Day 6 of Testimony
24A-0442E, Public Service Company - 2024 JTS - 06.18.25 - HRA (6 of 9)
The Full Day
Major Topics
NotebookLM generated (footnotes by me)
1. Transmission, Distribution, and/or Battery Capacity
Specifics about Additional Capacity and Purpose/Need:
Transmission Planning: Public Service's Drew Siebenaler supports the JTS from a transmission planning perspective, noting the evolving approach to modeling transmission needs as the Company aggressively reduces greenhouse gas emissions and transitions to more disparate and intermittent clean energy resources. The JTS Transmission Study was conducted, presenting illustrative portfolios showing the scope, magnitude, and cost of potential transmission projects needed for a final JTS portfolio. Mr. Siebenaler also highlighted the need for future processes and studies to refine the transmission portfolio for Phase II of the proceeding.
Generation and Capacity Resources: Justin M. Tomljanovic discussed the need for generation technologies to evolve the clean energy transition while maintaining reliability. The Company seeks approval for a Pre-Construction Development Asset (PCDA) approach, which allows for acquiring but deferring construction of generation and capacity resources in the Phase II process. Additionally, they seek approval for a Carbon Free Future Development Policy to competitively seek proposals for innovative, capital-intensive, or long lead-time clean energy resources.
EV Charging Infrastructure: The forecast includes significant EV adoption,1 which will require an increase in capacity. The Company employs a "trunching" method in its modeling for managed EV charging, shifting the load shape earlier or later in the day to mitigate the impact on system peak demand. This is done to avoid a more than 2-gigawatt increase in peak by 2050 if managed charging wasn't optimized.
Large Loads: New large load customers, such as data centers,2 require significant transmission infrastructure, including lines and substations. Customers are generally required to pay upfront for these dedicated assets. The Company anticipates a new large load tariff by January 31, 2026, which will replace prior non-standard Economic Development Rate (EDR) agreements and define terms for large load connections.
Comparison of Solutions/Approaches:
Proactive Planning vs. Reactive Build-out: The Company is undertaking transmission studies and proposing policies like PCDA and Carbon Free Future Development to proactively plan for and acquire future capacity. The intent is to meet energy and capacity needs through 2031.
Managed vs. Unmanaged Load: For EVs, the Company's current modeling assumes "trunching" of managed charging to mitigate peak demand. Interveners inquired about the economic benefits of more aggressive managed charging programs, implying that more active management could reduce the need for additional generation capacity built solely to meet high peaks. The Company's current managed charging profile for the "Charging Perks" program actually shows a "far peakier" demand than unmanaged charging, due to incentives that cause a large spike when the charging window begins.
Risk Mitigation for Large Loads: The Company intends to use "commercial principles" within Electric Service Agreements (ESAs) to ensure large customers bear financial commitments, such as upfront payments for infrastructure and potential exit fees, rather than solely relying on general ratepayer funding. This implicitly seeks to manage the capacity needed by these large loads more efficiently.
2. Opinion on Power Sources (Wind, Solar, Gas, SMRs, AP-1000)
Wind/Solar:
In Favor: Public Service is actively transitioning to "more disparate and intermittent clean energy resources" as part of its effort to reduce greenhouse gas emissions and meet "carbon-free electricity" goals. The 2021 ERP & CEP accelerated the retirement of coal-fired generation with "clean energy". Distributed solar is forecasted and treated as a resource for modeling purposes. The Company is seeking proposals for innovative clean energy resources through its Carbon Free Future Development Policy.
Gas:
Mixed/Context-Dependent: The Company's Coal Action Plan approved in 2021 included the conversion of the Pawnee coal plant from coal to gas. This suggests an acceptance of gas as a "thermal replacement" in the transition away from coal, but the overall goal is to "fully transition the Public Service system off of coal". No explicit general stance on new gas generation beyond this specific conversion was provided in these excerpts.
SMRs (Small Modular Reactors) & AP-1000 (Advanced Passive Reactors):
No Opinion/Not Mentioned: These specific technologies were not mentioned or discussed in the provided sources. The Company is exploring types of "carbon-free electricity" technology and innovative, long lead-time clean energy resources, which could potentially include these, but they are not named.
