New report shows that renewable energy prices continue to decline, undercutting the costs of existing coal plants
Colorado voters elected Jared Polis to be the state’s next governor on Tuesday, joining several other states that also elected governors who campaigned on clean energy. Polis campaigned on a platform that included bringing Colorado to 100% renewable energy by 2040, and in an interview with the Denver Post yesterday, said that renewable energy would be among his top priorities:
Is there anything in particular you plan on prioritizing?
Certainly, saving families money on health care, expanding access to preschool and kindergarten, and taking the steps to move toward more renewable energy will be among our top priorities both through executive actions as well as working with the state legislature.
In a debate last month, Polis emphasized that moving toward renewable energy could benefit ratepayers, because of the declining prices for new renewable energy:
At the 2018 Colorado Rural Electric Association Energy Innovations Summit this week in Denver, electric utility industry officials discussed changes in energy technologies and utility business models, such as increasing customer choices and declining costs of distributed renewable energy. But while there was broad agreement about the opportunities provided by cheaper renewable energy, there were disagreements about the scope and pace of business model changes underway in the industry - and the implications of those changes for the hundreds of electric cooperative directors and staff attending the conference.
Steve Collier, Director of Smart Grid Strategies at Milsoft Utility Solutions, delivered a presentation titled “Revolutionary Change in the Electric Industry: Threats and Opportunities,” which focused on the implications for electric cooperatives of what he described as an “eroding monopoly.” Collier explained:
What choices do customers have other than buying from you, all that that they have ever bought? Do they have choices? Yeah they have choices. Primarily distributed energy resources. But we’re not just talking about rooftop solar, we’re talking about a whole variety of options that they have to reduce the amount of electricity that they buy from you.
Delta Montrose Electric members vote for new financing options, supporting a potential buyout of Tri-State contract
Delta-Montrose Electric Association members voted to approve changes to the electric cooperative's articles of incorporation this week, creating new financing options that will help the co-op end its contract with its power supplier, Tri-State Generation and Transmission Association. Under the new articles of incorporation, Delta-Montrose Electric Association (DMEA) will be able raise money by issuing capital stock, “which could be used to to fund DMEA’s potential Tri-State buyout,” according to a press release.
“We believe addressing our power supply costs is essential for long-term rate stabilization for our members. This was the primary driver behind our recommendation to amend and restate the Articles of Incorporation,” said Delta-Montrose Electric CEO Jasen Bronec in a statement.
The DMEA board urged members to vote yes, including with a video that focused on how the changes would help DMEA finance a buyout of its contract with Tri-State. The co-op also hosted community meetings about the proposed changes. DMEA members voted by mail and at a special meeting on October 16, with 2,677 members voting yes (68%), and 1,248 voting no (32%).
The Poudre Valley Rural Electric Association board of directors is urging Tri-State Generation and Transmission Association to develop new policies to respond to a changing utility industry, and to study if adjusting its fuel mix could lower costs. In a resolution passed unanimously on September 19, the electric cooperative requested that Tri-State “work expeditiously in a transparent process to determine if significant cost savings are achievable by adjusting Tri-State’s fuel mix and provide the findings to Tri-State’s members by the end of calendar year 2018.”
Poudre Valley Rural Electric Association (PVREA) provides electricity to nearly 40,000 members in Larimer, Weld, and Boulder Counties, and this June was recognized as “Electric Cooperative Utility of the Year” by the Smart Electric Power Association for a community solar project that helped expand solar power opportunities for low and moderate income members.
PVREA is also Tri-State’s second largest member cooperative by electricity sales, and the resolution emphasizes PVREA’s partnership with Tri-State, noting that it helped form Tri-State and “has a vested interest in Tri-State to be successful."
Holy Cross Energy announced last week that it plans to shift its power supplies away from coal and increase its use of renewable energy to 70% by 2030, without any increase in the costs of it power supply. The Glenwood Springs based electric cooperative says the plan would lead to a 70% reduction in greenhouse gas emissions, compared to 2014 levels.
Holy Cross Energy CEO Bryan Hannegan highlighted why the co-op could shift to renewable energy without increasing costs: “Thanks to advances in technology and changes in energy markets, we have the opportunity to bring on new renewable energy resources at costs comparable to our existing supply. This will enable us to meet our clean energy goals while maintaining the reliable, affordable and safe service our members have come to expect.”
