Theater in Pueblo about nuclear, but the real story will be delivered June 1

Question of what constitutes ‘just transition’ lies at center of debate about what will replace Comanche 3

 

by Allen Best

By my count, more than 600 people were seated or standing against the walls of the conference room at Pueblo’s Sangre de Cristo Arts Center on Feb. 29. I had expected fewer people but perhaps some shouting.

At issue was whether Pueblo County should want Xcel Energy to build a shiny new nuclear power plant to replace the now-tarnished coal plant called Comanche 3.

Instead of shouts, I heard vigorous assertions. The strongest reaction I heard was after Leslie Glustrom spoke.

“The chances that this nuclear power plant that you’re all dreaming about will get paid for by people like me and all the people I work with is vanishingly small,” she said after first identifying herself as a Boulder resident and hence a customer of Xcel Energy. Black Hills Energy delivers electricity to Pueblo.

“It would cost three, four, five times as much as the alternatives. And that’s not going to get approved by the (Colorado Public) Utilities Commission. I’m as sure as I can be. It would not get approved. So every minute you spend here dreaming about nuclear, it’s kind of like teenagers dreaming about whatever, right? Or going grocery shopping and getting all these steaks and caviar and all this other stuff. And who’s going to pay for it? We’re not going to pay for it.”

Conspicuously absent were executives from Xcel Energy. On June 1 they will submit to the PUC a proposal for a Just Transition electric resource plan. The plan is supposed to address what the company needs to ensure reliable delivery of electricity to its 1.6 million customers and, if possible, shore up the tax base and economy of Pueblo County, at least to the extent that it is losing Comanche. Xcel pays $25 million a year to Pueblo County, most of which comes from Comanche Station, with over $15 million of that amount for Comanche 3.

Some think Xcel already has its plans in place — and this big-tent meeting was merely a sideshow. Instead of a nuclear power plant, as the Xcel Energy ad hoc committee concluded was the preferred choice, Xcel will propose the task force’s second choice: another natural gas plant, perhaps combined with carbon capture and sequestration. That’s the theory.

Of course, the reason the natural gas plant came in a distant second in the task force ranking is because it delivers far fewer jobs, 20 to 25, compared to the 77 employed at Comanche 3 and a lesser tax base of about $16.5 million.

“We are convinced that these two technologies could establish Pueblo as a leader in the clean energy world and make the words of “Just Transition” meaningful to Pueblo County as opposed to an empty slogan,” the task force report concluded.

 

For more than a century, long trains have been rolling into Pueblo to deliver coal mined at Crested Butte, Redstone, and along the foothills near Trinidad. At first the coal was for the steel mill. Then came the coal-burning units for electrical generation. One was in the middle of town. Far bigger were the Comanche units situated beyond the steel mill. The first two units were commissioned in 1973 and 1976.

Comanche 3 came much later, going on line in 2010. At 750 megawatts of capacity, it is Colorado’s largest coal plant and almost certainly its last.

I toured the plant in the summer of 2010 to do a story for a business magazine. The magazine cover played it as a success. At a certain level, that’s accurate. The cover photo was of a handful of Xcel blue-collar employees standing in front of the plant at dusk, triumphant and proud.

The story itself explored the fissure among environmental advocacy groups. Glustrom, if working from a very small organization, had drawn attention for her vigorous opposition to the compromise that was part of the PUC approval. She saw it as a waste of money given the pressing need to reduce, not grow, greenhouse gas emissions. Other groups, most notably Western Resource Advocates and Southwest Energy Efficiency Project, both of them also based in Boulder, told me that they felt they had succeeded in getting Xcel Energy to commit to energy efficiency programs. Amory Lovins may have been preaching that gospel for close to 30 years by then, but utilities had paid him little heed.

Context matters. That PUC decision was in 2005, and you may remember that Bill Owens, a Republican, was the governor, and the Democrat he had appointed (as mandated by Colorado law) to the PUC was Carl Miller, of Leadville — who, incidentally, I knew and held in high regard. But he was very definitely old school Democrat, a union guy who had worked at Climax, the molybdenum mine. In 2005, also consider that solar was still very expensive. Natural gas had gained market share during the 1990s, but the prevailing faith was in ever-bigger coal plants.

Peak coal production in the United States arrived in 2008, two years before Comanche 3 began operations. The plant was scheduled to continue operating until 2070. The first Comanche unit closed in 2022, and the second will be shuttered in 2025.

As it stands now, Comanche 3 will close in 2031, although I have heard informed sources speculate that it will close even sooner.

