Transcript - Day 9

It's over, it's over!!!

Eric Blank (Chairman): Good morning. Can you hear me?

Michelle (Unidentified): Yeah, good morning. I can hear you. Thanks.

Eric Blank (Chairman): Good morning. I'm Eric Blank, and this is the commissioner's hearing on public service companies, joint transition solicitation, proceeding 24A-0442E. We're now back on the record. Any preliminary matters, Mr. Ihle?

Jack Ihle: Your Honor, I was reaching for the coffee but couldn't reach for the button. I want to waive cross-examinations for a few witnesses today to ease up your schedule. I have no questions for Mr. Redmond, Ms. Vard, or Mr. Nichols. I've advised counsel this morning that I was waiving those witnesses. I might need a few more minutes with Ms. Henry Seros, but I think I can keep it to 15 minutes.

Eric Blank (Chairman): You had 10 minutes for Nichols on behalf of Moffat County?

Jack Ihle: Yes, and Mr. Redmond on behalf of Routt County. I also need a little extra time for UCA.

Eric Blank (Chairman): Got it. Commissioner Blank, I think PBLO was the only party who sought to cross Mayor Nichols. Do we have questions for the mayor, or can he be waived?

Matt Larson: I don’t have questions for Mr. Nichols.

Eric Blank (Chairman): Perhaps, before we proceed, can we address all waivers at once? From Public Service’s perspective, we’ll waive our time with Ms. Vard and Mr. Redmond.

Megan Gilman: I have no questions for Ms. Vard.

Tom Plant: I do have a couple of questions for Ms. Vard.

Megan Gilman: I have no questions for Mr. Redmond.

Tom Plant: I do not either.

Eric Blank (Chairman): Mr. Redmond is excused. Ms. Vard is not. How about Mr. Nichols?

Megan Gilman: Nothing.

Tom Plant: Mr. Nichols is excused.

Jon Landrum: Thank you, Your Honor. Commissioner Redmond had one revision to his testimony we were going to offer. I was wondering if we could stipulate to that. We filed previously about that revision, which was simply a misattached exhibit.

Eric Blank (Chairman): Mr. Larson, can you check with the parties? If there are no objections, you can assume that’s fine with us. Does that work for you, Mr. Larson?

Matt Larson: It does. Mr. Landrum, if you don’t mind sending it to me via email, we’ll look at it quickly, and we can stipulate to the admission.

Jon Landrum: I’ll do that. You don’t need to raise it again if you have no concerns.

Matt Larson: I’ll need the number, and I’ll need someone to let me know when it’s okay to move it in. You can email me, but I’ll need the number and confirmation that it’s all good.

Eric Blank (Chairman): Mr. Landrum and Mr. Larson, can you handle that by email with Commission Counsel?

Jon Landrum: I think we can.

Chris Leger: I just wanted to remind the commission about Commissioner Ballard’s availability. She indicated she would be unavailable this morning until 10:30, but her schedule has changed, and she’s hoping to be available starting at 9:30 today.

Eric Blank (Chairman): We’ll take her right after Mr. Buchanan. Would that work, depending on how long Mr. Buchanan is on the stand, so long as it’s after 9:30?

Chris Leger: That would work for her.

Eric Blank (Chairman): Thank you. I may have some issues around lunch, so I may need some help from you, Commissioner Gilman. Anything else before we jump into Mr. Buchanan? Mr. Buchanan, are you out there?

Sam Eisenberg: I have one quick matter, Commissioner Blank. We mistakenly filed a correction. There was a mistake in exhibit 601, which was the cross-answer testimony. Two versions have been filed with the commission. We request that the corrected version, 602, be admitted into evidence.

Eric Blank (Chairman): If you could run that by counsel, that’s fine. Have an email to Commission Counsel, copied to the relevant parties, and let’s handle it that way.

Sam Eisenberg: We are ready. Thank you.

Eric Blank (Chairman): Mr. Buchanan, can you hold up your right hand?

Wade Buchanan: I certainly can.

Eric Blank (Chairman): Do you swear to tell the truth, the whole truth, and nothing but the truth?

Wade Buchanan: I do.

Eric Blank (Chairman): You can put your hand down. Is anybody with you or communicating with you in any way?

Wade Buchanan: Just two very old dogs.

Eric Blank (Chairman): If that changes, will you let us know?

Wade Buchanan: Yes.

Eric Blank (Chairman): Back to counsel.

Sam Eisenberg: Thank you. Good morning, Mr. Buchanan. How are you today?

Wade Buchanan: I’m well. How are you?

Sam Eisenberg: Good, thank you. Would you please state and spell your name for the record?

Wade Buchanan: My name is Wade Buchanan. First name W-A-D-E, last name B-U-C-H-A-N-A-N.

Sam Eisenberg: Where do you work, Mr. Buchanan?

Wade Buchanan: I work at the Office of Just Transition at the Department of Labor and Employment for the State of Colorado.

Sam Eisenberg: What is your position there?

Wade Buchanan: I’m director.

Sam Eisenberg: Did you cause to file testimony in this case, including answer testimony, cross-answer testimony, and rebuttal testimony?

Wade Buchanan: Yes.

Sam Eisenberg: Those have been marked and admitted into evidence as exhibits 600, 601, and 602, correct?

Wade Buchanan: If you say so, yes.

Sam Eisenberg: Would the answers you gave to the questions in your written testimony be the same as if I were to ask you the same questions this morning?

Wade Buchanan: Yes.

Sam Eisenberg: Thank you. Mr. Chairman, I offer Mr. Buchanan for cross-examination. He’s now available. I have Conservation Coalition for 15 minutes, and it’s 8:08.

Patrick Wolsey: Good morning, Commissioners and Mr. Buchanan. I’m Patrick Wolsey, representing the Conservation Coalition. How are you doing today?

Wade Buchanan: Good, thank you, sir.

Patrick Wolsey: Mr. Buchanan, you recommend that the commission adopt a definition of just transition proposed by the Office of Just Transition in this case, correct?

Wade Buchanan: Correct.

Patrick Wolsey: I’d like to refer to hearing exhibit 600, your answer testimony, at page 11. At the bottom of page 11, starting at line 19 and onto the next page, you propose specific language for a definition of the term just transition, correct?

Wade Buchanan: Correct.

Patrick Wolsey: Can we increase the size of that for my aging eyes? Thank you. If we scroll up to page 8, lines 7 to 8, you assert that a definition of just transition can be derived from the statute governing your office, correct?

Wade Buchanan: Yes.

Patrick Wolsey: At lines 14 to 18, you identify Colorado Revised Statute sections 8-83-501, 504, and 504.5 as sources that can be helpful in developing a definition of just transition, correct?

Wade Buchanan: That’s correct.

Patrick Wolsey: But those sections don’t actually contain a definition of the term just transition, correct?

Wade Buchanan: That’s correct.

Patrick Wolsey: So, while there are Colorado statutes regarding just transition, to your knowledge, there’s no existing statute or rule containing the precise definition you’ve proposed here, correct?

Wade Buchanan: Correct. I state that on lines 8 and 9 of this page.

Patrick Wolsey: You recommend in your testimony that the commission adopt a definition of just transition not only for use in this proceeding but also for use in other proceedings, correct?

Wade Buchanan: Correct.

Patrick Wolsey: So you’re asking the commission to adopt a new, generally applicable definition of just transition for use in future proceedings, right?

Wade Buchanan: Generally, yes. I’m offering a definition based on the guidance from the legislature.

Patrick Wolsey: Are you aware that the Colorado legislature sometimes enacts statutes that specifically instruct the commission to adopt a rule on a specific issue?

Wade Buchanan: Yes.

Patrick Wolsey: To your knowledge, the legislature has not passed a law specifically requiring this commission to issue a rule to adopt a definition of just transition, correct?

Wade Buchanan: To my knowledge, no.

Patrick Wolsey: Have you or your office asked the Colorado General Assembly to pass a law adopting your proposed definition of just transition?

Wade Buchanan: We have not.

Patrick Wolsey: Have you or your office asked this commission to issue a rule adopting your proposed definition of just transition?

Wade Buchanan: We have not.

Patrick Wolsey: If you want a state agency like the commission to adopt a specific definition of just transition for use in both this proceeding and future proceedings, isn’t that a public policy decision that should be made by the legislature or by the commission in a rulemaking?

Wade Buchanan: You’re the lawyer; I’m not. We’re a policy organization, and I’m a policy person. My suggestion is simply that a definition would be useful in these proceedings. The lawyers can work out the details.

Patrick Wolsey: You testified in the company’s 2021 ERP proceeding, correct?

Wade Buchanan: Yes.

Patrick Wolsey: In the 2021 ERP proceeding, you didn’t propose the specific definition for just transition that you proposed here, correct?

Wade Buchanan: Correct.

Patrick Wolsey: Are you aware that the settlement in the previous ERP contains provisions regarding this just transition solicitation?

Wade Buchanan: Yes.

Patrick Wolsey: To your knowledge, the settlement in the last ERP does not contain the definition of just transition that you’re proposing here, correct?

Wade Buchanan: Correct.

Patrick Wolsey: Thank you. I have no further questions.

Eric Blank (Chairman): Thank you, Mr. Wolsey. I have 40 minutes for you, Ms. Consilia, and it’s a little before 8:15.

Ellen Kutzer (Ms. Consilia): Thank you very much. Mr. Buchanan, you’re going to get tired of all of us wishing you good morning and asking how you are, but I’ll join the crowd. How are you, and where are you?

Wade Buchanan: I’m fine. I’m at my home in Jefferson County.

Ellen Kutzer (Ms. Consilia): How are you, Ms. Consilia?

Ellen Kutzer (Ms. Consilia): You should have asked us that yesterday. The chairman had us working from 7:30 until 6:30, so we’re happy to be on the downward spiral. It was painful to watch.

Wade Buchanan: I don’t know that you can blame me for all this.

Ellen Kutzer (Ms. Consilia): No, you’re right. Mr. Buchanan, you were a signatory to both the original settlement agreement and the updated non-unanimous settlement agreement in the 2021 proceeding, were you not?

Wade Buchanan: Yes, I was.

Ellen Kutzer (Ms. Consilia): I’m going to ask to pull up exhibit 1226, which is the updated settlement agreement, and go to pages 25 and 26. Can you scroll and have paragraphs 42 and 43 up on the screen, making it big enough for both Mr. Buchanan and me to read? One of the provisions we agreed to in the updated settlement agreement, which was also in the original, is that the company will model just transition plan costs for Comanche 3, consistent with the agreed-upon modeling approach. Any plan replacement generation cited at Comanche or within Pueblo County will offset any total just transition costs, and just transition plan costs are recoverable. The company commits to make payments to Pueblo County annually from 2031 through 2040, allocated by the treasurer’s office, in the amount of the projected lost property tax revenues for those years unless offset. Do you see that?

Wade Buchanan: I’m aware of that. I see it only down to the first two lines on page 26.

Ellen Kutzer (Ms. Consilia): Can’t make it much bigger and show more?

Wade Buchanan: No, you’re fine. I’m just saying that’s my understanding.

Ellen Kutzer (Ms. Consilia): That’s what the commission ordered, to have the company make annual payments to Pueblo County, correct? Would you like to see that document?

Wade Buchanan: No, I understand that.

Ellen Kutzer (Ms. Consilia): Your Honor, we would move the admission of exhibit 1226. I can’t remember if anybody’s moved it into admission before.

Eric Blank (Chairman): Any objections? Is this the entire updated settlement agreement?

Ellen Kutzer (Ms. Consilia): Yes.

Eric Blank (Chairman): No objection. So moved.

Ellen Kutzer (Ms. Consilia): If you would please pull up exhibit 1227 and scroll down to page 48, paragraph 110. It states, “While the company commits to providing annual payments to Pueblo County in the amount of the projected lost property tax revenues, such payments do not begin until 2031.” You see that?

Wade Buchanan: Yes, I do.

Ellen Kutzer (Ms. Consilia): So, in both the updated settlement agreement and the commission’s order, we were discussing annual payments to Pueblo County, correct?

Wade Buchanan: Correct.

Ellen Kutzer (Ms. Consilia): Your Honor, for the record, I move into admission exhibit 1227, which is the complete commission order.

Eric Blank (Chairman): Any objections?

Unidentified Speaker: No objection.

Eric Blank (Chairman): So moved.

Ellen Kutzer (Ms. Consilia): In your answer testimony, exhibit 600, you recommend using the so-called Moffat model that would require Public Service to pay a direct benefit of $54,146,333 by 2031 and $18,292,667 in 11 annual minimum backstop payments between 2032 through 2042, then tapering down to $2,274,146 in 2042. Is that what you’re recommending in this case?

Wade Buchanan: We are not recommending that the commission adopt this. We’re offering it as an example of a new model, new information since the previous ERP was finished. I think the language we used was “utilize.” We did not make a recommendation that it be ordered by the commission for a community that did not agree with that.

Ellen Kutzer (Ms. Consilia): Can we agree that this new model would be a deviation from what was in the settlement agreement and what the commission ordered?

Wade Buchanan: I think it would be an addition. We consider what the commission ordered a floor, not a ceiling. It’s another way to look at the challenges the community faces and another option we hope people have. We don’t view it as changing the plan. We were saying, if you applied the Moffat model precisely as it exists in Moffat, this is what it would look like in other communities. We were not saying, therefore, do this.

Ellen Kutzer (Ms. Consilia): Thank you for that clarification. Direct benefit and minimum backstop payments do not exist in the statute that adopted the clean energy statute and set forth the requirements for a clean energy plan, do they?

Unidentified Speaker: Objection, foundation.

Wade Buchanan: I’ll have to take your word for that.

Ellen Kutzer (Ms. Consilia): Neither you nor anyone on behalf of the Office of Just Transition discussed this modification or new proposal with anyone from Pueblo County or the city of Pueblo before you submitted your answer testimony, did you?

Wade Buchanan: I don’t think so, no.

Ellen Kutzer (Ms. Consilia): Have you read the answer testimony of Sabina Gianio on behalf of Pueblo County?

Wade Buchanan: Yes.

Ellen Kutzer (Ms. Consilia): If you could pull up exhibit 1203, which has already been admitted, it’s the answer testimony of Ms. Gianio. Scroll down to page 3. Ms. Gianio, testifying on behalf of Pueblo County, said she reviewed the testimony of Mr. Eiley regarding the payment in lieu of taxes and the calculation, and she is approving that approach, correct?

Wade Buchanan: That’s what it says. It’s a little small for me to see.

Ellen Kutzer (Ms. Consilia): If you go down to the next page, Ms. Gianio is testifying whether she agrees, on behalf of the county, to calculate the amount of the annual payment in lieu of taxes, correct?

Wade Buchanan: Yes. I’d like to point out, however, that the term “payment in lieu of taxes” was not in the settlement agreement. That term has been introduced to reference the settlement agreement in this proceeding, but there’s no place, to my knowledge, in the settlement agreement where it was referred to as PILT or payment in lieu of taxes, which has a specific meaning that I don’t think we necessarily agreed to.

Ellen Kutzer (Ms. Consilia): You’re correct that that was not in the settlement agreement. Scroll down to page 4. In terms of your recommendation to the commission to adopt this new model with a direct benefit payment and minimum backstop payments, did you consider whether putting $54 million into the treasury of Pueblo County might cause a TABOR event requiring a refund?

Unidentified Speaker: Objection, compound and misstates prior testimony.

Ellen Kutzer (Ms. Consilia): Can I rephrase? You do say that if there would be a direct benefit payment to Pueblo of $54 million by 2031, that’s what it would entail, correct?

Wade Buchanan: No, I don’t recommend that. I say, if you were to apply this model to Pueblo, that’s what it would entail. I’m not making that recommendation. Nowhere in my testimony do I use that term. I’m giving it as an example of another path developed since the settlement agreement occurred.

Ellen Kutzer (Ms. Consilia): You’re familiar with the TABOR amendment that causes all of us in policy or governmental work heartburn, correct?

Unidentified Speaker: Objection, foundation, relevance.

Wade Buchanan: I used to run the Bell Policy Center, which did foundational work explaining TABOR. We were instrumental in advancing Referendum C in 2005, which changed the ratchet effect of TABOR. I am probably as familiar with TABOR as anybody, other than perhaps Doug Bruce.

Ellen Kutzer (Ms. Consilia): That’s no mean accomplishment. It is possible, based on your knowledge of TABOR, that an injection of a payment, which we would characterize as in lieu of taxes, could cause a TABOR event requiring a refund, isn’t it?

Wade Buchanan: It’s possible if those funds are TABOR funds. It’s not clear to me that a payment like this would necessarily be a TABOR fund for a community, but the lawyers would have to figure that out.

Ellen Kutzer (Ms. Consilia): I agree, but nobody wants to get in a position where there could be litigation by someone alleging a violation, correct?

Wade Buchanan: Correct, but if we were running afraid of litigation, we wouldn’t do anything in government.

Ellen Kutzer (Ms. Consilia): On page 4 of Ms. Gianio’s testimony, she indicates she works with bond counsel and rating agencies to manage the debt portfolio of the county and recommends to the county commissioners when it’s appropriate to issue new debt finance. You see that?

Wade Buchanan: I do.

Ellen Kutzer (Ms. Consilia): She’s testified that the quantification of these payments and the methodology used for quantification, as entered by the order of the commission, would be helpful to Pueblo County. You see that?

Wade Buchanan: Yes.

Ellen Kutzer (Ms. Consilia): She is concerned about the credit rating of Pueblo County and how she negotiates with financial agencies, correct?

Wade Buchanan: Correct.

Ellen Kutzer (Ms. Consilia): Would you agree that if Pueblo County is not interested in this Moffat model approach, the commission order and the settlement agreement should control in this case?

Wade Buchanan: No. The settlement agreement currently controls. We are simply offering new information that has come up since that settlement agreement was made, asserting that the settlement agreement is not necessarily the end-all. We’ve seen elsewhere in the testimony that other things are added on top of it. It’s up to the community to decide what will work for them.

Ellen Kutzer (Ms. Consilia): You talk about the Moffat model at numerous places in your testimony, correct?

Wade Buchanan: Correct.

Ellen Kutzer (Ms. Consilia): You understand that Tri-State has a different business model and a different regulatory framework, correct?

Wade Buchanan: I do. The regulatory framework did not require any conversation of community assistance at all. We argued, successfully, that the absence of that provision of law did not preclude community assistance conversations. With Moffat’s superb work with the utility, they negotiated what is seen nationally as a very strong model, as has the updated settlement agreement.

Eric Blank (Chairman): Your Honor, if you would give me one minute, I need to let my dogs out because they’re not calming down.

Eric Blank (Chairman): That works. Can we take this exhibit down?

Ellen Kutzer (Ms. Consilia): I don’t know if she’s finished with it, but she seems to have moved on.

Wade Buchanan: My apologies. The disadvantages of having a basement office and working from home. If you heard me yelling at them, I apologize.

Eric Blank (Chairman): We did not.

Wade Buchanan: Good. As long as it’s just the dogs. We’re all dog lovers, though sometimes I question my sanity.

Ellen Kutzer (Ms. Consilia): The Moffat model that you suggest the commission consider may not be authorized under the statutory framework that the Public Utilities Commission works under. Would you agree that’s a possibility?

Wade Buchanan: I’m not sure I would. “Authorized” is an interesting word. It’s certainly not considered or mandated, but to say it’s not authorized could imply that it is specifically forbidden. With that caveat, it’s true that it is not specifically mentioned but not specifically precluded either.

Ellen Kutzer (Ms. Consilia): You have looked at the statute in this case in terms of what it authorizes the commission to order, correct?

Wade Buchanan: I’m not sure I’ve dived into the specific statute that regulates how the commission works.

Ellen Kutzer (Ms. Consilia): If you could pull up exhibit 1211 from Pueblo’s exhibit box. This is a portion of the clean energy statute, 40-2-125.5, specifically Roman numeral VII, regarding just transition benefits.

Wade Buchanan: I am familiar with this.

Ellen Kutzer (Ms. Consilia): Would you agree that this statute has three components for what the commission can order a utility to pay as just transition benefits?

Unidentified Speaker: Objection, to the extent it’s calling for a legal conclusion, and this excerpt is out of context.

Eric Blank (Chairman): What would you want to see to give more context?

Unidentified Speaker: This is the portion of the statute that’s relevant.

Eric Blank (Chairman): Overruled. The witness has testified that he’s familiar with this exhibit, so you can keep going, Ms. Consilia.

Ellen Kutzer (Ms. Consilia): Line two says the clean energy plan must include workforce transition. We agree that’s one component. Can you increase the size, please? It must include workforce transition, so that’s one component. Then it says community assistance plans for utility workers impacted by any clean energy plan. That’s the second component, correct?

Wade Buchanan: I see that. If you want to call it a component, yes.

Ellen Kutzer (Ms. Consilia): The third component is a plan to pay community assistance to any local government or school district, the voters of which approved projects expected to be paid for from property taxes. You see that?

Wade Buchanan: I see that, yes.

Ellen Kutzer (Ms. Consilia): The statute provides that any payment of community assistance shall be reduced on an equivalent basis to the extent that property taxes derived from new infrastructure. So, if this is the statute that gives the commission authority to order Public Service to pay these components, that’s what the commission needs to look at, not the statutes that set up the Office of Just Transition. Would you agree?

Unidentified Speaker: Objection, calling for a legal conclusion.

Eric Blank (Chairman): Overruled. If the witness is uncomfortable answering, he can say so. I’ll let the witness answer as he chooses.

Wade Buchanan: I’m not a lawyer and wouldn’t make a legal conclusion. All I would observe is this language says “must,” not “may not” about anything. That was the same situation we were dealing with in the Moffat case.

Ellen Kutzer (Ms. Consilia): You can take this down now. One of the things you recommend in your testimony, exhibit 601, is that the county assessor should determine the property tax commitments of the relevant county, correct?

Wade Buchanan: “Should validate” is the word, I think, but I’m not looking at it.

Ellen Kutzer (Ms. Consilia): What is your understanding of how property taxes for a utility are calculated?

Wade Buchanan: They are calculated at the state level by the Division of Property Taxation in the Department of Local Affairs. The overall system for a utility is assessed statewide, then allocated out to the various counties that have facilities, including transmission and other facilities, and administered by the county.

Ellen Kutzer (Ms. Consilia): The property taxes that a utility like Public Service pays are calculated at the state level on a unit basis, looking at the financial statements of the utility, correct?

Wade Buchanan: When you say “on a unit basis,” you mean for the whole unit of Public Service’s infrastructure. I’m not sure what you mean by the word “unit.”

Ellen Kutzer (Ms. Consilia): You haven’t seen that used at the Department of Revenue?

Wade Buchanan: I don’t hang out at the Department of Revenue. I’m not familiar with the term.

Ellen Kutzer (Ms. Consilia): If you could pull up exhibit 1214, introduced yesterday. Before this comes up, Mr. Buchanan, you’re aware of the PYAC Committee and the PYAC report, correct?

Wade Buchanan: Correct.

