The Evolution and Status of the Colorado Renewable Energy
Standard (RES) Jonathan Miller Policy, Regulatory and Outreach
Team
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WeatherizationCommercial and Residential EfficiencyTransmission
and Smart GridTransportation FuelsState and Local OutreachRenewable
Energy DevelopmentFinance GEO Programs Policy, Regulatory and
Outreach Legislation Relationships and planning Investor owned
utilities REAs, Munis and Co-ops Education Energy issues
analysis
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Colorado Governors Energy Office (GEO) The Governors Energy
Office promotes sustainable economic development in Colorado
through advancing the states energy market and industry to create
jobs, increase energy security, lower long term consumer costs, and
protect our environment. Cost Security Jobs Mission
Environment
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BIG announcement 5/12/11 Xcel Energy announced it would meet
their 30% RES compliance commitment 8 years ahead of schedule.
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History of the RES Amendment 37 11/2004 10% by 2015 HB-1281
4/2007 20% by 2020 HB-1001 3/2010 30% by 2020
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Colorado RES compliance progress
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Xcels RES compliance estimates Source: 2012 Renewable Energy
Standard Compliance Plan: Public Service Company of Colorado. May
13,2011.
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Colorado RES compliance progress
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What counts towards the RES Eligible renewable-energy resources
include solar-electric energy, wind energy, geothermal-electric
energy, biomass facilities that burn nontoxic plants, landfill gas,
animal waste, hydropower, recycled energy, and fuel cells using
hydrogen derived from eligible renewables.
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Renewable Energy Standard Adjustment (RESA)
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ECA= Electric Cost Adjustment; RESA= Renewable Energy Standard
Adjustment; TCA=Transmission Cost Adjustment; AQIR= Air Quality
Improvement Rider; DSMCA= Demand Side Management Cost Adjustment;
Fort St. Vrain= PSCoowned gas peaking units; Comanche= coalfired
generating station in Pueblo; Base S&F= Base Service and
Facility Rates or Base Rate; PCCA= Purchased Capacity Cost
Adjustment paid to independent power producers; CPI= Consumer Price
Index Fuel Costs (natural gas and coal) Base Rates (utility asset
recovery) RES (~1.3 GW, capped at 2% rate impact) New Coal
Generation (~0.5 GW, 6% rate impact) ECA= Electric Cost Adjustment;
RESA= Renewable Energy Standard Adjustment; TCA=Transmission Cost
Adjustment; AQIR= Air Quality Improvement Rider; DSMCA= Demand Side
Management Cost Adjustment; Fort St. Vrain= PSCoowned gas peaking
units; Comanche= new 750 MW coalfired generating station in Pueblo;
Base S&F= Base Service and Facility Rates or Base Rate; PCCA=
Purchased Capacity Cost Adjustment paid to independent power
producers Produced by the Colorado Governors Energy Office. Source
data: CoPUC
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RESA applied to the incremental cost of RE? Source: Public
Service Company of Colorado Renewable Energy Standard Adjustment
Revenues Collected and Expenditures. May 10, 2011.
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The RESA deferred balance Source: Public Service Company of
Colorado Renewable Energy Standard Adjustment Revenues Collected
and Expenditures. May 10, 2011.
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Adding in the deferred balance The added cost of the RESA
deferred balance. 0.74% Thus, the actual RESA cost is ~2.74%
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The cost of the RES Fuel Costs (natural gas and Coal) Base
Rates (utility asset recovery) RES (~1.3 GW, capped at ~2.74% rate
impact) New Coal Generation (~0.5 GW, 6% rate impact) ECA= Electric
Cost Adjustment; RESA= Renewable Energy Standard Adjustment;
TCA=Transmission Cost Adjustment; AQIR= Air Quality Improvement
Rider; DSMCA= Demand Side Management Cost Adjustment; Fort St.
