The Colorado Public Utilities Commission has had a very active year that is now coming to a close. Key proceedings this year included the Just Transition Solicitation (JTS), Distribution System Planning (DSP), and a Virtual Power Plant (VPP) Application. The outcomes of these proceedings, and valuable insights  along the way, promise significant progress for Colorado’s electric system!  

Just Transition Solicitation Sets Stage for New Clean Energy Opportunities  

The Just Transition Solicitation (24A-0442E), or “JTS,” has become one of Colorado’s most consequential clean energy proceedings due to what it aims to achieve and how it came to fruition.  

The JTS originated from a settlement agreement reached in Xcel Energy’s previous Electric Resource Plan (ERP), approved by the state’s Public Utilities Commission in 2024. What was originally meant to be a smaller follow-up process quickly expanded into a full-fledged proceeding as Colorado’s energy needs became clearer. It began as a modest agreement and grew into one of the state’s most ambitious clean energy initiatives, emphasizing investment and opportunity as Colorado prepared to retire its last coal plant, Comanche 3, in Pueblo.  

The JTS was designed to procure a new portfolio of clean energy resources to replace the capacity of the Comanche 3 coal plant (intended to retire by the end of 2030), and just as importantly, ensure that the transition away from coal would also support a long-term clean energy strategy for Pueblo that includes new job opportunities, local investment, and reliable and affordable power. The process is also critical to meeting Colorado’s 80% by 2030 emissions reduction goal set forth by SB 19-236, marking a key milestone in the state’s transition to clean energy.   

Structured as a two-phase proceeding, the Commission has just concluded Phase 1 with its recent decision, which determined the amount of energy needed to replace Comanche 3 and meet future demand.  

Highlights of Phase 1 include:  

• New Clean Energy Procurement: Up to 6,000MW of new resources procured in two separate Request for Proposal (RFP) phases, one in 2026 and another in 2027, creating a long-term competitive demand for high-quality projects.
  
• Proactive Transmission Planning: Between the first and second resource RFPs, Xcel will file a transmission plan that integrates the new generation from the first RFP and proposes proactive transmission to access and integrate generation from resource-rich areas. Integrating transmission planning with resource procurement phases will support improved grid planning and project alignment.
  
• Carbon Free Future Development Fund: $100 million set aside for emerging clean firm technologies like long-duration energy storage and next-generation geothermal, with a dedicated advisory board and industry seat to guide project selection.
  
• Large Load Provisions: New tariff safeguards so that large electricity demands are met in a way that supports clean energy goals, manages costs, and supports reliability.

Advanced Energy United (United) participated in shaping Phase 1 of the JTS alongside a variety of stakeholders from the clean energy industry, community leaders, labor groups, environmental advocates, and Xcel Energy, working together to create an equitable transition. 

In summary, Phase 1 established key programs, processes, and plans that provide a glidepath for competitive procurement of new resources in Phase 2, which will begin in the new year. In Phase 2, Xcel will issue competitive requests for proposals (RFPs), evaluate the bids, and select the best projects and present them to the Commission for approval. 

Distribution System Planning to Better Match Colorado’s Clean Energy Ambitions  

While the JTS focuses on the state’s bulk clean energy supply through large-scale resource procurement, the Distribution System Plan, DSP (24A-0547E), focuses on how that power can reach consumers reliably and efficiently through grid modernization and electrification efforts.  

Distribution system planning is the process utilities use to proactively and strategically invest in upgrades to the distribution grid — the infrastructure that connects our homes and businesses to the local electricity grid — in a safe, reliable, resilient, and cost-effective manner. This was Xcel’s second DSP filing since the creation of the state’s distribution system planning process in 2019 under SB 19-236. The filing is an ambitious sequel to Xcel’s inaugural DSP filing and fundamentally introduces a new paradigm for distribution system planning as an extension of the proactive grid planning that United  supported in SB 24-218. This more proactive planning is intended to help utilities  prepare for a high electrification future and build out the grid with greater efficiency, cost containment, and local reliability benefits.  

