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USA: Disputes Surrounding Xcel Energy’s Power Pathway Project

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Power Pathway project Federal Energy Regulatory Commission (FERC) Xcel Energy's Public Service Co. of Colorado Transmission cost allocation Generator interconnection process

MEAN and municipal utilities from Aspen, Glenwood Springs, and Center, Colorado, filed a complaint with FERC against Xcel Energy’s PSCo, objecting to the allocation of costs for the Power Pathway Project. They argue that retail transmission customers, including themselves, should not bear the burden of costs for a project that doesn’t benefit them. The complaint requests FERC to modify the Network Service Agreement and establish separate cost allocation mechanisms. PSCo’s decision to prioritize its own generating resources over queued projects has drawn criticism, leading to complaints from Invenergy subsidiaries. Despite PSCo’s claims of necessity for state carbon emission reduction, opposition persists, with concerns about fairness and resource adequacy. The dispute highlights challenges in equitable cost distribution and transmission planning processes.

Xcel Energy-Colorado gets praise, blowback for clean energy plan

Dispute Over Cost Allocation: MEAN and Municipal Utilities Challenge Xcel Energy’s Power Pathway Project

  • According to the Municipal Energy Agency of Nebraska, known as MEAN, and three of its municipal utility members, the Federal Energy Regulatory Commission should prohibit Xcel Energy’s Public Service Co. of Colorado from allocating costs from a approximately$ 2 billion transmission project to specific general transmission customers.
  • According to MEAN and the utilities in a complaint filed on Friday at FERC, the municipal utilities that serve Aspen, Glenwood Springs, and Center, Colorado, claim they won’t be benefited by PSCo’s Power Pathway project and should not be responsible for covering any of its costs.
  • According to MEAN and the provincial utilities, PSCo’s retail transmission customers—including the three utilities—are expected to cover about 20 % of the project costs, or$ 400 million, while retail customers will cover the remaining expenses.
  • According to MEAN and the municipal utilities, PSCo improperly assigned costs to entities that don’t need or benefit from the project and failed to properly determine the benefits and beneficiaries of the Power Pathway project, including generators who will gain access to the grid through the transmission project.
  • According to the complaint, FERC should mandate that PSCo modify its Network Service Agreement between the utility and the provincial utilities in order to release them from liability for the project’s costs. According to MEAN and its three members, PSCo may be required by FERC to establish a distinct cost allocation zone or transmission rate mechanism for Colorado cities that excludes the project’s costs.
  • According to the complaint, the Colorado cities anticipate that their transmission rates will rise by 114 % in the first four years of PSCo’s projects, with no benefit to them.

Additionally, according to MEAN and the provincial utilities, the Power Pathway project should be regarded as a local transmission project with costs shared locally, including with various Colorado utilities.
Based on its cost, regional scope, high-voltage nature, and the possible benefit of the Power Pathway to various utilities and their respective ratepayers, the Commission established required non-discriminatory local planning and aggressive procurement for the type of project for which it is a poster child.

Project Evaluation: Challenges Surrounding the Power Pathway Project

According to the petitioners, FERC should direct PSCo to have the Power Pathway project re-evaluated as part of WestConnect’s local planning process.
Potential green generators were a major beneficiary of the Power Pathway, according to PSCo’s cost allocation. MEAN and the utilities claimed that this “provides an unfair enrichment to generators and places an unwarranted and unfair burden on transmission customers for as the Colorado cities.”

The May Valley-Longhorn Extension, which will add an extra 90 miles of double-circuit 345-kV line between novel substations, is part of the Power Pathway project. It consists of a 560-mile, 245 kVA double- circuit network transmission system between four existing underpinnings and three new ones. The majority of the project was approved by the Colorado Public Utilities Commission in 2022, but PSCo’s development has been put on hold after it decided in January not to approve the May Valley-Longhorn Extension. About 5.5 GW of wind, solar, and additional resources are anticipated to have access to the grid as a result of the Power Pathway project. According to the complaint, PSCo intends to launch the Power Pathway project online in stages between 2025 and 2027. It is being built. A request for comment was not returned by the utility.

Interconnection Disputes: Invenergy’s Complaints Against Xcel Energy’s Generator Interconnection Process

Salsa Solar Energy and Towner Wind Energy III, two Invenergy subsidiaries, have filed individual complaints against PSCo regarding the utility’s generator interconnection process on December 22. According to Invenergy, PSCo is improperly using its Power Pathway project’s transmission capacity for its own unqueued generating resources before its waiting generation projects. ” It pretty much appears that PSCo is attempting to benefit its unique generation by controlling transmission and the interconnection process.”

PSCo urged FERC to dismiss the complaint last month, claiming that the utility hadn’t finished the interconnection studies and that it was unnecessary. Additionally, PSCo claimed that in order to meet state carbon emission reduction requirements, it effectively set off transmission capacity to serve its native load customers.

The Colorado Public Utilities Commission informed FERC on Friday that Invenergy’s complaint is” speculative.” If PSCo is unable to maintain local load levels due to low priority interconnection queues for its replacement generation, the Commission should take into account the impact on resource adequacy and economical tension in the resource acquisition process, as well as the incentives for Colorado utilities to continue investing in new transmission.

Viktor Musil

Victor Musil, pen name for Edouard Py, advocates for inclusive, people-centered city development. His work underscores the importance of ethical considerations and equitable access, shaping the discourse on urban innovation worldwide.

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