Colorado Solar Victory on Net Metering

The Public Utilities Commission majority decided this morning that no immediate changes are needed to net metering in Colorado. In a discussion, Chairman Joshua Epel and commissioner Pam Patton agreed there is no rush to change the key policy of giving solar rooftop owners retail credit for the energy they produce. Commissioner Glenn Vaad earlier said he thinks the credit is too high. While a written order will provide greater clarification, this appears to be the outcome we have been working towards in more than a year of work on this docket that has included four workshops and numerous written filings. We have worked in full collaboration with other members of the solar industry and this represents a tremendous amount of hard work from many people. Citing political battles around the nation on net metering, Epel said, ` It is in our interests to continue net metering and not referee a philosophical dispute - that's not the Colorado way...I see no need to change the policy on one to one retail rate credit.'' He also reiterated that all parties agree that if solar customers meet requirements, utilities must allow interconnection. Commissioner Pam Patton said, ``We do not have an immediate problem that needs to be fixed.'' The commission is closing the proceeding, and members suggested policy changes would be up to the legislature, although some issues could be brought up in a later proceeding such as a rate case.

Solar Beats Gas in Colorado

“For the first time, the company received bids for utility-scale solar PV resources that are cost-effective head to head with natural-gas fired generation,” Public Service of Colorado said in the report. SunEdison Inc., the biggest clean-energy developer, began construction on a Colorado solar farm that will be the largest in the state and comes out ahead in direct competition with natural gas. The 156-megawatt Comanche solar farm will deliver power to Excel Energy Inc.’s Public Service of Colorado utility under a 25-year agreement, Maryland Heights, Missouri-based SunEdison said in a statement Thursday. The utility awarded the contract through an open solicitation, with the solar farm beating out other power sources including gas, SunEdison said. The deal shows that renewable energy is increasingly able to compete on price with fossil fuels. Utilities that are planning for future demand growth are looking more carefully at solar panels and wind turbines, which will be cheaper to operate over the next few decades in part because they have no fuel costs, said Julie Blunden, chief strategy officer at SunEdison. “We actually can offer solar and wind that’s cheaper than gas,” Blunden said in a phone interview Thursday. “It’s such an important inflection point. We can sell power without any fuel-price risk.” State Policy Buying power from Comanche will also help Public Service of Colorado meet state policies that require investor-owned utilities to get 30 percent of their power from renewable sources by 2020, according to the Database of State Incentives for Renewables & Efficiency, operated by North Carolina State University. Public Service of Colorado told regulators in a 2013 report it had received proposals for solar photovoltaic power that was competitive with gas priced at $5.90 per million British thermal units over a 20-year period. Another project was competitive with gas at $5.96 over 25 years. While the redacted report doesn’t identify the solar farms, Blunden said Comanche was one of the power plants that received contracts through the 2013 solicitation process. Natural gas for delivery on Friday to the Denver area was $2.55 per million British thermal units, according to data from Intercontinental Exchange Inc. Rising demand as new gas plants come online over the next few years will likely increase that price. The utility’s base gas forecast shows prices exceeding $6 by about 2020. “For the first time, the company received bids for utility-scale solar PV resources that are cost-effective head to head with natural-gas fired generation,” Public Service of Colorado said in the report.

Colorado Energy Office awards $1.2 million grant funding to GRID Alternatives for low-income solar project

The Colorado Energy Office is awarding $1.2 million in grant funding to GRID Alternatives, a nonprofit organization, to implement a solar demonstration project for low-income communities in Colorado. Building on Colorado’s national leadership in community solar, the project will focus on the state’s low-income electric energy burden, making solar more accessible and affordable. “This project will give us the opportunity to demonstrate how solar generation can be a sustainable solution to reduce electric bills for Coloradans who carry the greatest energy burden,” said Jeffrey Ackermann, director of the Colorado Energy Office. “And it will assist Colorado’s electric utilities in diversifying their electricity portfolios.” The demonstration project will involve the development of 5 to 12 community solar systems, ranging in size from 50 kW to 500 kW, solely for low-income shareholders. Cumulatively, the demonstration project will provide more than 1 MW of solar generation. Each system will be developed in partnership with utilities focused predominantly in the rural areas. Once complete, a minimum of 300 low-income households throughout the state will have access to community solar priced at an affordable rate. Approximately 30 percent of Colorado’s households are considered energy burdened, many of which are located in rural parts of the state. Of that 30 percent, 11 percent are considered energy impoverished, paying more than 10 percent of their income on utility bills. Energy burdened households are those that pay more than 4 percent of their annual income on utility bills. “Colorado has been effective in helping to reduce heating costs for low-income households through utility bill assistance and the state’s weatherization assistance program,” said Joseph Pereira, director of the Colorado Energy Office’s weatherization assistance program. “To address Colorado’s low-income energy burden more comprehensively, we have to continue to find ways to reduce electric costs.” The demonstration project aligns with a new initiative launched by the White House, which is designed to increase solar access for all Americans. The initiative includes actions to scale up solar access and cut energy bills in communities across America.

