This article was published by The Energy Mix on Aug. 12, 2024.
A Colorado utility will spend more than US$440 million over the next three years on a plan weighted heavily toward building electrification and energy efficiency measures, aiming to reduce reliance on gas heat and cut annual climate pollution by 725,000 tons.
Xcel Energy’s Clean Heat Plan, approved in early May, traces back to a state Clean Heat Law adopted in 2021, Canary Media reports.
“The utility, which provides both gas and electricity to its customers, filed an initial plan that included proposals to spend heavily on hydrogen blending, biomethane, and certified natural gas,” the news story states. “But after strong opposition from clean energy advocates who say these routes do not represent viable pathways to decarbonization, those proposals were reevaluated. Following a motion filed by the [U.S.] Sierra Club, Natural Resources Defense Council, and others last November, Xcel amended its original plan filed with the Colorado Public Utilities Commission.”
The majority of the money will now go to electrification and efficiency measures the CPUC deemed the “most cost effective and scalable ways to reduce emissions from burning gas and buildings, both in the short run as well as in the long term,” Meera Fickling, building decarbonization manager at Western Resource Advocates, told Canary Media. That makes Xcel’s Clean Heat Plan “a test case of a utility-led model towards decarbonizing the gas distribution system,” and a U.S.-wide model “for how gas utilities can allocate resources to decarbonize their system in the long term.”
A highlight of the plan is the 20,000 residential heat pumps Xcel plans to install this year, and the nearly 100,000 installations it plans to complete in just over two years. “The goals are really aggressive,” said Emmett Romine, the utility’s vice president of energy and transportation solutions. “When you look at the number of heat pumps and the number of water heaters we’ve got to contemplate getting into homes, it’s an enormous amount of work.”
That activity will increase gas and electricity rates by 1.1% and 7%, respectively, over the next four years, Canary Media says. “But advocates say it’s worth it to avoid pouring money into a gas system that must be phased out—and that the climate benefits outweigh the upfront costs.”
Alejandra Mejia Cunningham, senior manager of state buildings policy at the Natural Resources Defense Council, called the plan “a very good example of needing to pursue both sides of the equation at the same time—decarbonization, electrification—but at the same time ensuring that we’re starting to shrink and eliminate unnecessary investments in the gas system.”
Canary Media has more on how the Xcel Energy plan is developing and how it’s likely to play out.
Be the first to comment