3. Issues and Suggestions on Data Centers
Issues:
Rapid Load Growth: Data centers are a key driver of heightened demand growth, presenting a challenge for timely resource acquisition and grid planning. Public Service stated it is "behind the ball" in meeting new load growth and customer demand.
Speculative or Uncertain Load: There's a risk that customers may withdraw or move projects to different jurisdictions after generation resources have been procured. Interveners raised concerns about large loads being "speculative or uncertain".
Financial Risk to Ratepayers: If a large load customer withdraws and no new load materializes to backfill, there's a financial risk of stranded assets, which would fall on other ratepayers.
System Impacts: Concerns were raised about potential system impacts from large loads, including short-term disturbances like voltage instability, as well as issues related to ramping and reserves.
Confidentiality: The Company maintains confidentiality over strategic economic development customers and data centers, citing NDAs, which limits transparency for the Commission and other parties.
Water Usage: Data centers require water for cooling, though new technologies are increasing water efficiency.3
Suggestions/Company's Proposed Solutions:
"Skin in the Game" Commercial Principles: Public Service proposed "Large Load Commercial Principles" to ensure customers have "skin in the game". These principles are verbally discussed and intended to be included in Electric Service Agreements (ESAs). Examples include exit fees, contract minimums, and securitization requirements (e.g., upfront cash, letters of credit).
Probability Thresholds: For customers over 100 MW, inclusion in the incremental need pool requires a 90% probability (signed Interconnection Agreement (IIA) or ESA). For customers under 100 MW, an 80% probability (actively negotiating IIA/ESA) is proposed.
Large Load Tariff: The Company has committed to filing a new large load tariff by January 31, 2026, which is expected to formalize these commercial principles.
"Backfill" Assumption: Public Service maintains that if one large customer withdraws, another will materialize to utilize the procured resources, mitigating stranded asset risk.
Strategic Economic Development Customers: A separate category of customers, not necessarily data centers, who are deemed important to the Colorado economy due to existing operations, job creation, and state support. Their load is included in forecasts regardless of individual probability rating, based on the Company's "duty and obligation to serve them".
Load Flexibility: The Company discusses demand response (DR) capabilities and load flexibility with these customers. However, data centers prioritize reliability and uptime (5 9s), finding current load flexibility technologies (like backup generation or storage) not economically feasible for their operations, often opting for diesel generators.
Disagreement/Range of Opinions:
Risk Sharing: Public Service stated it is "not willing to agree" to share financial risk associated with potential stranded assets if large load predictions are wrong. Interveners questioned this stance, arguing that if the Company is so confident that new load will materialize, it should be willing to share some of that financial risk.
Transparency of Agreements: Public Service has not committed to providing executed copies of ESAs or IIAs to the Commission or parties for review during the interim period before the tariff filing. Interveners argue this makes it difficult to assess how commercial principles are being applied.
Probability Thresholds: Interveners suggested that the 90% threshold (signed IIA/ESA) should apply to all new large loads, not just those over 100 MW, arguing it would be workable. The Company disagreed, citing the nuances of smaller loads and existing strategic customers. UCA proposed defining a large load at 75 MW or more.
Definition of Strategic Economic Development Customers: Interveners noted the lack of specific metrics or parameters for classifying these customers, suggesting it could be any non-data center large load the company deems important.
4. Issues and Suggestions on Moving the State to All Electric (Heat Pumps, Electric Vehicles, etc.)
Electric Vehicles (EVs):
Current Status & Forecast: As of late 2024, approximately 140,000 EVs (including plug-in hybrids and full battery EVs) were in use. The JTS base forecast includes a "high EV scenario" projecting 830,000 vehicles by 2031, which aligns closely with the Governor's EV goals.4 This forecast assumes an acceleration in adoption.
Charging Patterns: The Company's forecast does not currently distinguish between plug-in hybrids and full battery EVs, despite acknowledging they would have "dramatically different charging characteristics". They are exploring incorporating this distinction in future forecasts. The modeling assumes 12,000 miles/year per vehicle based on national DOT estimates.