Vrain= PSCoowned gas peaking units; Comanche= new 750 MW coalfired
generating station in Pueblo; Base S&F= Base Service and
Facility Rates or Base Rate; PCCA= Purchased Capacity Cost
Adjustment paid to independent power producers Deferred Balance
Added Produced by the Colorado Governors Energy Office. Source
data: CoPUC
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How does it all add up? The incremental cost of meeting or
exceeding the RES has a < 3% rate impact The RES is ahead of
schedule Colorado has the 2 nd most aggressive Renewable Portfolio
Standard in the US Behind California. Is it time for a
celebration?
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Four factors to consider This isnt the whole story.
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#1: Small utilities Electric utilities serving less than 40,000
people are NOT subject to the RES. ~15% of Colorados
generation
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#2: Rural Electric Associations (REAs) and Municipal utilities
REAs and Munis that serve more than 40,000 people are subject to a
10% RES by 2020 ~25% of Colorados generation
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#3: Investor Owned Utilities (IOUs) IOUs ARE subject to the 30%
RES by 2020 ~60% of Colorados generation Public Service Company of
Colorado (Xcel Energy) Black Hills
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#4: Multiplier for in-state generation Generation in CO
receives a 125% multiplier that counts towards RES compliance
Nearly all COs Renewable Energy Credits (RECs) will be generated in
CO X 125%
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The basic breakdown Small Utilities 40,000 25% x 10% = 2.5%
Investor Owned Utilities (IOUs) 60% x 30% = 18% Total 20.5%
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The basic breakdown Small Utilities 40,000 25% x 10% = 2.5%
Investor Owned Utilities (IOUs) 60% x 30% = 18% Total 20.5% Factor
in Multiplier for In- State Generation 20.5% 125%
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Effective state-wide Colorado RES ~16.4%
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Other benefits of the RES
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Electric power transformation in the Rocky Mountain Region
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3% of IOU revenue will go to distributed generation Comparison
of estimated renewable energy minimum generation requirements from
HB07-1281 and HB10- 1001. 669 MW IOU projected MW capacity needed
for 2020 RES compliance 239 MW Total capacity projected for Xcel in
the 2013 compliance plan 430 MW Additional capacity needed by
2020
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Geothermals opportunity for distributed generation Geothermal
electric energy can qualify for distributed generation if it meets
the following conditions 1.Must be located at the site of a
customer and is connected to the customers side of the meter 2.Must
be less than 30 MW 3.Does not qualify as retail distributed
generation 4.Systems of 1 MW or greater must be registered with a
REC tracking system (selected by the PUC)
Economic Development Installed Renewable Energy $4.2 Billion
Renewable Energy Capacity 2,100 Megawatts Colorado Jobs
10,000+
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Bringing jobs to Colorado
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Bringing Jobs to Colorado
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Success: Renewable Energy Jobs
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Making Colorado a Cleantech Hub In the U.S. for Cleantech
Venture Capital Investment 18,000 Colorado Cleantech Jobs Source:
Colorado Cleantech. www.cleantechhub.com #
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Lessons Learned Xcel can meet 30% RES compliance (~24% w/
in-state multiplier) It can be done in half the time as expected
The rate impact is less than 3% Renewable energy is decreasing in
cost Clean jobs in Colorado Colorado is a national & global
leader
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GEOs Role Societal Interest Profits Balance
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Analytical Process Cost Jobs Security Environment Renewable
Energy IOU Utilities REAsCoops Environmental Groups Natural Gas
State Entities Regulators PublicCoal Policy and Regulatory
Incentives $ Invest Engage Plan ACT
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Market Transformation The Old Paradigm Colorados Progress
Market Adoption
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GEO Renewable Energy Subject Matter Experts Governors Energy
Office State of Colorado 1580 Logan Street, Suite OL1 Denver,
Colorado 80203 (303) 866-2202 TJ Deora Director Angie Fyfe
Associate Director, Operations Stacey Simms Associate Director,
Programs Morey Wolfson Senior Policy Advisor Jonathan Miller
[email protected] 303-866-2204