The current population of the state of Colorado is estimated to be 5.76 million. In October 2018, the state utilities used coal (49.3%), natural gas (29.1%) and renewable energy (21.52%) to generate electricity. Wind and hydropower are the primary sources of renewable energy in Colorado.
The state’s dependence on natural gas has offset the high cost of coal to keep electricity costs near the average price in the United States. In October 2018, the average cost of electricity in Colorado was U.S. 12.3 ¢ per kWh, which is the 29th most expensive price in the United States. The high cost of coal is causing state utilities to accelerate the move to renewable energy.
Xcel Energy, Colorado’s largest utility has committed to going 80% carbon free by 2030 and 100% carbon free by 2050. Xcel is committed to closing all coal-fueled power plants and to developing new renewable energy projects. It is important to note that carbon free includes nuclear power plants and fossil fuels plants with carbon capture and sequestration. Xcel will need to use carbon capture and sequestration in Colorado to meet their new carbon free commitments.
Xcel Energy is a utility holding company, headquartered in Minneapolis, Minnesota. Xcel Energy serves over 3.3 million electric customers and 1.8 million natural gas customers in Minnesota, Michigan, Wisconsin, North Dakota, South Dakota, Colorado, Texas and New Mexico. The economics of renewable energy is the primary reason for Xcel to abandon coal for renewable energy. An independent study by the Lazard Bank in 2015 showed that the cost of electricity with onshore wind farms is approximately half the cost of electricity with coal-fueled power plants.
Xcel Energy is the first major American utility in the country to set such an ambitious, carbon free target. The company believes it will be relatively easy to meet the 2030 carbon free targets with existing technology. Batteries will play a key role in Excel Energy’s plant by challenging natural gas as an essential component for the power grid.
Personally, I applaud Xcel Energy for their carbon free targets. Xcel Energy can become a benchmark for all utilities in the United States, if they can indeed meet their 2030 carbon free benchmark. In my opinion, Xcel Energy’s plan is far more practical and economically feasible than many “Green New Deal” programs.
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