to not having the ability to pay their utility payments.”
Xcel Power mentioned in its plan that the affect on buyer payments can be about 2.25% a yr, according to inflation.
The PUC workers and the Colorado Workplace of Utility Client Advocate, which represents retail and small industrial prospects, mentioned in filings that the rise solely accounts for the clear vitality plan, involving retiring coal-fired crops and including wind and photo voltaic, and never a variety of different investments, comparable to wildfire mitigation and transmission upgrades.
“I believe the total charge affect of the popular plan and different firm investments is topic to actual uncertainty, given all these uncertainties ensuing from the elemental actuality that we’re breaking new path,” Clean mentioned.
One of many main issues was the rise in transmission prices. In an earlier clear vitality plan authorized in 2021, Xcel Power estimated it might want $500 million in new transmission.
The plan now earlier than the fee is searching for almost $3 billion in transmission investments, due to an enlargement within the quantity of wind and photo voltaic technology within the revised plan. This comes after the PUC authorized a $1.7 billion regional transmission challenge referred to as Energy Pathway.
“The extent of transmission funding is a shock,” Plant mentioned. “We have now to determine how we are able to cut back these prices.”
In an effort to offer some value certainty, Xcel Power has proposed a efficiency incentive mechanism to carry the corporate accountable for development and operation prices.
Clean mentioned he was “actually relieved and happy to see that the corporate has sharpened its pencil” and “stands behind its pricing and efficiency metrics.”
Addressing the plan by means of the “lens of affordability” can be key, Gilman mentioned.
“We have now ensured that on this transition we can’t go away our neighbors behind,” she mentioned. “Make it too costly and we are going to get backlash.”