In early 2023, Xcel Energy convened an 11-member task force of community members to examine options. They met monthly through the year, usually for three hours at a time, and heard many experts, especially from Xcel. You can examine reports and listen to meetings at Xcel’s “Innovative Energy Solutions Study” website.

From the start, though, the legitimacy of the task force was in doubt. Pueblo, the city, was not asked to participate. The city has an energy advisory committee. How can you NOT have direct representation from a city of 110,000 in a county of 170,000?

The Pueblo Innovative Energy Solutions Advisory Committee, as the task force was called, issued its report in early January. I was sent a copy by Frances Koncilja, an attorney and former PUC commissioner who grew up in Pueblo. Her brothers famously created the alley of neon lights across from the old rail station. She co-chaired the task force study.

The report very directly asks what can Xcel deliver to Pueblo County in both tax base and in high-paying jobs that will be equivalent to Comanche?

Nothing comes close to nuclear.

“A new gas plant with carbon capture will not make Pueblo whole,” the executive summary declares. “It provides only 20 to 25 jobs with a salary range of $80,000 to $120,000 and tax payments of approximately $16.5 million per year. Of all the technologies that we studied, only advanced nuclear generation will make Pueblo whole and also provide a path to prosperity. Advanced nuclear provides 200 to 300 jobs with a salary range of $60,000 to $200,000. And tax payments? A bonanza for Pueblo County, according to the report: $95.29 million.”

Xcel has committed to paying property taxes of $15.9 million until 2040 but CORE Electrical Cooperative and Holy Cross Energy, who together own a third of the plant, have made no comparable pledges. (A spokeswoman for Holy Cross said the utility has not had any discussions about this).

The report finds no serious alternatives for generation of electricity or storage that come close to generating taxes or jobs. Solar? It’s not even mentioned in the executive summary, although it is in the fuller report. From Xcel’s perspective, it fails to provide the baseload generation. Plus, it takes large amounts of land and delivers few jobs and lesser tax base.

Hydrogen? Various types of storage. Xcel’s task force looked at many of them, perhaps all that matter, and found them all wanting – at least when it comes to replacing Comanche’s tax base and jobs.

That takes you to a different mental framework.

“Just as Colorado has adopted a social cost of carbon when modeling energy investments, the costs of a just transition for coal communities should be taken into account in the modeling,” the report declares.

White House economists during the Obama administration calculated the social cost of carbon at $42 a ton; those in the Trump administration lowered it to less than $5 a ton. Biden’s team came up with $51. The EPA recently raised it to $190 a ton.

The question I have after hearing all the conversation that evening in Pueblo was whether this thinking about what constitutes just transition has been too much inside the box. Granted, the onus is on Xcel because of Colorado’s regulatory environment to replace the lost generation of Comanche with something comparable in Pueblo County. Is there another way to accomplish just transition?

I had set out from my metro-Denver office with the expectation of getting to Pueblo a half-hour early. We crawled across on Interstate 25 through parts of Denver but were still in good shape until southern Colorado Springs. Then, the traffic stopped. We spent nearly an hour driving two or three miles. When I walked into the door in Pueblo to see the yellow-green shirts of the International Brotherhood of Electrical Workers, Koncilja had wrapped up her presentation and was answering questions about water contamination from a nuclear power plant.

Pueblo long was a labor town, and to an extent it still is. I counted maybe 100 of the yellow-green shirts, and I believe another union may have been represented by orange shirts. Several members got up to testify in support of a nuclear power plant but mostly they listened.

I wondered about the politics of this. Labor unions have been courted by Democrats and the Polis administration. I have to think that was part of the strategy of Jared Polis in 2018 when he announced his gubernatorial candidacy at the Solar Roast Coffee shop in Pueblo.

The marriage can’t always be a comfortable one. This issue may test the alliance — because, as Glustrom and many others pointed out, nuclear is a very, very expensive option.

My first introduction to the cost issue came in 2019. I had gone to Fort Morgan, the hometown of my youth, for an interim legislative energy committee hearing. A Logan County commissioner belligerently asked why state legislators weren’t promoting nuclear energy.

Chris Hansen, then a state representative, politely responded that nuclear was very expensive and cited some additional details. Only later did I realize he had a degree in nuclear engineering.

And in Pueblo at that town hall I heard somebody else speak with authority. His first name was Karl or perhaps Carl. He said he said he lived in Pueblo West and had worked at the Palo Verde nuclear power plant west of Phoenix. He had spent 13 years in the Navy aboard nuclear submarines. He had been around nuclear facilities for 44 years.

“Nuclear power does not concern me nor my kids,” he said. “They’ve lived near it, on it, around it, and I don’t believe any of the health hazards are a problem for nuclear power.”