Managed Charging: The Company's "Charging Perks" program's managed charging profile exhibits a "peakier" shape than unmanaged charging, with a large spike when the charging window begins, as it incentives overnight charging. The forecast mitigates this by "trunching" (shifting) the managed charging load to avoid EVs setting the system peak. The current managed charging participation rate is about 10%, aiming to ramp up to 70%.
Heat Pumps / Clean Heat Plan:
Forecast Assumptions: The forecast assumes that the clean heat plan goals will be achieved annually. The electric system's base forecast assumes the Clean Heat Plan's electrification levels, unlike the gas system's base forecast in the Gas Infrastructure (GI) plan.
Supplemental Heat: Heat pump installations are generally assumed to be paired with supplemental electric resistance, estimated at around 10 kilowatts per home. However, testimony from Elephant Energy suggests that two-thirds of their Front Range installations have no backup resistance and perform well in cold snaps. A sweep witness also testified that air-source heat pumps might only require 3-8 kW of supplemental heat. Public Service has "internal questions" about the applicability of these lower figures to Colorado customers.
Issues and Suggestions:
Forecast Accuracy: The Company acknowledged that 2024 retail energy growth was negative 0.7%, significantly lower than the forecasted 1.4%, partly due to weakness in commercial sales and delayed oil and gas electrification.
Managed Charging Efficacy: Interveners questioned the "peakiness" of the managed charging profile and asked about economic analyses for more effective demand-side management programs that could incentivize charging during off-peak times more broadly. There was no in-depth economic analysis presented on the best times to move EV charging.
Transparency of Forecast Updates: Concerns were raised that the Commission and stakeholders might not see the renewed forecast, especially regarding large load adjustments, before it's used in Phase II modeling due to timing challenges.
5. Keeping Rates Affordable
Stated Objective: Affordability is explicitly mentioned as a cornerstone of the Commission's resource planning process, balanced with reliability and a just transition.
Issues and Suggestions:
Risk of Stranded Assets from Large Loads: The potential for financial risk from stranded assets due to withdrawing large loads could increase costs for all ratepayers. Public Service's proposed "commercial principles" for large loads (e.g., exit fees, securitization) are intended to mitigate this risk by making customers bear more of the financial responsibility.
Company's Stance on Risk Sharing: The Company is "not willing to agree" to share in the financial risk of stranded assets if large load predictions are incorrect, implicitly placing this risk on other ratepayers. Public Service argues that any "length" or excess capacity from withdrawn large loads would be temporary and ultimately benefit all customers by being utilized by other growing demands.
Line Extension Tariffs: It was noted that some utilities are modifying their line extension tariffs to ensure that costs associated with connecting large customers like data centers are not passed through to all ratepayers. Public Service's current interconnection agreements for transmission customers require upfront payment for dedicated assets. The forthcoming large load tariff may address this further.
Economic Development Rates: Public Service intends to stop offering new discounted or economic development rates (EDR) for large load demands, which would mean these customers pay full tariff rates.
Managed EV Charging: By shifting EV load to off-peak times ("trunching"), the Company aims to reduce the need for expensive peaker plants or transmission upgrades that might otherwise be necessary to serve peak demand, indirectly contributing to affordability.
6. Keeping the Grid Reliable, Including Retaining Strong Inertia
Stated Objective: Maintaining reliability is a primary objective of the JTS.
Issues and Suggestions:
Resource Adequacy (RA): Public Service acknowledged that its current resource adequacy parameters are "considerably negative" for 2025. Despite this, the Company is committing to providing service for new large loads beginning in 2025. The discussion highlighted a potential disconnect between signing on new capacity and current RA deficits.
Intermittent Clean Energy: The transition to "disparate and intermittent clean energy resources" and "weather-dependent energy generation" poses challenges for reliability.5
Load Growth Management: Maintaining reliability while meeting load growth needs is a key challenge.
Modeling and Studies: The Company utilizes Effective Load Carrying Capability (ELCC) and Planning Reserve Margin (PRM) studies to assess resource adequacy. Approval for the updated 2024 RA Study and methodology is sought.