How renewable energy can save utilities money

A number of national policymakers, utilities, and industry groups have repeatedly claimed President Obama’s Clean Power Plan regulations for existing power plants will raise utility costs and sacrifice reliable electricity service. But Colorado tells a very different story, where renewable energy is replacing coal power plants and driving down the cost of electricity service without sacrificing reliability. Consider the 10th U.S. Circuit Court of Appeals recent rejection of a lawsuit claiming the state’s renewable energy standard was illegal and raised consumer utility bills because it limits out-of-state coal plants from selling electricity. In 2004, Colorado voters passed Amendment 37, the nation’s first renewable energy standard adopted by popular ballot. The original standard was 10% renewables by 2015, since increased twice by the state legislature to 30% by 2020. The first promise of the ballot measure was to “save consumers and businesses money." The latest utility bids for new renewable energy in Colorado show the promise to voters — renewable energy would grow up to save consumers’ money — has been kept. Every four years, Colorado’s regulated electric utilities develop a plan to buy or build new generation to meet future electricity demand. Those plans are submitted to the Public Utilities Commission, which approves a portfolio of resources to be put out for bids. Once the bids are evaluated, utilities submit their recommended portfolio of projects for approval and then negotiate contracts with the winning bidders. In 2011, Public Service Company of Colorado (PSCo) embarked on its scheduled planning, bidding, and contracting process after a decision to close 903 megawatts (MW) of coal-fired generation to comply with EPA ozone standards in the Denver air basin. While new natural gas plants replaced most of the early-retired coal, some of the early-retired coal was temporarily converted to run on natural gas, until the 2011 planning case could reveal better options – with surprising results. PSCo received bids for more than 6,200 MW of new generation in response to its RFP, about seven times the amount sought. Early in the evaluation process, PSCo revealed some wind and solar bids appeared to be lower than the cost of generation from its existing fleet. In December 2013, the PUC approved the utility’s acquisition of 450 MW of wind and 170 MW of solar generation along with some new natural gas capacity. Importantly, the prices bid for these renewable resources were lower than system average generation cost. In other words, the new wind and solar resources will reduce costs and save consumers money. Based on PSCo’s bid evaluations, we know the economics of solar and wind cannot be analyzed in a vacuum. Colorado enjoys terrific wind and solar resources that can be mobilized at low cost. Results might differ where resources are less productive or industry is less mature. Solar and wind investment and production tax credits also improve the economics of these resources. And new financing methods have brought down solar costs, providing lower cost investment funding and reducing energy prices. But other factors worked against these resources. Wind plants had to cover their own transmission costs to reach sometimes-distant points of interconnection with the utility. No carbon costs were considered in the analysis, even though zero-carbon resources like wind and solar reduce the utility’s carbon footprint. With new wind and solar below system average costs, interesting questions arise: Which additional fossil plants should be considered for early retirement? How can utility financial concerns about early retirement be addressed? If this trend of lower renewable costs continues, how will utilities need to change grid operations to accommodate more variable generation? Finally, what incentives could be provided to utilities to move more quickly toward lower-cost clean energy? Several approaches set out in America’s Power Plan can help policymakers answer these tough questions. Drawn from the expertise of over 150 electricity industry experts, the policy recommendations from America’s Power Plan provide a roadmap to a high renewables future without sacrificing affordability or reliability. One of the plan’s main recommendations, moving toward performance-based regulation of utilities to reward shifting to a cleaner and more reliable grid, is already being explored in Colorado. Smart regulation combined with rapidly improving economics of solar and wind are making Colorado’s electricity system more affordable and cleaner. PSCo’s experience shows wind and solar at utility scale can reduce consumer costs when included in a balanced generation portfolio. As wind and solar markets expand, these lower costs will benefit customers in additional states, facilitating the transition to a clean, affordable, reliable electricity system.

Colorado reaction to Obama's 'Clean Power Plan'