Cost tempered his enthusiasm. “The reason I’m neutral is because I am concerned about the financial end of it.”

He then began reciting figures about cost overruns. “I don’t know where the money’s coming from to build it. Xcel, are they still going to be around? Who’s going to build it and where does the money come from?”

 

 

Support for nuclear power nationally has grown from 43% in 2016 to 57%, according to a Pew survey in 2023. Republicans generally support nuclear power, but a growing number of Democrats do, too.

And the environmental community does have cleavages. Consider that James Hansen, the climate scientist who in 1988 famously testified before a Senate Committee chaired by then-Colorado Sen. Tim Wirth, has been a long-time proponent of nuclear. A New York Times  story in November 2023 quoted an attorney for the Natural Resources Defense Council who had sued the federal government over nuclear waste early in his career. The attorney said he had now become “more comfortable” with nuclear power because of the threat of climate change.

Under Colorado’s Golden Dome, debates about nuclear power have been held annually as some legislator or another parades a bill to support nuclear. Lacking support from the Polis administration, the bills have mostly died, although a 2023 study bill did get passed.

In January, that conversation continued. Sen. Larry Liston, a Republican from El Paso County, proposed to make nuclear a “clean energy,” making it eligible as a resource for utilities to achieve 2050 emission-free targets.

The bill, SB24-039, was postponed indefinitely on a 4-3 party-line vote.

Among those testifying in support was David Takahashi, an environmental advocate from Boulder County. His written testimony told committee members they would hear “a lot of well-meaning but reflexive opposition to defining nuclear energy as a source of clean energy.”

Do not confuse the “behemoth light-water reactors of yesterday” with the small modular designs of today, he said. A decarbonized and electrified world will require a combination of clean, intermittent energy, primarily solar and wind, and clean, dispatchable power sources – including nuclear.

On March 1, the day after the Pueblo meeting, the New York Times reported a 365-to-36 vote to streamline processes used by federal regulators in approving new reactor designs.

“Tackling the climate crisis means we must modernize our approach to all clean energy sources, including nuclear,” said Rep. Diana DeGette, a Democrat who represents Denver. “Nuclear energy is not a silver bullet, but if we’re going to get to net-zero carbon emissions by 2050, it must be part of the mix.”

Certainly, the Biden administration believes nuclear must be part of the mix. In June 2023, the Economist had noted this aim for a “nuclear -power renaissance.” The Infrastructure Investment and Jobs Act of 2021 had created a $6 billion fund to keep existing nuclear power plants running. Some 18% of U.S. electricity comes from nuclear energy.

The Inflation Reduction Act of 2022 made nuclear power eligible for the same tax credits as wind, solar, and other renewables. That law delivers a bonus tax break for reactors built in fossil-fuel areas such as a coal-mining town, to funnel workers into green jobs. See: Energy Community Tax Credit Bonus

Those sweeteners aside, nuclear faces three major challenges, the magazine noted. One is fuel, both procurement and then disposal. “Russia dominates uranium processing, and is the world’s only commercial supplier of high-assay, low-enriched uranium.” Also, officials worry about finding enough workers to build and operate new nuclear plants.

Cost leads the concerns as was noted by Glustrom along with Pueblo native and engineer Ken Danti and a number of other speakers in Pueblo.

The U.S. Department of Energy estimated that nuclear reactors must come in at $3,600 per kilowatt of capacity to be built quickly around the country. First-of-their-kind reactors are costing anywhere from $6,000 to $10,000.

The nuclear sector has had a horrendous decade of cost overruns. Two reactors in Georgia cost $35 billion, double the original estimates.

One response to the all-too-typical cost overruns, past and present, is to produce smaller reactors but many of them.

“The hope is that these reactors would have a smaller upfront price tag, making it less risky for utilities to invest in them,” the New York Times’ Brad Plummer explained in the March 1 story. “That, in turn, could help the industry start driving down costs by building the same type of reactor again and again.”

So far, that idea remains in its infancy. NuScale Power, a company in Idaho, tried to build a half-dozen small reactors. But it struggled with costs and found it difficult to sign up enough customers. Last year, it pulled the plug.

Still others, though, continue experimentation, including the plan by TerraPower, a company in which Bill Gates is a significant investor, to build a sodium-cooled reactor to replace a coal-fired power plant at Kemmerer, Wyo.

China has moved far more briskly, owing partly to lower labor costs but also other factors. It has added 37 nuclear reactors during the last decade, a time when the United States has added 2.

 

Beyond nuclear, there may be other ways to achieve deep decarbonization. For example, can we move renewables around the continent? Transmission building, though, takes time.