System Impacts of Large Loads: UCA (an intervener) raised concerns about "short-term disturbances like voltage instability as well as issues related to ramping and reserves" potentially caused by large loads. The Company's witness, Mr. Bailey, deferred these technical questions to other experts, indicating it's not his area of direct responsibility. Large load customers prioritize "5 9s" uptime (high reliability) for their operations.
Inertia: The term "inertia" itself was not explicitly mentioned in the provided text.6 However, concerns about "ramping and reserves" and the grid's increasing reliance on intermittent sources implicitly touch upon grid stability challenges that traditional generation, with its associated inertia, typically addresses.
7. Reducing Carbon Emissions
Stated Objective: Reducing carbon emissions is a core objective of the JTS, aiming for an 80% emissions reduction by 2030.7 The JTS is described as taking a "significant step in balancing energy policy objectives to reduce emissions" and completing the effort to meet 2030 emissions targets set by Senate Bill 19-236. The Company also aims to "fully transition the Public Service system off of coal".
Methods/Strategies:
Coal Retirement/Conversion: The 2021 ERP & CEP accelerated the retirement of coal-fired generation (Craig 2, Hayden 1 & 2, Comanche 3) and conversion of Pawnee to gas. Cherokee 4 is slated for shutdown in 2028.
Transition to Clean Energy: The Company is aggressively reducing greenhouse gas emissions by transitioning to "more disparate and intermittent clean energy resources". They have "Carbon-Free Electricity (CFE) goals" and are exploring various CFE technologies.
Beneficial Electrification: Oil and gas electrification is seen as driven by emissions reduction mandates, contributing to the overall carbon reduction effort.
Analysis of Response: Weaknesses, Assumptions, and Missing Perspectives
Weaknesses and Limitations based on Source Material:
Limited Technical Depth on Reliability: While "reliability" is a prominent goal, the sources offer limited detail on how Public Service plans to maintain "strong inertia" or address specific system disturbances like voltage instability and ramping with the increasing penetration of intermittent renewables. The Company's witness on large loads, Mr. Bailey, deferred such questions, indicating these details are outside the scope of this specific testimony in the transcript.
Economic Justification for Demand-Side Management (DSM): The discussion on managed EV charging (e.g., "trunching") is presented as a modeling assumption to mitigate peak demand, but the transcript notes a lack of "in-depth economic analysis" on the best times to shift EV charging or the cost-effectiveness of increasing managed charging program uptake.8 This limits understanding of the optimal investment in DSM to achieve grid benefits and affordability.
Specifics of "Clean Energy Technologies": While "Carbon-Free Electricity" goals and the exploration of "innovative, capital intensive or long lead time clean energy resources" are mentioned, the sources do not specify the types of technologies being explored (e.g., advanced nuclear,9 long-duration storage, geothermal, carbon capture, specific renewable energy technologies beyond solar/wind). This leaves a gap in understanding the Company's long-term technology strategy for emissions reduction and reliability.
Details of "Just Transition": Although a core objective of the JTS and supported by a workforce planning witness, the transcript does not provide specific details on the Company's workforce transition plan or community support mechanisms beyond noting the early retirement/conversion of coal plants.10
Transparency of Large Load Contracts: The Company's decision not to commit to filing executed ESAs/IIAs for Commission review during the interim period means that the actual implementation of the "commercial principles" and their effectiveness in mitigating risk to ratepayers remains less transparent than it could be. This is a deliberate choice by the Company, creating a known information gap.
"Best Solution" Nuance: The instruction to "compare multiple possible solutions before choosing the best one" is challenging to apply comprehensively, as the sources primarily present Public Service's proposed solutions and interveners' concerns or alternative suggestions, rather than a formal comparative analysis of different solutions by the Company itself. My response attempts to frame the discussion as a comparison of the Company's chosen approach versus the alternatives or criticisms raised by others. The "best" solution is often implicitly contested in regulatory proceedings, with different parties having different priorities.
Missing Perspectives (not present in the provided sources):
Third-Party Technical Analyses: Detailed independent assessments of the technical feasibility or cost-effectiveness of different grid modernization, reliability, or specific generation technologies.
Direct Community/Labor Voices (in this transcript): While "just transition" is mentioned, the transcript focuses on the Company's internal processes and discussions with the Commission, rather than direct testimony from affected communities or labor unions (though Mr. Kangas covers the workforce planning perspective).