Ellen Kutzer (Ms. Consilia): Did you look at any of the presentations made to the PYAC Committee, which have been on the website?

Wade Buchanan: I think I’ve scrolled through them. I’ve certainly read the report.

Ellen Kutzer (Ms. Consilia): Look at pages 34, 35, and 36 of hearing exhibit 1214. This was a presentation by Mr. Kowalsski of Public Service Company to the PYAC group so we could understand the taxes. Even though you haven’t seen it, would you agree this is how you understand taxes are calculated, or do you have a different view? Mr. Kowalsski first explained how residential property taxes are calculated. At a high level, can you agree this is how property taxes are calculated in Colorado?

Wade Buchanan: To my knowledge, this is accurate. I can’t attest to the assessment rate in this example, but yes.

Ellen Kutzer (Ms. Consilia): On page 35, Mr. Kowalsski told us that state-assessed property values of all public utilities are then apportioned to the counties for collection of local property tax, and this type of valuation was referred to as a unit appraisal. Do you have any reason to believe he was incorrect?

Wade Buchanan: No.

Ellen Kutzer (Ms. Consilia): Mr. Kowalsski said the utility’s property value is based on the group of assets, and the valuation is not determined for individual assets. Do you have any reason to believe he is incorrect?

Wade Buchanan: No, I don’t. That’s my understanding, and I now understand what he means by “unit.”

Ellen Kutzer (Ms. Consilia): On the next page, he lays out the timeline and says current year assessments are based on prior year financial statements. Do you see that?

Wade Buchanan: I do.

Ellen Kutzer (Ms. Consilia): On page 38, he says this is how property taxes are calculated for Comanche. Do you have any reason to believe this is incorrect?

Wade Buchanan: Not with a quick scanning of it, no.

Ellen Kutzer (Ms. Consilia): What can a county assessor do to calculate the property taxes that Public Service might pay to Hayden?

Wade Buchanan: The county assessor validates that that’s what the bill was. My recommendation that the assessor be the source of information was a way of mitigating disagreement between what we believe the number for the Hayden station to be, what Routt County believes, and what the company asserted in Mr. Eiley’s testimony. We didn’t want to argue about who was right or wrong. The accurate number is essentially the bill the assessor sends to the company. That’s what we meant by validating it through the assessor’s office.

Ellen Kutzer (Ms. Consilia): You’d support any other third-party accurate source, like the Division of Property Taxation, correct?

Wade Buchanan: We would accept that too. We just didn’t want to argue between the company and the community when it’s a matter of record what the actual number is.

Ellen Kutzer (Ms. Consilia): You were questioned by counsel for the Conservation Coalition about whether OJT’s definition of just transition should be adopted. You recall that?

Wade Buchanan: I do.

Ellen Kutzer (Ms. Consilia): You know that the PYAC group made a recommendation as to how they thought just transition should be interpreted for their community?

Wade Buchanan: Yes, I do.

Ellen Kutzer (Ms. Consilia): On behalf of the Office of Just Transition, do you have any objection to a community using the definition it feels is more appropriate for that community?

Wade Buchanan: That’s an interesting question. I need to think about what is implied. We were trying to suggest a common framework with a definition for what just transition means in the context of this proceeding, which has just transition in its title. There’s nothing in our definition that is inconsistent with the PYAC definition. The explicit focus on property taxes and the number of good-quality jobs, core to the PYAC definition, are our goals from the beginning, prominently displayed in our action plan and on our website. If Pueblo or any other community had a definition that worked for them, we have no objection. We simply say that, from the state’s perspective, the definition we offered is our best interpretation of what the legislature intended.

Ellen Kutzer (Ms. Consilia): One of the things the Office of Just Transition has suggested is that economies for coal communities should be diversified, correct?

Wade Buchanan: Yes, correct.

Ellen Kutzer (Ms. Consilia): There is nothing in the clean energy plan statute that requires Public Service or any other utility to assist in the diversification of a coal community economy, is there?

Wade Buchanan: Not that I’m aware of, but I also don’t think there’s anything that precludes it.

Ellen Kutzer (Ms. Consilia): The state of Colorado, as opposed to the individual utility, should have a moral obligation to help these communities diversify, would you not agree?

Wade Buchanan: There is language in section 501 of our statutes stating a moral obligation to ensure a just transition for communities. I don’t know if that specific provision mentions diversification.

Ellen Kutzer (Ms. Consilia): The concept of diversification has grown out of the advisory committee to the Office of Just Transition?

Unidentified Speaker: Objection, foundation.

Wade Buchanan: It is not solely an invention of our advisory committee, though that would be adequate from my perspective. Diversification is a fundamental part of effective economic development, ensuring a community remains resilient and not overly dependent on one sector. I’m pretty confident that diversification shows up in our statutes.

Ellen Kutzer (Ms. Consilia): How much money has the state of Colorado allocated to the Office of Just Transition over its five years of existence?

Wade Buchanan: It comes in several parts. The bulk is $30 million in general funds deposited in our cash fund between 2021 and 2022 in three different legislative bills—$15 million each for community assistance and economic development work and support for transition workers who have been laid off or are in danger of being laid off. We receive a regular line item in the state budget every year, ranging from about $100,000 in the first year to a peak of around $500,000, currently around $400,000, totaling about $2 million for operations and staff. The third amount is dedicated funding from the state coal severance tax, about $3 million so far, expected to reach at least $7 million over time. Adding those up, we’ve received about $30 million plus $2 million from the long bill plus $3 million from the severance tax, totaling about $35 million.

Ellen Kutzer (Ms. Consilia): Can we agree that, although you’ve had an impressive career, you do not have expertise in economic development?

Wade Buchanan: I wouldn’t say I don’t have expertise. I have developing expertise, but I am not an economic developer.

Ellen Kutzer (Ms. Consilia): Economic development is done through the Office of Economic Development, correct?

Wade Buchanan: Correct. Our statute directs us primarily to coordinate state agencies—OEDIT, DOLA, and others—in their work in transition communities. Our role is not to replace those entities but to help coordinate and collaborate.

Ellen Kutzer (Ms. Consilia): Can we agree that $40 or $50 million is a very small amount of what will be needed to diversify the economies for these coal communities?

Wade Buchanan: Oh, yes.

Ellen Kutzer (Ms. Consilia): The state of Colorado doesn’t have any funds to put into that at this point, correct?

Wade Buchanan: We go back to the TABOR conversation. We do not expect any more state funding in the near to medium future.

Ellen Kutzer (Ms. Consilia): Let’s talk about the current composition of your advisory board. You have a representative from Moffat County and Routt County, correct?

Wade Buchanan: Correct.

Ellen Kutzer (Ms. Consilia): There is no representative, and has not been for some time, from Pueblo County Commissioners, correct?

Wade Buchanan: That’s correct.

Ellen Kutzer (Ms. Consilia): Your December newsletter indicated you’re hiring an additional Yampa coal transition navigator, correct?

Wade Buchanan: We lost our initial navigator and hired another one. Right now, we have one navigator, a statewide position, but based on closure dates, almost all activity in terms of people approaching layoff is in the northwest.

Ellen Kutzer (Ms. Consilia): From your staff of six people, do four live in northwestern Colorado?

Wade Buchanan: We have two in northwest Colorado, specifically in Moffat County—one navigator and one statewide community and economic development person, hired because she was the best applicant, not because she lived in Moffat.

Ellen Kutzer (Ms. Consilia): Pull up exhibit 1219 from our hearing box. This is a discovery response to questions submitted by Pueblo. You’re the sponsor of these responses, correct?

Wade Buchanan: Correct.

Ellen Kutzer (Ms. Consilia): I move the admission of this exhibit into evidence.

Eric Blank (Chairman): Any objection?

Unidentified Speaker: No objection.

Eric Blank (Chairman): So moved.

Ellen Kutzer (Ms. Consilia): A lot of money has been allocated or granted to northwestern Colorado according to this discovery response, correct?

Wade Buchanan: We’ve had earmarks for each community. The northwest is the first to utilize their entire earmark. It’s a small amount of money given the challenge, but comparable to other communities, it’s the largest earmark, and they’ve fully utilized it.

Ellen Kutzer (Ms. Consilia): You’re paying for the attorneys for Routt County and Moffat County to participate in this proceeding and the Tri-State proceeding, correct?

Wade Buchanan: That’s not correct. When we first came into the Public Service process in 2021, we saw only one community represented, ably by you. The other communities weren’t represented, and we said they ought to be here because it affects their future. We offered to fund a grant to hire an attorney for each community’s first intervention. We funded Moffat’s intervention in the Tri-State case, not in this case. We’re doing that with Routt and Hayden up to a certain amount, and this will be the one and only time.

Ellen Kutzer (Ms. Consilia): What is the amount capped at for each county?

Wade Buchanan: We started at $25,000; we cap it at $50,000.

Ellen Kutzer (Ms. Consilia): Pueblo was not eligible to apply for that kind of grant because they’ve been participating?

Wade Buchanan: You’re already here. Our purpose was to get them to understand the value of being here, and if they wanted to continue, it was on their own dime. It was an incentive to participate.

Ellen Kutzer (Ms. Consilia): The funds earmarked for Pueblo have been approximately $930,000?

Wade Buchanan: It’s based on the number of coal facilities—power plants or mines—in a community. The northwest, a three-county area, has two power plants and four coal mines.

Ellen Kutzer (Ms. Consilia): Have you been to Pueblo recently?

Wade Buchanan: I passed through there on Friday, but I was just passing through. I get down periodically to the mayor’s meetings of the just transition advisory group. We always have someone at that meeting.

Ellen Kutzer (Ms. Consilia): In terms of economic diversity, have you visited Pueblo recently?

Wade Buchanan: Not recently, no.

Ellen Kutzer (Ms. Consilia): Are you aware that one of the things Pueblo needs to diversify the community is about $20 million for wastewater and sewage on 22,000 acres?

Wade Buchanan: I may have heard specific conversation that I haven’t retained. The issue has been a major discussion at the mayor’s group.

Ellen Kutzer (Ms. Consilia): Any suggestions as to how Pueblo can find $20 million for a water treatment or sewage facility?

Wade Buchanan: We would help if they applied for support from the earmark they have. We could help with planning and engineering, but we don’t have enough money for the actual project. We have a pool of grant writers available to any affected community if they need assistance seeking funding. OEDIT and DOLA have sources of funding. These are hard questions for every community.

Ellen Kutzer (Ms. Consilia): I’ve run out of time, and before I get the fish-eye from the chairman, I’ll end on that note. These are hard decisions for all our communities. Thank you, Mr. Buchanan.

Eric Blank (Chairman): Thank you, Ms. Consilia. I have Routt County for 30 minutes, and it’s a little after nine.

Jon Landrum: Good morning, Mr. Buchanan. Nice to see you again.

Wade Buchanan: I don’t know where you are, Mr. Landrum. Have I been on the stand that long? It feels like last week at this point.

Jon Landrum: Good morning. I apologize. For the record, I’m an attorney representing Hayden and Routt County. It’s good to see you again.

Wade Buchanan: Good to see you.

Jon Landrum: I want to start by discussing some background on the Office of Just Transition. Can you explain how it was founded?

Wade Buchanan: We were created in legislation in 2019, House Bill 19-1314, as part of a larger package of bills addressing climate and energy issues. An important priority for stakeholders was to help those otherwise left behind by the transition.

Jon Landrum: You mentioned HB 19-1314, which you also discussed with Ms. Consilia, correct?

Wade Buchanan: Kind of. We’ve been subject to about seven or eight different bills. We refer to the statute now because some parts of each bill are no longer effective. I’d refer to 8-83-501 through 506.

Jon Landrum: You were discussing with Ms. Consilia the moral commitment that Colorado has to a just and inclusive transition, correct?

Wade Buchanan: Correct.

Jon Landrum: Does OJT view the word “Colorado” in that statute as applicable only to state agencies, or is it a broader concept?

Wade Buchanan: It says Colorado has this commitment. The legislature can technically speak only for the state government, but it certainly speaks for all of state government and was intended to speak as broadly as possible.

Jon Landrum: OJT was a participant in proceeding 21A-00141E, the 2021 ERP case, correct?

Wade Buchanan: Correct.

Jon Landrum: You, on behalf of OJT, filed cross-answer testimony in that proceeding?

Wade Buchanan: We did.

Jon Landrum: Is it true that you specifically testified that OJT did not speak for individual transition communities?

Wade Buchanan: We did.

Jon Landrum: Is it also true that you expressed concern in that testimony that most transition communities were not represented in that proceeding?

Wade Buchanan: We did.

Jon Landrum: Is it fair to say that OJT’s position is that you do not speak for the interest of any individual transition community?

Wade Buchanan: That is our position.

Jon Landrum: Was OJT a participant in the 2022 updated settlement agreement, or the USA, as we’ve been calling it?

Wade Buchanan: I believe we signed that, yes.

Jon Landrum: At the time the USA was negotiated, had OJT done any analysis to determine whether it was realistic for the assessed value lost from the closure of coal plants to be replaced within the timeframe set out for backstop payments?

Wade Buchanan: I don’t think we did an extensive analysis, but we consulted with OEDIT and others. We had a sense it was a significant commitment but did not expect it to be adequate for the purposes of the transition.

Jon Landrum: You knew at that time that there was more work to be done?

Wade Buchanan: Yes.

Jon Landrum: Do you know if any other party performed any economic development analyses related to the updated settlement agreement?

Wade Buchanan: If they did, I’m not recalling.

Jon Landrum: From OJT’s perspective, was the intent of the community assistance payments in the USA to serve as a bridge to future economic diversification in transition communities, or was it something else?

Wade Buchanan: I think it was intended to be a start at driving a sound transition. “Bridge” is probably a good word. To be clear, in the 2022 USA, nothing was done to directly support economic development. These were backstop payments.

Jon Landrum: Did you provide testimony to support the 2022 USA?

Wade Buchanan: Yes.

Jon Landrum: Was your testimony that you were troubled that transition communities other than Pueblo were not represented in the settlement negotiations?

Wade Buchanan: I did.

Jon Landrum: Did you remind the commission and parties that OJT did not represent transition communities or speak on their behalf?

Wade Buchanan: We did, very explicitly.

Jon Landrum: Did you provide live testimony in support of the settlement agreement?

Wade Buchanan: I did.

Jon Landrum: Do you remember having a conversation with Commissioner Plant during that live testimony?

Wade Buchanan: Not Commissioner Plant. I don’t think he was on the commission at the time.

Jon Landrum: Can we pull up exhibit 1810 from Routt County’s box?

Eric Blank (Chairman): Give me just a second to get there.

Jon Landrum: I’m trying to remember the commissioner’s name. Maybe Commissioner Gavin?

Wade Buchanan: It was Commissioner Gavin, that’s who it was.

Jon Landrum: We’ll confirm with the transcript. Do you recognize this as the transcript for the settlement testimony for the 2022 USA?

Wade Buchanan: That’s what it appears to be.

Jon Landrum: Can we increase the size? Scroll down to page 250. Let’s scroll up a little to see who this conversation is with. Commissioner Gavin. Do you remember having this discussion with him?

Wade Buchanan: I do.

Jon Landrum: Do you remember speaking in this testimony with Commissioner Gavin that OJT did not represent individual communities?

Wade Buchanan: I do.

Jon Landrum: Isn’t it also true that Commissioner Gavin expressed concern that there was a lot of focus on Pueblo but comparatively little on other communities?

Wade Buchanan: If that’s what the transcript references, I remember the conversation in general, but I can’t attest to specifics without seeing it.

Jon Landrum: Can we go down to page 252, lines 1 through 3?

Wade Buchanan: That’s Gavin speaking. I see that.

Jon Landrum: Would you agree he expressed concern that other transition communities were not participants in this process?

Wade Buchanan: Yes.

Jon Landrum: I’d like to move for the admission of exhibit 1810.

Eric Blank (Chairman): Any objection?

Unidentified Speaker: No objection.

Eric Blank (Chairman): So moved.

Jon Landrum: I want to follow up on statements made by PSCO witness Mr. Eiley. Were you watching Mr. Eiley testify?

Wade Buchanan: I watched part of it. I didn’t watch the entire multi-day presentation.

Jon Landrum: Something Mr. Eiley said, also discussed with Ms. Consilia, was that you were an expert in economic development. Are you an expert in economic development?

Wade Buchanan: No.

Jon Landrum: You testified earlier that OJT didn’t perform any economic development analysis as part of the 2022 USA, correct?

Wade Buchanan: That’s correct.

Jon Landrum: Is it true that OJT intervened late in the 2021 ERP proceeding?

Wade Buchanan: We intervened at the end of September 2021, five months after others were supposed to intervene.

Jon Landrum: Was it OJT’s understanding, either at the time of intervention or later, that the 2021 ERP case would fully resolve all issues related to just transition commitments by PSCO?

Mr. Buchanan: Certainly wasn't our expectation, no.

Attorney: I want to pull up exhibit 1807 from our box. You just went through this, I think, with Ms. Consilia, or maybe the phase two decision, but do you recognize this as the phase one decision on the 2021 ERP case?

Mr. Buchanan: That's what it looks to be, yes.

Attorney: Can we turn to page 49, please? While we're at it, can we increase the size? We should just make that a default at this point. I want you to review specifically paragraph 111 of the decision, which is right in the middle there.

Mr. Buchanan: Okay.

Attorney: You had a chance to review that piece of the commission statement?

Mr. Buchanan: Yes.

Attorney: As part of reading this paragraph and decision as a whole, did you interpret that the 2021 ERP process would be the end of all community assistance discussions at the commission?

Mr. Buchanan: No, I did not.

Attorney: Thank you very much for that. I think this has already been admitted into evidence with a separate witness, but if not, I'd ask we take administrative notice of this decision. Ms. Whitman, any concerns?

Ms. Whitman: No objection.

Eric Blank (Chairman): So noticed. Thank you for that.

Attorney: I want to turn now to the exciting topic of property taxes, which you just discussed with Ms. Consilia. As part of your role with OJT, are you familiar, generally, with the property taxes from transition facilities in transition communities?

Mr. Buchanan: Yes, generally understood.

Attorney: At a high level, as you talked with Ms. Consilia, you understand how property taxes for a facility like Hayden Station are calculated?

Mr. Buchanan: Yes.

Attorney: I want to turn to your 2021 cross-answer testimony. Do you remember testifying about this? Let's pull up exhibit 1804, please. Do you recognize this as your cross-answer testimony in the 2021 ERP case?

Mr. Buchanan: Yes.

Attorney: Can we turn to page 30, please? Zoom in, please, for Mr. Buchanan—the default request. I'm specifically interested in lines 7 through 15 once we get a chance to zoom in. Take a chance to review that and let me know when you’re finished.

Mr. Buchanan: Yes.

Attorney: With the caveat, just lines 7 through 15, which is the information for Hayden Station, right?

Mr. Buchanan: Okay.

Attorney: At least in 2020, which was when these numbers were pulled from, is my understanding, were the property taxes at Hayden Station in total $4.98 million?

Mr. Buchanan: That was our understanding, which we quoted here.

Attorney: In your testimony, you state that the company paid $3.62 million, the company being PSCO in this case?

Mr. Buchanan: Yes.

Attorney: And that Pacificorp and Salt River Project paid the rest. Is that right?

Mr. Buchanan: Correct.

Attorney: If you trust my math here, based on these numbers, would the company's portion of the total property tax bill for Routt County be roughly 73%?

Mr. Buchanan: It would be whatever 3.62 is divided by 4.98, and if that's what you did, then yes.

Attorney: I promise you the math is right, but it’s subject to check—73%. Based on your conversation with Ms. Consilia, we understand that these property tax assessments change based on a variety of factors. Is that right?

Mr. Buchanan: Correct.

Attorney: As you discussed with Ms. Consilia, one of those factors is the market value of PSCO as a company, which also changes?

Mr. Buchanan: I believe that to be the case, yes.

Attorney: With the caveat that these numbers can change, is it fair to say that the other two owners of Hayden Station, Salt River Project and Pacificorp, contribute a significant portion of the property taxes for Hayden Station?

Mr. Buchanan: Yes.

Attorney: Would it not be true then, if PSCO is not required by the commission to pay the full amount of the property taxes, or if these other corporations are not required to pay the full amount, that Hayden and Routt County are looking at a pretty significant property tax shortfall, even if the community assistance payments are paid? I would add PBLO to that too.

Mr. Buchanan: Yes, I think all communities are looking at significant property tax shortfalls. I think not Morgan, because it is 100% owned by the company, but yes, the other communities, I think. There’s been an assumption in these processes, back to 2021, that it was only the operating partner that was on the hook. We’ve argued in our testimony that that leads to a fairly random outcome, where the amount of support depends on the luck of the draw of the ownership structure.

Attorney: I think we’ll get to that a little bit later in terms of that effect. At this time, I’m done with this exhibit. I had asked for its admission into evidence. Any objection, Ms. Whitman?

Ms. Whitman: I have no objection from OJT.

Eric Blank (Chairman): So moved.

Attorney: Are property tax losses the only economic impact from the closure of these facilities?

Mr. Buchanan: No.

Attorney: Would other impacts be sales taxes, potentially?

Mr. Buchanan: Certainly.

Attorney: Severance taxes from lost mining facilities?

Mr. Buchanan: Yes.

Attorney: Job losses, both indirect and direct effects?

Mr. Buchanan: Yes.

Attorney: You testified earlier that as part of your role with OJT, you look at property tax records in transition communities. Is that right?

Mr. Buchanan: We do, yes.

Attorney: Is your understanding that county assessors regularly keep property tax records?

Mr. Buchanan: Yes.

Attorney: Are these documents publicly available?

Mr. Buchanan: Yes, they are.

Attorney: Can we pull up what’s been marked in our box as exhibit 1806? Mr. Buchanan, do you recognize this document?

Mr. Buchanan: I do recognize this document.

Attorney: Is this document the Routt County treasurer statement of taxes due for PSCO in 2024?

Mr. Buchanan: That’s what it appears to be, yes.

Attorney: I would now ask for admission of hearing exhibit 1806. Ms. Whitman?

Ms. Whitman: I don’t have an objection.

Eric Blank (Chairman): Admitted.

Attorney: Can we turn to page nine of this document, please? Mr. Buchanan, is it your understanding that taxing area 35 in Routt County is the Hayden Station?

Mr. Buchanan: Can you increase the size, please? Can you ask that question again, sorry?

Attorney: Can we just scroll down a little bit? A tiny bit. Oh, a little up, sorry. I’m trying to look at 35. There we go. Do you recognize tax area 35 as being the Hayden Station area?

Mr. Buchanan: Yes.

Attorney: Based on this document, would you say that the property tax bill for PSCO in 2024 for Hayden Station was a little over $3.6 million?

Mr. Buchanan: Yes.

Attorney: We can pull that down now, thank you. Earlier with Ms. Consilia, you had a discussion about who was right on the calculation of property taxes, either the county assessor or the company. Do you remember that?

Mr. Buchanan: I did, yes.

