Public Service of Colorado cuts over 200 MW out of capacity need estimate

The Public Service Co. of Colorado unit of Xcel Energy (NYSE: XEL) said in an Oct. 31 resource update filed with the Colorado Public Utilities Commission that it has slashed its forecasted capacity need for later this decade.

The company had filed its 2016 Electric Resource Plan (ERP) on May 27 with the commission. The filing initiated “Phase I” of this ERP proceeding. An evidentiary hearing in this matter is scheduled for Feb. 1-3 and 6-8, 2017. The Oct. 31 filing was an update to the 2016 ERP.

The 2016 ERP proposes using a competitive acquisition process to acquire any generation capacity needs over an eight-year Resource Acquisition Period (RAP) that extends through the summer of 2023. The company is currently forecasting a need for just under 400 MW of additional generation capacity by summer 2023, over 200 MW lower than the 615 MW of need initially forecast in the May 27 ERP filing.

The demand forecast of 7,051 MW for summer 2023 is 174 MW lower than the December 2015 demand forecast that was used in the company’s May 27 ERP filing. This reduction in peak demand is the primary driver behind the approximately 200 MW reduction in projected resource need.

The Xcel company’s Total Summer Net Dependable Capacity (NDC) is projected to decrease by approximately 520 MW over the time period from 2016 to 2025. This change includes the impacts of company-owned plant retirements, increased capacity at the Cabin Creek pumped hydro facility, an assumption as to the SPS Diversity Exchange, expiring power purchase agreements (PPAs), and assumptions as to incremental additions of customer-choice solar.

The company noted that the 120-MW Comanche Solar facility, which was part of the commission-approved 2013 All-Source resource portfolio, was placed in-service on Sept. 2 of this year. As a result, all of the generation resources contained in the resource portfolio from the 2013 All-Source Solicitation are operational.

The utility noted that the EPA’s proposed Clean Power Plan is under legal challenge from 27 states and a number of industry groups. The CPP has been stayed by the U.S. Supreme Court since Feb. 9, 2016 ,while the U.S. Court of Appeals for the District of Columbia Circuit reviews its legality. On Sept. 27, 2016, the D.C. Circuit heard oral arguments on the CPP. It is generally expected that the D.C. Circuit Court will issue its opinion in early 2017. At that time, the U.S. Supreme Court can decide whether to hear the case itself in 2017 or 2018. The stay will be lifted when either (1) the U.S. Supreme Court declines to hear the case, or (2) the U.S. Supreme Court issues a decision on the merits of the case.

Said the utility: “We will continue to monitor the D.C. Circuit outcome and U.S. Supreme Court activities, but we may not have final certainty on the CPP’s legal status before approximately June 2018. Lacking certainty on the fate or deadlines of the CPP, Colorado has not developed a state plan to implement the rule. Despite lacking the details that a State compliance plan for Colorado would provide, the Company believes that its current plans/actions to: (1) take advantage of the recently extended federal PTCs through the construction of the 600 MW Rush Creek Wind Facility, (2) encourage bidders to offer additional cost effective utility-scale wind and solar resources into the Company in the Phase II acquisition process, (3) continue investing in Colorado consumers and providing them choices for their energy needs through the Company’s 2017 RE Plan, and (4) continue our efforts in the area of DSM and customer choice programs, will ultimately put Public Service and its customers in a better position to comply with the carbon dioxide emission reductions envisioned in the CPP or any other future state or federal carbon dioxide regulations.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.