Broader Policy Debates (beyond the PUC context): The documents stick to the regulatory proceeding, not broader political or societal debates that might influence energy policy.
Refinement based on Analysis:
The initial extraction and categorization were robust. The refinement primarily involves explicitly acknowledging the limitations of the sources, particularly the absence of deep technical details, comprehensive economic analyses of alternatives, and the company's explicit refusal to share certain data or take on certain risks. By framing discussions as Company proposals vs. intervener concerns/suggestions, the "multiple solutions" aspect is addressed to the extent possible given the adversarial nature of a hearing transcript. The response highlights where agreement is broad (e.g., emissions reduction goals) versus where significant disagreement exists (e.g., large load risk allocation).This response is based on the provided documents: "Proceeding 24A-0442E.pdf" (referred to as the "JTS Application") and "transcript6.txt" (referred to as the "transcript").
Key Variables
Before detailing the discussions, it's crucial to understand the foundational elements influencing the proceedings:
The 2024 Just Transition Solicitation (JTS) Framework: This proceeding centers on Public Service Company of Colorado's (referred to as "Public Service" or "the Company") application for approval of Phase I of its 2024 JTS. This JTS is an extension of the 2021 Electric Resource Plan and Clean Energy Plan (2021 ERP & CEP) and aims to establish a framework for meeting energy and capacity needs through 2031.
Company's Core Objectives: The JTS has ambitious, intersecting objectives: achieving an 80% emissions reduction by 2030, ensuring grid reliability amidst load growth, optimizing the Electric Resource Planning (ERP) process, and facilitating a just transition for impacted communities. These goals are balanced with considerations of affordability.
Significant Load Growth: A key challenge is the "heightened demand growth", largely driven by new large commercial and industrial customers (such as data centers) and increased electrification from sectors like oil and gas, as well as electric vehicles (EVs) and heat pumps. Accurate forecasting and efficient management of this demand are critical.
Clean Energy Transition Complexities: The shift towards "disparate and intermittent clean energy resources" brings inherent challenges for grid stability and reliability due to their weather-dependent nature.
Risk Management and Allocation: A significant point of discussion is who should bear the financial risks associated with investments made for new loads that might not fully materialize, and how to protect existing ratepayers.
Regulatory Process and Transparency: The Commission's approval is sought for various aspects, including resource acquisition, modeling inputs, and new policies. The degree of transparency regarding customer-specific agreements and forecast updates is a debated topic.
Summary of Major Topics Discussed
1. Transmission, Distribution, and/or Battery Capacity
Specifics and Purpose/Need:
Transmission: Public Service is actively modeling and identifying transmission needs to support its aggressive greenhouse gas emissions reduction goals and the transition to "more disparate and intermittent11 clean energy resources". The Company conducted a JTS Transmission Study, which provided "illustrative transmission portfolios" showing the potential scope, magnitude, and cost of projects required for the final JTS portfolio. Future studies will refine these plans for Phase II.
Generation and Capacity: The JTS seeks to "identify and develop a framework to meet the Company’s energy and capacity needs through 2031". Public Service is exploring "Carbon Free Electricity (CFE) goals" and the types of CFE technologies currently being considered. The Company proposes a "pre-construction development asset (PCDA) policy" to acquire but defer construction of some generation and capacity resources in Phase II. Additionally, a "Carbon Free Future Development Policy" is proposed to competitively seek proposals for "innovative, capital intensive or long lead time clean energy resources".
Electric Vehicle (EV) Load: The Company's forecast for EV adoption projects a significant increase in load. To manage this, Public Service uses a "trunching" method in its modeling, which involves shifting EV charging load to different times of the day to mitigate its impact on system peaks. This strategy aims to avoid a "more than 2 gigawatt increase in the peak by 2050" if managed charging were not optimized.
Large Customer Infrastructure: New large customers, such as data centers, require substantial transmission infrastructure, including lines and substations, to connect to the system. Customers are typically required to pay for these "dedicated assets" upfront.
