The rationale from Xcel Energy sounds good for all of us, including Mother Nature. Maybe it is not.
The for-profit, out-of-state power monopoly wants to decommission two coal-fired power units at the Comanche generating station near Pueblo. It will replace them with wind, solar and battery storage. Xcel, Colorado’s largest electric utility, tells us this will help the planet and reduce costs for ratepayers.
There are reasons to doubt these claims. A new federal report explains how everyone might be better off if Xcel keeps the Comanche units operational long into the future.
We first learned of big concerns with Xcel’s proposal last summer, when analysts at a public policy institute in Chicago weighed in.
“Xcel has a vested financial self-interest in presenting cost estimates that justify its desire to build the new facilities,” said James Taylor, senior fellow for environmental policy at The Heartland Institute, in a guest column for The Denver Post in August.
The government guarantees Xcel a profit return of about 10 percent of every dollar it spends building facilities — even if those expenses pose a greater liability for ratepayers. Xcel builds many of its new facilities and employs specialists to justify replacing old plants with new alternatives, some of which have not been proven reliable.
Anyone can see the conflict of interest. Xcel gets a guaranteed return whenever it builds, so it pitches the public and the Public Utilities Commission on reasons it should deconstruct and build. The company adores politicians who promise a green future of 100% renewables, as that promise means out with the old and in with the new. It means billions in additional future profits, at a cost to ratepayers.
“Xcel’s proposal to shut down the Comanche 1 and 2 power plants will drain millions of dollars from Colorado consumers,” Taylor explains.
The plan to replace Comanche units with wind, solar and batteries will raise the cost of energy so much it inspired opposition from a nonprofit utility that buys energy wholesale from Xcel. Intermountain electric cooperative predicts Xcel will have to increase wholesale and consumer rates to pay for replacing Comanche.
A report issued last week by the U.S. Department of Energy tells us these concerns, and more, are true.
“The retirement of Comanche Units 1 & 2 will cause significant impacts on the local community,” the report states.
The report explains how emissions at units 1 and 2 are significantly below average, as Xcel recently invested about $200 million in emissions control equipment. Xcel “justified the expense by asserting that the investment would provide clean air for several decades.”
The government report compares and contrasts the future under Xcel’s plan with the option of keeping Comanche units and outfitting them with carbon capture utilization and storage technology. The process removes CO2 from flue gas and the atmosphere, reusing it and storing it safely. Comanche, the report states, is a perfect case study for carbon capture “as it is the plant that is closest to a trunk line, the Sheep Mountain Pipeline in Colorado.”
Xcel’s proposal, known as its Colorado Energy Plan, would reduce emissions by 53% over 23 years. By contrast, keeping 1 and 2 with carbon capture would reduce emissions by 65% — an additional 12% reduction.
Xcel’s plan would create about 11,200 jobs in Colorado and about 3,100 in Pueblo. Retention of Comanche units, while adding carbon capture, would create about 18,600 jobs in Colorado and 13,300 in Pueblo. Additionally, the report concludes, retrofitting and keeping the Comanche units would: