Why not wind? CRES history Part 2:

In 2000, Colorado’s largest utility rejected a proposed wind farm near Lamar. Why? A team that included CRES fought back. The result: Colorado Green — followed by others.

The story so far. Triggered by the oil embargoes of the 1970s, Colorado became a forum for explorations of alternative futures for energy. Some of those involved in this conversation were natives, others drawn to the state by creation of the Solar Energy Research Institute, the precursor to NREL. Spurred by a national solar organization, a grassroots organization called the Colorado Renewable Energy Society was created in 1996.

by Allen Best

The Public Service Co. of Colorado, a subsidiary of Xcel Energy, is a state-regulated investor-owned utility offering electricity and natural gas. In a model created by utility executive Samuel Insull early in the 20^th century, Xcel and other investor-owned utilities operate as monopoly service providers but, in exchange, submit to state regulation.

In addition to exercising control over rates, Colorado regulators require the company to file an electric resource plan every three years and to acquire generation resources through competitive bidding. The plan Xcel filed in November 1999 was for new resources to be acquired from 2002 through 2004.

To meet that demand, Xcel planned to go to a familiar tool chest: natural gas. Colorado utilities in the 1990s had been ramping up natural gas generation in ever-larger configurations, a practice that was to continue into the first decade of the 21^st century. Altogether, 5,195.5 megawatts of natural gas generating capacity was added in the 20-year period. Coupled with the new natural gas-fired generators, Xcel also planned very modest demand-side management programs. Absent from Xcel’s plans in 1999 was new wind generation.

Colorado from its earliest days of homesteading had windmills to pump water. Some were configured to generate small amounts of electricity. Then, in the 1980s and 1990s, wind developers began assessing the state’s wind resources. They found much to exploit.

By the late 1990s, Xcel had also dabbled in wind via a new program called Windsource. Customers had the opportunity, if they chose, to pay extra for “clean” wind energy. Their demand was met in the late 1990s first by Ponnequin Wind Farm, a project located along the Wyoming border north of Greeley, the state’s first commercial-scale wind farm. It had a capacity of 25.3 megawatts. It was followed by the 25-megawatt wind farm on the Peetz Table north of Sterling in 2001.

The program had been instigated as a result of prodding by CRES and other groups that included Environment Colorado, the Sierra Club, and the Roaring Fork Valley’s Community Office for Resource Efficiency, known as CORE.

Plenty more wind was available for development. Colorado’s steadiest, most reliable winds blow in the state’s southeastern corner, near the center of the Dust Bowl havoc of the 1930s. The “quality” of the wind—a word used with the prejudice of electrical production in mind – ranks very high. The state energy office had used U.S. Department of Energy funds and help from NREL to place a meteorology tower near Lamar, atop Signal Hill, to record wind velocities.

With those data in hand, a California-based wind company called Zond Systems created a proposal for a wind farm 22 miles south of Lamar. The company was later sold and became Enron Wind.

Xcel would have nothing to do with the proposal. Too costly, the company said in response to three repeated applications from Enron. The third time, renewable advocates discovered that Xcel had added $61 million to the bid price on the presumption of added costs for transmission and for integrating wind into the company’s electric operations. Those padded costs aside, the bid that Xcel had rejected was for electricity costing 3.2 cents per kilowatt-hour. That was lower in cost than all other of Xcel’s generating sources in Colorado aside from the small hydro plant along Interstate 70 at Georgetown Lake.

Lehr had taken note. Working pro bono on behalf of CRES, he set out to demonstrate why the PUC should order Xcel to properly consider the bid from southeastern Colorado.

One of the experts he tapped was Andrews, the former SERI contractor who had by then been studying energy for more than two decades. Andrews warned the PUC commissioners to be skeptical of Xcel’s predicted low prices for natural gas. Although he did much research before putting on his coat and tie to testify before the PUC commissioners, Andrews remembers being on shaky ground in his projections. In the short term, he was proven correct, though. Natural gas prices skyrocketed to $14.50 per million Btu in 2008. Xcel had predicted $3 or less. Xcel was correct for the longer term as fracking and other advanced drilling techniques produced a flood of cheap natural gas.

The second part of the case against Xcel came from Law and Water Fund of the Rockies, now called Western Resource Advocates. John Nielsen identified flaws in Xcel’s modeling of benefits of wind to Xcel’s generating fleet.

NREL researcher Michael Milligan provided the final evidence for the wind proposal. He testified to the improved skill in predicting wind capacity. That enhanced ability to predict wind made it easier to integrate it into electrical supplies.

The PUC commissioners were persuaded. They ordered Xcel to contract for power from the 108-turbine Colorado Green proposal.

When completed in 2004, Colorado Green was the fifth largest wind farm in the United States, capable of generating 162 megawatts. It was a huge victory for CRES and other clean energy advocates.

Since then it has been repowered with updated technology, enabling it to produce even more electricity. Even so, its production has been dwarfed by that of other, much larger wind projects that have become common in Colorado, including the 600-megawatt Rush Creek Wind Project between Limon and Colorado Springs.

Those wind farms have augmented tax revenues and added some long-term, well-paying jobs to struggling farm communities on Colorado’s eastern plains. Colorado Green, for example, paid $2 million a year in local property taxes upon its completion, and it has since been expanded and joined by other wind farms. In addition, the Emick family, on whose land Colorado Green sits, has been reported to have created a foundation to endow local improvements.

Among the boosters of Colorado Green in Prowers County was John Stulp, then a county commissioner who also grew wheat on a nearby farm. Colorado Green has been what he says he expected.

“It’s been good for the tax base. It’s not a huge employer, but it’s good employment for the 10 or 12 who are on the operations and maintenance crews. They pay their bills. The county has gotten along with them reasonably well. They’re good corporate neighbors, so to speak, and it’s clean energy,” says Stulp, who led the Colorado Department of Agriculture for four years in the administration of Gov. Bill Ritter, then was a special water advisor to Gov. John Hickenlooper for eight years.

Colorado Green, the first major advocacy case for CRES, also opened the door to Amendment 37. It put Colorado on the national renewable map.

Next: Rejected at the Legislature, renewable advocates take their case directly to voters.

What you may have missed in this series:

Part 1: A coming together of minds in Colorado.

Or download the whole series in one e-magazine of Big Pivots 64..

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