Publish Date: November 8, 2023
This report, commissioned by Advanced Energy United and written by Strategen Consulting, assesses the proposed resource plan set forth by Public Service Company of Colorado (known by customers as Xcel Energy) in Phase II of their 2021 Electric Resource Plan (“ERP”), commonly referred to as the 120-Day Report.
Xcel incorporated many incentives from the Inflation Reduction Act of 2022 in Phase II to increase its investment in affordable, clean energy, but the low cost of clean energy resources could provide an opportunity to avoid additional natural gas deployment. The report analyzes a portfolio of battery storage, solar, and wind resources from the list of publicly available projects in the 2022 All-Source Request for Proposals that are sized to exceed the capacity of the proposed 400 MW gas peaker, the largest in Xcel’s plan. An economic analysis was done to estimate the cost of the gas unit relative to the clean energy portfolio, including the value of energy and the cost of operation.
The modeled clean energy portfolio is more economic than the proposed CT while providing greater capacity. In the first year of operation, the clean energy portfolio would provide savings of $28.9 million, before considering additional factors such as grid services, stranded asset risk, and fuel supply risk. Savings in subsequent years are anticipated to be even greater.
This report is organized into three sections:
- The first section provides an overview of Xcel's 120-Day Report and a summary of the clean energy benefits included in the IRA.
- The second section details the case study, describing the utility’s proposed natural gas peaker plants, the development of the alternative clean energy portfolio, and the economic analysis performed. This section also includes discussion of additional factors that may further impact the planning decision.
- Finally, the report concludes with recommendations for Xcel and the Colorado Public Utilities Commission (“PUC”).
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