Attorney: Is it OJT’s position that, regardless of what the actual numbers of the property taxes are, we should be ensuring that those numbers are correct as part of this process?

Mr. Buchanan: Yes, and they are a matter of public record. It shouldn’t be hard. I’m baffled by the disagreement because it’s right there in the assessor’s numbers.

Attorney: With that document I just showed you, would that be one example of where those numbers could be found?

Mr. Buchanan: Yes.

Attorney: I want to turn now to the Tri-State ERP proceeding, 23A-0585E, and the settlement in that proceeding. Were you a part of that case?

Mr. Buchanan: I get lost in all the numbers. Just doing it for the record, the Tri-State ERP case?

Attorney: Yes.

Mr. Buchanan: Yes, we were an intervenor.

Attorney: Are you familiar with the settlement agreement in that proceeding?

Mr. Buchanan: Yes.

Attorney: In terms of structure, would you agree with me that the Tri-State settlement agreement includes three components: one, three years of payments not subject to offset; two, ten years of payments subject to offset by Tri-State investment; and three, property dedications to the local governments? Does that sound right to you?

Mr. Buchanan: That sounds right.

Attorney: Is it your understanding that the monetary value of the direct payments from that settlement is $70 million?

Mr. Buchanan: Yes, the direct payments and the backstop payments combined, yes.

Attorney: Is it your understanding that the water rights that were also dedicated as part of that settlement are valued somewhere in the range of two and a half to five million dollars?

Mr. Buchanan: That’s what I’ve been told, and I have no reason to doubt that that’s an accurate range.

Attorney: Are you aware that Tri-State has announced planning to construct a natural gas facility as a replacement to Craig Station?

Mr. Buchanan: I’m aware that it is an intended outcome. I’m not sure where they are in the announcement process, but yes.

Attorney: With that in mind, I don’t have a ton of time left. I want to talk about some equitable outcomes for just transition communities. Would it be fair to say that OJT has learned a lot about the just transition process and the PUC’s role in that process since it participated in that first PSCO 2021 ERP case?

Mr. Buchanan: Oh, absolutely, yes.

Attorney: Is it OJT’s position that the General Assembly intended for the commission to consider just transition proceedings broadly?

Mr. Buchanan: Yes, I mean, it’s in our legislation to intervene. I assume that’s because the legislature intended for the commission to hear and consider these issues.

Attorney: Does OJT believe that just transition assistance and outcomes should be roughly equitable between just transition communities of the same tier?

Mr. Buchanan: Yes, understanding there’s not going to be a perfect symmetry, but generally equitable among all the communities.

Attorney: Did you review the answer testimony of UCA witness Leslie Henry Seros and/or the UCA’s rebuttal testimony?

Mr. Buchanan: I believe I did, yes.

Attorney: Is your understanding that UCA is advocating for payments to Craig and Moffat County based on the megawatt capacity owned by PSCO and Craig Station?

Mr. Buchanan: Yes.

Attorney: Is your understanding that the calculation of this payment was based on the settlement in the Tri-State ERP proceeding?

Mr. Buchanan: I believe that’s correct, yes.

Attorney: Have you or OJT done any kind of analysis comparing the community assistance model proposed by UCA and the community payments as contemplated by 2022 USA?

Mr. Buchanan: We have not done a formal analysis. We did a quick math problem to see what the bottom-line numbers would be.

Attorney: Did your analysis conclude that Routt County would receive comparatively more in economic payments under the UCA’s proposal than under the USA backstop payment proposal?

Mr. Buchanan: Yes, that’s my recollection.

Attorney: Just one second, I have a couple of questions left. Can we pull up from my box 1808, please? Sorry, you said again? I don’t think we’ve looked at 1808. Sorry, then it was 1808 for the first time. Now I’m confused because I pulled up 1808, but it’s marked as 1807. It’s an ERP phase 2 decision. Is that what you want?

Mr. Buchanan: That’s right.

Attorney: I’m going to change the title to 1807, is that okay?

Mr. Buchanan: Thank you, I appreciate that.

Attorney: Do you recognize this as the decision in the phase 2 ERP proceeding?

Mr. Buchanan: That’s what it appears to be, yes.

Attorney: Can we scroll down to paragraph 221? I don’t have the page number on me. Can you read paragraph 221 for me and let me know when you’re finished?

Mr. Buchanan: Can you increase the size, please? Okay.

Attorney: Based on this paragraph, is your understanding that the commission ruled that it may be necessary to go beyond the six years of USA payments to Routt County?

Mr. Buchanan: I believe so, yes.

Attorney: Does OJT support the concept that additional community assistance could be provided to transition communities by the company on top of the amounts provided for in the USA?

Mr. Buchanan: Yes.

Attorney: Would OJT support applying the Moffat model to communities who desire that approach in a way which is on top of the proposal for community assistance in the USA?

Mr. Buchanan: Yes, for those communities that desire that approach.

Attorney: Do you believe that different models could coexist within this just transition framework?

Mr. Buchanan: Absolutely, I think we’re learning a lot over time. I’m sure there are several other models out there. Your comment about equity is the right measure, I believe.

Attorney: Thank you so much. I have no further questions for this witness.

Eric Blank (Chairman): Thank you, Mr. Denton. Mr. Larson or the company, I have 10 minutes, and it’s a little after 9:30.

Matt Larson: Thank you, Mr. Chair. Good morning, Mr. Buchanan.

Mr. Buchanan: Good morning, Mr. Larson.

Matt Larson: For the record, Matt Larson on behalf of Public Service. I think you’ve gone through some of these items already in your examination, but you signed the initial settlement agreement in proceeding number 21A-0141E, correct?

Mr. Buchanan: Correct.

Matt Larson: Then you later signed the updated settlement agreement in that same proceeding, correct?

Mr. Buchanan: Correct.

Matt Larson: I want to start by focusing on the initial one that was executed on November 24th, 2021. Before you signed that, did you discuss the provisions of that agreement with any representatives from Moffat County?

Mr. Buchanan: Not that I recall. I think we were subject to confidentiality in the negotiations.

Matt Larson: What about the city of Craig?

Mr. Buchanan: Not to my recollection.

Matt Larson: What about Routt County?

Mr. Buchanan: Not to my recollection.

Matt Larson: What about the town of Hayden?

Mr. Buchanan: Not to my recollection.

Matt Larson: So, understanding settlement privilege, you didn’t discuss the fact that there were discussions underway with respect to how these communities might be compensated under the agreement with them in any way, shape, or form?

Mr. Buchanan: I do not recall doing so. That was three years ago.

Matt Larson: Let’s go through the same thing prior to the updated settlement agreement. At that point in time, the community assistance provisions were included as part of the initial settlement agreement, isn’t that true?

Mr. Buchanan: Yes, they were revised a little bit in the second one, but yes, the basic principle is there.

Matt Larson: The basic concept was in that initial settlement agreement, correct?

Mr. Buchanan: Correct.

Matt Larson: There was an updated settlement agreement in the spring of 2022, right?

Mr. Buchanan: Correct.

Matt Larson: Did you talk to any representatives from Moffat County about the initial settlement agreement before the updated settlement agreement was signed?

Mr. Buchanan: I do not recall whether there was any conversation.

Matt Larson: What about the city of Craig?

Mr. Buchanan: I do not recall.

Matt Larson: What about Routt County?

Mr. Buchanan: I do not recall.

Matt Larson: What about the town of Hayden?

Mr. Buchanan: I do not recall.

Matt Larson: So, in your role as head of OJT, you didn’t talk to any of these communities in that interim period between when the initial settlement agreement was signed and when the updated settlement agreement was signed?

Mr. Buchanan: That mischaracterizes the testimony.

Eric Blank (Chairman): Sustained.

Matt Larson: You also had an exchange with Mr. Denton about the operator model, where the operator of the asset is paying the community assistance payments. You denoted that Pawnee is 100% owned, so it’s not really an issue in Morgan County. Do you recall that?

Mr. Buchanan: Yes.

Matt Larson: Have you spoken to Holy Cross Electric Cooperative about community assistance payments?

Mr. Buchanan: No, we have not.

Matt Larson: What about Core Electric Cooperative?

Mr. Buchanan: No, we have not.

Matt Larson: What about Pacificorp?

Mr. Buchanan: No, we have not.

Matt Larson: What about Salt River Project?

Mr. Buchanan: We have not.

Matt Larson: What about Platte River Power Authority?

Mr. Buchanan: We have not.

Matt Larson: So, is Public Service the only co-owner non-operator entity that you’ve had discussions with or advocated in favor of making assistance payments?

Mr. Buchanan: The characterization that we’re in discussions with them—we’re in this proceeding. It’s been suggested that we should go beyond the owner-operator model for obligation, and we think that’s a good idea. I wouldn’t characterize this as the only proceeding where that’s come up, and we have agreed with that recommendation. I object to the suggestion that we should be out negotiating with the other utilities. We just think this is a good provision to include. We think the community ought to have the support of as many of the utilities as the PUC has authority to direct to do it. We don’t think the idea should be dismissed because the PUC does not have authority to effectuate everyone doing it.

Matt Larson: Would you agree with me that the structure of the updated settlement agreement helps to drive replacement generation infrastructure and resources into just transition communities?

Mr. Buchanan: Yes, I would.

Matt Larson: Would you agree that it was a leading model, basically created on a blank slate at the time that settlement was reached?

Mr. Buchanan: Absolutely, yes, very much so. We think it’s a very strong model.

Matt Larson: Why do you think that replacement generation is important and plays an important role in a just transition?

Mr. Buchanan: I think any investment that results in jobs and property taxes is an important part of a just transition. Certainly, communities that have had energy facilities before have the workforce available, often have transmission facilities available, so there are assets in the community that make sense. We’re agnostic about technologies. We think diversification is important. We certainly would support any energy investment that creates jobs and creates property tax. We would hope that the entire process would result in greater diversification and less dependence on one sector. We think that’s the definition of resiliency moving forward. But with all those caveats, a business that creates jobs, provides property tax, and creates good jobs, as most energy projects do, is very desirable.

Matt Larson: Electric generation and transmission is a piece of the puzzle in terms of replenishing lost property tax, isn’t that true?

Mr. Buchanan: Yes, totally.

Matt Larson: Energy providers are well-positioned to drive those types of investments into communities, aren’t they?

Mr. Buchanan: That’s true, yes.

Matt Larson: Other entities may be better positioned to drive other kinds of benefits, diversification benefits, into communities, isn’t that true?

Mr. Buchanan: That’s correct.

Matt Larson: The updated settlement agreement and its architecture help to drive that kind of infrastructure and investment from energy providers into these communities, isn’t that true?

Mr. Buchanan: That’s true. But to the extent there isn’t, for example, the company in Hayden has entertained a number of potential new investments. I went up to a meeting where the company was announcing to the workers that there would be molten salt, and we know that is no longer an option. It is very likely that in many cases, if not most cases, what the company invests in will not replace the entirety. What’s valuable about the cash payments—the company in its testimony refers to them as lump-sum, short-term payments—but the value is that it can facilitate, as it’s going to do in Moffat through their permanent fund, the ability of the community to then go out and seek other investments that may not be in the energy sector, which are key to diversification and the just transition.

Matt Larson: Do you think the carbon-free future development can help to drive investments into just transition communities?

Mr. Buchanan: I do.

Matt Larson: Thank you for your time, Mr. Buchanan. I appreciate it.

Mr. Buchanan: Thank you.

Eric Blank (Chairman): Thank you, Mr. Larson. Commissioner Gilman, questions for Mr. Buchanan?

Megan Gilman: Morning, Mr. Buchanan. I don’t have any questions.

Eric Blank (Chairman): Commissioner Plant?

Tom Plant: Thank you. Morning, Mr. Buchanan.

Mr. Buchanan: Good morning, Commissioner. Good to see you.

Tom Plant: You gonna play the banjo for us?

Mr. Buchanan: Maybe later.

Tom Plant: I have a real quick conceptual question for you, just to get your thoughts on this. The commission is faced with a transition in the PBLO community where the plant there is being closed about 40 years early. We’ve got plants in Moffat and Hayden counties that are closing anywhere from two to nine years early. Those are decisions that were made by this commission, and we recognize the responsibility that we have. But what is the obligation, beyond replacing the reductions in property taxes that are a result of that decision? Where does the obligation begin and end for utility ratepayers in that overall transition? We’re talking about some very different situations, and I’m trying to understand the extent of the obligation of the ratepayers in this particular case. I was wondering if you could share your thoughts from your experience and the communications you’ve had with these many communities.

Mr. Buchanan: It’s a fantastic question and one of the core questions: what is the obligation for the state, for the companies, for the communities? We have the privilege and challenge of being the first state to take those questions on with the creation of our office. From a policy perspective, it’s a very interesting and at times weighty consideration. With respect to the company, which is an investor-owned company, they have demonstrably benefited significantly from the resources in the community, both the natural resources and the human resources, that were an important part of their success in providing energy to our communities and nation, and providing value to their shareholders. I think the shareholders ought to be an important part of the conversation. I’m not an expert on how you do that.

Mr. Buchanan: From the ratepayers’ perspective, they receive increasingly clean, reliable, dependable, and fairly affordable electricity. Those are your primary responsibilities. We are asking in this proceeding to deal with a lot of externalities. We’re moving toward a cleaner fleet of facilities, trying to reduce emissions, making the correct investments to avoid once-in-a-decade weather phenomena. I think it’s wholly appropriate that the economic health and well-being of the community that’s been a part of the company’s success for a long time be front and center. We’re not talking about a huge amount of money in the grand scheme of things. I think there’s a strong obligation. Where that obligation begins and ends is more of an art than a science.

Mr. Buchanan: I would suggest that the initial position that Tri-State took—that there was no obligation to community assistance—I considered that to be, forgive the expression, ridiculous. I would also consider it ridiculous to say this is totally on the company. The state has recognized that, and other actors are recognizing that. Where in between, I think, is a balance of how engaged the company was in the community, how much the community gave to their success, and the impacts on the ratepayers, especially in a situation like Tri-State, where their customers could get up and leave, as some have.

Tom Plant: There are a couple of issues you bring up that we’re all trying to work through. One is replacement—that’s one question I’ll set aside for now. The other is beyond replacement. If you’ve got a plant that was going to close in two years, is the correct obligation six years, ten years, four years? It was going to go away at some point. Is that transition period, whatever it is beyond those two years, an obligation of the ratepayers, the state, or, as you said, the company and the investors of that company, because the company has benefited? To give back to that community and help them make that transition, I’m trying to figure out in my mind. There’s been some discussion about using a ten-year number or a six-year number, but we’ve got plants closing nine years early, two years early. Is there an idea of what that extended obligation would be beyond the scheduled closing date, and whose responsibility is it for assisting in that transition?

Mr. Buchanan: Very legitimate, and I understand the dilemma. I don’t have a strong position. The big issue of a plant closing a long time before it was initially intended to close—have people recouped their investment? From the community’s point of view and the health of the workers, it looks the same whether it’s six years or 40 years. They’re out of a job they thought they were going to be in for a longer amount of time. Property taxes go away that people were depending on, sometimes to pay bonds and other things you can’t necessarily get out of. I understand the argument that there were only two more years, and they were going to be going through this anyway, but I’m not sure that’s necessarily the case because the nameplate end date is not necessarily when a facility closes. I don’t know how much weight to put on that.

Mr. Buchanan: From our perspective as the Office of Just Transition, as a state office responsible for caring first for the interests of the communities and workers, we are largely persuaded that the experience of the communities and workers is largely the same regardless of some end date in the future. That counts for a very important part of the consideration. I’m not sure that provides you the guidance you need.

Tom Plant: I don’t think there are any easy answers, or else we wouldn’t be here. I wanted to get your thoughts, knowing you’ve been working on this issue with these communities for a long time. I appreciate it. That’s all my questions.

Eric Blank (Chairman): Thank you, Commissioner Plant. That was the question I was going to ask, Mr. Buchanan. Thanks for coming. Ms. Whitman, any redirect?

Ms. Whitman: Briefly, Mr. Chair, please. I won’t take long. Mr. Buchanan, I want to clarify because I think there’s some confusion in the record. You were speaking with Ms. Consilia about whether OJT had provided grants to communities for attorney fees. Do you remember those questions?

Mr. Buchanan: Okay.

Ms. Whitman: My understanding is that OJT provided initial grants, one-time grants, to communities to retain counsel to intervene in proceedings like this one. Is that right?

Mr. Buchanan: That’s correct.

Ms. Whitman: Any subsequent interventions into proceedings would be on their dime, so to speak?

Mr. Buchanan: Yes.

Ms. Whitman: In this case, to clarify for Moffat and Craig, did OJT provide a grant for them to intervene in the JTS in this case?

Mr. Buchanan: Not in this case, no.

Ms. Whitman: What would be the answer for Routt?

Mr. Buchanan: This is their first case, their one shot on our dime.

Ms. Whitman: Any subsequent proceedings that Routt County partners or governments would intervene in, that would be on their dime, so to speak?

Mr. Buchanan: Yes, not on our dime. They would be paid for by the government throughout, however they chose to fund it.

Ms. Whitman: I want to ask some additional questions. If we could pull up admitted exhibit 1219 that Ms. Consilia had admitted into evidence, I want to ask a few follow-up questions. These are OJT’s discovery responses to PBLO, is that right?

Mr. Buchanan: Correct.

Ms. Whitman: In your testimony, do you remember discussing with Ms. Consilia about earmarks for each community that’s undergoing a just transition or attempting to achieve one?

Mr. Buchanan: Yes.

Ms. Whitman: Please lay a little foundation. What is an earmark in the lexicon that OJT uses?

Mr. Buchanan: In 2021, 2022, we received money from the legislature and a directive, because it was considered stimulus funding for the state, to get it out the door very quickly. We pushed back on that because the closures were not right away, and it would have been a misuse of the funds for the purpose of just transition to spend it all before the workers even knew they were losing their jobs. We implemented a grant program in part in response to the urgency that the legislature had indicated. We didn’t want to make it a competitive grant where the first in line had the best opportunity. We looked at the challenge in each community and looked for indicators of what the challenge was.

Mr. Buchanan: We landed on the number of facilities in each community as the primary indicator of the need in the community. In the west end of Montrose County, where the closures had already happened, we doubled that credit. We recognized that tier 2 communities also had some need. That left us with 13 different credits, and we divided that into the money we had, and that told us how much money was available for each community. We called that its earmark. That money was available to eligible entities in each community, which is defined in our statute. We announced that and waited for people to apply for it. That’s essentially how our grant program has worked.

Mr. Buchanan: The northwest communities, which include Routt, Moffat, and Rio Blanco, have six facilities: four coal mines and two power plants, so they have six credits. Morgan County has one credit for one power plant. PBLO has one credit for one power plant. The west end of Montrose County has two credits for a power plant and a mine, plus an additional two because they’ve already closed. Then the tier 2 communities added up to 13. When more money came in, we added to the Tri-State communities’ additional earmarks because, to Matt Larson’s point, the uniqueness of the original settlement meant that the utility with facilities in Pueblo, Morgan County, and Routt County had made a significant financial commitment that Tri-State had not made. We saw that as creating an equity question that we tried to address by adding some additional funding earmarks for Moffat and the west end of Montrose County.

Ms. Whitman: It sounds like PBLO did have an earmark. They had one credit, so they had an earmark?

Mr. Buchanan: PBLO has an earmark of right around $930,000, of which they’ve utilized about $450,000 for a position in the mayor’s office to develop a just transition strategy for the city and the county.

Ms. Whitman: Does PBLO have a second earmark, or am I understanding you correctly?

Mr. Buchanan: No, they have a full earmark. We combined the earmarks into one, so they still have about $470,000 left for any eligible entity to apply for. The assumption has been that the community might request that for implementation of whatever plan this first grant resulted in. Ms. Consilia asked about a major infrastructure issue. It certainly would be available to the extent it can be helped with something like that. That’s an allowable use.

Ms. Whitman: So PBLO has more money available?

Mr. Buchanan: PBLO has more money.

Ms. Whitman: You were speaking with Ms. Consilia about whether the term “diversification” appears anywhere in OJT’s statute. Do you remember that testimony?

Mr. Buchanan: I do, yes.

Ms. Whitman: In my OJT box folder, if we could pull up Colorado Revised Statute 8-83-504, please. It should be the top one; I uploaded it this morning. It has an exhibit number, I believe, exhibit 603.

Eric Blank (Chairman): It’s going to need an exhibit number to be in the record. What’s your last exhibit number you’ve used?

Ms. Whitman: If you look in our OJT box, I do have one that has an exhibit number, exhibit 603. I wasn’t sure if you would need that, so I hedged my bets.

Eric Blank (Chairman): I’ve got it. Thank you.

Ms. Whitman: If we could pull that up, please. Sorry, it’s giving me grief, so I’ve got to pull it up another way. It’ll just be another minute. It’s opening right now. Do you mind if I add a header to it when we’re done with it?

Eric Blank (Chairman): Not at all. I should have done that myself, so apologies, but that would be fine.

Ms. Whitman: Thank you very much. Mr. Buchanan, I’ve pulled up a portion of the just transition cash fund section 504 of OJT statute. Have you read this statute before?

Mr. Buchanan: Yes, many times. This is actually the community assistance side of it.

Ms. Whitman: If you can increase the size of this, please. I want to focus specifically on subsection 4. If you could scroll down to 504, 4B1. Are you familiar with this section of the statute?

Mr. Buchanan: Yes.

Ms. Whitman: Does the statute suggest that diversification, in subsection B1 specifically, is mentioned? Do you see that word?

Mr. Buchanan: Yes.

Ms. Whitman: What do you understand the statute to provide? I know you’re not a lawyer.

Mr. Buchanan: I understand the direction to us to be to help the communities diversify, transition in a way that leads to a more diverse and resilient economy, and is less dependent on any one sector. I’m not an economic development expert, but I know enough from what I’ve done here that this is a very common situation for rural communities to be overly dependent on one sector—whether it’s agriculture, gambling, hard rock mining, or, in this case, coal—and therefore very vulnerable to transitions and closures. One of the very strong responses to that is diversification, so that it’s less dependent and more resilient. I see that encapsulated in this section.

Ms. Whitman: One final question. You were discussing with Commissioner Plant about the ratepayer obligations and shareholder obligations. Do you remember that testimony?

Mr. Buchanan: Yes.

Ms. Whitman: OJT has made a suggestion, at least in its testimony, about the Moffat model, right?

Mr. Buchanan: Yes.

Ms. Whitman: That’s potentially something the commission could look at as a roadmap?

Mr. Buchanan: It’s structured a great deal like the USA, in the sense that it’s yearly payments that largely reflect some amount of years of property tax obligation. What is very unique about it is that upfront direct payment that cannot be offset, as a kind of down payment on the economic development activities for the community. That’s something we think is a real step forward. Colleagues in other states are impressed by it. It’s something Moffat should be very proud of, and I think the commission should be very attentive to.

Ms. Whitman: Thank you. Chair Blank, I do not have any other questions for Mr. Buchanan.

Eric Blank (Chairman): Thanks for joining us today, Mr. Buchanan. Be well. You’re excused. Let’s take a 10-minute break till 10:15, and we’ll come back with Ms. Villard and Commissioner Plant’s questions.

Eric Blank (Chairman): Ms. Villard, are you out there?

Melody Villard: Yes, Melody Villard, I am here.

Eric Blank (Chairman): Can you hold up your right hand? Do you swear to tell the truth, the whole truth, and nothing but the truth?

Melody Villard: I do.

Eric Blank (Chairman): You can put your hand down. Is anybody with you or communicating with you in any way?

Melody Villard: No.

Eric Blank (Chairman): If that changes, will you let us know?

Melody Villard: Yes.

Eric Blank (Chairman): Commissioner Plant.

Tom Plant: Good morning, Ms. Villard. How are you doing?

Melody Villard: I’m doing well, thank you.

Tom Plant: I just had a couple of real quick questions for you. I was reading through your testimony, and I wanted to make sure I understood some of the underlying assumptions there. When you have a property like Craig, and you’ve got one plant that’s closing in one year and another plant that’s closing three years later, how do the property taxes work in that case? Is it assessed on the entire facility, so it’s basically five years, or does something happen with the assessed value at year two that modifies things, and then another thing happens at year five?

Melody Villard: I believe that the state assesses on the actual property, not just on what’s owned in the plant here locally, but what the business has throughout the state. I’m not 100% sure on that. It is a state assessment that comes to the county, so what the factors and formulas are in that assessment, I’m not 100% sure. That would come from the state.

Tom Plant: Great, thanks. I’ll try to figure that out from somewhere. I still don’t quite understand how that works. You have a calculation where you’re calculating the lost wages or economic impact, where you take the average salary and the number of employees times five and a half years, and then multiply times 60%, because all employees aren’t from Moffat County or don’t spend the money in Moffat County. Was that calculation intended to be a backstop with respect to reemployment of workers who lose their jobs at those plants, or is it a payment for lost economic impact from the loss of those jobs, regardless of whether they’re re-employed?

Melody Villard: That is more of a lost economic impact overall. 60% of the workforce coming from Moffat County, that economic impact would be lost across the board in our community. It was factored on that.

Tom Plant: So it’s not a backstop against not re-employing those workers?

Melody Villard: No.

Tom Plant: Okay. Reemployment to those workers would potentially have them relocating completely out of Moffat County, and so that impact would be to the economic impact they’ve had in our community to this point?

Melody Villard: Yes.

Tom Plant: In going through those things, I think Ms. Chartrand showed a discovery that identified 38 employees. I think that’s where you got that number from. On the $118,000 average salary, I did a division of the $8.9 million total by the 158 employees at Craig, and I got $56,000. I was wondering where the $118,000 came from.

Melody Villard: The $118,000, I believe, we reached out and pulled a report of what the annual wages were for the plant to average. There was an economic report that I think you had attached in your testimony that showed that total income from employees or the total cost of employees was $8.9 million, and there were 158 jobs. So I just divided those, and I came up with $56,000. I didn’t know if that $118,000 came from some other calculation or from some discovery request.

Tom Plant: I would have to review that in my testimony.

Tom Plant: The five and a half years that went into that, what is that based on?

Melody Villard: The average between the Hayden Units 1 and 2’s early closure dates, those accelerated early closures.

Tom Plant: So this is a combination of the Hayden and the Craig plants?

Melody Villard: It’d be Hayden Units 1 and 2.

Tom Plant: The employee economic impact is based solely on the Hayden Station?

Melody Villard: Yes.

Tom Plant: There’s none of this that’s applied to the Craig Station in any way?

Melody Villard: No, only property tax for the Craig Station.

Tom Plant: Why is that, just curious?

Melody Villard: Because the Hayden Station is in Routt County, and Moffat County is not entitled to property tax in Routt County. We just provide them with the workforce. The property tax requested in the Craig Station is located in Moffat County.

Tom Plant: But you didn’t do a similar calculation for the Craig employees in Moffat County?

Melody Villard: We did not.

Tom Plant: I did see that $118,000 in a discovery request for Hayden, so that makes sense. The 60% was the percentage of those employees that live in Moffat County or spend money in Moffat County, or what was that from?

Melody Villard: The 60% was an assumption that not all of the salary would be spent in Moffat County. We would have property tax from their homes, their investment in groceries, gas, whatever else they’re spending their money on in our community. But recognizing that not 100% of their wage would be spent locally, some of that would be spent out of town, other investments outside of our community. That 60% accounted for not 100% of their wage being directly spent in Moffat County.

Tom Plant: So that was just an estimate?

Melody Villard: Sure.

Tom Plant: Those are all the questions I had. Thank you very much, I appreciate it.

Melody Villard: Thank you.

Eric Blank (Chairman): Thank you, Commissioner Plant. Ms. Chartrand, I assume limited redirect, given Commissioner’s questions?

Ms. Chartrand: Yes, Commissioner Blank. I wondered if we could put Commissioner Villard’s testimony up, that’s hearing exhibit 2100, please. If we could go to page 44, please, and make that a little bit bigger.

Ms. Chartrand: Commissioner Villard, do you recognize this as your answer testimony?

Melody Villard: Yes.

Ms. Chartrand: The first part on page 44 discusses Moffat County and the city of Craig’s request for tax payments for Craig Station Units 1 and 2, is that correct?

Melody Villard: Yes.

Ms. Chartrand: If we scroll down to the second bullet point, which starts at line eight, this explains what Commissioner Plant was just walking you through, correct, as to Moffat County and the city of Craig’s request for community assistance in light of Hayden Station’s closure?

Melody Villard: Yes.

Ms. Chartrand: I’m going to limit my redirect to that, Commissioner Blank.

Eric Blank (Chairman): Thank you. You may be excused, Ms. Villard.

Melody Villard: Okay, thank you. Thanks for joining us.

Eric Blank (Chairman): Mr. Shaw, if you’re out there?

Attorney: Your honor, I have to reach out to him. I had come to the conclusion he wasn’t going to testify until 11, and I will text him right now.

Eric Blank (Chairman): Is Mr. Swearing, we waived him? He’s excused, do we miss? Should we move on to Mr. Haye and come back to Mr. Shaw?

Attorney: That’s okay with me, but I can just text Jeff now if you give me—

Eric Blank (Chairman): Let’s go to Mr. Haye if Mr. Haye’s available.

Attorney: I believe Mr. Haye’s available. Let me just—we had told him about half an hour, so let me see if he’s here. There he is, looks like he’s trying to come online.

Eric Blank (Chairman): Thank you, Mr. Haye, for being available. Can you—

Keith Haye: Sorry about the challenge with the camera, Chair Blank.

Eric Blank (Chairman): You might hold it up a little higher so we can center your face a little better.

Keith Haye: Let me go ahead and lower my desk. I’ll go off camera for a minute and come right back up.

Eric Blank (Chairman): There you are, perfect. Mr. Haye, can you hold up your right hand? Do you swear to tell the truth, the whole truth, and nothing but the truth?

Keith Haye: I do.

Eric Blank (Chairman): Is anybody with you or communicating with you in any way?

Keith Haye: No, there’s no one here.

Eric Blank (Chairman): If that changes, you’ll let us know?

Keith Haye: I will.

Eric Blank (Chairman): Mr. Bennis?

Mr. Bennis: Thank you, Chair. Good morning, Mr. Haye.

Keith Haye: Good morning, Mr. Bennis.

Mr. Bennis: Can you please say and spell your name for the record?

Keith Haye: My name is Keith Haye. The spelling on the first name is K-E-I-T-H, last name is H-A-Y.

Mr. Bennis: For whom are you employed, and in what capacity?

Keith Haye: I’m employed by the Colorado Energy Office, and I am currently the senior director of policy.

Mr. Bennis: Did you cause answer testimony and cross-answer testimony to be filed in this case?

Keith Haye: I did.

Mr. Bennis: Mr. Haye is available for cross-examination.

Eric Blank (Chairman): Thank you. Ms. Consilia, I have 20 minutes for you, and it’s 10:30.

Ms. Consilia: Thank you so much. Good morning, Mr. Haye. How are you doing today?

Keith Haye: I’m well, Ms. Consilia. How are you?

Ms. Consilia: We are just winding down, and you know how these long weeks are, but probably not as tired as some people are. I want to focus on some things that have arisen in the testimony over the last few days to see if you can help clarify some things. First, is the Energy Office taking any position as to whether or not the Moffat model should be used rather than the model that was laid out in the 2021 settlement?

Keith Haye: It's an interesting question. You heard this morning from Mr. Buchanan at the Office of Just Transition that they have put forward the Moffett model as another approach to calculating the value of a just transition to communities. In our testimony, we were supportive of the recommendations of the Office of Just Transition up to the point where it would conflict with the settlement agreement. I agree with Mr. Buchanan that both the underlying requirements in Senate Bill 19-236 and the language in the universal settlement agreement set a floor. The commission, in its decision in the proceeding, was clear that while it accepted the terms of the universal settlement agreement, it may need to do more to effectuate a just transition. The Moffett model is another way for the commission to look at what it may want to do in effectuating that just transition.

Miss Consilia: Can you pull up exhibit 1211 from our box, please? While they're pulling that up, Mr. Haye, I want to discuss the statute that created the clean energy plan, Senate Bill 19-236, in particular subsection 4, Roman numeral 7. I know you're not a lawyer, but you've lived with these statutes and probably do a better job of analyzing some of this stuff than most of the lawyers on the call. Can you see that on your screen, Mr. Haye?

Keith Haye: I can.

Miss Consilia: This is the statute we were trying to apply in the 2021 proceeding. In my opinion, it establishes three components that the commission has authority to order a utility to pay. The first component is workforce transition. Would you agree that's a component of just transition?

Keith Haye: Yes, I would agree with that.

Mr. Ronis: I object to the extent that Mr. Haye is being asked to make any legal conclusions here.

Chairman Eric Blank: It's understood Miss Haye—Mr. Haye is not a lawyer, and the concern is noted.

Miss Consilia: The second component is a community assistance plan for utility workers impacted by the closure. Would you agree with that?

Keith Haye: I would. That appears to be the second and into the third line of the language.

Miss Consilia: The third component is a plan to pay community assistance to local governments or school districts, the voters of which have approved costs expected to be paid from property taxes. Can we agree that's a third component?

Keith Haye: I would agree with that as well.

Miss Consilia: If we can take that down, I'd like to take you back to what we were talking about in the 2021 proceeding and look at some of the evidence that was developed. Can you call up hearing exhibit 1230 from our box? This was the testimony of Holly Velasquez on behalf of Public Service. Do you recall this testimony?

Keith Haye: Only in very broad outlines. I did not review it for this proceeding.

Miss Consilia: If you scroll down to page 11, what Miss Velasquez laid out is the amounts of taxes that Public Service believed were the result of the Hayden unit closing down. You see that 1.6 million per year for Hayden One. If we go to the next page, there was an additional amount for Hayden 2. It was your testimony in this case, as well as Miss Velasquez’s testimony, that the only community that had voter-approved projects to be implemented by the closure was Pueblo. Do you recall that?

Keith Haye: I do recall that. In fact, I believe that piece of my testimony was based on a discovery response we received from Public Service regarding their analysis of the company's obligations to the different communities that were part of the conversation of the universal settlement agreement.

Miss Consilia: Miss Velasquez, on behalf of the company, was suggesting payments in lieu of taxes for Hayden, even though she was not aware of Hayden having voter-approved projects relying on these payments from Hayden. Do you recall that?

Keith Haye: I don’t believe we discussed payments in lieu of taxes during the conversation around the universal settlement agreement. I do recall that the parties to that settlement agreement discussed just transition payments to Pueblo, Hayden, and other communities impacted by coal transitions resulting from the coal plan that was part of the clean energy plan in that 2021 ERP.

Miss Consilia: On page 30 of this exhibit, Miss Velasquez lays out that from the period from 2040 to 2070, Comanche was supposed to produce about $65 million in property taxes. Do you recall that?

Keith Haye: That is what the document says.

Miss Consilia: Your Honor, I would move the admission of this exhibit.

Mr. Ronis: Your Honor, I think this exhibit is hearsay. This person’s not here to be cross-examined. I’ve not reviewed this whole document.

Miss Consilia: Your Honor, I can ask you to take administrative notice of it. It’s in the file, and it’s been used in the 2021 proceeding.

Mr. Ronis: Can you scroll to the top of this thing? I mean, it’s a limited foundation, and the witness isn’t familiar with it.

Chairman Eric Blank: I guess we can take notice of it and attach the weight it deserves with the concerns by Mr. Ronis and the limited foundation. So keep going.

Miss Consilia: Thank you. One of the things discussed in the 2021 proceeding is whether or not Pueblo could request and be compensated for the taxes paid by the minority owners, Holy Cross and CORE. Do you recall that?

Keith Haye: I do. In fact, Pueblo presented testimony that those amounted to between five and a half and $6 million a year.

Miss Consilia: Subject to check, that sounds roughly accurate?

Keith Haye: Yes.

Miss Consilia: The Energy Office did not support, and the commission did not authorize, a payment from Holy Cross or CORE, the minority operators of Comanche, did they?

Keith Haye: There are two questions there regarding the Energy Office’s position and the commission’s actions. I’ll take the second. My understanding is that the commission likely did not take action with respect to Holy Cross or CORE because neither of those utilities are subject to commission jurisdiction. The scope of the 2021 universal settlement agreement, and the 2021 ERP, was Public Service and its emissions reduction plan to meet the 2030 targets and the just transition plans that were a component of that clean energy plan. The commission looked at what was before it in that proceeding and decided on that limited set of issues.

Miss Consilia: CORE had intervened in the 2021 proceeding and was a party, correct?

Keith Haye: I don’t recall that exact fact at the moment, so I’ll say, subject to check, I know there were something like 16 or 19 parties that signed that settlement agreement, and it was a couple of years ago.

Miss Consilia: Do you recall whether or not Holy Cross had intervened and was a party?

Keith Haye: I do believe that Holy Cross intervened, yes.

Miss Consilia: If the Energy Office did not support Pueblo getting compensated for the lost property taxes that CORE or Holy Cross were supposed to pay, why are you now recommending that Public Service be ordered to pay for its minority ownership in the Craig facility?

Keith Haye: Could you show me that testimony? I don’t recall that in my direct testimony in this case.

Miss Consilia: In your answer testimony in the prior proceeding—no, I must have confused you. In this case, you are recommending that the commission order Public Service to pay for its minority interests in the Craig station, correct?

Keith Haye: Correct.

Miss Consilia: Why did you not support Pueblo’s request in the 2021 proceeding whereby they would be compensated for the approximately $6 million a year they were losing when Comanche 3 closed, that CORE and Holy Cross were responsible for?

Keith Haye: Could you show me that 2021 testimony, please?

Miss Consilia: Let’s look at hearing exhibit 1232, which is Mr. Ortiz’s cross-answer testimony and attachments that I’ve relabeled for this proceeding. If you look at this exhibit 1232 on page three, you can see that Mr. Ortiz was sponsoring hearing exhibits that showed the Treasury bills to Holy Cross, Public Service, as well as Intermountain, which is now called CORE. Does this refresh your recollection as to what Pueblo’s claims were in the 2021 case, Mr. Haye?

Keith Haye: My question, Miss Consilia, was not about what Pueblo was asking for in the 2021 proceeding. You have suggested at least twice that I had a particular opinion in my testimony in the 2021 proceeding, and I’m asking to see that testimony to confirm your representation of my position in the 2021 proceeding. I’m not trying to be difficult; I just don’t recall the exact language of what I said in the 2021 proceeding.

Miss Consilia: I did not label that exhibit, so I don’t have that, but subject to check, if I represent that the Energy Office either took no position or did not endorse the Pueblo position, can we agree upon that?

Keith Haye: Subject to check, I think what I would say is that in the 2021 proceeding, the issue was the Public Service clean energy plan and what the company needed to do under the requirements of Senate Bill 19-236 with respect to a just transition. Since that time, the Energy Office has continued to work with the Office of Just Transition and others on different models to move forward a just transition for coal communities impacted by the closure of coal mines and coal plants. You can see that in the work of the Energy Office with respect to Tri-State. It’s clear that the commission in the phase 2 decision in the 2021 proceeding believed that the settlement agreement likely set a floor for just transition requirements and did not fully circumscribe what might be required to implement a just transition. In the intervening four years, the Energy Office, as have we all, has learned more about what might be part of a just transition. We are here supporting a number of the recommendations of the Office of Just Transition, reflecting the learning we have had since that initial conversation in 2021.

Miss Consilia: Would you agree that the commission is still bound by the statute you and I went through, section seven of the clean energy plan, in terms of what it has the authority to order a utility to pay?

Mr. Ronis: Objection, calls for a legal conclusion.

Chairman Eric Blank: We’ll stipulate that Mr. Haye is not a lawyer, and with that, the objection is overruled. Mr. Haye can answer as he sees fit.

Keith Haye: Thank you, Chair. Thank you, Miss Consilia. I think the way I would understand the statute is that it provides direction to the commission for what it must consider, and it’s the three factors you and I discussed already. I don’t think I would read the statute as limiting the commission to considering only those three factors. When you look at some of the language in the statute for the Office of Just Transition, which you talked about this morning with Mr. Buchanan, it’s clear that the state sees a broader set of obligations than just those three requirements. Going back to that phase 2 decision in the 2021 proceeding, the commission itself saw that it may have to do more. The 19-236 statutory language clearly directs the commission to consider a set of factors; I don’t believe it limits the commission to only those factors.

Miss Consilia: Mr. Haye, on behalf of the Energy Office, you did sign the settlement agreement, the original and the updated settlement agreement in 2021, correct?

Keith Haye: I did.

Miss Consilia: Pueblo signed it, so this is my concern. The city and the county signed the settlement agreement, so they have a contractual obligation to support that. I have an ethical obligation to support that. Now what I’m seeing is other people coming in with ideas why there should be more just transition payments than Pueblo received. Is there a question here?

Chairman Eric Blank: Overruled. If you could let her finish the question, that’d be great.

Miss Consilia: Do you think it is fair and reasonable that Pueblo, who’s going to lose close to a billion dollars in property taxes, is bound by the settlement agreement, and the other coal communities are able to ask for more on a conceptual basis than Pueblo got? Do you think that’s fair?

Keith Haye: I appreciate the question. The way I would approach it is this: when we look back at the commission’s decisions in the 2021 proceeding, it set up a process that has yet to conclude. That process included the filing of this just transition solicitation and a follow-on filing or set of filings. It’s a little unclear in the language of the settlement agreement where the commission would determine the final value of the just transition for each of the impacted communities. We have heard clearly from the communities in the northwest that they see the value of the just transition being more than what was in the settlement agreement, which set a floor based on the statutory criteria. It would be up to Pueblo, whether the city or the county, to make the case that more was merited for just transition, in roughly the way that Moffett, Craig, and Hayden have made a case here. We are all, as parties, bound by that settlement agreement. It’s really a question of what, in addition to the settlement agreement, might be merited or warranted. That’s how I would approach answering your question. It would be up to Pueblo to give the commission additional things to consider if it felt that’s what Pueblo needed beyond what is part of the settlement agreement.

Miss Consilia: Do you know the total amount of payments that Hayden is asking for in this proceeding?

Keith Haye: I don’t recall the exact number off the top of my head.

Miss Consilia: It was between 89 and $90 million, if I’m correct?

Keith Haye: Subject to check, that sounds right.

Miss Consilia: In the Tri-State proceeding, the towns of Craig and Moffett got approximately $70 million, correct?

Keith Haye: Subject to check, that sounds accurate.

Miss Consilia: They’re asking for another $28 million, almost $29 million, correct?

Keith Haye: Sounds right.

Miss Consilia: What Pueblo agreed to and to be bound by in the settlement agreement in 2021 was a total payment of $165 million. If we are talking just about the dollar value of the 2021 settlement agreement, then yes, that sounds accurate. There were other terms and conditions, including the filing of this proceeding and the PIAC report to support reinvestment in the Pueblo community.

Keith Haye: Yes.

Miss Consilia: Would the Energy Office support Pueblo’s request to modify the settlement agreement and obtain additional dollars from Public Service in this proceeding or another proceeding?

Keith Haye: I’m hesitating because I don’t know that there is a requirement to modify the settlement agreement. I don’t believe that’s what is going on here. The settlement agreement stands as it is and made a set of determinations based on the three factors in the statute. There is a request by communities here based on evidence they have provided about what their view of a just transition would look like. At some point in this proceeding, the commission will make a determination that will lead to that next just transition proceeding. It would be open to Pueblo participating in that future proceeding, seeking potentially additional payments based on other factors that Pueblo might bring forward, one of which is likely to be the outcome of this proceeding of whether or not there was reinvestment in the community and at what level. If you’re asking me, would we support Pueblo participating in a future proceeding? Yes, absolutely.

Miss Consilia: Would you support Pueblo being compensated for lost property taxes as well as other community assistance, depending on what the commission decides in this proceeding?

Keith Haye: I don’t think I can bind myself or a future Energy Office to what we might do in a future proceeding. We would have to wait until we see that evidence, but I do think it is reasonable for Pueblo to make its case if it feels it should. Sitting here today, based on the state of the record in this case, with Pueblo, in my opinion, contractually and ethically bound to $165 million, do you think, speaking on behalf of the Energy Office, that it is fair that Hayden be awarded by this commission $90 million and that Craig and Moffett be awarded an additional $29 million in addition to the $70 million they’ve gotten from Tri-State? Do you think that is fair?

Keith Haye: The commission hasn’t made a determination about what it will do with respect to Hayden or Craig or the counties. We’ve yet to see what the outcome of the phase 2 proceeding will look like in terms of reinvestment in those communities. I don’t know today that I can opine on a speculative outcome.

Miss Consilia: I have no further questions.

Chairman Eric Blank: Thank you, Miss Consilia. I have CEC next, 15 minutes, and it’s 10:55, Miss King.

Michelle King: Good morning, Mr. Haye. We know one another. I’m Michelle King, and I’m here on behalf of the Colorado Energy Consumers. How are you?

Keith Haye: I’m well, Miss King. Good morning, and it’s wonderful to see you.

Michelle King: Let’s start with your answer testimony, hearing exhibit 400, and I’ll refer our attention to page 14, line 16, please, Miss Federico. There, Mr. Haye, you frame what the commission should consider, and you echoed this paragraph in your cross-answer testimony as well. You say in evaluating the JTS, the commission should consider not only the goals of the 2022 updated settlement, the statutory directive to achieve at least an 80% reduction in emissions by 2030, and how decisions in this ERP align with the long-term strategy of achieving deeper GHG emissions reductions while maintaining reliable, affordable electric service. Is that right?

Keith Haye: That’s what it says, correct.

Michelle King: To unpack this, you understand the statute directs an 80% reduction in emissions by 2030, correct?

Keith Haye: Subject to check, I believe it requires at least an 80% reduction by 2030 and directs utilities to strive to present their customers with 100% emissions-free electricity by 2050, something like that.

Michelle King: You also mentioned in this paragraph reliable, affordable electric service, right?

Keith Haye: Correct.

Michelle King: Ensuring reliable electric service is important to CEO, isn’t it?

Keith Haye: Yes.

Michelle King: Ensuring affordable electric service is also important to CEO, is that right?

Keith Haye: Yes.

Michelle King: If we can scroll back to the discussion beginning on page 12, line 19, and carrying over to page 13, perfect, thank you. Mr. Haye, here you’re discussing the company’s load forecast and the need to rightsize the forecast because a forecast that’s too low may limit opportunity, whereas a forecast that’s too high may drive the acquisition of new resources above what is necessary to meet customer demand and ensure reliability and a risk of cost to customers beyond what is needed. Is that right?

Keith Haye: That is what my testimony says, correct.

Michelle King: You advise that we rightsize our forecasts to avoid jeopardizing reliability, right?

Keith Haye: Our recommendations around the forecast are in part related to concerns around reliability, also affordability, and we’re also considering economic development opportunity as we’re directed to in the governor’s letter. There’s a number of factors here that lead to that Goldilocks challenge, we might call it.

Michelle King: I’m with you with the Goldilocks, getting it just right. Part of that just-right equation is about avoiding imposing costs on customers beyond what is needed. Would you agree?

Keith Haye: Can you restate the question?

Michelle King: Avoiding—you want to get the forecast just right to avoid imposing costs on customers beyond what’s necessary.

Keith Haye: That’s right, and I believe that’s really the purpose of an ERP and the exercise we are currently going through. It is a long-standing practice that one of the goals of phase one in an ERP is to evaluate the load forecast and then to—

Michelle King: You answered my question that we should avoid imposing costs beyond what is necessary, and you said yes.

Keith Haye: I don’t think I answered the question that way. You continued with your explanation about the purpose of an ERP, and I—

Chairman Eric Blank: Miss King, Mr. Haye is very capable and can address your explanation in redirect.

Michelle King: Thank you. From a moment ago, we talked about the statutory requirement of at least 80% emissions reductions by 2030. Do you recall that conversation?

Keith Haye: I do.

Michelle King: Do you agree that for things beyond what’s needed to meet that floor or threshold, we should be evaluating its impact on reliability and cost to customers in an ERP?

Keith Haye: We’re evaluating a number of factors that the commission is directed to consider: first, the size of the load forecast; second, the types of resources necessary to meet that load. We are evaluating those within the context of policy goals set by the general assembly, including greenhouse gas emissions reduction targets, requirements around a just transition, best value employment metrics, and addressing disproportionately impacted communities. The commission is directed to consider a number of factors when it evaluates an electric resource plan, ultimately approving or providing a presumption of prudence for a portfolio of resources that achieves that set of factors.

Michelle King: I’m going to bring you back to my question, which asks specifically about reliability and cost to customers. Do you agree that for things beyond meeting the statutory threshold, we should be evaluating the impact on reliability and cost to customers?

Keith Haye: I don’t think I do because those are two of the factors we have to look at when evaluating an ERP, along with all the other factors I just listed.

Michelle King: It’s your testimony that we still need to consider those things because we always need to consider those things. Is that a fair recap?

Keith Haye: The commission should always be looking at a range of factors, including reliability and affordability, and that’s what it says in my testimony.

Michelle King: If we can turn to your cross-answer testimony, hearing exhibit 402, page five, lines 1 through 4. There, you recommend that the commission ultimately select a portfolio that achieves or exceeds the 80% level of emissions by 2030 as recommended by CC4CA. Is that right?

Keith Haye: Sorry, it’s very small. If we could enlarge it and point me to the particular line, I’m having trouble seeing it.

Michelle King: Lines one through four. Your recommendation is 86% emissions reductions, consistent with CC4CA’s.

Keith Haye: I believe you said 80%. That’s why I was confused; I couldn’t see the 80%. My testimony does say that the commission should select a portfolio that achieves or exceeds the 86% level of emissions reductions that the commission approved in the 2021 ERP.

Michelle King: You agree that is above the floor set forth in the statute of 80%?

Keith Haye: The statutory language speaks for itself that it’s at least 80%, and 86% is bigger than 80%.

Michelle King: Has CEO performed a study of the impacts of CC4CA’s recommendation on reliability?

Keith Haye: The recommendation for an 86% level is part of what we would be doing in this ERP. That’s the goal of ERP modeling.

Michelle King: In making that recommendation, you don’t yet know the impacts on reliability, correct?

Keith Haye: The 86% level was approved in the 2021 electric resource plan. The commission found that—

Michelle King: I understand the origins of it. What I’m asking is, you don’t know, as you sit here today, the impacts that recommendation has on reliability. I’m very short on time here.

Keith Haye: I’m happy to answer the question. The commission approved that level of emissions reductions in the 2021 ERP. I don’t believe the commission would approve a level of emissions reductions that it believed was not reliable.

Michelle King: I have full faith and confidence in the commission, as do I. CEO does not know today the impacts that recommendation has on reliability, correct?

Mr. Ronis: Objection, asked and answered.

Michelle King: It hasn’t been answered, respectfully, Your Honor.

Chairman Eric Blank: Overruled. If you could repeat the question, Miss King.

Michelle King: Has CEO performed—CEO does not know, as it sits here today, the impacts that recommendation has on reliability, correct?

Keith Haye: We have a plan that meets an 86% emissions reduction already that the commission found to be reliable.

Michelle King: Has CEO performed a study of the impacts that CC4CA’s recommendation would have on costs?

Keith Haye: We have not.

Michelle King: Mr. Haye, you were active on behalf of CEO during the 2025 legislative session, correct?

Keith Haye: Correct.

Michelle King: You are aware of efforts from the session to advance legislation that would have accelerated current requirements for emissions reduction, having utilities meet a 100% emission reduction by 2040. Are you aware of that?

Keith Haye: I would describe it slightly differently, but yes, we were actively engaged in a bill that would have put in place a planning process to achieve the deepest emissions reductions possible by 2040, consistent with maintaining reliability and affordability.

Michelle King: Miss Federico, can we please pull up hearing exhibit 1002? I believe it’s already been admitted by Mr. Rushoff, if that helps in terms of timing. Mr. Haye, have you seen this letter before?

Keith Haye: I have.

Michelle King: Have you reviewed this letter previously?

Keith Haye: I have not looked at it in probably a month or so, but yes.

Michelle King: Miss Federico, if we can scroll down towards the bottom of the page to the paragraph “we were surprised,” and, Miss King, would it be possible to enlarge this just a little bit? My eyes are old, and I’m having trouble seeing it on the screen, if that’s okay.

Keith Haye: Thank you. I see the paragraph you wanted me to.

Michelle King: In the middle of that paragraph, in the third line, it reads, “amongst several concerns,” and then it says, “this draft seriously risks driving energy costs higher at a time when our state is already nearing an affordability crisis.” Continuing on, it says, “customer impacts and reliability must be top of mind as we continue forward with the energy transition.” Are you familiar with that part?

Keith Haye: That is what the letter says.

Michelle King: While the legislation ultimately didn’t go forward, you understand these expressed concerns about accelerating the energy transition requirements with respect to reliability impacts and cost, correct?

Keith Haye: That is the position of the signatories to this letter. As I said to you previously, Mr. Haye—

Michelle King: You are aware of those concerns?

Keith Haye: I am aware that that is their view of this proposed piece of legislation.

Michelle King: Given your involvement, I believe your words were that you were actively involved in the session. Hearing these concerns from the 60-odd signatories to this letter, is that something that CEO takes seriously?

Keith Haye: It is absolutely something that CEO takes seriously, which is why we structured a policy intended to achieve the deepest emissions reductions possible while maintaining reliability and affordability and actually had provisions for both of those things in the draft language.

Michelle King: But you don’t know the impact of that recommendation on cost, correct? That’s what your testimony was a moment ago.

Keith Haye: The impact of which recommendation—the statute or the 86%?

Michelle King: The recommendation that you advanced in your testimony. We supported CC4CA’s recommendation to utilize the previously approved 86% emissions reduction as a floor in phase 2 modeling in this ERP. In response to your question about whether or not we conducted an independent assessment as to the economics of that, I did agree that we had not done that.

Michelle King: Is it possible that using an 80% emissions reduction, as required by the statute, might yield a portfolio that has improved reliability and better costs than what your recommendation of 86% yields?

Keith Haye: I would express differently what the statute directs. The statute directs at least an 80% emissions reduction by 2030, and there are a number of—

Michelle King: I want to make clear in the record, it’s your testimony that the statute directs at least 86% emissions reduction?

Keith Haye: Sorry, at least an 80% emissions reduction. Miss King, I misspoke.

Michelle King: Thank you very much. I have no further questions.

Chairman Eric Blank: Thanks, Miss King. I think we have 20 minutes for the company, Mr. Larson, 11:13.

Matt Larson: Good morning, Mr. Haye.

Keith Haye: Good morning, Mr. Larson. How are you?

Matt Larson: I’m well, thank you. It’s nice to see you. I just have a few questions for you this morning. If we could pull up hearing exhibit 144, which is modified SJD9. Mr. Haye, do you see hearing exhibit 144 on the screen?

Keith Haye: I do.

Matt Larson: I’ll represent to you that this document is attachment SJD9, which was hearing exhibit 2606, and it’s got a series of changes throughout it marked in red. You see that?

Keith Haye: I do.

Matt Larson: Have you seen this document before?

Keith Haye: I have.

Matt Larson: With the changes reflected in this modified SJD9, CEO is joining the tri-party framework, isn’t that true?

Keith Haye: Subject to renaming it the quad-party framework, yes, we are in fact joining the other three parties in supporting the framework.

Matt Larson: That was actually going to be my next question, whether the quad-party framework would confuse you or not. That sounds like it will not. If we could go to the changes on page two, please, Miss Federico. Mr. Haye, these changes clarify support of using the updated base forecast and add a table that converts probabilities to steps, isn’t that true?

Keith Haye: That’s correct.

Matt Larson: If we could roll down to page five, there’s a series of changes that make clear that incremental need pool activations are based on aggregate load ramps associated with the activation, correct?

Keith Haye: That’s correct.

Matt Larson: This was actually something important to the Energy Office. There’s also an addition here that for aggregated load ramps greater than 500 megawatts during the relevant RAP, Public Service be required to file an application on a 120-day timeline. Do you see that?

Keith Haye: I do.

Matt Larson: An emissions verification workbook along with that application, and CEO supports the addition of this third swim lane, so to speak, of incremental need pool activations, correct?

Keith Haye: We do.

Matt Larson: If we could go back up to page two, please, Miss Federico. There, in the fifth bullet, you see where the red is, and it says one of the principles that the now four parties support is the use of the updated base forecast approach for the JTS base RFP. Do you see that?

Keith Haye: I do.

Matt Larson: In your answer testimony, hearing exhibit 400, at page 26, you state as follows: it is important the commission approve a load forecast that is not overly speculative and that balances customer affordability and meeting emissions reduction targets with development at a pace and scale that meets realistic new customer needs. Do you recall making that testimony?

Keith Haye: I do.

Matt Larson: The updated base forecast approach meets this objective, isn’t that true?

Keith Haye: I believe that it does. This is sort of that Goldilocks challenge I was talking about with Miss King. When we looked at where the updated base forecast landed, it had a reasonable amount of building and transportation electrification consistent with the state’s emissions reduction goals more broadly. It included a series of strategic economic development customers, in the company’s nomenclature, that we believe best understand the direction they are headed in terms of growth. It also included a number of large load customers that met the requirements of being included in that updated base forecast. In our view, it reasonably balanced reliability, affordability, and the economic development opportunity that the Energy Office has been directed to look at in the letter from Governor Polis.

Matt Larson: You mentioned the strategic economic development opportunities included within the updated base forecast. Those are important loads for the state of Colorado, isn’t that true?

Keith Haye: Yes.

Matt Larson: One of those is the Denver International Airport expansion, which is important to the state of Colorado, isn’t that true?

Keith Haye: I’m not an expert on economic development opportunities, but my recollection and understanding is that the tourism industry and the conference industry are important to the state of Colorado as economic drivers, and the airport is fundamental to being able to do that work. So yes, I think DIA is a huge economic driver both locally and at the state level, and it’s an important customer.

Matt Larson: Thank you, Mr. Haye. Mr. Chair, I have nothing further.

Chairman Eric Blank: Thank you, Mr. Larson. Commissioner Gilman, questions for Mr. Haye?

Commissioner Megan Gilman: Yes, I don’t have an incredibly long timeline here, but I want to see if you wanted to go first with your time restrictions, or if it’s fine for me to go first.

Chairman Eric Blank: If you would go, that’d be great.

Commissioner Megan Gilman: Good morning, Mr. Haye.

Keith Haye: Morning, Commissioner Gilman. Good to see you.

Commissioner Megan Gilman: Good to see you. Just a couple of questions for you. Is it fair to say you had concerns in your answer testimony with ensuring that any large load strategy here is supportive of Colorado’s emissions trajectory?

Keith Haye: It is fair. That was really when we were talking with the company about supporting the framework agreement. We wanted to make sure that, especially for those really large customers, the 500 and above segment, the commission would have a little more time to evaluate those customers and their impacts on emissions reductions. That was part of our coming onto that framework—the 120-day timeline in an application process where parties would have the right of discovery, where the commission would have more time to review, and where it was clear we’d have an emissions reduction workbook.

Commissioner Megan Gilman: To my understanding, that process is particular to when you have an individual large load customer who would ramp up to 500 megawatts or more in the RAP. Is that fair?

Keith Haye: I would describe it slightly differently. It could be one customer, or it could be an aggregation. You could imagine five 100-megawatt customers where the company comes forward with an application seeking to supply resources to meet the load for those five individual customers. It really is either one customer that’s 500 megawatts or an aggregation of customers that adds up to that to trigger that application process.

Commissioner Megan Gilman: That’s the activation of the incremental need pool at a level of 500 megawatts or more. There are three different ways in which the incremental need pool is triggered, based on the capacity coming forward. The third one is that 500 and above, but then there’s 99 and below, and 100 to 500 range. Each of those has slightly different provisions with respect to the timeline, but all would be required to have an emissions verification workbook accompanying that.

Commissioner Megan Gilman: Are there—the smaller load triggers would have less process, but they would still have emissions information?

Keith Haye: That’s our understanding, yes. They would all have that. For example, the lowest category of trigger might be where a bid comes in, a bid isn’t effectuated for some reason, and the company needs to pull out of the incremental need pool to replace a failed bid. If it’s a wind farm for a wind farm, the analysis is probably relatively easy. If the resources change, there’d be maybe some additional review needed. That’s why the Energy Office was comfortable with the different timelines in each of those different categories or buckets, because the amount of capacity replacing changes.

Commissioner Megan Gilman: The assumption is a triggering of the incremental need pool from a failed bid, so long as it’s substituted by the same resource type, the same technology, wouldn’t trigger a reassessment of emissions because ideally, it should be the same. It’s just these large loads—anytime large loads trigger the incremental need pool, we get new emissions data, and then the timeline and process change a little depending on the size?

Keith Haye: I think that’s right. We really focused on those two bigger buckets, the 100 to 499 and 499 and above. The real difference between those two is the 100 to 500 is on a 45-day clock, and the 500 and above is on a 120-day clock with an application process around it, whereas the 100 to 500 doesn’t have the application process; it’s a notice process to the commission, but you will have the emissions verification.

Commissioner Megan Gilman: With regard to the emissions verification, are there certain requirements or guidelines around what that emissions verification shows? We have the floor in statute for 2030, a projection a decent amount in excess of that in the 2021 ERP for 2030, and an agreement from the USA regarding 2033. There’s a lot of moving targets here. What I’m wondering is, we’ll get submission of the emissions data, there’s a lot of expectations around what trajectory we’re on, so is that to be litigated, to be figured out, or are there other expectations around what the targets should be if resources are triggered to serve the load?

Keith Haye: It’s a great question, Commissioner. It comes down to what the company has called solution sets. There are two questions for the commission to consider: what are the solution sets as it moves from phase one to phase two, and as we move into the incremental need pool process, how do you work with whatever solution set was adopted in that process? The just transition solicitation is the finishing off and culmination of the clean energy plan process to achieve the 2030 emissions reduction targets. In our testimony, and in conversation with Miss King, we have advocated that the commission utilize the 86% emissions reduction adopted in the 2021 ERP for moving forward into the phase 2 solicitation process. In our minds, that phase 2 process would go from 86% through 90%, which is part of the emissions reduction trajectory from the universal settlement agreement, out to a zero emissions reduction by 2050, consistent with the state’s long-term trajectory of reaching net zero by 2050. I agree with Miss O’Neal from staff yesterday; I don’t love the term checkpoint cases, but because this proceeding is the culmination of that 2030 ERP planning process, we need to benchmark what the clean energy plan costs are here. In no way should the commission use a checkpoint case for decision-making purposes about resources. It’s trying to understand which costs would be eligible for the clean energy plan rider and which would not be. In my mind, and in the position of the Energy Office, as we move from 86 and 90 to 100 in phase two, that’s the trajectory we should carry forward through the implementation of the incremental need pool, as long as we find that it is both reliable and affordable.

Commissioner Megan Gilman: Help me understand your position on portfolios. Staff put forth in SJD10 a list of portfolios where more than half maintain the 86% in 2030. I know SWEPCO said the majority of portfolios modeled should maintain the 86% by 2030. I’d like to hear your impression of those portfolios and if you think it is suitable or acceptable to have some portfolios, as they do, that are 80% by 2030.

Keith Haye: I appreciate the question. I agree with the company and staff that we need to place reasonable limitations on the number of portfolios or solution sets we’re looking at so we don’t end up where we did in the last ERP. I agree that staff’s approach of picking a preferred portfolio and looking at a set of sensitivities around single-variable changes, like gas prices or tax credits, makes sense. The checkpoint case is necessary to determine what goes into the rider. Our preferred approach is to utilize the 86, 90, and 100, but it would be reasonable for the commission to look at a series of cases that utilize the 80, 90, and 100 to understand what the cost difference might be, if there is a cost difference, for achieving those emissions reductions. It’s important that the commission utilize the social cost of carbon in the modeling, as that’s a statutory requirement for clean energy planning. As you’re considering which solution sets or portfolios to consider, having that reference set of cases, having 86, 90, 100, and an 80, 90, 100 all make sense for modeling purposes. We think the 86, 90, and 100 should be the solution set the commission utilizes for decision-making purposes.

Commissioner Megan Gilman: In answer testimony, SWEPCO and Miss Valentine advanced the idea that if the incremental need pool is activated, especially to serve large loads, the emissions trajectory be maintained, and even if that comes at an additional cost, the solution would not be diminishing the emissions trajectory but allocating those costs to the new customers as a cost of maintaining the trajectory due to adding them. Any thoughts on that?

Keith Haye: There are a couple of things in this proceeding that give the commission new tools in the near future. We’ll have the large load tariff to help address how we bring on new resources to meet new large load customers. The agreement on the framework, where we have a proceeding for loads in aggregate above 500 megawatts, means if we’re getting a data center or two, those customers would trigger that process. The commission would have an expedited proceeding to evaluate what the resources are and what alternative resources might be. It’s challenging today to suggest an answer to a future problem, but from the Energy Office’s perspective, we’ve tried to make recommendations around different tools the commission could utilize when it sees that challenge to figure out the right path forward.

Commissioner Megan Gilman: I believe the Energy Office advocated in answer testimony for modeling, both from a transmission and generation sense, the company joining an organized wholesale market like a full RTO, as they’re statutorily required to do. We don’t see that in staff’s list. Is that what you’re still advocating for, and if so, it sounds like there’s discussion about not having the right inputs on how to model that, which market? I wanted to get an update on your current thinking around whether that’s still necessary and how you would recommend that be done.

Keith Haye: The company is statutorily directed to be in an organized wholesale market absent some commission findings. The Energy Office has recently started to re-evaluate whether utilities should be moving into FERC-jurisdictional proceedings, given some presidential executive orders and efforts by the Secretary of Energy to utilize FERC to force fossil-fired plants to remain open, even when the commission and utilities are clear that represents an unnecessary cost to customers from a reliability perspective. We’re looking at whether it continues to make sense in this current federal regulatory climate to be as aggressive moving into markets where they may lose their ability to ensure Colorado can meet its emissions reduction requirements. That said, I think the company should model moving into an organized wholesale market, but it’s challenging to figure out today if that is Markets Plus, RTO West, or if the commission would like to look westward. There’s advocacy in all directions on that question. In a different proceeding currently before the commission, we’ve said the company should look at all those options as it considers where it needs to be in 2030. The best outcome would be to understand the cost and benefits of each move from an emissions perspective and a customer cost and savings perspective. I haven’t really answered your question, Commissioner Gilman. There’s a lot of options on the table for the company, and it’s hard to suggest we need four more model runs looking at each of those different market options.

Commissioner Megan Gilman: On a potential approach, especially since I haven’t heard anyone volunteer the right inputs to put into this sort of run, given your quad-party framework that sets up a supplemental RFP, which would rerun phase two in 2027, and given how many things are up in the air federally, would an appropriate course be to look at this as an issue for the supplemental RFP modeling and, in the interim, do some stakeholder work to identify what a reasonably characteristic run would look like in terms of inputs, what we pick to model, or do we model two options, and make this a supplemental RFP effort where we have the time to establish what we would really want to run?

Keith Haye: Commissioner Gilman, that’s an elegant solution to move forward today, to give parties direction to work together to think about what this looks like and bring it back in the next RFP. It’s a both-and solution, and I think it’s completely reasonable and elegant to the challenge we’re all facing today.

Commissioner Megan Gilman: One other question—I know I said two before, but I came up with a new one. With regard to updates to the forecast, this one’s got wilder things going on that we need to forecast around than in the past. If there are major forecast shifts in large load, assumptions, and economic forecast, both for the base RFP and the supplemental RFP two years from now, what level of comfort do you have around there being essentially no process to vet or provide feedback? What might a mechanism look like, especially given the very large moving parts here?

Mr. Keith Hay: For the base RFP load forecast, we came into the proceeding concerned about where the base forecast was, as reflected in our answer and cross-answer testimony. Through the course of the proceeding, as the company refined that forecast and we learned more about different customer categories, we’ve become comfortable with the current base forecast the company has put forward. This includes the level of economic growth, electrification, strategic economic development customers, and new large loads.

As we move forward, a couple of tools can help address this concern. What I hear you speaking to, Commissioner Gilman, is not the concern about updating the load forecast but the new large load customers, like data centers, and their impacts. The tariff filing, a potential outcome of this proceeding, would be helpful in handling those one-off customers. To the extent they come through the incremental need pool process, we have that. There’s also an opportunity to look at those customers in an update to the RFP forecast.

The unique aspect of the load forecast we’re facing is these new large customers coming at a pace and scale we haven’t seen before. We’re putting in place a process to help the commission manage their emergence and bring them onto the system in a way that maximizes benefits, putting downward pressure on rates while minimizing costs.

Commissioner Megan Gilman: Thank you, Mr. Hay.

Commissioner Tom Plant: Do you mind if I ask a question for Mr. Hay first?

Commissioner Megan Gilman: Go for it.

Commissioner Tom Plant: Mr. Hay, compared to its direct case, Mr. Ali and other company witnesses testified that wind prices are up 74%, solar by 84%, and storage by just under 25%. In the rebuttal case filing, I think CTs are up over 40%. The cost and rate impacts of these clean energy price increases have not been modeled or quantified in any meaningful way on this record. Given that reality, any advice on how this commission can get comfortable mandating greater emission reductions than those required by statute if we don’t understand the cost and rate impact?

Mr. Keith Hay: Fair question, Commissioner Plant. It’s always great to see you, Chair Blank. In my conversation with Commissioner Gilman, we were clear that the energy office, while looking for the commission to model the 86% and 100% scenarios, also thinks it’s important to model the 80% and 100% scenarios. If the commission wanted to model an 80% and 100% scenario bypassing the 90%, that might be reasonable in light of the changes in prices.

Having the 80% and 100% and 86% and 100% scenarios would give you a sense of what it would cost to minimally meet the emissions reduction requirements in statute, whether that can be done under the cost cap, and what incremental costs you might incur to achieve a deeper emissions reduction in the 86% by 2030 timeframe.

My answer is to have those two benchmark cases as a tool to decide the right 2030 emissions reduction trajectory. There’s a cost cap provision in the 2030 clean energy plan statutory language, and the commission could look to that if needed. So, three tools: don’t make any decision in the phase one process, set up a series of scenario analyses in phase two to generate the information needed, and wait until you have actual bids and costs on portfolios to make that determination.

Commissioner Tom Plant: That’s the recommendation?

Mr. Keith Hay: Yes, wait until you have actual bids and costs.

Commissioner Tom Plant: Thanks, Mr. Hay. Good morning, still. I think most of my questions have been answered. I just wanted to ask your perspective. You were talking to Commissioner Gilman about the checkpoint portfolios and the necessity for those to establish what the rider would be based on. One of my concerns is that we’re running these models with a transmission adder, which biases a model, particularly when you remove all the emissions requirements around it.

Both you and Ms. O’Neal have postured that it’s not something we need for portfolio selection, so it’s technically something we could do after the fact. Maybe remove the various adders and compare it to whatever portfolio we end up selecting to determine the true incremental cost, if any. Does that make sense to you?

Mr. Keith Hay: I think so, Commissioner Plant. The company and staff landed on roughly 14 portfolios, two of which were the checkpoint cases. Essentially, drop those two, run the dozen, the commission would land on a preferred portfolio, and then go back and figure out the incremental cost to flow into the rider. That’s what I hear you suggesting. It’s a different way of doing it, but I don’t see why the commission couldn’t do it that way if it wanted to.

Commissioner Tom Plant: One of the things in freeing up those two is potentially going to the other parties outside of the staff and the company for portfolios that the parties think are important. One proposal is a run that considers no PTC or ITC, which may be a realistic assumption. There was discussion around the wholesale market. Commissioner Gilman offered a way to address that, and Ms. O’Neal indicated it wouldn’t change since the reliability rubric or loss of load is going to be 0.1 anyway. You’ve talked about emissions levels being a criterion. Are there any other things we should consider as alternative runs if we had a couple of additional models?

Mr. Keith Hay: It’s an excellent question, Commissioner Plant. I’ve been focused on landing in a place where it’s a manageable number of model runs, recognizing the commission needs to set a lower and upper bound from an emissions reduction perspective. We’re happy to think about that and potentially opine in a statement of position on what additional runs would be valuable or necessary.

The framework that staff laid out, having model runs sufficiently different to give the commission a unique look, is worth considering. I remember a couple of ERPs where we did a lot of work to get different looks and ended up with a net present value within a percent or two of each other. I wouldn’t want the commission to do a lot of work to end up in a place where you haven’t learned anything interesting. There’s already a lot of model runs that might give you different looks that could be valuable for decision-making, but we’re happy to think about that.

Commissioner Tom Plant: Great, I appreciate it. That’s all the questions I had.

Commissioner Megan Gilman: Mr. Bonis, I have a hard stop at noon. Do you have more than 10 minutes?

Mr. Bonis: I can do it.

Ms. Consilia: Your honor, I’m going to waive Ms. Valentine, and I think that’ll ease up your schedule this afternoon. Mr. Shaw is logged in and available after lunch. I would appreciate if we can give him a time certain at 1:00 p.m.

Mr. Bara: Nothing for me, thank you, Chair.

Commissioner Megan Gilman: Mr. Bonis, if we could do this in 10 minutes or less, that would be great.

Mr. Bonis: Pretty sure I can. Mr. Hay, I’ve got three things I want to clear up with you. The first involves a conversation you had with Commissioner Gilman. I thought I heard you say that CEO thinks for loads less than 100 megawatts that trigger the incremental need, the framework would require an emissions workbook. Did I mishear?

Mr. Keith Hay: I may have misspoken. I thought it did, but I may have misremembered.

Mr. Bonis: Can we open hearing exhibit 144 and scroll down to page five, please? Could we make it a little bigger? Mr. Hay, there are circled bullet points, two of them. The first says the company would provide an updated emissions verification workbook for loads with a ramp greater than 100 megawatts, and the second in red says for loads with a ramp greater than 500 megawatts. Do you see that?

Mr. Keith Hay: I do. It refreshes my recollection. I mischaracterized when talking with Commissioner Gilman and misremembered the distinction between 100 to 500, 500 and above, and what was below 100.

Mr. Bonis: To be clear, is it your testimony that the workbook is only required for loads greater than 100 megawatts?

Mr. Keith Hay: That is what is in the framework currently.

Mr. Bonis: You can pull that down. The second thing was you were talking with Ms. King about the letter concerning the 2020-25 legislation. You started a sentence about the draft seriously risking driving costs higher. I wanted to give you the opportunity to finish your thought.

Mr. Keith Hay: Thank you, Mr. Bonis. What I was trying to articulate was that the signatories to the letter who opposed the legislation represented those as their concerns. That was not the concerns of the energy office at the time. Our view was that we had crafted a starting point for discussion that included an emissions reduction requirement through 2040 but also had provisions for reliability and affordability. I was disagreeing with the representation of the letter that our framework didn’t account for those things. We believe it did.

Mr. Bonis: Thank you. Finally, you were talking with Ms. King about factors in ERPs. I feel like you got cut off. What do you believe is the purpose of resource planning?

Mr. Keith Hay: You can find the purpose of resource planning in two places. There’s clear direction in the commission’s rules around resource planning, where it’s articulated that the goal is to determine the resource need and the portfolio to meet that need, consistent with expanding the use of renewable energy and minimizing the net present value revenue requirement. That rule language guides the commission.

We’ve articulated in testimonies over the last several years a number of statutory changes that are incumbent on the commission to consider as it evaluates a just and reasonable outcome in a resource planning process. These include emissions reduction requirements through 2030, statewide or economy-wide 2050 emissions reduction targets, just transition, environmental justice considerations, and best value employment metrics. These have statutory direction to the commission.

One part of the commission’s four-part mission is achieving the social and environmental policies of the state of Colorado. The commission needs to look at the different statutory directions they’ve been given as they evaluate an ERP. My disagreement with Ms. King was that she focused on one or two of those, and it’s much more difficult for the commission because it’s a balance of many factors.

Mr. Bonis: Thank you, Mr. Hay. Chair, I did it in six minutes. Enjoy your afternoon.

Chairman Eric Blank: You’re a man of your word who didn’t have full control over his witness. Thank you, Mr. Hay. Nice to see you. Thanks for joining us today. You may be excused.

Mr. Keith Hay: Good to see you, Chair. Thank you.

Chairman Eric Blank: With that, let’s take a break till one. Commissioner Gilman, if you can put on Mr. Shaw and then Ms. Valentine, I’ll be listening on my cell and back at 1:30. If you would be willing to do that, that’d be greatly appreciated.

Commissioner Megan Gilman: We’ll do. See everyone at one.

Chairman Eric Blank: See everybody at one. Thanks all.

Commissioner Megan Gilman: Welcome back. It is 1:00, and I will be filling in for the chairman due to some availability issues for a short time here. I’ll take full credit for bringing us to an on-time conclusion later today. Before we get started, Mr. Larson, what do you have?

Mr. Matt Larson: Thank you, Commissioner Gilman. The company is going to waive its cross-examination of SWEEP witness Ms. Valentine. I think we were the only remaining cross-examination for her.

Commissioner Megan Gilman: I still have a couple of questions for her. Mr. Bara, were you on?

Mr. Bara: I see Mr. Priu has his hand up as well. I had a few minutes for CEC.

Commissioner Megan Gilman: That’s right. CEC still has a brief cross for Ms. Valentine. So, we’ve got CEC and commissioner questions for Ms. Valentine. Anything else on schedule or other procedural matters before we get started?

Mr. Bara: No.

Commissioner Megan Gilman: With that, we are back on the record. We’ll welcome up Mr. Shaw if he’s available.

Mr. Jeff Shaw: Good afternoon.

Commissioner Megan Gilman: Good afternoon, Mr. Shaw. Can you please raise your right hand? Do you swear to tell the truth, the whole truth, and nothing but the truth?

Mr. Jeff Shaw: I do.

Commissioner Megan Gilman: Is anyone with you or communicating with you in any way?

Mr. Jeff Shaw: No.

Commissioner Megan Gilman: If that changes, can you please stop and let me know?

Mr. Jeff Shaw: Absolutely.

Commissioner Megan Gilman: Thank you, sir. Go ahead, Ms. Consilia.

Ms. Consilia: Mr. Shaw, will you identify yourself and please spell your last name, although it’s only one syllable, so it’s probably pretty easy?

Mr. Jeff Shaw: My name is Jeff Shaw. I’m the president and CEO of the Pueblo Economic Development Corporation. The last name is S-H-A-W.

Ms. Consilia: You submitted testimony in this case, hearing exhibits 1200 and 1205 with some attachments. If those have been admitted into evidence already, if I were to ask you the same questions today, would you have the same answers that are in exhibits 1200 and 1205?

Mr. Jeff Shaw: I would.

Ms. Consilia: Thank you, your honor. We’ll start with EJC.

Mr. Michael Hyatt: Good afternoon, Mr. Shaw. My name is Michael Hyatt. I’ll be asking you questions on behalf of the Environmental Justice Coalition, or EJC. I’d like to talk about what a just transition looks like for Pueblo according to the Pueblo Economic Development Corporation and the local governments. Is it the case, in your view, that one important component of a just transition is replacing the lost property tax revenues from the Comanche coal plant?

Mr. Jeff Shaw: It’s one aspect of it, absolutely.

Mr. Michael Hyatt: As far as your overall recommendation in this case for what a just transition includes, is it only a new natural gas plant in the short term and advanced nuclear in the long term to make Pueblo whole?

Mr. Jeff Shaw: That’s correct.

Mr. Michael Hyatt: You want Public Service to build a gas plant in Pueblo through this ERP process and to build an advanced nuclear facility in Pueblo in a future ERP?

Mr. Jeff Shaw: That’s correct.

Mr. Michael Hyatt: If we could please pull up hearing exhibit 1200, attachment JCS1. Mr. Shaw, this document you attached to your testimony is the January 2024 PISAC report, right?

Mr. Jeff Shaw: That’s correct.

Mr. Michael Hyatt: You personally served on the PISAC committee?

Mr. Jeff Shaw: I did, yes.

Mr. Michael Hyatt: Can we please scroll down to page four? If we could zoom in a little bit towards the top of that page. Can you see the text okay, Mr. Shaw?

Mr. Jeff Shaw: I can lean forward a little bit. I can make it bigger if needed.

Mr. Michael Hyatt: Maybe a little bit. That’s good. Mr. Shaw, can you see here in the first full paragraph on this page that the report states that Comanche 3 generates $31 million per year in overall property tax payments across its three owners?

Mr. Jeff Shaw: Yes.

Mr. Michael Hyatt: That $31 million represents the property taxes paid by Xcel Energy, CORE, and Holy Cross, if I understand it correctly?

Mr. Jeff Shaw: Yes.

Mr. Michael Hyatt: Can we now scroll down to page 16, towards the bottom of that page? Mr. Shaw, this page begins section seven, where the report discusses the zero and low-emission technologies the PISAC considered, is that right?

Mr. Jeff Shaw: Yes, that’s correct.

Mr. Michael Hyatt: If we could now scroll down two pages to page 18. These tables here show the annual salaries and property taxes generated by the various technologies that were studied, is that right?

Mr. Jeff Shaw: That’s correct.

Mr. Michael Hyatt: If we could focus on the bottom table here, doesn’t it show that a combined cycle gas turbine with carbon capture would generate approximately $16.5 million in annual property tax revenues?

Mr. Jeff Shaw: It does say that, yes.

Mr. Michael Hyatt: Just to the right of that, it shows that an advanced nuclear facility would generate approximately $95.2 million in property tax payments per year, right?

Mr. Jeff Shaw: Correct.

Mr. Michael Hyatt: It’s always a little dicey to ask a witness to do math, but I feel confident you and I could do this basic addition. If you add that $16 million and $95 million, that adds up to about $111 million in annual property tax payments, would you agree?

Mr. Jeff Shaw: I’ll take your word for it, yes.

Mr. Michael Hyatt: Under Pueblo’s preferred outcome, the company would replace the $31 million in lost property tax payments from Comanche 3 with two new resources that generate $111 million in property tax payments, correct?

Mr. Jeff Shaw: Correct.

Mr. Michael Hyatt: Under your proposal, Public Service would pay $80 million more per year in property tax payments than Public Service, CORE, and Holy Cross currently pay for Comanche 3, right?

Mr. Jeff Shaw: Correct.

Mr. Michael Hyatt: Ultimately, wouldn’t it be the Public Service ratepayers who would be responsible for paying that additional $80 million per year in property tax payments under your proposal?

Mr. Jeff Shaw: I would assume so, but I can’t necessarily comment on who pays for it. I assume the ratepayers would certainly have a portion of that.

Mr. Michael Hyatt: Thank you, Mr. Shaw. That’s all the questions I have for you.

Commissioner Megan Gilman: Thanks, Mr. Hyatt. Next, I have the company with five minutes.

Mr. Matt Larson: Good afternoon, Mr. Shaw.

Mr. Jeff Shaw: Good afternoon.

Mr. Matt Larson: For the record, I’m Matt Larson. I represent Public Service. Are you familiar with the structure put in place through the updated settlement agreement in Xcel’s clean energy plan that provides community assistance payments to Pueblo County but also allows for an offset in the event that replacement generation comes into the community?

Mr. Jeff Shaw: I am aware of it, yes.

Mr. Matt Larson: The way that’s structured is that there’s a set of committed community assistance payments, and in the event that replacement generation or infrastructure is cited, that offsets the community assistance payments, is that right?

Mr. Jeff Shaw: That’s correct.

Mr. Matt Larson: You have a background in economic development, right?

Mr. Jeff Shaw: I do, absolutely.

Mr. Matt Larson: You work on economic development projects across southern Colorado, isn’t that true?

Mr. Jeff Shaw: I do.

Mr. Matt Larson: From the perspective of receiving a payment or receiving replacement generation and infrastructure, which one is better from an economic development perspective, and why?

Mr. Jeff Shaw: Replacement is certainly better than just receiving payment of taxes because there’s additional economic benefits for the replacement. If we’re talking about property taxes, there’s economic benefit on top of that. You’re going to have jobs attached to that, additional investment into the community, indirect jobs, induced jobs, and primary jobs associated with that. The replacement technology is much more critical than just a payment in lieu. That’s a small portion of the economic benefit to the community.

Mr. Matt Larson: Would you agree that the structure of the updated settlement agreement from the clean energy plan is designed to drive replacement generation and infrastructure into just transition communities?

Mr. Jeff Shaw: Yes, I would.

Mr. Matt Larson: We don’t have any further questions. Thank you.

Commissioner Megan Gilman: Thanks, Mr. Larson. Commissioner Plant?

Commissioner Tom Plant: I don’t have any questions.

Commissioner Megan Gilman: I also do not have any questions. I’ll turn it back to you, Ms. Consilia.

Ms. Consilia: If you could pull up hearing exhibit 1214. Mr. Shaw, while we’re waiting to get that pulled up, I will represent to you that this is a consolidated PDF of the presentations that were made to the PISAC committee that you were a member of.

Mr. Jeff Shaw: Okay, thank you.

Ms. Consilia: Can you explain to the commission the types of information that was presented to you as a member of the PISAC report, how the committee used it, and how you used these presentations in arriving at the final report?

Mr. Jeff Shaw: The PISAC group followed a very engaged and involved long series of meetings over a long period of time. Information was brought to us, experts were brought in, technologies were studied, and economic impacts were studied. There were extensive conversations and communications between the parties of the PISAC group to discuss what the benefits to the community would be.

Part of it was understanding what we’re dealing with regarding the closure of Comanche 1, 2, and mainly 3, what that means for the community by losing that kind of asset, and what the opportunity looks like for replacement generation. It was a very thorough process, sometimes extremely technical and into the weeds.

Ms. Consilia: Was there any information or expertise that you requested that was not provided to you during the course of your 10-month process?

Mr. Michael Hyatt: Commissioner Gilman, this is far beyond the scope of my cross-examination or Mr. Larson’s cross-examination. There were no questions about the composition of the PISAC committee. My questions were limited to comparing property tax revenues from various generation options, and Mr. Larson’s were directed towards whether payments or new generation resources are more preferable in Pueblo.

Ms. Consilia: Madame Chair, I believe an implication has been created by some testimony that the PISAC committee did not have the available information or expertise. Mr. Shaw, as a participant for 10 months, can indicate whether he believed the presentations made were adequate for them to arrive at the recommendation they made.

Mr. Michael Hyatt: I think that’s beyond the scope of proper redirect. Redirect should be limited to issues raised during cross-examination. Ms. Consilia is asking this witness to address issues other witnesses raised in their testimony but not during his cross-examination.

Commissioner Megan Gilman: Ms. Consilia, I tend to agree with Mr. Hyatt. The outcomes with regard to the recommendations on the two types of technologies and the benefits they would create were covered, but he didn’t get into depth about the composition of PISAC or the information provided to them. If you could keep it to the areas in his cross-examination, that would be ideal.

Ms. Consilia: Mr. Shaw, did you request any information with respect to the committee’s recommendation for a new natural gas plant in the short term and advanced nuclear in the longer term that you did not receive?

Mr. Jeff Shaw: No, we received information that we requested. There were a lot of requests made by the PISAC group for questions and directions we wanted to look at. That was very responsive, so I don’t think anything was left out as far as unanswered questions.

Ms. Consilia: I have no further questions, your honor.

Commissioner Megan Gilman: Thank you, Ms. Consilia. Mr. Shaw, thank you for joining us and for your testimony. You’re free to go.

Mr. Jeff Shaw: Thank you.

Commissioner Megan Gilman: Mr. Priu, you’re just here preparing for Ms. Valentine?

Mr. Priu: That’s right.

Commissioner Megan Gilman: No worries. Ms. Valentine, good afternoon.

Ms. Claire Valentine: Good afternoon.

Commissioner Megan Gilman: Can you please raise your right hand? Do you swear to tell the truth, the whole truth, and nothing but the truth?

Ms. Claire Valentine: Yes, I do.

Commissioner Megan Gilman: Is anyone with you today or communicating with you in any way?

Ms. Claire Valentine: No, they’re not.

Commissioner Megan Gilman: If that changes during your testimony, can you please stop and let me know?

Ms. Claire Valentine: I will.

Commissioner Megan Gilman: Turn it to you, Mr. Barroso.

Mr. Barroso: Thank you, Commissioner. Good afternoon, Ms. Valentine.

Ms. Claire Valentine: Good afternoon.

Mr. Barroso: It’s been a long hearing, but I think we’re in the home stretch now. Could you please state and spell your name for the record?

Ms. Claire Valentine: My name is Claire Valentine, C-L-A-I-R-E, last name V-A-L-E-N-T-I-N-E.

Mr. Barroso: Would you please identify by whom you’re employed and in what capacity?

Ms. Claire Valentine: I’m employed by Western Resource Advocates as a senior policy adviser.

Mr. Barroso: Commissioner, Ms. Valentine’s answer, cross-answer, and rebuttal testimonies and attachments have already been admitted into the record. She’s available for cross-examination.

Commissioner Megan Gilman: Thanks, Mr. Barroso. CEC, I’ve got 20 minutes.

Mr. Frit Po: Thank you, Commissioner. Sorry about jumping the gun there. Hi, Ms. Valentine. My name is Frit Po. I am counsel for Colorado Energy Consumers, or CEC. It’s nice to meet you.

Ms. Claire Valentine: It’s great to meet you.

Mr. Frit Po: In your answer testimony, you discuss two solution sets of portfolios in phase 2: one that solves for an 80% emissions reduction in 2030 and another that solves for a 90% emissions reduction in 2033, correct?

Ms. Claire Valentine: Yes. I’m just turning to that portion of my testimony as well.

Mr. Frit Po: If you’d like that pulled up, it’s hearing exhibit 1300 at page 94.

Ms. Claire Valentine: Thank you.

Mr. Frit Po: I believe you responded, but to confirm, you discuss a 90% solution set and an 80% solution set, and those are presented in the table here?

Ms. Claire Valentine: Yes, I think your question was about the 90% and 80% solution sets, and they’re presented in this table.

Mr. Frit Po: Perfect. The table you’re referring to is figure CV8, where you present those portfolios?

Ms. Claire Valentine: Yes, I see them there.

Mr. Frit Po: As you recommend in your answer testimony, 10 of those 12 portfolios would solve for a 90% emissions reduction in 2033, correct?

Ms. Claire Valentine: Yes, that’s correct.

Mr. Frit Po: We can take that down for now, but happy to pull it back up if it would be helpful. In your cross-answer testimony, you recommend that the commission ensure at least half of the phase 2 portfolios adopted solve for a 90% emissions reduction in 2033, correct?

Ms. Claire Valentine: That is my recollection.

Mr. Frit Po: To confirm, in your cross-answer, you updated your position from your answer, and you’re now recommending that at least half the portfolios solve for 90% emissions reductions by 2033, is that accurate?

Ms. Claire Valentine: Not quite. To clarify, the statement in my cross-answer was intended to respond to staff’s proposal, which had a limited representation of portfolios with the 90% by 2033 trajectory. Our concern was that the settlement agreement in the 2021 ERP presented the 90% by 2033 emissions threshold as a target. Given that, it should be represented in a majority of the portfolios analyzed.

Mr. Frit Po: Understood. Can we please pull that table back up in the answer testimony at page 94? Of the 10 out of 12 that solve for a 90% reduction by 2033, there are two subcategories. Eight of these 10 portfolios are based on what you defined as the 90% solution set, and two are based on an expedited 2030 decarbonization set, correct?

Ms. Claire Valentine: Yes.