Key Decisions 

We do not yet have the written decision from the Commission, so our understanding of key decisions is drawn from the Commissioners’ public deliberations.  

• Proactive Planning: The Commission has approved a framework for proactive planning that allows for cost recovery of significant distribution infrastructure spending in anticipation of load growth. Accepting many of United’s recommendations, the Commission made clear they expect continued improvement in the modeling methodologies, especially to incorporate load flexibility, and will apply performance metrics to ensure that planning adequately enables timely and efficient interconnection.
• Data Access: United was also very active in advocating for improved access to data necessary to unlock the potential of existing and future distributed energy resources (DERs). The Commission accepted United’s recommendations for improvements to the Green Button Connect customer energy data access platform, and major improvements to grid data access (Hosting Capacity) to show where both new generation projects (like community solar) and new larger loads (like EV charging stations) can be added most efficiently.
• Integrating Flexibility: The Commission will order new Flexible Interconnection Tariffs to allow for new generation projects and new loads that can reduce their grid needs during certain high-impact periods to be connected without waiting for costly grid upgrades. The Commission also approved a pilot project championed by United for smart electrical panel deployment in Denver and a settlement that United joined that adopts an accelerated, collaborative process to identify and develop Targeted Demand Areas (TDAs) and non-wires alternatives (NWAs) with communities and solution providers.
• Virtual Power Plants (VPPs): United also helped include a requirement that Xcel implement a VPP program in SB 24-218. The filing for that program was consolidated with this DSP. During the proceeding, United spearheaded negotiations with Xcel that resulted in a widely supported settlement approved in its entirety by the Commission. The settlement envisions an open-access, pay-for-performance tariff that allows any qualifying DER aggregator to sign up to provide capacity and receive payments for the average capacity dispatched per quarter. Aggregations may consist of a wide variety of technologies, from home batteries to smart thermostats to electric vehicle charging equipment, with a seasonal participation option for summer-only resources like air conditioning. The capacity payments are related, but not directly tied, to avoided costs and will begin at $173 per kW/year plus an additional $65 for DERs on certain impacted distribution feeders. These performance payments will be revised in subsequent years, but aggregations are able to “lock-in” the incentive amounts in place at the time of their registration for five years. The VPP program will begin in 2026 and grow by 25 MW per year up to 125 MW in 2031.

Looking Ahead: Future Filings to Watch  

This suite of filings reinforces the coordinated, long-term planning Colorado must undertake now to manage the energy transition and meet future energy demand with reliable, flexible, and affordable power. With the Commission expected to issue a written decision on the DSP soon, several anticipated follow-on filings from Xcel in 2026 will be shaped and informed by frameworks or recommendations that United championed in this year’s proceedings. 

Key filings that United will be tracking in the coming year include: 

• Competitive RFPs: As required by Phase 1 of the JTS, Xcel will issue an RFP for new resources in 2026. After the RFP responses are received, the Colorado Coordinated Planning Group will conduct a transmission planning process in late 2026, studying necessary upgrades and coordinating with the Colorado Electric Transmission Authority (CETA). This will then inform a second resource RFP that will be presented to the Commission for approval.
• Transmission Plan: As mentioned above, the JTS decision strategically sequences transmission planning and resource procurement to support improved grid planning and project alignment.
• Large Load Tariff: Also emerging from the JTS, this tariff will be structured to meet large electricity demands in a way that supports clean energy goals, manages costs, and supports reliability.
• Flexible Interconnection: These tariffs are expected to be a directive in the Commission’s DSP order and will offer new ways to connect both generation and flexible loads without waiting for costly upgrades.
• Data Access: This filing will also build on requirements anticipated in the DSP decision and offer new ways to improve access to customer energy data, which is necessary to expand and scale flexible and reliable energy resources and programs.
• Hosting Capacity Analysis: Also required by the DSP, this filing will provide transparency into where DERs can be added cost-effectively and where system bottlenecks must be addressed.
  

These upcoming filings, combined with the significant progress made this year, will accelerate Colorado’s progress in attracting new investment, scaling clean energy resources, supporting electrification, and preventing system bottlenecks that would deter economic growth and increase costs for consumers.