Colorado Renewable Energy in the Voters

"Xcel can't have it both ways. They can't take credit for the wind they were told to build and then say 'Don't vote for Amendment 37, because we're doing it already.'"

[RE Insider] In November, Colorado's 4.3 million citizens will have the opportunity to vote on Amendment 37, a renewable energy portfolio standard. The Amendment will be the first renewable energy portfolio standard in the nation to be put directly before voters rather than processed through a state's legislature. Simultaneously, Xcel Energy, the state's largest utility, is before the Colorado Public Utility Commission arguing a rate case, a least-cost plan and a gas cost adjustment.

In the rate case, Xcel Energy seeks an increase in the premium it charges customers for wind generated for its WindSource green program; it also seeks to reduce net metering payments to customers generating electricity fed into the grid. In the least-cost plan, Xcel seeks to build a 750 MW coal-fired plant, paid up-front by ratepayers, which would never be put out for bid. Approval of a no-bid project would eliminate from consideration alternatives like renewables and demand-side management. (The least-cost plan, or LCP, may extend Xcel's nominal demand-side management for summer peak loads but none for base load.) The LCP - formerly called the integrated resource plan - also seeks 500 MW from renewables, something which the utility is not required to fulfill. Xcel's regulatory representatives recently filed a gas cost adjustment of 15 percent on the heels of a 73 percent increase in 2003, and Xcel faces fines for poor service reliability as its customer satisfaction levels slump.

Amendment 37 has bipartisan sponsorship from Republican Lola Spradley and Democrat Mark Udall. It requires the state's seven largest utilities to conform to a renewable energy portfolio standard that sets a goal of 10 percent by 2015; the goal, which includes a 4 percent solar requirement, is modest compared with the renewable portfolio standards established in 16 other states across the country. Affected utilities in Colorado can opt out of the requirement by putting a vote to their ratepayers. Ft. Collins Utilities is exempt since it already meets the requirement. The Colorado Rural Electric Association opposes the Amendment, but a handful of rural electric associations, like Delta-Montrose Electric Association, support it.

Legislation for a renewable portfolio standard sponsored by Republican Lola Spradley failed to pass into law earlier in 2004. It was the fourth time Colorado's legislators had rejected RPS legislation. Xcel supported the Spradley legislation, but by July 2004, it had aligned with Tri-State Generation, the Colorado Rural Electric Association and coal companies to oppose Amendment 37. They set up shop on the 12th floor of Xcel's building in downtown Denver, called their issue committee Citizens for Sensible Energy Choices, and hired Hill Research Consultants to help fight the Amendment. (Hill Research, based in Texas, is a public opinion and marketing research firm serving well-known political clients such as Tom Delay, Katharine Harris and Jeb Bush.) Hill Research led a focus group of Republican voters in Colorado; the research was attended by staff from Xcel's corporate offices. By mid-September, Xcel had contributed over half a million dollars to oppose the Amendment, Tri-State a quarter of a million and Hill Research just over $40,000. That same month, Xcel Energy published an article "We Support Renewable Energy, But Not [Amendment 37] in its "Energy Update" newsletter and inserted it into customer bills.

In the bill insert article, Xcel states that it "supports renewable energy?We want to greatly expand renewable energy in Colorado, but in a way that keeps the price of electricity reasonable for all of our customers. We don't think this initiative achieves that objective." The historical record tells another story. In Minnesota - where Xcel has almost three times the wind power they have in Colorado - the utility was forced to build wind farms by the Minnesota legislature. It was punishment by Minnesota against Xcel for violating a contract for the storage of radioactive waste adjacent to Native American land. Xcel could only continue to store the radwaste if it built a wind project and established a renewable energy trust, both of which the utility did, stipulating that it would charge a premium for wind generated electricity. In Colorado, it took the equivalent of a lawsuit to get Xcel to build the Colorado Green wind farm in Lamar, Colorado, even though, as Xcel later acknowledged, it saved ratepayers over $4 million a year. The wind that Xcel has agreed to build in the least-cost plan comprises only a third of the wind that Xcel says it can build. In addition, it is doubling the cost of its WindSource premium-priced green program and gutting its solar programs. (By contrast, Ft. Collins Utilities, a debt-free utility, is voluntarily expanding its wind program and dropping the premium by 60 percent.) Matt Baker, Director of Environment Colorado, a primary supporter of the Amendment, notes, "Xcel can't have it both ways. They can't take credit for the wind they were told to build and then say 'Don't vote for Amendment 37, because we're doing it already.'" Responding to Xcel's claims that it supports renewable energy, an energy efficiency engineer based in Boulder, Colorado commented, "Xcel has fought renewables tooth and nail."