Mr. Frit Po: To clarify, that 90% solution set would achieve 90% emissions reduction in 2033, followed by a linear progression to zero emissions in 2050, correct?

Ms. Claire Valentine: It’s been a while since I wrote this testimony, so I’m perhaps uncertain if I referenced the linear trajectory. I may need a reminder.

Mr. Frit Po: If we could scroll up to page 93, lines 9 through 11, you’re describing the company’s proposed sets. I’ll let you orient yourself.

Ms. Claire Valentine: Thank you for this reminder. Yes, what we’ve presented here is aligning with that linear progression trajectory.

Mr. Frit Po: The expedited 2030 decarbonization portfolios would achieve emissions reductions of 86% in 2030 and 90% in 2033, correct?

Ms. Claire Valentine: That’s correct.

Mr. Frit Po: Now I’d like to briefly talk about the rationale underlying this recommendation. If we could turn to the discussion on page 94, line 10, continuing to page 95, line five. You’re recommending focusing on the 90% solution set because those portfolios are consistent with paragraph 44 of the updated settlement agreement in the phase one ERP, is that right?

Ms. Claire Valentine: That’s correct. In my cross-answer testimony, I elaborate on why these portfolios could be cost-effective options in phase 2.

Mr. Frit Po: At footnote 125, at the bottom of that page and continuing to the next, you include some text from paragraph 44, is that right?

Ms. Claire Valentine: Yes.

Mr. Frit Po: Could we please pull up hearing exhibit 415 and scroll down to page 27? Would you agree that this paragraph 44 on page 27 is what you were quoting in your footnote?

Ms. Claire Valentine: I see it now. The company will utilize a 90% emission reduction target.

Mr. Frit Po: Since you rely on this paragraph 44 in your testimony, I trust you’re generally familiar with it?

Ms. Claire Valentine: Yes, I’m familiar with the settlement, though I wasn’t a witness in this proceeding.

Mr. Frit Po: I noticed the final sentence was not in your quote in the footnote. Are you aware that the agreement provided that the company may advocate for any of the portfolios developed?

Ms. Claire Valentine: Yes, I’m aware of that.

Mr. Frit Po: Paragraph 44 also agrees that the settling parties requested the commission approve a cost-effective Pueblo just transition portfolio, in part after evaluating the cost impacts of different portfolios, is that fair?

Ms. Claire Valentine: Yes, I see that now.

Mr. Frit Po: We can take that one down. Do you recall in your answer testimony citing Senate Bill 19-236 and the implementing statute, 40-2-125.5?

Ms. Claire Valentine: Yes, I do.

Mr. Frit Po: If we could please pull up hearing exhibit 21104. Were you logged on for CEC’s cross-examination of Mr. Keith Hay?

Ms. Claire Valentine: Yes, I was.

Mr. Frit Po: Could we scroll down to page three, subsection three, titled clean energy targets? Focusing on subsection 3A1, I recognize you’re not a lawyer, so I’m asking for your understanding as you rely on it. Could you review 3A1 quickly? Is it your understanding that this section requires electric retail utilities, including the company, to achieve emissions reductions from 2005 levels of 80% by 2030?

Ms. Claire Valentine: I’m not an attorney, but my holistic understanding is that the qualifying retail utility shall reduce carbon dioxide emissions associated with electricity sales by 80% by 2030. That’s further addressed in the next subsection regarding the trajectory for 2050, which can occur sooner if practicable.

Mr. Frit Po: Is that a yes, that subsection A1 sets an emission reduction requirement of 80% by 2030?

Ms. Claire Valentine: Yes, that’s a floor requirement.

Mr. Frit Po: Does it say at least 80% or just 80%?

Ms. Claire Valentine: I point to the operative phrase “or sooner if practicable,” which could point to higher emissions reductions earlier.

Mr. Frit Po: That goal for 2050 is qualified by “as long as practicable” and also that it’s technically and economically feasible, correct?

Ms. Claire Valentine: That’s true, as well as other pieces, like in the public interest.

Mr. Frit Po: Is it your understanding that the statute does not require emissions reductions from 2005 levels of 86% by 2030?

Ms. Claire Valentine: I don’t see the number 86 referenced in this section.

Mr. Frit Po: Is it your understanding that the statute does not require emissions reductions from 2005 levels of 90% by 2033?

Ms. Claire Valentine: I also do not see that referenced here.

Mr. Frit Po: If we can scroll up to page two, subsection one, the legislative declaration. Is it your understanding that the legislature declared it a matter of statewide importance to promote clean energy and technologies that reduce carbon dioxide emissions but also to do so in a cost-effective manner?

Ms. Claire Valentine: I see reference to cost-effective there.

Mr. Frit Po: In your opinion, shouldn’t we solve for both emissions reductions and affordability?

Ms. Claire Valentine: Cost-effectiveness is clearly referenced in the statute. There are several metrics to measure cost-effectiveness, many of which can point to portfolios with higher emissions reductions than the base amounts indicated for 2030.

Mr. Frit Po: Do you agree that we should solve for both emissions reductions and affordability?

Mr. Michael Hyatt: Objection, asked and answered.

Commissioner Megan Gilman: You can answer to the extent possible.

Ms. Claire Valentine: I think affordability is a factor that the commission should consider in its decision-making.

Mr. Frit Po: That’s all my questions. Thank you.

Commissioner Megan Gilman: I don’t have any other parties. Commissioner Plant?

Commissioner Tom Plant: I don’t have any questions for this witness.

Commissioner Megan Gilman: Thank you. Ms. Valentine, I have a couple of questions for you. Good afternoon.

Ms. Claire Valentine: Good afternoon. Nice to see you.

Commissioner Megan Gilman: Nice to see you as well. SWEEP recommends directing the company to conduct modeling of its phase 2 commission-approved portfolio, after phase 2 is done, under a load forecast that excludes new large load growth for the purpose of informing future cost allocation matters. Am I correct that you see this occurring at the conclusion of phase 2, and if so, how or where would that information be provided?

Ms. Claire Valentine: The intention of this recommendation was recognizing the load uncertainty in this proceeding and the value of additional modeling without requiring the company to do all types of modeling for two different load forecasts. We presented this idea of conducting post-commission approval portfolio modeling without large loads. It could be done through a compliance filing in this proceeding, a future rate case, or another cost allocation proceeding. It could provide valuable information.

Through discussions in this hearing, there could be value in looking at an additional modeling run of an unconstrained portfolio without large loads, as Ms. O’Neal discussed, to measure the SEER. I could see value in doing a run that looks at that metric with and without large loads.

Commissioner Megan Gilman: What would be the use of having that unconstrained or benchmark version without large loads?

Ms. Claire Valentine: The concept of unconstrained modeling originally presented concerns for SWEEP, as we believe the company should develop portfolios that reach statutory targets for emissions reductions. But I understand where Ms. O’Neal was coming from with the SEER calculation. Given the narrative around large load customers making it more difficult to decarbonize Public Service’s system, additional modeling could be valuable for understanding the costs associated with the SEER, both with and without large loads, to get a better sense of those discrepancies, given their 90% load factors that are more challenging to serve with wind and solar alone.

Commissioner Megan Gilman: With regard to your base recommendation about this post-phase 2 modeling without large loads, who would define what size or type of large load? We’ve got strategic development loads, data centers of varying sizes, and different ramp levels. What criteria would define a large load in that run?

Ms. Claire Valentine: That’s a great question. I wish Mr. Eden were up after me, as he has broader perspective on large load developments. I don’t have a specific answer at this moment, but if it would be helpful, we could take note to think about for our statement of position how that might be conducted.

Commissioner Megan Gilman: That would be helpful to understand better. Do you see that as something that could or should be completed well after any litigation of a large load tariff?

Ms. Claire Valentine: Yes, I think so.

Commissioner Megan Gilman: You supported, in your cross-answer, the staff proposal for multiple solicitations, but you’re not a party to the quad-party framework. Can you help me understand, since you supported multiple solicitations, which portions of the quad-party framework you agree with and which you do not?

Ms. Claire Valentine: We still have a lot of concerns regarding the incremental need pool structure. It’s worth differentiating between the incremental need pool as a mechanism for backup bids and addressing bid failures, where strategies like for-like replacements can ensure resources selected are akin to what the commission expected, versus using it to respond to large load growth. There are serious ratepayer and emissions concerns.

The quad-party framework presents a limited regulatory review of load ramps under 500 megawatts. That could be over a gigawatt of resource acquisitions run through the incremental need pool with just commenting from parties or the commission, especially without a large load tariff change to add consumer protections like minimum contract lengths or demand features. It raises questions about whether resources acquired are for load truly committed to taking service and how a gigawatt of new resources impacts the emissions trajectory and cost allocation.

In my rebuttal testimony, I recommend ensuring load for which the incremental need pool is activated is associated with a signed contract with consumer protections. Additionally, maintain the emissions reduction trajectory set by the commission in phase two, as the filing for the incremental need pool won’t have comparative analyses to investigate whether different options ensure the emissions trajectory continues.

Commissioner Megan Gilman: In your testimony, you advocated that the emissions trajectory should be maintained. If activation of the incremental need pool causes that to be more expensive, those costs should be borne by the large loads that made it more expensive. Is that a fair paraphrase?

Ms. Claire Valentine: Yes. That’s why I teed up additional modeling related to the unconstrained portfolio to understand those differences. These 90% load factor customers are a different beast to serve compared to flexible loads like electric vehicles, which can be better paired with renewable generation. It’s worth doing that modeling to understand those differences and how they could be allocated, as residential and small commercial ratepayers should not be on the hook for costs introduced by large load customers.

Commissioner Megan Gilman: If we looked at your concept of understanding the cost delta to keep the incremental need pool on the same emissions trajectory, that would require contrary modeling to understand what else it takes. Do you have any thought as to the mechanism to charge those particular customers, or are you charging a rate class of large customers that incremental cost?

Unknown Speaker: That’s a good question, worth exploring in a cost allocation proceeding, perhaps through a future large load tariff or another approach. I’m not sure how future proceedings will address whether a new customer class is created or other changes occur.

Jack Ihle: One more question. I’m curious about your position on the staff’s portfolios in Surrebuttal SJD10. Your initial concern was insufficient representation of the 90% emissions reduction by 2033 from the USA. Many portfolios take the proposed portfolio, but the majority of unique ones use the 90% by 2033 target. What’s your reaction to those portfolios?

Unknown Speaker: I appreciate the commission staff bringing forward modified portfolios that come closer to the emissions trajectories we’re interested in. One concern is that the low new gas portfolio is defined a bit higher than we’d recommend. I can’t recall all our perspectives offhand, but I appreciate that staff tested a variety of futures.

Jack Ihle: Thanks. Those are my only questions, Chairman.

Eric Blank (Chairman): Miss Valentine, if you have questions. Thanks for your leadership, Commissioner Gilman. I have one question for you, and then maybe Commissioner Gilman can monitor the redirect, and we can switch with the next witness. Given the load uncertainty, cost allocation, transmission planning, resource costs, long-term rate impact, and environmental issues raised, any thoughts on the commission adopting the low load forecasts to manage risk and uncertainty instead of the base case? Would you like me to keep talking so you can think about it?

Unknown Speaker (Miss Valentine): I wish Mr. Iden were going after me since he’s our load forecasting expert. It depends on the commission’s broader approach to the phase 2 process and framework. I discussed concerns with the incremental need pool and how it might play out, especially without a large load tariff with consumer protections. There are trade-offs if the commission uses the incremental need pool for a larger chunk of load. I’d point to Mr. Iden’s recommendations on behalf of February and SWEEP for specific forecasting, including large load and electrification pieces. Look at it as a package and balance across the entire package, not overly focusing on one element. Is that fair?

Eric Blank: I think you’re reexpressing the incremental need pool concerns and deferring load forecast specifics to Mr. Iden’s recommendations. Back to you, Commissioner Gilman.

Megan Gilman: Mr. Barroso, redirect?

Mr. Barroso: Commissioner, I’ll keep this brief. Just one or two questions, Miss Valentine. Do you remember discussing cost-effectiveness with counsel for CEC?

Miss Valentine: Yes, I do.

Mr. Barroso: In one of your answers, you said a portfolio could be cost-effective while achieving deeper emission reductions. Do you remember that?

Miss Valentine: Yes.

Mr. Barroso: What led you to that conclusion?

Miss Valentine: The Colorado phase one and phase two process includes illustrative modeling of different futures. Despite political uncertainties affecting phase one modeling, the technical appendix shows no new gas portfolios with lower present value revenue requirements for 2025 to 2040 and during the resource acquisition period. These portfolios achieve deeper emissions reductions by 2030, with lower societal costs. Given uncertainties in resource costs from 2040 to 2050 and the importance of societal costs, which Colorado ratepayers increasingly bear through wildfire mitigation funding, these metrics should be considered for affordability with deeper emissions reductions.

Mr. Barroso: Thank you for your time. No further questions.

Eric Blank: Thank you, Mr. Barroso. Miss Valentine, you’re free to go. Back to you, Chairman. Thank you, Commissioner Gilman, for your help. I have Miss Henry Seros next. Can you raise your right hand? Do you swear to tell the truth, the whole truth, and nothing but the truth?

Miss Henry Seros: I do.

Eric Blank: You can put your hand down. Is anybody with you or communicating with you in any way?

Miss Henry Seros: No.

Eric Blank: If that changes, will you let us know?

Miss Henry Seros: I will.

Eric Blank: Back to you, Miss Nelson.

Miss Nelson: Thank you, Mr. Chairman. Good afternoon, Miss Henry Seros. Do you like to be called Ms. Henry, Miss Seros, or Miss Henry Seros? We’ve had this discussion before, so I’ve decided to simplify things and go with my official last name, Henry.

Miss Henry Seros: Okay, I’ll go with Henry. That sounds good.

Miss Nelson: Did you prepare UCA hearing exhibit 300 revised one, UCA hearing exhibit 306, your answer testimony, 306 your cross-answer testimony, and hearing exhibit 308, UCA surrebuttal testimony sections one through three?

Miss Henry Seros: That’s correct.

Miss Nelson: If asked the same questions in that testimony, would your answers be the same?

Miss Henry Seros: Yes.

Miss Nelson: Miss Henry is available for cross.

Eric Blank: Thank you. I have 15 minutes for Routt County. Mr. Dipman?

Brandon Dipman: Sorry, I jumped the gun. Thank you. Good afternoon, Miss Henry. My name is Brandon Dipman, and for the record, I represent Routt County and the town of Hayden. Good to see you again.

Miss Henry Seros: Good to see you too.

Brandon Dipman: I’ll be brief and won’t take the full 15 minutes. I want to talk about UCA’s proposal, introduced in its answer testimony and expanded in rebuttal testimony, for payments to Craig and Moffat County for PSCO’s ownership of Craig Station. Am I correct that UCA proposes PSCO pay Craig and Moffat County $6.8 million for each of the two units at Craig Station in which PSCO has ownership?

Miss Henry Seros: Yes, that’s correct.

Brandon Dipman: PSCO’s ownership of Craig Station equals 41.6 megawatts in each unit, correct?

Miss Henry Seros: That is our understanding, yes.

Brandon Dipman: The $6.8 million payment is based on the $70 million direct economic payment to Moffat and Craig in the Tri-State settlement, correct?

Miss Henry Seros: That is correct, based on PSCO’s percentage of ownership.

Brandon Dipman: Let’s do some math, always dangerous. You testified it’s $6.8 million for 41.6 megawatts. Calculating the dollar figure per megawatt, would you agree it’s roughly $163,000?

Miss Henry Seros: I’ll take your numbers for it, yes.

Brandon Dipman: PSCO’s ownership of Hayden Station in both units is 237 megawatts, correct?

Miss Henry Seros: That’s my understanding, yes.

Brandon Dipman: If I multiply $163,461 by 237, would you agree that equals almost $39 million?

Miss Henry Seros: I believe so.

Brandon Dipman: Is this amount more than the $16.3 million Routt County would receive under the USA?

Miss Henry Seros: Yes.

Brandon Dipman: For context, in UCA’s surrebuttal testimony, UCA stated there should be uniformity with regard to community assistance within proceedings, correct?

Miss Henry Seros: UCA believes these communities deserve just and equitable treatment, yes.

Brandon Dipman: Does that equitable treatment extend not only within proceedings but between proceedings?

Miss Henry Seros: That’s a good question. UCA believes these communities, though facing similar economic and developmental challenges, are not the same. We’re proposing an alternative solution for this just transition process within this complicated proceeding that would benefit these communities equitably and in the public interest.

Brandon Dipman: If I understand correctly, this model could be used for other communities beyond Craig and Routt County?

Miss Henry Seros: Another good question. We’re proposing an alternative that, in the Tri-State proceeding, seemed to satisfy the communities involved and could potentially provide similar satisfaction to other communities.

Brandon Dipman: One final question. Does UCA believe one of the General Assembly’s policy intentions in this transition process is equitable economic transitions?

Miss Henry Seros: That’s correct, as cited in our surrebuttal.

Brandon Dipman: Thank you. No further questions.

Eric Blank: Thank you, Mr. Dipman. I have 20 minutes. Did you reserve cross, Miss Consiglia?

Frances Consiglia: No, Your Honor. I asked for a few more minutes since I waived other witnesses, but I think I have 15.

Eric Blank: Thank you.

Frances Consiglia: Good afternoon, Miss Henry. We haven’t met before. My name is Frances Consiglia, and I represent the City of Pueblo, the County of Pueblo, and Pueblo Economic Development Corporation.

Miss Henry Seros: Good afternoon, Mrs. Consiglia. It’s a pleasure to meet you.

Frances Consiglia: Likewise. You’re the last person standing today, so thank you for your patience and flexibility. I’m at mile 20 in this marathon, but I think there are two more UCA witnesses. If I can follow up on Mr. Dipman’s questions, you said you were attempting to provide a solution. What is the problem you’re trying to solve?

Miss Henry Seros: I wouldn’t call it a problem. It’s a process. We’re proposing an alternative to the just transition process and framework.

Frances Consiglia: You weren’t involved in the 2021 proceeding, correct?

Miss Henry Seros: That’s correct. I wasn’t part of UCA staff then.

Frances Consiglia: Did you read the settlement agreement or the updated settlement agreement in forming your conclusion?

Miss Henry Seros: At a high level, I’m familiar with the decision in that proceeding.

Frances Consiglia: Did you read testimony from utility consumer advocates or the coal community, like Pueblo, in that case?

Miss Henry Seros: I did not.

Frances Consiglia: The problem I’m having with your testimony is what relationship a calculation based on megawatt hours of coal generation has to just transition benefits. Can you explain the connection?

Miss Henry Seros: The alternative we’re proposing is based on the Tri-State ERP proceeding. That framework addressed tax backfill, economic development, and property rights within the just transition package for those communities. We’re proposing an alternative here for Craig units one and two, using the nameplate capacity of 428 megawatts, dividing it by PSCO’s percentage ownership to extrapolate a proportional amount. We’re going beyond thinking of unit closures and providing assistance based solely on that, considering the moral commitment to workers and communities that have powered Colorado for decades, as HB19-1314 provides. Without a specific path, we’re proposing an alternative for communities that might not receive community or economic development assistance under other frameworks.

Frances Consiglia: You’re not an economist, are you?

Miss Henry Seros: I am not.

Frances Consiglia: In your layperson’s opinion, what’s the relationship between your calculation approach and providing for workforce transition in coal communities?

Miss Henry Seros: Could you rephrase your question?

Frances Consiglia: The clean energy bill requires utilities to provide for workforce transition. How does your calculation relate to that?

Miss Henry Seros: In this proceeding, the company didn’t propose workforce assistance or a plan for Craig units one or two, stating they’re not full owners or operators and thus not responsible for workforce transition. We acknowledge there’s a commitment not just for workforce transition but also for community assistance, despite the company’s arguments that they can’t control workforce issues as partial owners.

Frances Consiglia: Does your model account for tax payments the utility would have made through the original closure date?

Miss Henry Seros: No.

Frances Consiglia: Did you look at voter-approved projects in the community paid for through taxes from the facility?

Miss Henry Seros: I’m not aware of those projects.

Frances Consiglia: I represent Pueblo. Comanche 3 will close 40 years early in 2031, at 750 megawatts, with PSCO owning about 520 megawatts. Can you provide a calculation for what Pueblo would receive for PSCO’s interest in Comanche 3 using your model?

Miss Henry Seros: I could, but I’d need a pencil and paper or calculator.

Frances Consiglia: What components would you need to arrive at that calculation?

Miss Henry Seros: Although I wasn’t part of the Pueblo settlement agreement, if Pueblo wants to reassess the company’s commitment to community assistance, workforce transition, or economic development, it could do so in another proceeding. UCA would support analyzing evidence presented in that proceeding. I can’t estimate now without evidence or familiarity with Pueblo’s conditions.

Frances Consiglia: For Craig, did you account for the total investment?

Miss Henry Seros: No, we considered the percentage of ownership in those units.

Frances Consiglia: What do you mean by ownership? What’s the multiplier and multiplicand?

Miss Henry Seros: We estimated per megawatt, taking the $70 million assigned to Craig 3, divided by 428 megawatts, getting $163,551 per megawatt, multiplied by 41.6 megawatts, arriving at $6.8 million per unit.

Frances Consiglia: Where did the $70 million come from?

Miss Henry Seros: From the Tri-State settlement for Craig unit 3, with $48 million for tax backfill and $22 million for taxes over 10 years and economic development over four years.

Frances Consiglia: You didn’t look at the original capital investment in Craig 1 by Tri-State or other owners?

Miss Henry Seros: No, we did not.

Frances Consiglia: Or the undepreciated amount on their books?

Miss Henry Seros: No.

Frances Consiglia: No further questions.

Eric Blank: Thank you, Mr. Blink. Mr. Eisenberg, I have 20 minutes. It’s 2:15.

Sam Eisenberg: In my defense, I got in the habit of calling Commissioner Gilman chair while you were gone. Good afternoon, Miss Henry.

Miss Henry Seros: Good afternoon, Mr. Eisenberg.

Sam Eisenberg: For the record, I’m Sam Eisenberg of Wilkinson Barker, representing PSCO. UCA opposed the Power Pathway project when the CPCN was filed, correct?

Miss Henry Seros: I’m not familiar with that proceeding.

Sam Eisenberg: I’ll represent that Dr. England’s answer testimony in hearing exhibit 321A recommends delaying construction pending further study, and UCA’s SOP supported only a conditional CPCN for each segment. Any reason to disagree?

Miss Henry Seros: Objection, no foundation.

Eric Blank: Overruled. If the witness can answer, she can.

Miss Henry Seros: With the caveat that I’m not familiar with that proceeding, I’ll take your word for Dr. England’s testimony.

Sam Eisenberg: UCA also opposed granting a CPCN for the May Valley Longhorn Extension, or MVLE?

Miss Henry Seros: Same answer.

Sam Eisenberg: UCA opposes approval of the MVLE in this proceeding?

Miss Henry Seros: You can discuss that with Mr. Neil. He has time reserved for crossing.

