HUDSON | Increasingly affordable, reliable renewable energy isn’t so scary anymore
Author: Miller Hudson - September 24, 2018 - Updated: September 24, 2018
Technology develops in accordance with an ethos and logic impervious to ideology. Politicians on both the right and left have been badly burned in recent years by staking policy positions presuming tomorrow will look a lot like today. Whatever you may believe about evolution in the biological realm, technology changes incrementally in response to the application of human ingenuity. This all came to mind as I listened to speakers at a workshop on Colorado’s energy resilience earlier this week at the law offices of Faegre and Benson in Denver.
To put these remarks in context it is useful to glance back to 2004 when a coalition of environmental and consumer groups placed a directive on the ballot requiring Colorado’s electric utilities to derive 10 percent of their power from sustainable sources by 2020. The sponsors enjoyed an unexpected ally in Republican House Speaker Lola Spradley. Prior to serving in the Legislature, Spradley spent her career working at Mountain Bell and USWEST during the break-up of AT&T. She was acquainted with the recalcitrance and aversion to change that characterizes most regulated utilities. She also hoped that the construction of wind and solar projects would provide a mechanism that could supplement income for ranch and farming families in her rural district. Voters narrowly approved the initiative.
While Public Service Company of Colorado, now XCEL, formally remained neutral on the proposal, it funneled money to a vociferous opposition led by the state’s rural electric cooperatives (REAs). A litany of horrors were trotted out to alarm residents and customers: (1) the variability of renewable energy would destabilize the grid and result in frequent brownouts, (2) millions in additional costs would fall on customers as utilities were forced to install control systems needed to stabilize service, (3) electric bills would skyrocket as utilities abandoned cheaper coal and natural gas generation, (4) proponents were trying to select winners and losers in the energy marketplace, and more. All this was going to occur because of a 10 percent renewable energy standard. Fourteen years later, Colorado has blown past 40 percent renewables and should reach 50 percent by 2021 while enjoying average rates in the bottom third of utilities nationally.
Tri-State Generation, power wholesaler to Colorado’s REAs, brags about the improved resilience in its transmission system, while XCEL points a spotlight at its recently completed billion-dollar wind farm stretching across a half dozen counties on the Eastern Plains. The Platte River Power Authority, serving the northern Front Range, explains their customers are demanding more sustainable power sources, including smaller, distributed generating stations. So, what happened that the utility prophets of 2004 got so wrong? Follow the money. David Roberts noted in a January story in VOX titled, “In Colorado, a glimpse of renewable energy’s insanely cheap future,” that every renewable sourced bid submitted to XCEL for 2.5 GW of added and replacement power came in cheaper than either coal or natural gas.
The only remaining stumbling block to achieving a 100 percent sustainable grid is energy storage – batteries. They remain expensive and their reliability under heavy usage is untested, but even those costs are falling and storage capacity is growing. Nonetheless, critics of XCEL’s Colorado Energy Plan that was submitted to the Public Utilities Commission last year, which is heavily reliant on sustainable purchases, repeat the same old shibboleths. On the political front, Democratic gubernatorial candidates Mike Johnston and Jared Polis were attacked for their support of a 100 percent renewable standard by mid-century. Truth be told, it is entirely possible Colorado will reach that goal without any heavy political lifting.
Fuel costs for electric cars are 20-30 percent that of gasoline, which is unlikely to ever be any cheaper than it is today. As soon as vehicle recharging becomes faster and more widely available you can kiss the reciprocating engine and its maintenance expenses goodbye, cleaning up our air in the bargain. Market forces will continue to drive these changes so long as we continue to assure a level playing field. Despite the president’s rapturous praise for “beautiful, clean coal,” fossil fuels are likely headed for the economic exit. That raises the question, what is the future for all the proposed fracking in Colorado? 88 percent of our hydrocarbons are currently shipped out of state. If those customers begin to evaporate, we may see more wells shut than drilled.
In the shadow of the Arab oil embargo I arrived as a freshman legislator in 1979 during a bi-partisan flurry of interest in energy conservation. Bryant O’Donnell, counsel for the Public Service Company of Colorado, appeared before the House Transportation Committee to oppose any conservation measures, declaring, “…we are not in the conservation business, we are in the energy business.” With a brashness born of serving in the minority, I responded by saying, “Mr. O’Donnell, your company is a regulated monopoly. Consequently you are in whatever business this Legislature tells you to be in – and if that includes conservation, you will be in the conservation business.” It was encouraging to hear today’s utility spokespersons talking about what their customers preferred.