The $2 billion Power Pathway project by Xcel Energy, which aims to construct 550 miles of high-voltage power lines in eastern Colorado, has drawn criticism from three Colorado cities as well as an energy agency in Nebraska.
Critics claimed that Xcel is unfairly charging consumers who won’t profit from the project and don’t require the new power line for a portion of the project’s cost. They claimed that Xcel had circumvented federal standards governing regional electric transmission planning and coordination, which would have obliged the energy provider to fairly distribute project costs to all project beneficiaries, including non-customers.
The Power Pathway project, according to Xcel Energy, will “enhance the overall reliability of the grid and enable delivery of clean energy to all our customers, both retail and wholesale.”
The Federal Energy Regulatory Commission (FERC), which oversees the interstate generation and distribution of electric power, received the complaint on February 16.
The complainants in this case include the Municipal Energy Agency of Nebraska (MEAN), a wholesale electricity provider for over sixty member communities in four states, including the Town of Center and the cities of Aspen and Glenwood Springs in Colorado.
The Colorado members purchase wholesale power and other services from MEAN, which supplies Aspen and Glenwood Springs with “100% clean energy” and contributes over 40% of the “clean” energy used by Center.
Their electricity is delivered through the statewide power system of Xcel Energy, a paid service subject to FERC and Colorado regulations.
With the goal of supplying windmills and solar farms in southern and eastern Colorado, Xcel Energy was granted authorization by the Colorado Public Utilities Commission in June 2022 to invest a minimum of $2 billion in the construction of up to 550 miles of new high-voltage power lines.
According to Xcel, the project will create a “backbone network transmission system in eastern Colorado” that will boost the transmission system’s dependability considerably and offer enough transmission capacity to support an additional 3,000–3,500 megawatts of new power generation.
The complainants claimed that as business wholesale customers of Xcel, they would be held responsible for the expenses of the additional powerlines even though the project will not benefit any of them and a FERC-mandated regional approach would have shown this.
“Investments in a future free of carbon have already been made by Glenwood Springs and our joint filers. Glenwood Springs Mayor Ingrid Wussow stated, “Our residents shouldn’t have to pay an unfair increase in fees for Xcel Energy’s infrastructure that offers no direct benefit to our constituents.” In summary, the proposed network service agreement unreasonable requests that we pay Power Pathway expenses that are unrelated to the advantages to our communities.
They stated that Xcel expects their electricity transmission costs to increase by 114%.
According to Public Service’s projections, Colorado Cities will pay more than twice as much (114%) by the end of 2027 for the same transmission service they currently receive, serving the same load, utilizing the same generation resources, and not utilizing any renewable resources made possible by the Power Pathway.
The complaint further stated that the entire cost of the new powerlines will be borne by Xcel ratepayers, both residential and commercial, and that the new renewable energy generator owners who plan to develop facilities in the state’s eastern plains, which the project is intended to serve, will not be paying for them.
In order to prevent discrimination by overcharging some to the advantage of others, FERC regulations require regional planning and coordination for high-voltage distribution lines to guarantee that everyone who benefits from them pays their just and reasonable share of the costs.
That is precisely what the complainants said Xcel’s disregard for federal law accomplishes.
By arguing that the project is “a locally needed transmission addition to support state policy objectives,” Xcel, according to the complaint, avoided regional planning.
The complaint stated that Public Service withdrew the project from regional consideration and regional cost sharing and instead submitted the Power Pathway to the Colorado Public Utilities Commission, “despite initially reviewing project alternatives through the WestConnect subregional planning committee.”
Paul Cicio, chair of the Electricity Transmission Competition Coalition, which promotes free-market competition in the construction of power lines, said, “This is an important consumer complaint as it raises the serious question of utilities grossly misaligning cost allocation for billions of dollars related to a transmission project—all in order to avoid a strong regional planning process and competition.”
“Regionally planning all transmission 100 kV and above by the Order No 1000 regions is the best way to stop this gaming of the system,” Cicio stated.
A $15 billion “preferred plan” for Xcel Energy’s Clean Energy Plan was also presented in September 2023. Over the following seven years, this plan would add a “unprecedented” amount of renewable energy to the grid. This is in addition to what the new transmission lines will cost.
More than 1,100 bids for renewable energy projects have been submitted to Xcel Energy Colorado, according to Robert Kenney, president of the company. These projects will supply the state’s more than 5,000 megawatts of additional line capacity.
In October, the Independence Institute, a Denver-based organization that promotes laws to “enhance personal and economic freedom,” released a May 2023 analysis estimating that the cost to taxpayers by 2050 of just changing the electrical system may reach $318 billion.
According to the organization’s energy policy researcher, Jake Fogleman, the typical monthly household electricity bill might reach $628 by 2040. The study stated that Colorado’s all-sector power rates climbed by more than 70% between 2004 and 2022, from an average of 6.95 to 11.85 cents per kilowatt hour, when the state passed its first renewable energy portfolio mandate.
The survey states that Colorado currently has the highest average pricing in the whole Mountain West area.
In a prior interview, Jeremy Nichols, senior campaigner for the Environmental Health Program of the Center for Biological Diversity, stated that “more transmission isn’t necessarily the solution to developing more clean energy.” “We don’t want Xcel to burden ratepayers with ineffective, inefficient, or worse, environmentally damaging transmission projects. More transmission is a significant investment.”
According to Xcel, their proposal satisfies all federal regulations.