Xcel’s Kenney says it’s too expensive now but may be something his utility will embrace
by Allen Best
Xcel Energy has two nuclear power plants in Minnesota. The current chief executive of its operations in Colorado previously oversaw nuclear power plants in both California and in Missouri.
Will Xcel submit plans for a nuclear power plant in Pueblo as part of its Just Transition Electric Resource Plan?
Not likely, says Robert Kenney, the chief executive of Public Service Co., the Xcel operation in Colorado. But he says that the high costs of nuclear might come down in time to help Xcel figure out how it will hit its 2040 carbon reduction targets.
“At Xcel we do have a background in running nuclear plants,” Kenney told Big Pivots in a brief interview after a transmission line groundbreaking near the company’s St. Vrain plant in Weld County. Fort St. Vrain was a nuclear power plant from 1979 to 1989 that was later recommissioned to burn natural gas.
“I do think that (nuclear) is a clean, safe, reliable resource that has to be part of an all-of-the-above analysis, particularly as we add more renewable energy,” said Kenney. “These are intermittent resources, and so you need something that’s dispatchable. Right now it’s either natural gas or nuclear.”
Duane Highley, the chief executive of Tri-State Generation and Transmission Association, Colorado’s second-largest electrical generator, said in a May session that nuclear remains too expensive and he doesn’t expect costs to come down until 2035 to 2040. (See: “Duane Highley talks about Tri-State’s journey from coal.”)
“I can’t say whether the cost curve is going to come down by 2030 or 2035,” said Kenney. “I do know that the advanced and small-modular reactor technology is still maturing,” but may not be mature enough to be a candidate for new generating resources in the next few years.
“But I do think it’s something that we’ve got to be willing to embrace. I think the cost is significant, and I think that there’s probably a role for the federal government to play in helping to backstop some of these financial concerns. But I do think it’s something we have to keep in mind.”
Xcel is scheduled to submit its next electric resource plan to state regulators in Colorado on Aug. 1, although the company is expected to seek an extension – its second – until mid-October. Those plans speak to what kind of projects Xcel thinks it will need to meet electrical demands while also achieving the goals set by both the company and by Colorado for continued reduction in emissions. The review process commonly takes two to three years, but the addition of new resources can take a much lengthier time yet. For example, Xcel submitted an electric resource plan in 2016 that yielded bids for wind and solar in late 2017. Those bids delivered projects that in some cases did not come on-line until mid-way through 2023.
This particular resource plan is to look first at how Xcel might be able to create new energy infrastructure at Pueblo and Hayden, where it will be closing coal plants.
In 2023, Xcel formed a task force to look at the question of what comes after Comanche 3, the coal unit in Pueblo that is planned for retirement by the end of 2030. The task force – which conspicuously lacked representation from the City of Pueblo, which has an energy commission – concluded that the best answer was a major nuclear power plant. A natural gas plant was the second choice of the task force, but with far fewer jobs and much less tax base and, as such, of lesser interest.
What was this task force all about? Can it seriously be considering nuclear at Pueblo – or anywhere else in Colorado, for that matter, given the still enormous costs of nuclear? Bill Gates, as part of his climate change work, has put $1 billion toward a new nuclear power plant in Wyoming but recently told a TV interviewer that he suspects the project will cost $10 billion before it is completed. Others, looking at the recent cost-overruns, might wonder whether even that figure may be optimistic.
“I think what we’ve said, and I think (the task force) would agree is that the technology’s not mature enough for this particular acquisition period. And I think that’s the challenge. It’s not going to be a technology that we’ll be able to deploy in the ‘25 to ‘29 time period,” said Kenney.
Kenney acknowledged that several types of electrical generation are being developed and face the same cost hurdles. The cost of geothermal is coming down, if doubts remain about how much it can deliver for Colorado. Colorado Gov. Jared Polis in June estimated that enhanced geothermal can deliver 4% to 8% of Colorado’s electricity by 2040.
Green hydrogen – making hydrogen from renewable sources — also remains a possibility, and Xcel has been engaged in efforts to be part of a pilot project in northeastern Colorado. The pilot, however, failed to gain federal funding.
“They’re all in various stages of maturity. I admire the engineers. I’m not one, but I have a lot of confidence in human ingenuity. We’re on our way to reaching 80% carbon-free (energy) by 2030. We’ve made commitments to be 100% carbon-free by 2050. And I think that the 2030 to 2050 time period is where there is some measure of uncertainty. But what is certain is that we have a lot of big brains running around the place, and I think we’re going to be able to figure it out.”
See also: What constitutes a just transition for Pueblo? March 25, 2024
What was left unsaid in Pueblo? June 26, 2024
Top photo: Robert Kenney speaks to television reporters on April 6 as high winds begin to blow hard along Colorado’s Front Range.
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