Sam Eisenberg: It’s in your testimony as the lead witness.

Miss Henry Seros: If you have questions about the May Valley Longhorn Extension, they should be directed to Mr. Neil.

Sam Eisenberg: These are policy-level questions, not technical. The theory behind Power Pathway was “if you build it, they will come.” Have you heard that phrase?

Miss Henry Seros: Yes.

Sam Eisenberg: Objection, Miss Henry stated she wasn’t involved in that proceeding.

Eric Blank: Overruled. She testified she’s heard it.

Sam Eisenberg: You’ve watched Field of Dreams?

Miss Henry Seros: I have.

Sam Eisenberg: UCA’s theory seems to be: don’t build the MVLE, wait for bids, and build later if needed?

Miss Henry Seros: I believe so.

Sam Eisenberg: The price of the MVLE has gone up since UCA opposed it in proceeding 21A096E?

Miss Henry Seros: The extension and its cost are better discussed with Mr. Neil.

Sam Eisenberg: I’m hoping to complete these at the policy level to save time with Mr. Neil. Can we pull exhibit 147? Mr. Neil’s testimony says Longhorn’s capacity on the MVLE is “very expensive and uncompetitive.” Looking at the Colorado annual average wind speed map at 30 meters from NREL, can you identify where the May Valley Longhorn Extension is?

Miss Henry Seros: You’re asking about issues not in my testimony. I’m not comfortable answering. Mr. Neil should discuss the May Valley Longhorn Extension.

Sam Eisenberg: Do you know who Christopher T.M. Clack is?

Miss Henry Seros: No.

Sam Eisenberg: Dr. Clack filed testimony in the Power Pathway proceeding, with a PhD in applied mathematics and plasma physics, running an energy consultancy. Any objection to his expertise?

Miss Henry Seros: Objection, I’ve said I’m not familiar with him.

Eric Blank: Overruled, but it’s heavy sledding.

Sam Eisenberg: I’ll move on. Is UCA planning to oppose the CPCN for the Denver Metro project in proceeding 24A0560E?

Miss Henry Seros: I’m not part of that proceeding, so I can’t answer.

Sam Eisenberg: Is Mr. Neil?

Miss Henry Seros: I’m not aware if he is.

Sam Eisenberg: There was significant discovery in this proceeding, correct?

Miss Henry Seros: Yes.

Sam Eisenberg: UCA served 18 sets of discovery on the company, subject to check?

Miss Henry Seros: Subject to check, yes.

Sam Eisenberg: Counting discrete subparts, UCA served 911 separate discovery requests on PSCO?

Miss Henry Seros: I’ll take your word for it.

Sam Eisenberg: In your answer testimony, you attached three PSCO discovery responses, Dr. Will attached two, Miss Summer six, Mr. Milligan one, Mr. Neil six. None in your or Mr. Neil’s cross-answer. In total, UCA used 19 PSCO discovery responses?

Miss Henry Seros: I’ll take your word for it. We didn’t count attachments, focusing on other issues.

Sam Eisenberg: You stated UCA was denied the ability to present alternatives due to modeling issues, page 34?

Miss Henry Seros: That’s correct.

Sam Eisenberg: On page 23, you said UCA’s team replicated the company’s modeling results, but time constraints prevented satisfactory results or proposing a portfolio?

Miss Henry Seros: That’s correct.

Sam Eisenberg: Do you recall the company meeting with UCA on March 25, 2025, at UCA’s request regarding modeling?

Miss Henry Seros: That’s correct.

Sam Eisenberg: You were part of that conversation?

Miss Henry Seros: Yes.

Sam Eisenberg: Miss Hotelling led for UCA?

Miss Henry Seros: I believe so.

Sam Eisenberg: She asked technical questions about the model?

Miss Henry Seros: Yes.

Sam Eisenberg: Mr. Landrum and his team were present?

Miss Henry Seros: Yes.

Sam Eisenberg: Did the company answer all questions on that call?

Miss Henry Seros: To my recollection, we discussed issues UCA encountered running the model. The commission directed parties to address modeling issues through discovery with the company. We reached out to see if they had the same issues with the EnCompass model. They confirmed the long run times and explained how they worked through them by running multiple models simultaneously with various licenses, which UCA didn’t have. They provided insights beyond my understanding but didn’t offer a specific solution other than what worked for them.

Sam Eisenberg: They answered every question Miss Hotelling posed and follow-up discovery questions?

Miss Henry Seros: I believe so.

Sam Eisenberg: Direct testimony was filed October 15, 2025, answer testimony due April 18, 2025?

Miss Henry Seros: I’ll take your word for it.

Sam Eisenberg: UCA’s attorneys reached out to PSCO’s on March 13, 2025, to set up the meeting?

Miss Henry Seros: I’ll take your word for it.

Sam Eisenberg: UCA waited months before reaching out, a month before the answer deadline, and the company scheduled a meeting the following week?

Miss Henry Seros: We tried solving the issue with our consultants from GridLab. They tried different mechanisms and previous models before we reached out.

Sam Eisenberg: You worked closely with the UCA team preparing testimony?

Miss Henry Seros: UCA has a strong team of analysts. We work under our director and deputy director, focusing on specific issues and coordinating testimony.

Sam Eisenberg: As lead witness, you discussed answer testimony with the team before filing?

Miss Henry Seros: Yes.

Sam Eisenberg: Mr. Neil proposed procuring 1,000 to 2,500 trucks in his answer testimony?

Miss Henry Seros: I do.

Sam Eisenberg: UCA withdrew that portion seven days later?

Miss Henry Seros: I do.

Sam Eisenberg: Why?

Miss Henry Seros: Objection, calls for work product and attorney-client privilege.

Eric Blank: Sustained.

Sam Eisenberg: Without divulging privileged information, why withdraw it seven days after filing?

Miss Henry Seros: Objection.

Eric Blank: Overruled.

Miss Henry Seros: We had strong arguments for other alternatives, so we didn’t need to move forward with Mr. Neil’s proposal.

Sam Eisenberg: Does UCA have a position on the modeled cost of unserved energy in this proceeding?

Miss Henry Seros: Could you rephrase?

Sam Eisenberg: Have you heard discussions about unserved energy during the hearing?

Miss Henry Seros: At a high level, yes.

Sam Eisenberg: Does UCA have a position on treating unserved energy in the model?

Miss Henry Seros: That’s better directed to our consultants who ran the model, like Miss Hotelling or Mr. Summers.

Sam Eisenberg: Does UCA have a position on acceptable megawatt hours of unserved energy in a phase two portfolio?

Miss Henry Seros: Same answer.

Sam Eisenberg: If the commission approves a portfolio with significant unserved energy, does UCA have a perspective on which customers should be curtailed during rolling blackouts?

Miss Henry Seros: I didn’t address that in my testimony, so I can’t answer.

Sam Eisenberg: If UCA could include a number for appropriate unserved energy in its statement of position, that would be helpful. No further questions.

Eric Blank: Thank you, Mr. Eisenberg. Commissioner Gilman, questions for Miss Henry?

Megan Gilman: No questions.

Eric Blank: Commissioner Plant?

Tom Plant: No questions.

Eric Blank: I have the same question as for Miss Valentine. Given concerns about load uncertainty, cost allocation, transmission planning, resource costs, long-term rate impact, and environmental issues, any thoughts on adopting the low load forecast instead of the base case?

Miss Henry Seros: I’d give the same answer as Miss Valentine. I’d prefer a segregated load forecast if possible. The company indicated it would be time-consuming. Mr. Landrum said they could do it after phase 2. If a separate load run isn’t feasible for cost allocation, we’d recommend the low load forecast.

Eric Blank: Thanks. Miss Nelson, redirect?

Miss Nelson: Thank you, Chairman Blank. Miss Henry, I’ll follow up on your discussion with Mr. Eisenberg about what UCA did before contacting PSCO to arrange a meeting with their modelers. Explain what you did.

Miss Henry Seros: When we engaged GridLab, we knew this proceeding was unique with many factors and assumptions. Our consultants noticed the EnCompass model runs getting stuck or taking seven to eight days per run. We thought it might be a software issue, so they tried a previous software version, but the problem persisted. We contacted staff, who had the same issues, confirming it wasn’t our version. We asked discovery questions to work around these kinks. After some time, when nothing worked, we reached out to the company. The time between noticing problems and contacting the company was spent trying to fix it ourselves or with other parties.

Miss Nelson: Did that lead to recommendations in Miss Hotelling’s testimony about future EnCompass model runs and requests during the application or discovery process to permit parties to give commission recommendations?

Miss Henry Seros: Yes, she provided recommendations, including those you mentioned.

Miss Nelson: That’s all I have. Thank you.

Eric Blank: Thank you. Miss Henry, you may be excused. Mr. England, can you raise your right hand? Do you swear to tell the truth, the whole truth, and nothing but the truth?

Scott England: I do.

Eric Blank: Put your hand down. Is anybody with you or communicating with you?

Scott England: No.

Eric Blank: If that changes, will you let us know?

Scott England: Of course.

Eric Blank: Over to you, Mr. Bunker.

Mr. Bunker: Thank you, Mr. Chairman. Dr. England, please state and spell your last name for the record.

Scott England: My name is Scott England, last name spelled E-N-G-L-A-N-D.

Mr. Bunker: Identify your employer and position.

Scott England: I’m employed by the Colorado UCA as an economist.

Mr. Bunker: In this proceeding, did you file hearing exhibit 301, your answer testimony and attachments SE1 through E16?

Scott England: Yes.

Mr. Bunker: Mr. Chairman, Dr. England’s hearing exhibit 301 and attachments have been admitted. He’s available for commissioner questions, as all other parties waived cross.

Eric Blank: Commissioner Plant or Commissioner Gilman, any questions for Dr. England?

Tom Plant: I do not.

Megan Gilman: No, I did not.

Eric Blank: Did Xcel keep some cross? I have five minutes.

Mr. Larson: They waived cross on day one. Mr. Larson is nodding.

Eric Blank: Dr. England, sorry for the confusion. You may be excused. Mr. Neil, can you raise your right hand? Do you swear to tell the truth, the whole truth, and nothing but the truth?

Chris Neil: I do.

Eric Blank: You can put your hand down. Is anybody with you or communicating with you?

Chris Neil: No.

Eric Blank: If that changes, will you let us know?

Chris Neil: I will.

Eric Blank: Mr. Wittershine?

Mr. Wittershine: Thank you, Mr. Chairman. Can you hear me?

Eric Blank: We can.

Mr. Wittershine: Mr. Neil, please state your name and occupation.

Chris Neil: My name is Chris Neil. I’m a rate financial analyst for the Utilities Consumer Advocate.

Mr. Wittershine: You’re the same Chris Neil who filed answer testimony, cross-answer testimony, and sponsored section 4 of UCA’s surrebuttal comments?

Chris Neil: Yes.

Mr. Wittershine: Your written testimony would be the same if given live today under oath?

Chris Neil: Yes.

Mr. Wittershine: Mr. Chairman, Mr. Neil has spotty internet coverage. If we lose him, he may need to call in, but hopefully, we won’t have that issue. He’s available for cross-examination.

Eric Blank: Thank you. I have 15 minutes for CEA. Mr. Ribbon?

Mr. Ribbon: We intended to waive that if we hadn’t communicated it.

Eric Blank: Thanks. Xcel, you wanted five or 10 minutes, Mr. Eisenberg?

Sam Eisenberg: Good afternoon, Mr. Neil. Good to see you. How are you?

Chris Neil: Good, Mr. Eisenberg. How are you?

Sam Eisenberg: I’m doing well. For the record, Sam Eisenberg, representing PSCO. Following up on questions I asked Miss Henry. The price of the MVLE has gone up since UCA opposed it in proceeding 21A096E, correct?

Chris Neil: Yes.

Sam Eisenberg: Do you think the cost of building that extension will get cheaper in the future?

Chris Neil: I can’t speculate.

Sam Eisenberg: At a high level, UCA’s position is that PSCO hasn’t justified the MVLE’s benefits compared to costs?

Chris Neil: Our position is the same as the commission’s conditional approval. If PSCO gets enough bids to justify the project, it can be built. If not, it shouldn’t.

Sam Eisenberg: Can we pull hearing exhibit 147? Mr. Neil, you’re familiar with how the May Valley Longhorn Extension runs from Kiowa County south past Lamar through Prowers County into Baca County, the southeast corner?

Chris Neil: Yes.

Sam Eisenberg: Do you see the orange and red wind resource in Prowers County? I’ll represent that Dr. Clack testified in 21A096E that the highest capacity factor wind, not in complex terrain, is in the southeastern portion of the state. Any reason to disagree?

Chris Neil: No.

Sam Eisenberg: Dr. Clack testified the MVLE extends into the southeastern region to access the best wind resource. No reason to disagree?

Chris Neil: No.

Sam Eisenberg: Dr. Clack stated Baca and Las Animas counties contain 11% of the state’s total maximum technical potential for wind development. No reason to disagree?

Chris Neil: [Connection lost] I’m back. Sorry, my internet cut out.

Eric Blank: No problem.

Chris Neil: I have no reason to disagree with Dr. Clack.

Sam Eisenberg: This high wind potential Dr. Clack discussed is the red and orange shape in the southeast corner of the map?

Chris Neil: Yes.

Sam Eisenberg: Chairman, I move to admit hearing exhibit 147 as a demonstrative.

Mr. Wittershine: No objection.

Eric Blank: So moved.

Sam Eisenberg: Who did Dr. Clack testify for?

Chris Neil: UCA.

Sam Eisenberg: In UCA’s SOP in that proceeding, UCA cited Dr. Clack’s testimony, arguing the MVLE provides access to Colorado’s best wind resources. Any reason to disagree?

Chris Neil: No, subject to check.

Sam Eisenberg: When weighing the MVLE’s costs and benefits, how should the commission weigh Dr. Clack’s testimony and yours?

Chris Neil: They’re not inconsistent. Good wind doesn’t justify the MVLE’s cost when including bid costs. Other regions in Colorado have good wind, not the best, but can provide resources at lower cost than the southeast corner with the MVLE.

Sam Eisenberg: Thanks for your time. Good to see you.

Chris Neil: Good to see you.

Mr. Wittershine: That’s all I have.

Eric Blank: Commissioner Gilman, any questions for Mr. Neil?

Megan Gilman: No questions.

Eric Blank: Commissioner Plant?

Tom Plant: No questions. I have one, possibly confidential. On pages 47 and 48 of the 120-day report in 21A41E, I agree a wind map doesn’t justify the line. But the company showed the line’s cost was significantly cost-effective based on phase 2 bids. Have you seen that report?

Chris Neil: I’ve seen it, but I’m sure it didn’t say it was cost-effective, or they would have built the MVLE to support those projects, which didn’t happen.

Tom Plant: We gave it a conditional CPCN in the CPP case last year. Can you look at pages 47 and 48 of the highly confidential report before your statement of position and let us know if you change your mind? If there’s enough capacity to justify the MVLE, it might trigger the $1.8 billion Harvest Mile-Chambers-Sandown-Cherokee line, which must be considered.

Chris Neil: I’ll look at it.

Tom Plant: That’s all I have.

Eric Blank: Mr. Wittershine, redirect?

Mr. Wittershine: Mr. Neil, why does UCA continue to support conditional approval of the MVLE?

Chris Neil: It depends on whether there’s enough low-cost renewable resource to justify the $300 million MVLE compared to other renewal bids. That didn’t happen last time. If it happens this time, build the line. Until then, we stick with conditional approval.

Mr. Wittershine: Thank you. No further questions.

Eric Blank: Thank you, Mr. Neil. You can be excused. I’d like to take a 10 or 15-minute break, confer with counsel and advisors to ensure the record is final, then see if there are other issues before we adjourn and close the record. Mr. Larson, anything before that?

Matt Larson: No, that sounds like a good set of next steps.

Eric Blank: Let’s break until 3:10 and finish this up. Thanks all.

[Break]

Eric Blank: We’re back on the record in 24A442E. Miss Rosati, can you help us finalize this record? I know there was one thing from COSA and Miss Kutzer you wanted to get in, and maybe more.

Miss Rosati: Yes, two things to confirm, then I have the list of exhibits from the last two days to read. We’re waiting to hear from the company on objections to the highly confidential exhibit from yesterday morning.

Matt Larson: The company has no objection to its admission.

Miss Rosati: Thank you. Miss Kutzer has an exhibit to raise.

Ellen Kutzer: We conferred with parties’ counsel. We have a correction to a header for hearing exhibit 2203, attachment KLW1, in our box.com folder, ready to replace the errant header. Apologies.

Eric Blank: Any objection?

Unknown Speaker: No objection.

Eric Blank: So moved. Anything else on record evidence, Miss Rosati, before opening it to parties?

Miss Rosati: I’ll go through the list of exhibits from the last couple of days.

Eric Blank: Any other evidentiary or record issues before Miss Rosati reads the list? Miss Whitman?

Miss Whitman: I conferred with parties about substituting the corrected caption for hearing exhibit 601. I asked for objections; nobody responded, and the company doesn’t object.

Eric Blank: Silence is assent. Is 601 in your box?

Miss Whitman: Yes, it should be. It’s revision one.

Eric Blank: It doesn’t have revision one in the title or header. Miss Rosati, are you okay with that?

Miss Rosati: If you can change it, I’ll add revision one to the header and title.

Eric Blank: Mr. Rosati, anything else?

Miss Rosati: Miss Kutzer had one remaining evidentiary issue.

Ellen Kutzer: It wasn’t clear after yesterday where we stood on the company submitting redlines to the conforming bid policy in statements of position. Is the commission ruling on that later, or seeking clarity before closing the record?

Eric Blank: That’s a statement of position issue, not a record issue. Let’s take it up later.

Ellen Kutzer: Fair enough.

Miss Rosati: I’ll read the exhibits from yesterday and today. Commission counsel provided a list of admitted exhibits to parties Monday morning via email. We addressed issues raised. Exhibits offered and admitted: 2908 HC, 146, 144, 2601 revised 1 confidential, 2601 revised 1, 2610, 1214, 1213, 1226, 1227, 1219, 1810, 1804, 1806, 147, 1800 revised 1, 1800 attachment JTR-7 revised one, 2203 attachment KLW1 revised 1, 601 revised 1. Exhibits taken administrative notice: 1807, 1230.

Eric Blank: Thank you. Any concerns with those exhibits, Mr. Larson?

Matt Larson: I didn’t hear 147, the wind speed demonstrative admitted via Mr. Neil. Was it on your list?

Miss Rosati: It is on our list. I may not have said it, so we’ve said it now.

Matt Larson: Cool. Nothing else.

Eric Blank: Any objections to any of that?

Unknown Speaker: No objection.

Eric Blank: Any other record evidentiary issues? On statements of position, we’re proposing a deadline of July 14. Mr. Larson, in your cross of Mr. Haye, can you explain in your SOP whether the company is changing confidentiality assertions for large load customers, including strategic economic development customers?

Matt Larson: The only change is Denver International Airport, due to their public comment identifying them.

Eric Blank: That simplifies things if it’s not highly confidential. The second item: parties, help us understand what’s necessary for the phase one decision versus issues for phase two, as in the 2021 ERP SOPs.

Matt Larson: That may cross-pollinate with the phase one versus phase two item.

Eric Blank: Advisors have a question about the company’s plan to ensure resources procured through this JTS are included in the C rider calculation, consistent with representations in 24-307E. Clarify in your SOP. Mr. Larson, I’m struggling with model contract language. We don’t think it’s appropriate for you to introduce PPA language from your rebuttal case in your SOP. Due process issues raised by IP counsel resonated. Any ideas on getting model contract language on this record?

Matt Larson: JLB2 outlines our position on key contract areas in dispute, on the record with cross-examination opportunities. We’re interested in certainty for a successful phase two. We could propose a process in our SOP, like a notice and comment or pre-hearing conference to drive toward an outcome. JLB2 has our positions for consideration.

Eric Blank: Mr. Pierce filed a 36-page surrebuttal. I’m confident we can find a process. We’ll propose something. We’re brainstorming with counsel about quicker guidance than a full phase one decision in August, depending on timing, as we’ll need help from the company and parties. It’s tough to decide on this record.

Ellen Kutzer: I don’t have an answer now, but if you’re asking the company to recommend a process in SOPs, we can do that in ours if you’re not proposing one before briefs.

Eric Blank: It’s not possible to do that. Interim guidance might help narrow the gap. You’re far apart in litigation positions, and it’s tough to resolve without language. We’ll address it in your briefs and may take it up shortly after.

Mr. Cox: You mentioned the July 14 SOP deadline. With the hearing’s length and the holiday week, any estimate on when transcripts will be finalized?

Eric Blank: Miss Harriet’s not here today. Email her for a better idea. Miss Rosati, can you get an answer?

Miss Rosati: I don’t have one today. If there’s an issue, we can revisit the deadline at a future CWM.

Eric Blank: Coordinate with counsel to accelerate transcripts if possible. Mr. Bunker?

Mr. Bunker: Regarding the process discussion, will other parties respond to SOPs on that issue, agreeing, disagreeing, or offering alternatives?

Eric Blank: It’s a dialogue. It may be okay to handle in August, but I’m concerned we don’t have a record to resolve it fully. There may need to be responsive comments.

Matt Larson: We’ll propose a way for the company to put something out and intervenors to respond, giving a foundation for language. I’d like to avoid responsive SOPs, as they’re not necessary.

Miss Consiglia: The court reporters have been quick. Tracy and Harriet are working on it, so I don’t see a delay.

Eric Blank: Anything else on SOPs or timing? Miss Good, did we have a page limit?

Miss Good: I apologize if I missed it in a written order.

Miss Rosati: I don’t know offhand but can check. Mr. Larson?

Matt Larson: The traditional page limit in commission rules is 30 pages.

Eric Blank: Any suggestion?

Matt Larson: We prefer 30 pages to make it easier on advisors.

Mr. Bonis: CEO agrees with the company.

Eric Blank: That works for us. Anything else? I want to thank everyone. This is likely the most impactful case in my tenure, in terms of dollars, affordability, economic development, megawatts, and Colorado’s landscape with new generation and transmission. I don’t think we’ve seen anything like this in Colorado’s history. Thank you for starting early, staying late, and being disciplined to get this done thoughtfully. With deep appreciation and some exhaustion, thanks all.

Megan Gilman: I share your appreciation for getting it done. Back in my day, the 2021 ERP was the biggest ever. This is just the interim ERP. Thanks for everyone’s concentration.

Tom Plant: I echo that. Thanks for the hard work. This is an enormous case with unprecedented uncertainty in every part. I appreciate the communities in Pueblo, Hayden, and virtual meetings for their fantastic outpouring of interest and concern. Shout out to legal assistants, transcripts, advisors, and counsel for keeping the show running.

Eric Blank: Any final thoughts? Turn on cameras to say goodbye? Get some sleep. I personally thank you all for a great conversation. Unless anyone has final thoughts, the record’s closed, and we’re adjourned. Thanks all.

All: Thank you.