Comparison of Solutions/Approaches:
The Company's approach focuses on a combination of proactive planning (transmission studies, PCDA, Carbon Free Future Development Policy) to acquire and plan for future capacity needs. For EV load management, the Company primarily relies on modeling load shifting ("trunching") based on an assumed future rate design that would incentivize off-peak charging.12 Interveners, however, questioned the economic justification for this "simplistic approach" and inquired about the potential for more aggressive and economically analyzed demand-side management programs to flatten EV load.
2. Opinion on Power Sources (Wind, Solar, Gas, SMRs, AP-1000)
Wind & Solar:
In Favor: Public Service is actively transitioning to "clean energy" and "disparate and intermittent clean energy resources" to reduce greenhouse gas emissions and meet "carbon-free electricity" goals. Distributed solar is forecasted and integrated into modeling as a resource. The overall strategy aims to "fully transition the Public Service system off of coal".
Gas:
Mixed/Context-Dependent: The Company's 2021 ERP & CEP included the conversion of the Pawnee coal plant to gas as part of its coal retirement strategy. This indicates a role for gas as a "thermal replacement" during the clean energy transition. No broader opinion on the use of new natural gas generation was provided in these excerpts beyond this specific conversion.
SMRs (Small Modular Reactors) & AP-1000 (Advanced Passive Reactors):
No Opinion/Not Mentioned: Neither SMRs nor AP-1000 reactors were explicitly mentioned or discussed in the provided documents. The Company is generally exploring "innovative, capital intensive or long lead time clean energy resources", which could potentially include these technologies, but they are not specified.13
3. Issues and Suggestions on Data Centers
Issues:
Rapid Load Growth: Data centers are a major driver of increased demand, posing challenges for rapid resource procurement. Public Service acknowledged being "behind the ball" in meeting this demand.
Risk of Withdrawal: There is a risk that large customers, including data centers, might withdraw or relocate projects after Public Service has procured generation, leading to "speculative or uncertain load".
Financial Risk to Ratepayers: If a customer withdraws, any stranded assets could impose costs on other ratepayers.
System Impacts: Concerns were raised regarding potential short-term system disturbances, such as voltage instability, ramping issues, and impacts on reserves, due to large loads.
Confidentiality: The Company maintains confidentiality on certain customer details due to Non-Disclosure Agreements (NDAs), which limits the transparency of specific arrangements for the Commission and other parties.
Water Requirements: Data centers require water for cooling, though new cooling technologies are improving water efficiency.
Suggestions/Company's Proposed Solutions:
"Skin in the Game" Principles: Public Service proposes "Large Load Commercial Principles" to ensure financial commitment from customers, including exit fees, contract minimums, and securitization (upfront cash, letters of credit). These principles are currently being discussed verbally with customers and are intended to be incorporated into Electric Service Agreements (ESAs).
Probability Thresholds: For new large loads over 100 megawatts (MW), the Company proposes a 90% probability threshold (requiring a signed Interconnection Agreement (IIA) or ESA) to trigger the "incremental need pool." For those under 100 MW, an 80% probability (active negotiation of IIA/ESA) is proposed.
Future Large Load Tariff: Public Service has committed to filing a new large load tariff by January 31, 2026, which is expected to formalize these commercial principles.
"Backfill" Assumption: The Company believes that if one large customer withdraws, another will materialize to utilize the procured resources, thus minimizing stranded asset risk.
Strategic Economic Development Customers: These are defined as existing customers, not necessarily data centers, who are vital to the Colorado economy. Their load is included in forecasts regardless of their individual probability rating, driven by the Company's perceived "duty and obligation to serve".
Load Flexibility Discussions: Public Service proactively discusses demand response (DR) and load flexibility options with large customers. However, these customers prioritize "5 9s" uptime and currently find economically viable load flexibility solutions, such as battery storage or alternative backup generation, limited, often relying on diesel generators instead.
Disagreement/Range of Opinions:
Risk Sharing: Interveners questioned why the Company is "not willing to agree" to share in the financial risk of stranded assets if its forecast proves inaccurate.
Transparency: Concerns were raised that the Commission and parties would not have access to executed ESAs and IIAs during the interim period, hindering their ability to assess the actual implementation of commercial principles.