The Chairman and CEO of Xcel Energy, Wayne Brunetti, summarized the utility's position on wind and renewables at the Edison Electric Institute's International Utility Conference held in London, "We have 825 megawatts of wind generation, but it is nowhere near the load. Fundamentally, the wind is there when we don't need it and never there when we need it. When it is, we end up backing down our most efficient coal units to accommodate wind generation." Baker responds, "These guys don't like wind and renewables. They do it because they have to."

Mr. Brunetti has sympathizers. Colorado's Governor, Bill Owens, recently appointed Carl Miller to the three-person Public Utility Commission. Mr. Miller comes from the mining industry. His colleague, Greg Sopkin, derided global warming and the Kyoto Protocol in a recent PUC hearing on the renewable energy portion of the LCP and earlier denied intervention status to a Colorado resident who wanted to give voice to the risks of climate change. In that same hearing, after calling climate change irrelevant to the proceedings, he permitted an attorney representing the Coal Association to question witnesses on compliance of coal-fired plants with emission regulations.

Citizens for Sensible Energy Choices stated publicly that it is willing to spend up to $10 million to defeat the Amendment. Much of that money will go to advertising. It's still not clear whether ratepayer money finances this opposition; Xcel has refused publicly to account for its monetary and in-kind contributions to the issue committee. It also refused to account for its allegations that the Amendment will cost ratepayers an additional $580 million to $1.5 billion over the next 20 years, based on price forecasts for natural gas. (It uses these unsubstantiated figures repeatedly in its publicity against the Amendment.) On September 20th, two ratepayers (one of them this writer) filed a complaint regarding alleged campaign and political violations by Citizens for Sensible Energy Choices. The allegations surround the issue committee's failure to report In-Kind (Non-monetary) contributions from Xcel to the committee.

Coloradans for Clean Energy, a grassroots campaign funded in large part by house parties across Colorado and staffed by a raft of volunteers, supports Amendment 37. It has begun its advertising campaign and distributions of literature and yard signs, and it has established a speaker's bureau to urge Coloradans to vote in favor of this renewable energy portfolio standard. Their literature quotes the U.S. Department of Energy, "Wind is the cheapest form of new energy" and an Energy Foundation report released on September 8, 2004, "The 'most likely outcome of 37 is that state-wide electric rates will be virtually unchanged?state-wide utility costs will decrease by $14 million - or about one cent per month - for the average residential customer from 2005-2024.'"

Citizens for Sensible Energy Choices launched its radio advertising this week and is expected to begin shortly a TV advertising campaign against the Amendment.

About the author...

Heather Rae, principal of Brae Consulting, is a marketing and communications professional, formerly employed by Xcel Energy, the fourth largest utility in the USA.She has more than 17 years of management, marketing and technical expertise in the energy services, telecommunications and information systems industries. After assisting publication of communications materials for several UN sustainability conferences and reporting on sustainability meetings at the World Bank, the State Department and other organizations, in 1994, Heather traveled to Bolivia to research family planning information dissemination. In 1997, she successfully petitioned to intervene in a nuclear decommissioning hearing and blocked expansion of an illegally-sited and polluting nuclear chemical manufacturing plant. Heather serves on the Sierra Club energy committees through which she actively participates in promotion of sustainable development in Colorado. She is an involved member of the American Marketing Association, the Association of Energy Services Professionals and the Colorado Renewable Energy Society. She has helped to develop and conduct candidate surveys for organizations such as the League of Environmental Voters of Montgomery County, Maryland. Heather graduated from Wesleyan University with a major in Latin American Studies and from Phillips Exeter Academy. She also attended Wellesley College and study programs in Madrid, Spain and Bogota, Colombia.

Please Note: RenewableEnergyAccess.com and Arizonaenergy.org do not endorse the sites behind these links. We offer them for your additional research. Following these links will open a new browser window.

Colorado Renewable Energy in the Voters' Hands