A report from Columbia University’s Center on Global Energy in December 2023 cited modeling studies by the National Renewable Energy Laboratory that explored various scenarios. One of the questions it identifies is how rapidly nuclear will move forward as compared to carbon capture and sequestration technology?

The Polis administration clearly sees carbon capture being a coming thing. Consider the new Colorado Greenhouse Gas Pollution Reduction Roadmap 2.0. It mentions carbon capture 15 times and carbon sequestration 9 times.

Nuclear? Zip.

Earlier, I mentioned that I got to the meeting a half-hour late. My sense is that this will be the case for nuclear and Pueblo. By the time the costs of nuclear get contained, other decisions will have been made.

The report alludes to this problem. The mature technologies that can be built by 2031 all come up short in tax base. Everywhere, we are waiting to see what technologies mature rapidly and bend down the cost curves.

That takes us to thinking outside the box. The task force briefly alludes to a bigger picture. It cites the PUC Retail Rate report that found that Pueblo residents paid 34% more than the statewide average and 47% more than Xcel Energy charges its customers during the same time period.

The cause? Because Pueblo’s electricity provider, Black Hills Energy, had switched from coal to gas, according to this report. Those higher costs, in turn, have resulted in businesses that consume large volumes of electricity scouting Pueblo as a new location – and then leaving upon learning the price of electricity.

Is natural gas really to blame for the high cost of Black Hills Energy? That’s a bold assertion I’d like to see debated somewhere.

Pueblo has lower real estate prices than its neighbors in the northern Front Range and lesser incomes, 68% of the state average. It has robust water supplies.

Might there be solutions outside the box of electrical generation? The task force report suggests that is what must happen: “Pueblo needs to pivot from a coal community to develop a new vision of its future and plan to attract innovative clean energy projects into the community.”

Pueblo already has turned the corner in key ways. It has the world’s largest wind turbine tower manufacturing plant, CS Wind. President Joe Biden stopped by there last year to deliver a speech. The Comanche coal-burning units are surrounded by solar panels, including Bighorn’s 300-megawatt collection that allows Evraz, the steel mill, to boast of producing solar-made quarter-mile-long rails.

The first rails into Pueblo were nailed in 1872. Those rails and the coal they delivered, along with the water of the Arkansas River, enabled the first production of steel.

In 1971 came the Transportation Technology Center located east of Pueblo about a dozen miles. Gov. Jared Polis and other state officials traveled there in January to take a ride on a new electric-powered train. How it differs from the train I often take from Olde Town Arvada to Union Station, I don’t know. I find this commuter train superb – (and better yet if they would quit making those tiresome announcements about the next rail stop in Wheat Ridge).

The push underway is to advance passenger rail along the Front Range, from north of Fort Collins, at Wellington, south to Pueblo, and also from Denver to Craig. Passenger rail for the latter ended in about 1967.

I can’t say that passenger rail will be the answer for the woes of Moffat County, which loses its power plant tax base about the same time Comanche 3 closes. I am not sure that it is the full answer for Pueblo. Certainly not the tax base. Certainly, not immediately.

As for the Pueblo town hall, the concluding remarks were offered by Jerry Bellah, the vice president of the 8^th district of the International Brotherhood of Electrical Workers. “No disrespect to the lady from Boulder,” he said, but then he pushed back hard to Glustrom’s remarks a few minutes before.“We support solar, we support wind, we support storage, and we support nuclear because we believe in the science,” he began, then he got personal as he responded directly.

“Those jobs are so important. My kids are all moving out. They went and got educations. They had to move out…. Sometimes being the loudest in the room does not make you correct. We believe in the science of global warming and we believe in the science of nuclear.”

I said I heard no shouting. But clearly, the labor unions are aggrieved. After the meeting, Bellah along with Gary Arnold, the business manager of the pipefitters union, sent a letter to the Pueblo County commissioners, the sponsors of the town hall.

“Of the 21 speakers, 16 were against advanced nuclear and only 5 persons were allowed to speak in favor of the advanced nuclear,” they asserted..

The unions accused those against nuclear of having made “numerous false and outlandish accusations.” And advanced nuclear, with a 70-year life span, “can be cheaper than wind and solar, which last 15 to 20 years and then must be replaced,” the unions argued.

Glustrom’s comments provoked special response. “Coming to Pueblo to be given a platform to mock, taunt and ridicule the hard-working members that keep our homes warm and safe seems beyond disrespectful and inappropriate,” the letter said. “If our hard-working blue-collar members want steak and caviar, should that be ridiculed?”

This alliance of blue and green, labor and environmentalists, has hit a rough patch. But that doesn’t change the cost of nuclear. For now, it has a top-shelf price tag.