Probability Thresholds: Interveners advocated for a consistent 90% probability threshold for all new large loads, regardless of size, for inclusion in resource planning. UCA specifically suggested defining a "new large load" as 75 MW or more.
Definition of Strategic Economic Development Customers: The lack of specific metrics for classifying these customers raised concerns about arbitrary inclusion in forecasts without stringent probability requirements.
4. Issues and Suggestions on Moving the State to All Electric (Heat Pumps, Electric Vehicles, etc.)
Electric Vehicles (EVs):
Adoption Rates: As of late 2024, approximately 140,000 EVs (including plug-in hybrids and full battery EVs) were in use. The JTS base forecast includes a "high EV scenario" projecting 830,000 vehicles by 2031, aligning with the Governor's goals, which requires a significant acceleration of adoption.
Forecasting Granularity: Currently, the forecast does not differentiate between plug-in hybrids and full battery EVs, despite acknowledging their different charging characteristics, though this is being explored for future forecasts.
Managed Charging: While managed charging participation is currently around 10% (aiming for 70% long-term), the Company's "Charging Perks" program actually leads to a "peakier" managed charging profile than unmanaged charging due to incentives that cause a large spike when the charging window opens. The Company uses a "trunching" method in modeling to shift this load and avoid EVs setting the system peak.
Heat Pumps / Clean Heat Plan:
Forecast Assumptions: The Company's forecast assumes that the clean heat plan goals will be achieved annually.14 The electric system forecast incorporates these goals, but the gas system's base forecast in its Gas Infrastructure plan does not assume any clean heat plan impact.
Supplemental Heat: Heat pump installations are assumed to be paired with supplemental electric resistance (e.g., 10 kW/home). However, testimony suggests some installations have no backup resistance or require less (3-8 kW).
Issues and Suggestions:
Forecast Accuracy: The Company experienced a negative 0.7% electric sales growth in 2024, versus a 1.4% forecast, partly due to unanticipated commercial sales weakness and delayed oil and gas electrification.
Managed Charging Optimization: Interveners questioned the "peakiness" of managed charging and the lack of in-depth economic analysis for optimizing EV load shifting to reduce peak demand. They also inquired about the limiting factors for customer uptake of managed charging programs.
Real-World Data Integration: There was a discussion about incorporating actual adoption rates and usage patterns of all-electric customers (e.g., heat pump supplemental heat use) into future forecasts.
Oil and Gas Electrification: Projected to add approximately 364 MW of new load by 2031 from about 10 large customers, driven by emissions reduction mandates. These loads are considered "very, very likely".
5. Keeping Rates Affordable
Stated Objective: Affordability is explicitly a "cornerstone of the Commission’s resource planning process".
Comparison of Solutions/Approaches:
Risk Mitigation for Large Loads: Public Service's primary strategy to protect ratepayers from new large loads' costs is through "Large Load Commercial Principles". These principles (e.g., exit fees, upfront payments for dedicated assets, securitization) are designed to ensure customers have "skin in the game" and bear more of the financial risk, thereby preventing "cross-subsidization" and protecting other rate classes. The forthcoming large load tariff is intended to formalize these protections.
Disagreement on Risk Sharing: Public Service explicitly stated it is "not willing to agree" to share in the financial risk of stranded assets if large load forecasts are incorrect, implying existing ratepayers would bear these costs. Interveners challenged this stance, arguing that if the Company is confident in its forecasts, it should share the risk.
Demand-Side Management: The "trunching" of EV charging is an indirect measure to keep rates affordable by mitigating peak demand, which can reduce the need for more expensive peak generation or transmission upgrades. However, there was no in-depth economic analysis of this benefit.
Economic Development Rates: Public Service intends to stop offering new discounted economic development rates for large loads, meaning these customers will pay full tariff rates, which benefits other ratepayers by avoiding ratepayer subsidies. Existing customers on such rates are limited to two.
6. Keeping the Grid Reliable, Including Retaining Strong Inertia
Stated Objective: Maintaining reliability while meeting load growth needs is a "sizeable objective" of the JTS, balancing it with emissions reduction and a just transition.