Other electric utilities in the state have also begun to increase their use of renewable energy, taking advantage of the fact that new wind and solar power in Colorado is now cheaper than existing coal plants, and responding to growing demands for cleaner energy from large electricity consumers including municipal governments and some major companies. But Holy Cross Energy is the first electric cooperative in Colorado to establish an ambitious renewable energy target. Let’s look at how Holy Cross Energy plan to achieve its goals.
More major companies expect 100% renewable energy options, and some are pushing for broader changes in power markets
At the Global Climate Action Summit last week, twenty-one major technology companies announced the Step Up Declaration, which aims to boost the impact of corporate sustainability efforts by leveraging the companies’ various avenues of influence. The declaration notes:
We look beyond our four walls to activate supply chains, influence political and regulatory mechanisms, push each other as peers, partners and competitors and enable and inspire our customers.
The companies supporting the Step Up Declaration play a growing role in the economy, and claim to represent over $750 billion in combined market capitalization: Akamai Technologies, Arm, Autodesk, Bloomberg, BT, Cisco Systems, Ericsson, HP, Hewlett Packard Enterprise, Lyft, Nokia, Salesforce, Supermicro, Symantec, Tech Mahindra, Uber, Vigilent, VMware, WeWork, Workday, and Zoox.
The largest technology companies have also made clear their preferences for renewable energy, and those are now the largest companies in the world:
The five largest publicly-traded companies in the world — Apple, Amazon, Google’s Alphabet, Microsoft and Facebook — all have corporate commitments to use 100 percent renewable energy and at least three of them have already hit those ambitious targets.
The technology sector remains the largest purchaser of renewable energy, but major companies in other sectors have also made 100% renewable energy commitments, including Coca-Cola, Nike, Anheuser-Busch, General Motors, and Walmart - a total of 144 companies so far. And the impacts of those corporate renewable energy commitments are growing quickly, according to a Bloomberg New Energy Finance report last month, which found that “corporations have already purchased 7.2GW of clean energy globally in 2018 through July, shattering the previous record of 5.4GW for the whole of 2017.”
The Colorado Public Utilities Commission approved Xcel Energy’s Colorado Energy Plan yesterday, greenlighting the plan to close two units at the Comanche coal plant in Pueblo Colorado, and replace that power with a mix of new renewable energy and battery storage projects along with existing natural gas plants.
Xcel Energy’s plan attracted national attention this year due to the proposals for large scale battery storage projects and unprecedented bids for cheap new wind and solar energy. In Colorado, the plan attracted support from labor, business, environmental, and community organizations, thanks to its expected economic and health benefits.
A report this week from the Colorado Fiscal Institute found that closing the two coal units would reduce air pollutants in Pueblo and Colorado, leading to fewer asthma attacks, emergency rooms visits, and other health problems. A June report from the Leeds School of Business at the University of Colorado Boulder found that the plan would create hundreds of new jobs, boost local tax revenue, and provide a net positive economic impact to the state - mostly by avoiding nearly $1 billion in coal purchases from Wyoming.
A new report from the Rocky Mountain Institute (RMI) finds that Tri-State Generation and Transmission Association could save its member co-ops over $600 million through 2030, by taking advantage of low cost renewable energy resources and shifting away from its reliance on coal fired power plants. Moreover, the report shows that if Tri-State fails to cut costs and continues to rely on its higher cost coal plants, the generation and transmission association will face increased risks, including losing electricity sales because of defection by its member co-ops, as well as by those co-ops’ members.
The RMI report compares the costs of each of Tri-State’s coal fired power plants – broken down by the costs of fuel, fixed operations and maintenance costs, and variable operations and maintenance costs – to the range of bid prices for new wind and solar energy in Colorado that Xcel Energy received this year in response to it Colorado Energy Plan proposal. Even after adding costs for expanding transmission and other integration costs to bring those new renewable energy resources online, it costs more to keep running Tri-State’s coal plants than it would to add new renewable energy.
The Delta Montrose Electric Association (DMEA) board of directors is urging members to support a proposal that would change the electric cooperative’s articles of incorporation, to support DMEA’s efforts to end its contract with Tri-State Generation and Transmission Association.
