Coalition of Ratepayers

Pueblo beware of Xcel’s promise of economic development

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Xcel Energy continues to make absurd claims about its Colorado Energy Plan Corporate Enrichment Plan (CEP).

The Coalition and others have debunked the cost-savings scam, but what about the economic development claims? One of our favorites is that the CEP, which will destroy 80 to 90, maybe more, good-paying jobs in Pueblo, is good economics for the city. To lend credibility to the claim, clearly it needs some, Xcel commissioned a self-serving study from the respectable University of Colorado Leeds School of Business.

To Xcel’s delight, the Leeds study painted a rosy picture following the loss of jobs with the closure of Comanche 1 and 2. There’s one huge problem with the study that renders the whole thing useless:

PSCo [Xcel Energy Colorado] provided data that included capital expenditures, operating expenditures, revenue requirements, and taxes for each scenario, consistent with the final Preferred Electric Resource Plan and Preferred Colorado Energy Plan as presented in the June 6, 2018 120-Day report. The research team worked under the assumption that the company provided good-faith estimates for each scenario.

Xcel supplied all the numbers. Leeds should have researched those numbers a little more before simply accepting them as “good faith estimates” because Xcel’s accounting and modeling have been thoroughly discredited in the company’s quest for approval of the CEP.

Colorado Public Utilities Commission Staff doesn’t trust Xcel’s numbers, writing this in public comments:

Staff is unable to conclude that the Preferred CEPP is more likely than not to produce savings. The modeling results presented by the Company contain a number of errors and a fundamental flaw, which are discussed below, that render the results suspect.

Colorado’s largest rural electric cooperative Intermountain Rural Electric Association (IREA) doesn’t trust Xcel’s numbers as former Moffat County Commissioner John Kinkaid pointed out in a letter to the editor that appeared in the Grand Junction Sentinel:

The plan ‘requires ratepayers to pay a premium for renewable generation levels that significantly exceed already-satisfied Renewable Energy Standard levels and is based on a deeply flawed model that inaccurately projects cost savings decades from now.’

The Coalition of Ratepayers has proven repeatedly that Xcel’s numbers are unreliable:

PSCo’s accounting has been riddled with biased assumptions, errors, and changes that are completely self-serving and call into question the Company’s credibility on numerous claims. Simply put, PSCo’s numbers are not trustworthy or accurate.

And the study itself? PUC Staff criticized it writing, “The Leeds report is not transparent, and the Company did not provide sufficient additional support to allow Staff to determine the quality of the results.”

Staff went on to provide an economics lesson that ends with its opinion of the CEP’s possible economic benefits to Pueblo:

Staff concludes that the Preferred CEPP may result in a positive economic impact for Pueblo County in the same way that economic activity is generated if a building is destroyed and rebuilt. The decision about whether a building should be destroyed and rebuilt should be made based on the value of that project, not the economic impact of an exercise that will utilize dollars that could be used for another possibly more beneficial purpose. The magnitude of the economic impact provided in the Leeds report is impossible for Staff to validate, but is likely much smaller than the estimate provided by Leeds.

Beware of Xcel’s false promise of economic development. The International Brotherhood of Electrical Workers (IBEW), Local 111, which represents Comanche employees, pointed out that during a 15 year period of time, the Leeds study indicated Pueblo likely would experience negative GDP growth.

We will know in a couple of weeks if the Colorado PUC will approve Xcel’s massive $2.5 billion fuel switching scheme. If the commission says yes, it will do so knowing that cost-savings and economic development claims aren’t true. In other words, Xcel will be allowed to get away with not telling the truth as it enriches shareholders at the expense of Colorado’s ratepayers and the hard working folks of Pueblo, who face an uncertain future.

The truth frightens Western Resource Advocates

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“Three things that cannot be long hidden: the sun, the moon, and the truth.”  Budda

Western Resource Advocates (WRA), a multi-state renewable energy advocacy group and intervenor supporting Xcel Energy’s Colorado Energy Plan (CEP), filed a motion on July 16 requesting that the Colorado Public Utilities Commission (PUC) disallow huge portions of the Coalition of Ratepayers expert witness Charles Griffey’s testimony (and here) that challenges Xcel’s CEP accounting.

The CEP is Xcel Energy’s massive $2.5 billion fuel-switching scheme away from hydrocarbons in favor of predominantly industrial wind.

WRA, which brags about destroying view sheds with unreliable industrial wind turbines, doesn’t think the cost to ratepayers is within the scope of the proceeding. Nor does WRA believe that the Coalition should have the right to critique questionable claims from Xcel, WRA, and the Sierra Club that the CEP is economical and in the public interest.

Coalition attorney Meredith Kapushion filed our response on Friday, July 20:

Contrary to WRA’s assertions, the testimony offered by Griffey is in direct response to prior testimony, is directly relevant to the interrelated issues and comports with the Commission’s rulings in this case.

Griffey’s testimony is a direct challenge to claims made in the AD/RR proceeding (Docket 17A-0797E) by Public Service Company of Colorado (“PSCo” or “the Company”), Sierra Club, and WRA that flatly endorse the economic conclusions of the 120-Day Report and make sweeping  pronouncements that the AD/RR application and the Preferred Colorado Energy Plan Portfolio (“CEPP”) are in the public interest. The very parties that support WRA’s Motion seeking to strike Griffey’s testimony are the same parties that introduced this issue in earlier testimony. They should not be allowed to proclaim the alleged benefits of the CEPP in the AD/RR proceeding without weathering any critique. It is both the hallmark of an adversarial system and the obligation of the Commission to consider the very type of argument and information that has been presented  by the Coalition to rebut these claims. The truth should neither be buried nor ignored. [Emphasis mine]

This leaves us wondering, what is it about the truth that has WRA, the Sierra Club, and Xcel so frightened? Perhaps it’s that Xcel and its supporters said the CEP would move forward ONLY if it saves Xcel’s customers money as the Colorado Springs Gazette reported, “Xcel’s caveat is that it would not go ahead with the project if it didn’t create savings for customers or at a minimum, not cost them more than they already pay.”

But, yet again, the Coalition found errors in Xcel’s most recent figures that give the illusion of but not actual cost savings as stated in our recent response:

When corrected for these errors, the early retirement of Comanche Units 1 & 2 will cost ratepayers at least $284 million on a present value basis through 2054 (even more when a shorter time horizon is considered). This is a $497 million difference from PSCo’s 120-Day Report and undermines the claims made in the AD/RR proceeding by PSCo, Sierra Club, and WRA that the CEPP saves ratepayers money and is in the public interest. 

Previous errors totaled $88 million, which Xcel acknowledged.

The truth is that WRA and their co-conspirators don’t want the truth. They want the plan.

If the PUC commissioners do decide to strike Griffey’s testimony then it also should strike significant portions of Xcel, WRA, and Sierra Club testimony as the Coalition requests. Hopefully, we find out on Wednesday, July 25 if truth prevails over fear.

“On the face of it, it must be a bad cause which will not bear discussion. Truth seeks light instead of shunning it.” Horace Mann, as quoted in the opening of our response.