Issues and Suggestions:
Resource Adequacy (RA) Shortfalls: Public Service acknowledges "considerably negative" resource adequacy parameters for 2025. Despite this, the Company is committing to providing service for new large loads in 2025, raising questions about how this will be achieved.
Intermittent Resources: The increasing reliance on "disparate and intermittent clean energy resources" and "weather-dependent energy generation" presents challenges for grid stability.
Modeling and Planning: The Company relies on updated Effective Load Carrying Capability (ELCC) and Planning Reserve Margin (PRM) studies for resource adequacy planning. Public Service also seeks approval for its proposed Phase II "all-source competitive acquisition and bid evaluation process to acquire generation resources".
System Impacts of Large Loads: Concerns were raised regarding potential "short-term disturbances like voltage instability as well as issues related to ramping and reserves" that large loads could cause. Public Service's witness, Mr. Bailey, deferred these technical questions to other experts, indicating they are outside his direct purview.
Inertia: The term "inertia" was not explicitly mentioned in the provided text. However, the discussions around challenges with "ramping and reserves" and the grid's increasing reliance on intermittent, weather-dependent resources implicitly highlight the broader issue of grid stability, for which inertia is a key component traditionally provided by large spinning generators.
Comparison of Solutions/Approaches:
The Company's approach focuses on a portfolio-based solution through the JTS, aiming to meet capacity needs via a competitive acquisition process and robust modeling. It also includes demand-side management (e.g., EV load shifting) to reduce peak stress. Interveners highlighted a potential disconnect between current RA deficits and commitments to new large loads, implying a need for more explicit strategies to bridge this gap or potentially reassess commitments in light of reliability challenges.
7. Reducing Carbon Emissions
Stated Objective: Reducing carbon emissions is a "sizeable objective" of the JTS. The Company aims to achieve an "80 percent emissions reduction by 2030" and "advance the effort to fully transition the Public Service system off of coal". The 2021 ERP & CEP already established a specific emissions reduction target.
Methods/Strategies:
Coal Plant Retirement/Conversion: The 2021 ERP & CEP included plans for accelerating the retirement of coal-fired generation (Craig 2, Hayden 1 & 2, Comanche 3) and the conversion of the Pawnee plant from coal to gas. Cherokee 4 is scheduled for shutdown in 2028.
Transition to Clean Energy: Public Service is "aggressively reducing greenhouse gas emissions by transitioning to more disparate and intermittent clean energy resources" and is pursuing "Carbon-Free Electricity (CFE) goals". The "Carbon Free Future Development Policy" is intended to spur the development of innovative clean energy resources.
Electrification of Other Sectors: The Company is facilitating electrification in other sectors, such as oil and gas, which is driven by "mandates to reduce emissions".15
Agreement/Disagreement:
There is broad agreement on the goal of reducing carbon emissions and transitioning away from coal. The discussions in the transcript largely focus on the impacts of this transition (e.g., on reliability, load growth, affordability) rather than fundamental disagreement on the emissions reduction objective itself or the core methods of coal retirement and clean energy adoption.
Datacenters don’t consume water, they just use low temperature water to air condition the buildings. Any air conditioning or heat exchanger will work - but they require even more power.
Just because Governor Polis wants it to happen, doesn’t mean it will happen. Follow the numbers, not the dreams.
Thank you Captain Obvious
This is very worrisome. We don’t want a system wide blackout like Spain.
No discussion of what the batteries for this would cost???
Should we be worried that this has not yet happened?
One thing I find annoying. When the SMRs do start shipping, we’ll then discover that the existing Westinghouse AP-1000 is cheaper per GW of power. And SMRs will be used solely for special uses like Hawaii where no outer island needs 1GW.
I think we all know that the Just Transition is virtue signaling.
Which I think means if we built nuclear, we’d spend a lot less on transmission.
This will probably work. But people make nonsensical economic decisions all the time.
It unfortunately is in Xcel’s interests to go the solar + wind + batteries + backup route because the CAPEX for that is a lot more than nuclear.
I believe Xcel has a budget up to 60 million for retrofits to remove gas furnaces. And through March they had given out under a million. That’s not “on track.”
Why are we doing this when our present concern is not sufficient generation capacity?