For all the uproar, this energy bill doesn’t go far enough
Big Pivots Xcel Energy’s high and wide sails will almost certainly be trimmed by Colorado legislators. Senate Bill 23-291, the bill crafted in response to spiking natural gas prices this winter, will impose small steps to protect consumer interests.
What this bill won’t do is make Colorado’s largest utility as innovative in this energy transition as it is successful in generating profits for its investors.
The company reported $727 million in profits from its Colorado operations in 2022. Investors in the company’s eight-state operating region earned yields of more than 9%.
Customers were chilled even more during this winter of uncommon cold by natural gas prices that pole-vaulted 75%. Xcel and other utilities protested that they were merely passing along costs.
State legislators leveraged the unhappiness into an investigation of long-standing complaints. Critics have long contended that investor-owned utilities enjoy an uneven playing field at the Colorado Public Utilities Commission, the state agency governing Xcel, Black Hills Energy and other investor-owned utilities.
The bill’s most important provision would allow the PUC to “consider requiring each investor-owned electric utility to bear a percentage of its total fuel costs in order to incentivize the utility to find efficiencies and reduce fuel waste.” In other words, it puts the company’s own skin in the game. It might heighten accountability.
Senate President Steve Fenberg, a Democrat from Boulder who headed the select committee, said the proposal would not dramatically alter the compact between monopoly energy utilities and consumers. Utilities enjoy monopolies in their service territories, assuring a steady stream of revenues – and profits. State regulators must oversee reliability, affordability and, in recent years, pollution reduction. Fenberg told Senate Finance Committee members that the changes amount to “tweaks” to the regulatory compact.
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