An already completed bid-solicitation period could prove to be a major hurdle for Western Slope interests pushing to have a natural gas-fired power plant built locally as part of an Xcel Energy proposal to close two coal-fired units.
The Colorado Public Utilities Commission this week agreed to let Xcel present a clean-energy plan portfolio for consideration as part of its current electric resource plan. The portfolio would include early retirement of two coal-fired generation units at Xcel's Comanche generation facility in Pueblo. Xcel would replace that power with new renewable and natural gas generation.
Commissioners in Mesa, Garfield and Rio Blanco counties and the West Slope Colorado Oil and Gas Association would like to see Xcel locate what the utility says could be up to 700 megawatts of gas-fired generation at a plant in the Piceance Basin, where the facility could be supplied by locally developed gas.
But Xcel spokesman Mark Stutz notes that the utility already has gone through a bidding process that closed in November from entities interested in supplying the renewable and gas-fired power.
For a project based in western Colorado to be considered by Xcel, someone already would have had to submit a bid for it, Stutz said.
"They would need to already be in the process with a bid for a project to potentially happen on the Western Slope," he said.
He said project bids had to include a reference to their general location. For now, the locations of proposed projects are being kept confidential by Xcel.
Xcel also was allowed to submit its own bids, and did so, but the proposed locations are confidential, Stutz said.
Xcel also allowed for bidders to refresh their bids more recently to account for developments like new tariffs on solar imports and changes in federal tax law, but that process also has been completed and only involved previous bidders.
Stutz said projects can be bid outside the process, but only if they're no more than 30 megawatts in size.
He also said a project "may be proposed or built based on mandates outside of the electric resource planning process, such as legislation by the state."
Xcel was able to build three generating units at its Cherokee Generating Station in Denver outside of that process under the 2010 Clean Air — Clean Jobs Act, which encouraged construction of gas-fired generation to replace coal-fired power. It built its Rush Creek Wind Project in eastern Colorado under a carve-out within Renewable Energy Standard legislation, Stutz said.
He also noted that the recent bid process pertained to the electric resource plan Xcel filed in 2016. According to the utilities commission, regulated utilities in the state must file a plan every four years to forecast future electric demand and how the utility will meet it.
Stutz said Xcel will begin a new resource planning process in 2019. That could lead to opportunities for bids involving Western Slope facilities.
David Ludlam, executive director of the West Slope oil and gas association, believes the utilities commission will have some latitude in its decision-making in the Xcel matter and be able to consider socioeconomic equity and fairness.
"They (commission members) are political appointees, and when there's a will, there's a way to help northwest Colorado site electric generation facilities on top of the second-largest natural gas resource in the country," Ludlam said.
Public Utilities Commission spokesman Terry Bote said Friday that what the agency will be able to consider for this specific energy portfolio will be dictated by what Xcel ends up proposing based on the bids Xcel has received.
He said that without speaking to an attorney, he can't address what latitude the commission might have in its decision-making authority.
Mesa County Commissioner Rose Pugliese noted that Gov. John Hickenlooper has "been very supportive of opportunities for rural economic development, especially on the Western Slope," and that he appoints the utilities commission members.
"We will continue to advocate for a natural gas power plant on the Western Slope, and we'll continue to lobby the governor" and other decision-makers to make that happen, she said.
Ludlam indicated that supporters of getting gas-fired generation located locally are planning to play a long game, regardless of the outcome of the current Xcel planning process.
"I think this will be something that we try to pursue in perpetuity," he said.
Meanwhile, Xcel is awaiting the commission's written order from this week's proceedings on the clean energy plan, which Xcel is referring to formally as the Colorado Energy Plan.
Stutz noted that the plan "was developed with an incredibly diverse group of customers, independent power producers, state agencies, environmental organizations, labor, renewable energy organizations, and other stakeholders."
He said modifications discussed by the utilities commission this week "could impact the plan and will have to be considered by the many parties to the agreement once we see a written decision."