CEA: Future of Coal Supply for Colorado’s Largest Coal Plants Uncertain
Peabody Energy and Arch Resources are the largest coal producers in the Powder River Basin (PRB) in Wyoming, and are both major suppliers of Xcel’s biggest Colorado coal plants – the 500 MW Brush coal plant and 750 MW Pueblo Unit 3, of which Xcel owns 500 MW.
With Arch likely to pull out of the PRB and Peabody potentially facing the second bankruptcy in less than 5 years, there are serious questions about future coal supply. There aren’t any regions of the country that are in the position to supply reasonably priced coal to these plants if the PRB sources are not available. This should play out in the next several years and should help Colorado move beyond coal, hopefully in the 2020s.
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AQCC Update In order to meet Colorado greenhouse gas reduction targets, Colorado’s Air Quality Control Commission (AQCC) has decided to close three coal plants – Tri-State’s Craig Unit 3, Platte River Power Authority’s Rawhide, and Colorado Springs Utility’s Ray D. Nixon – by the end of 2028 rather than the utility’s voluntary plans for 2030. The final vote will take place later this month. Read more HERE.
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PUC Updates
On November 24, the Colorado Public Utilities Commission (PUC) issued an order which generally accepted Tri-State’s Electric Resource Plan, the first ERP in the state to include the social cost of carbon in its modeling. The PUC directed Tri-State to file information on the costs and finances of their coal plants and to apply the social cost of carbon in its analysis of all resources in their portfolio, including those outside of Colorado. Tri-State will file a full ERP in December 2020.
You can read Western Colorado Alliance for Community Action’s review HERE. The PUC also opened a general investigation on Oct. 29 on decarbonizing gas utilities. A similar effort is under way in Massachusetts.
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COGCC Update
The Colorado Oil and Gas Conservation Commission (COGCC) has finally passed the “Mission Change” rule-making that implements the 2019 Senate Bill 19-181 directive to regulate rather than foster oil and gas activity. It includes increased setbacks from 500 to 2000 feet, elimination of routine venting and flaring, and requires consideration of environmental justice in permitting decisions. While it is a watershed moment for environmental protection in Colorado, it doesn’t go as far as we hoped it would. 350 Colorado has outlined several outstanding issues, including adequate bonding for well reclamation and reducing exemptions. The action link is no longer current, but the issues are still valid and will hopefully be addressed in rule-makings early next year.
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| What We Are Reading CO Latino Voters Want Climate Action to Fuel Economic Rebound A new poll of Colorado Latino voters shows a strong support for government action to combat the climate crisis. The poll contradicts long-held assumptions that working-class communities of color aren’t interested in environmental issues. Read an analysis of the findings HERE. Bringing Low and Middle Income Consumers into the Market A prototype community southeast of Los Angeles, California, aims to demonstrate the advantages of having prosumers in a disadvantaged community selling into electricity market, and reaping a cleaner environment, added income, and boosted energy resilience. Study Shows 90% Carbon-Free Electricity at No Extra Cost Possible by 2035 A study conducted by the Goldman School of Public Policy at UC Berkeley lays out the possibility of drastic carbon reduction from our electrical grid. The findings show that economic prosperity and a sustainable electricity grid are both possible in the near future. San Francisco Bans Gas in New Residential and Commercial Buildings The San Francisco City Board of Supervisors voted to approve a ban on natural gas infrastructure for new residential and commercial construction projects. This marks the 40th California municipality, and perhaps the largest city, to ban natural gas for new construction. |
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Dec. 1, 2020, Allen Best. These stories are from Big Pivots, but they are posted to the Mountain Town News website. This will change within a few weeks, thanks to the recent receipt of a grant, with a website that will be named Big Pivots).
A year earlier for three coal plants
The Air Quality Control Commission—the body delegated by the state legislature to do most of the heavy lifting to get Colorado to achieve the deep economy wide carbon emissions—was about to deliberate about a proposal to require three coal plants to close a week early when I sent out issue No. 23 of Big Pivots on Nov. 20.
Soon after, the commission voted 5-2 to require the Craig 3, Rawhide and Nixon coal plants to close by the end of 2028, a year earlier than the utilities that operate them had planned. It was, said one witness on behalf of the Sierra Club and the National Parks Conservation Association, merely a nudge. Tri-State Generation & Transmission, the owner and operator of Craig 3, seemed to think it was more than that. Xcel Energy registered opposition, too.
See A nudge, not a shove, and decide for yourself whether it was merely a nudge.
Tri-State in November announced it intended to achieve 80% reduction in emissions by 2030, as the state wants. For the Westminster-based utility, the second largest in Colorado, it’s a new era. Before 2019, Tri-State was responsible in theory to its members but not in a consequential way to state regulators. A 2019 law changed that.
The upshot is that Tri-State must now submit electric resource plans, the same as Xcel Energy and Black Hills, to the Public Utilities Commission. Its first submission is due today, Dec. 1.
That filing may begin to answer the perplexing question of exactly how Tri-State intends to achieve that 80% reduction. Will it have to drastically cut imports of coal-based generation to its Colorado members from coal plants in Wyoming and Arizona.
See A new era of Tri-State. (And look for another story by tomorrow with some details about Tri-State’s filings.)
Another proposal for Mt. Evans
The Wilderness Society has teamed up with the Arapaho and Cheyenne tribes to petition a federal agency. They propose to a federal agency that Mt. Evans be given a new name: Blue Sky Mountain. (If you’re thinking about Vail’s Back-Back Bowl, you’re not alone).
The problem with Evans? It remembers an individual who doesn’t look so swell in 21st century eyes as he did in the 19th century, when he play a regrettable role in the Sand Creek Massacre. See Blue Sky Mountain in lieu of Evans?
Reflections after East Troublesome
Guest writer Andrew Miller suggests that Grand County, site of much of the East Troublesome Fire in October, should look for ideas to the Kansas town of Greensburg. That town rebuilt differently after being nearly leveled by a tornado. Among the changes he proposes are new building materials. See his essay.
Boulder and Cañon City have been going in opposite directions since the 1870s when one took the state prison in the belief that crime would pay, and the other the state university. That was a time when education didn’t pay nearly as well as it does now. In the November election, they again crossed paths in their utility franchise votes. See more here.Comanche 3 under the microscope
This story ran in the Nov. 3 issue of Big Pivots (and a similar story in May) but it deserves noting once again. The future of the youngest coal-fired power plant in the West is in doubt. It looks like a lemon and has been down for repairs most of 2020. It’s had many problems since it opened in 2010. Will it make it to 2030? See more here.
Regional roundup from Big Pivots No. 23
Peabody Coal puts on a brave face in Wyoming, California’s fourth-largest city (San Francisco) says no new natural gas, a move likely to be followed by San Jose. And solar farms are going up in northwestern New Mexico. See the recap here.