President Barack Obama’s “Clean Power Plan” — designed to slash the nation’s carbon dioxide production by 32 percent by 2030, compared to 2005 levels — drew responses from across the spectrum in Colorado. Colorado Senate President Bill Cadman, R-Colorado Springs, said that the Senate Republicans were “disappointed" in the rules and pledged that his Republican colleagues in the Senate would propose a bill in January 2016 that requires the Colorado Public Utilities Commission to hold public hearings on the state’s compliance plan. Cadman said he’ll also seek to have the commission approve the state’s plan "before any state agency adopts rules to implement this costly electric power generation mandate in Colorado.” On the other end of the spectrum, Bob Keefe, the executive director of Environmental Entrepreneurs (E2) — a national community of business leaders — said the now final rule is “the most significant environmental policy we’ve seen in recent years, and also a huge catalyst for economic growth.” The Denver Business Journal's story about the plan is here. Read on for a roundup of what folks around the state are saying: Colorado Senate President Bill Cadma n (R-Colorado Springs): “Senate Republicans are disappointed by the EPA rules rolled out today by the Obama administration. I can promise that Senate Republicans will offer legislation in January to require full PUC public hearings and PUC approval before any state agency adopts rules to implement this costly electric power generation mandate in Colorado. This President continues to show complete disdain for Congress with another end-run around the legislative process. The liberal extremists are conspiring with the White House to eviscerate federalism, the separation of powers and state’s rights.” U.S. Rep. Diana DeGette(D-Denver) "We are already experiencing disruptions due to climate change, and the overwhelming scientific consensus says that such problems will only get worse. In Colorado, that has meant severe drought, wildfires, unprecedented floods and many other severe events that cost our communities dearly. If we can take steps to reduce the odds of such disasters in the future, we have an obligation to do so. Fortunately, our experience in Colorado shows that we can take meaningful action that breathes new vitality into our economy at the same time. The Clean Power Plan will push states to transition to cleaner power sources, reducing the emissions from the sector that currently produces more carbon pollution than any other. Colorado has already taken important steps towards using renewable energy, and we have seen clean new businesses, industry sectors and our broader economy flourish as new clean and renewable energy options come to market." Jill Ryan , Eagle County Commissioner “Ski resorts are already feeling the impacts of a warmer climate on the length and quality of ski seasons, and climate change could threaten their very existence. It doesn’t take much to undermine our tourism economy. Only a 1 percent dip in tourists to Colorado ski resorts would cost more than $375 million and 4,500 jobs. The Clean Power Plan represents an opportunity for Colorado to craft a plan to continue its leadership in reducing carbon emissions. It is a necessary but flexible step to effectively address climate change and keep visitors from across the world coming to Colorado for world-class skiing.” Chris Brown, President of Vestas-American Wind Technology, Inc. “The Clean Power Plan is a significant step in the right direction. It’s not something that will alter our market potential in the short run but if the plan is adopted, it will create a more stable U.S. market for renewable energy in the long run. ... The Clean Power Plan is definitely achievable, and wind energy is the quickest and most cost effective way for states to meet the reductions. Wind is already helping states meet their clean energy needs and can do more while creating new jobs and benefiting local economies. More wind can be integrated into the grid reliably; many states and regions are adding large quantities of wind to the electricity mix while maintaining grid stability.” Ben Fowke, chairman, president and CEO of Xcel Energy Inc. “Implementing clean energy is familiar ground for Xcel Energy. We have worked for years with our states to increase the use of renewable resources, to help customers save energy and to modernize and retire our coal plants – all at a reasonable cost. This approach has put our company on a sound course to achieve a 30 percent reduction in carbon dioxide by 2020. “We appreciate the EPA’s willingness to work with stakeholders in developing this groundbreaking and complex set of regulations. It will take time to thoroughly review and assess the full impact of the rules. While we expect the Clean Power Plan does not provide everything we hoped for in terms of fully recognizing the early actions of proactive states and utilities, Xcel Energy is ready to move ahead. We look forward to working with our states in the best interest of our customers, ensuring we continue to meet their expectations for clean, reliable and affordable power.” Joel Serface, managing director of Brightman Energy, a renewable energy development company. “The Clean Power Plan is a huge opportunity for Colorado’s economy. By tackling the rising economic costs of climate change, we can modernize our energy infrastructure, stimulate innovation and help create thousands of good, new Colorado jobs in high-growth sectors like wind and solar.” State Sen. John B. Cooke(R-Weld County): “The Governor needs to commit himself to a true public process, including a rigorous review by the people’s representatives in the Colorado General Assembly, before giving a green light to Colorado’s implementation of this new federal mandate. These rules are being challenged in federal court by sixteen states, and I hope that Colorado’s Attorney General will join that lawsuit now that the EPA rules are final. The fact is, the Clean Air Act passed by Congress does not authorize these costly dictates, and there is a good chance the US Supreme Court will block these rules for that reason.” Kim Tyrrell, Air Quality Programs Manager, American Lung Association in Colorado “Nationwide, the Clean Power Plan will prevent up to 90,000 asthma attacks and 3,600 premature deaths each year starting in 2030. That’s important for Colorado’s more than 135,790 children with asthma who face greater health risks from air pollution and climate change. Undeniable evidence tells us that our warming climate threatens public health and safety. Right here in Colorado, we see the impacts firsthand: in our air quality, where our ozone is worse than it should be; where we have more particle pollution from more wildfires and drought; and where we face more extreme weather events, including heat waves and flooding." Jonathan Lockwood, executive director for Advancing Colorado, which advocates for free markets “This very strict, and extreme, so-called power plan is dirty, expensive and unnecessary. What we are seeing is a job-killing ideological push that will increase energy costs on Colorado families. This is a costly crusade that hurts our families and communities, and we need to speak out against politicians like Sen. Michael Bennet and Gov. John Hickenlooper who praise and bow down to this plan.” Rebecca Cantwell, Executive Director, Colorado Solar Energy Industries Association “Colorado’s solar industry looks forward to playing a leading role in achieving Clean Power Plan targets while driving down the long-term cost of power, increasing reliability and providing thousands of jobs across our state.” Tim Gaudette, Colorado Outreach Manager for Small Business Majority "Energy expenses can adversely impact small businesses’ bottom lines and cut into their profits. That’s why small employers want sound policies — like the Clean Power Plan — that transition the U.S. to a clean energy economy so they can spend less on utility bills and have more cash available to invest in and expand their companies."