Colorado governor’s last-minute legislation would accelerate state’s clean energy targets

Colorado Gov. Polis drafted a last-minute bill that would accelerate by 10 years the state’s requirement for Colorado’s investor-owned utilities to eliminate all greenhouse gas emissions associated with electricity production.

However, Colorado’s legislators would need to approve the late-bill status for it to be introduced. If passed, the bill could help the governor meet his campaign promise to rely on 100% clean energy by 2040.

According to the draft version of the bill, which was obtained by Colorado Public Radio, Colorado’s investor owned utilities Xcel Energy and Black Hills Energy would have 15 years instead of the current 25 years to eliminate all greenhouse gas emissions associated with their electricity production. The utilities would only be able to ask for an extension if regulators agree that hitting the deadline would raise consumer electricity rates by more than 1.5% a year.

Colorado Press Secretary Shelby Wieman told pv magazine USA, “A close read of the initial policy framework – which we are currently seeking feedback on – shows strong protections for consumers and assurances for reliable electricity and we hope they can be made even stronger,” she said. “This is just the beginning of the conversation, and we look forward to conversations around how Colorado can continue leading the nation on reliability, cost savings on electricity, and climate action.”

Utilities in Colorado are currently required to submit plans to stop generating electricity from fossil fuels in favor of renewable energy. According to the Colorado Department of Labor and Employment, the last of the six remaining coal-fueled electrical power plants still in operation is scheduled to shutter in 2031. Xcel Energy owns half of these remaining plants.

Xcel and Black Hills Energy, along with 62 other signatories sent a letter to the governor asking him to reconsider the 2040 Clean Energy Plan legislation. In the letter, the utilities and other various interest groups such as the Colorado Mining Association said they “need time and space for discussions.”

“As a group, we have not historically agreed on all aspects of the energy transition and have often engaged in vigorous debate on what the best path forward is for our State’s energy future,” the letter said. The coalition asked legislators to not grant the drafted bill late bill status “not because we don’t think it may be possible to get there, but because we have to build out the framework thoughtfully, and with intention, to ensure that the energy transition doesn’t needlessly result in soaring energy costs.”

According to Xcel Energy, 45% of its electricity in Colorado is carbon-free.  The Colorado Public Utilities Commission approved Phase II of its Clean Energy Plan in January 2024, a portfolio that will add approximately 6,100 MW of new generation, making it the largest clean energy portfolio in state history, according to Xcel. The utility also said it will invest $12 billion to $13 billion across Colorado to deliver more affordable, low-cost energy options. Xcel said it takes advantage of approximately $8 billion in Inflation Reduction Act tax credit benefits to reduce costs and support its customers, communities and workforce.

Wieman said Colorado is on track to reach more than 85% emission reductions in the power sector by 2030 and on a path to nearly decarbonize the power sector by 2040. “As we look to expand on this successful framework to move us closer to our goals and reduce energy costs for consumers, we will continue to engage in a robust conversation with all those who have an interest in this policy, always putting consumers first.”

Colorado was the first state to enact a renewable portfolio standard through an initiated state statute.

Last week, a bill to automate Colorado’s permitting process for rooftop solar was introduced in the Senate. Colorado is ranked 14th in the country for its  4.46 GW total installed solar capacity, which represents 11.5% of the Centennial State’s electricity, according to the Solar Energy Industries Association.

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