DMEA posted a video and background information on its website to explain the proposed changes, and the reasons the board of directors is recommending that members vote yes this October to support the proposal. According to DMEA:
The revisions do three general things. First, they modernize and streamline language (which in some cases been in place since 1938). Second, they allow DMEA to take advantage of being governed by a newer Colorado cooperative law (called the Colorado Cooperative Act). Third, they give DMEA more financial flexibility by allowing it to issue capital stock to non-members.
Those new financing options could be a first for electric cooperatives. DMEA says, “While we are not aware of any electric cooperatives that have issued capital stock to non-members, many other types of co-ops have,” including major agricultural cooperatives like Sunkist, Oceanspray, and Land O Lakes.
DMEA will host a series of town halls next month about the proposed changes, and members will receive ballots the last week of September. DMEA members can cast their vote by mail, or in person at an October 16 meeting.
Wind energy projects are increasing jobs, tax revenue, and lease payments to landowners in the Eastern Plains of Colorado - and in the process, attracting support from leaders of both major parties in the state.
State legislators and other officials joined Xcel Energy and wind turbine manufacturer Vestas this week to highlight the economic benefits of wind energy in eastern Colorado, with a tour of the 600 megawatt Rush Creek wind energy project. The wind energy project in Cheyenne, Elbert, Kit Carson and Lincoln counties is currently under construction, and is expected to come online in October 2018.
“Wind is a huge win-win for rural Colorado,” said Shawn Martini, Vice President of Advocacy for the Colorado Farm Bureau. “Rush Creek is just one project and we’re poised to see even bigger investments should Xcel Energy’s Colorado Energy Plan be approved by the Colorado Public Utilities Commission, which, for the growth and health of our communities, we hope they do.”
Xcel Energy’s Colorado Energy Plan would mean a major expansion of renewable energy in the state, including additional major wind energy projects in eastern Colorado. According to an analysis from the Leeds School of Business at the University of Colorado Boulder that was filed last week last with the Colorado Public Utilities Commission (PUC), the Colorado Energy Plan would result in net economic benefits in Colorado, including a net increase of 549 jobs.
Governor-elect Jared Polis says moving Colorado toward more renewable energy will be a top priority
Electric cooperative officials discuss cheap renewable energy and an “eroding monopoly”
Delta Montrose Electric members vote for new financing options, supporting a potential buyout of Tri-State contract
Poudre Valley Electric requests Tri-State policy changes and fuel mix study
Holy Cross Energy plans to shift away from coal, aiming for 70% renewable energy
What do corporate renewable energy commitments mean for electric utilities?
Colorado Energy Plan approval will mean new renewable energy investments in rural Colorado
Report: Tri-State could save $600 million by shifting from coal to renewable energy
Delta Montrose Electric seeks new financing options to end contract with Tri-State
Wind energy jobs in rural Colorado attract bipartisan support
Colorado Energy Plan analysis shows switching from coal to renewable energy will boost jobs and local tax revenue
Poudre Valley Electric and Xcel Energy Colorado President win national awards from Smart Electric Power Alliance
Latest coal plant subsidy proposal could hit electricity bills in the West
Moody’s report: “High quality renewable resources” could help Tri-State and Basin Electric navigate rising carbon transition risks
Senator Heinrich highlights “frustrations in New Mexico” with Tri-State’s limits on local solar
Moody’s report shows Tri-State’s coal plants are more expensive than new renewable energy
Tri-State’s limits on local energy development are a growing problem for co-op members
Governor Hickenlooper discusses Tri-State at the Climate Leadership Conference
Bids for Xcel’s Colorado Energy Plan include a proposal for the world’s largest battery
New wind and solar power in Colorado is now cheaper than existing coal plants
Companies' 100% renewable energy goals are getting results in Colorado
What does cheap solar mean for electric cooperatives?
Colorado towns and cities are helping push utilities to embrace renewable energy
How are electric cooperatives navigating the transition from coal to cheap clean energy?
Blocked from building more solar projects, United Power shifts to community batteries
Economic reality sets in for Tri-State efforts to expand the Holcomb coal plant
Solar projects in the works in Grand and Jackson counties
Mountain Parks Electric grapples with solar