Climate CitiSuns Score Wins in Clean Heat Plan
The first-ever Clean Heat Plan for Xcel Energy was recently approved by regulators and marks a victory for Climate CitiSuns.
Regulators at the Public Utilities Commission largely rejected Xcel’s proposals to mix hydrogen in its gas system and use recovered methane. Rather, they adopted the path urged by environmental groups to cut greenhouse gas in its system by switching to electric appliances and pushing more energy efficiency, agreeing that Xcel had overestimated the costs of electrification while downplaying the health benefits.
The plan, required by a 2021 law, calls for spending up to $440 million, with more than 70 percent of the budget to help customers reduce the use of fossil methane gas in their homes. The plan is expected to avoid up to 725,000 tons of greenhouse gas emissions annually, greater than the savings from Xcel's existing programs.
The PUC is ordering Xcel to ramp up electrification initiatives like all-electric new construction, incentives to switch to heat pumps, stacking incentives from federal funding, and promoting investments for low-income and disproportionately-impacted customers.
The plan will be funded with new fees added to utility bills. Estimates are that the plan will boost gas rates by 7% and electricity rates by 1.1% over the next few years. But climate advocates say that because customers won’t be paying for projects that expand Xcel’s gas network, the cost impacts should lessen over time.
Xcel proposed blending hydrogen with its gas supply, a plan opposed by environmental and health groups. ``There are many unacceptable health, safety, and climate risks associated with blending hydrogen into the residential gas supply," said Lauren Swain, coordinator for PSR Colorado (Physicians for Social Responsibility). And the PUC agreed, saying in its order: ``At this time, there are too many open questions regarding system compatibility for hydrogen blending, additional infrastructure or infrastructure costs, potential contract terms, and actual emission reduction potential to approve any spending now.’’
But those who worked on the plan praised the final outcome, although some want more emphasis on cold-climate heat pumps to provide all of a home's heating and cooling.
“As Xcel’s electric grid rapidly decarbonizes, thanks to the growing use of Colorado’s abundant solar and wind resources, deploying today’s high-performance electric heat pumps is the most efficient way to provide clean heating and cooling of our buildings,” said Chuck Kutscher of CRES (Colorado Renewable Energy Society). “The decision by the Commission to put us on a firm path to building electrification is a triple win for Coloradans because it will greatly reduce outdoor air pollution, indoor air pollution, and the greenhouse gas emissions causing climate change.”
More information:
Why Xcel Energy’s new clean heat plan could shift Colorado away from natural gas (cpr.org)
Xcel's Clean Heat Plan Approved with Major Climate Wins | Sierra Club
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