Renewable energy could be part of Drake debate

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In the midst of a study about the future of coal-fired Drake Power Plant, Mayor Steve Bach’s goal of adding 6,000 jobs a year and ongoing chatter about how Colorado Springs Utilities is governed, no one is talking much about renewable energy.

At least, no one seems to be talking much about it.

Colorado ranks fourth in the country for clean technology jobs and has the second most aggressive renewable energy portfolio standard for major utilities like Xcel and Black Hills Energy — 30 percent by 2020 — in the country. (Colorado Springs Utilities is exempt from the requirement, but must get 10 percent of its power from renewable sources by 2020.)

Denver’s economic development corporation has dedicated an entire arm of its operation to growing the clean-technology industry — the Colorado Cleantech Hub.

Other cities and utilities around the country are increasingly interested in renewable energy and using it as an engine for economic development.

San Antonio lured an international headquarters to relocate there, invest $1 billion and establish 800 permanent jobs with a request for proposals for 400 megawatts of solar energy.

The Pentagon has issued a $7 billion RFP for renewable-energy power purchase agreements at its installations.

Yet conversations about renewable energy and its economic power in Colorado Springs, home to five military bases, have stayed out of the spotlight.

Renewable energy didn’t top the wish list in CSU’s latest Electric Integrated Resource Plan discussions. Steve Berry, Utilities public affairs specialist, said public input every three to five years helps craft CSU’s 20-year plan. The most recent plan was published in late 2011.

“A lot of corporations and companies will say renewables are important, but in the end, it comes down to cost,” Berry said. “We are community owned, so if our customers said they wanted to invest in renewable energy, we would.”

While not the top priority, renewable energy is a bigger part of the plan than the state requires, said Bruce McCormick, CSU chief energy services officer. It aims to get 20 percent of its power from renewable sources by 2020, he said, while cutting energy consumption by 10 percent.

The catch is that Utilities wants to keep its 20 percent regional price advantage, something McCormick says is key to its role as an economic driver.

“A lot of companies are attracted to Colorado Springs because of our low electric rates,” he said. “We are particularly attractive to companies that have high electricity demand, and Colorado Springs has kind of become known as a leading city in the country for those industries.”

Recent examples of companies attracted by utility rates include the Walmart data center and the Bal Seal plant, McCormick said. Low rates and easy, inexpensive connections are quiet ways CSU has encouraged economic growth, he said.

But San Antonio’s CPS Energy (formerly City Power Services), hasn’t been quiet about its role in economic development.

“We had plans to add a scrubber to one of our oldest coal-fired units,” said CPS spokeswoman Lisa Lewis. “But it did not make sense for our particular utility to spend $1 billion on scrubber technology.”

Instead, the municipal utility purchased a natural gas plant from a neighboring utility. Lewis couldn’t say what it cost, but did say it was less than the scrubber would have cost. At the same time, CPS was looking to increase its renewable energy load, hoping to reach 20 percent by 2020.

“We were already heavily leveraged in wind,” she said. “We have more than 1,000 megawatts of wind.”

So they looked to solar, Lewis said, “and we saw that we could leverage our buying power to gain economic development for San Antonio.”

They started with an RFP for 50 megawatts of solar with the stipulation that the bidder would have to bring jobs to that community. More than 100 companies responded, CPS decided it could use up to 400 megawatts of solar. OCI Solar Power, a Korean company, promised to put its North American headquarters in San Antonio and bring 800 jobs if it got the contract.

“We partnered for a very reasonable price,” Lewis said. It was reasonable enough that CPS hasn’t had a rate increase since 2010 and recently announced it would put off a scheduled rate increase for 2013.

McCormick knows about the San Antonio project and has talked to the utility’s CEO.

“I don’t think it could work here on the same scale that it worked there,” he said. “But I wouldn’t say it couldn’t work here. We would just have to have a specific need.”

With Drake still online, McCormick said, Utilities doesn’t need any more generation capacity.

Editor’s note: This is the first of an occasional series about renewable energy in the state and the Colorado Springs area.

One Response to Renewable energy could be part of Drake debate

  1. Great article Amanda Miller! I look forward to reading more about renewable energy in Colorado Springs.

    Ken Brickman
    November 2, 2012 at 3:58 pm