Xcel Energy focusing on new coal-to-gas plan

AP News
Posted: Oct 21, 2010 4:44 PM
Xcel Energy focusing on new coal-to-gas plan

Xcel Energy's plan to retire about 900 megawatts of coal-fired power generation by 2022 is off the table, as it focuses on doing it by 2017 instead.

The utility expects to file a new proposal Monday.

As required by a new state law, Xcel Energy Inc. submitted a plan to substantially cut emissions to help the state meet foreseeable federal air standards by adding emissions controls at some plants, retiring some coal-fired units and switching some to run on natural gas. That plan wouldn't have been fully implemented until 2022, when Xcel said it wanted to shut down the coal-fired Cherokee 4 unit in Denver.

However, staff for the Colorado Public Utilities Commission said Thursday that that time frame wouldn't work, because the law requires Xcel to fully implement its plan by 2017. The PUC is charged with deciding whether Xcel's plan is acceptable.

Xcel spokesman Mark Stutz said the company was disappointed because the later timeline would have spread out costs for its customers and allowed for greater reliability of its system. It also would have given the coal industry more time to find other places to sell coal Xcel would no longer need, he said.

The utility has estimated its original plan would have raised customers' annual electricity bills 1.5 percent. It's unclear how much more customers would pay under a new plan.

Xcel is still trying to work out details of how to meet the tighter schedule. A possibility could include switching Cherokee 4 to run on natural gas before 2018.

Coal industry interests had lined up against Xcel's original plan, while natural gas interests formed an unusual coalition with environmental groups to support it. Now all sides are left to see what Xcel will propose next.

The Left-wing Paradise of San Francisco
Rachel Alexander

The Coal Mining Association had asked PUC Chairman Ronald Binz and Commissioner Matt Baker to recuse themselves from the proceedings Thursday, but the two declined.

The association alleged the commissioners negotiated with Xcel and natural gas companies on the new state law that prompted Xcel's plan and weren't impartial. Baker said his meetings with natural gas companies were publicly disclosed and dealt with questions about natural gas supplies. Binz said that rather than working "in league" with Xcel, he was working to limit rate increases for Xcel's customers.