Colorado Regulators Hold Xcel Energy Accountable for Failures in Grid Data Transparency, Create Path to Flexible Interconnection
IREC-Supported Decision Protects Consumer Benefits and Clean Energy Goals
The Colorado Public Utilities Commission (PUC) voted verbally in public deliberations on October 29 on a decision that resoundingly rejected practices by Xcel Energy, the state’s largest utility, that have prevented the public from benefiting from ratepayer-funded tools that enhance the use of distributed clean energy and electric vehicle (EV) charging in Colorado. The decision, which was significantly shaped by recommendations from IREC, is a notable example of a Commission using its regulatory powers to ensure that monopoly utilities do not stand in the way of clean energy deployment.
Key outcomes of the decision include:
- Harsh rebuke of Xcel Energy for its “inability or unwillingness to comply… with the statute, our orders, and prior settlements.”1
- Rejection of arguments by Xcel that grid data needed to effectively site clean energy and EV charging cannot be shared publicly while still ensuring grid security, and a mandate to discontinue related practices hindering public access to and use of this data (including data redaction, non-disclosure agreements, insufficient detail, etc.).
- A mandate that Xcel establish a flexible interconnection tariff for both new electric generation (such as solar and battery storage) and load (such as electric vehicle charging infrastructure), emphasizing the urgency of adopting this tariff to serve customers in a more cost-effective and timely manner.
“The Colorado PUC has shown great leadership in its decision, demonstrating its commitment to ensuring utility accountability to the state’s clean energy and transportation goals,” said Chris Nichols, Interim CEO of IREC. “IREC looks forward to continuing to work with Colorado to maximize public benefit and lower distribution system investment costs.”
This decision is part of a broader proceeding addressing Xcel’s distribution system plans and virtual power plant program. While making decisions about how much and in what manner the utility should invest in its distribution system going forward, the Commission recognized the importance of enabling the flexible operation of load and generation distributed energy resources (DERs) to lower the cost of distribution system investments. This flexibility cannot be achieved without high-quality grid data that identifies where and when the grid is constrained; the Commission’s decision improves access to this data in the formats needed.
Improving Public Access to Vital Grid Data
The grid transparency portions of the decision centered on Xcel’s hosting capacity analysis (HCA). This tool, commonly displayed as a map, provides a snapshot of the conditions on the electric grid that influence whether new electric generation or load can be safely integrated at a particular location without costly and time-consuming grid infrastructure upgrades. This data helps better inform siting of new projects by providing insights to help developers avoid heavily constrained areas of the grid and propose projects that are more likely to be economically viable.
Xcel was first directed to invest ratepayer funds in developing an HCA in 2021; the data it published has been plagued with issues that hinder its use. These include presenting data without the detail needed to make effective siting decisions; excessive data redaction; and forcing users to sign, in the words of the Commission, a “commercially unreasonable” non-disclosure agreement (NDA) to access unblurred HCA maps or tabular data (among many other issues). Despite recent requirements from the legislature that Xcel publish a detailed hosting capacity map for load as well as generation, Xcel refused to make the load map available to the public. The Commission rejected Xcel’s arguments that these practices are necessary to protect the security of the electric grid and voted that it publish unredacted data without requiring an NDA from users, in addition to requiring improvements in the granularity of data.
Describing the significance of improvements in the level of HCA detail Xcel will now have to provide, IREC Regulatory Engineer Midhat Mafazy explained, “[the current level of detail] is like being told there’s traffic on Interstate 55 somewhere between Chicago and St. Louis. It’s vague and not very useful. Developers need more granular data that pinpoints where constraints are and why congestion is happening. These improvements will make the data massively more useful for deploying clean energy and EV charging infrastructure, and smarter grid planning overall.”
A Pathway to Flexible Interconnection
The Commission also voted to require Xcel to develop a policy for flexible interconnection and energization. Flexible interconnection is a new paradigm for connecting generation or load projects to the grid with the option to fluctuate the amount of power they send to or pull from the grid as system capacity changes. Xcel had proposed a very limited application of flexible interconnection on specific sections of its grid for specific projects and had no concrete plans for flexible load. IREC argued that the proposed project eligibility was far too limited and recommended a formal tariff that defined eligibility, review criteria, and implementation steps. The Commission’s decision reflects this recommendation.
Flexible interconnection is gaining attention as states grapple with the need to quickly bring more power generation online to meet demand. Commissioner Megan Gilman contextualized the importance of flexible interconnection, noting: “One of [our] state goals is getting DERs, getting new customers and loads, connected… in a cost-effective and timely manner… Flexible interconnection clearly is one tool that could be available… Limiting that option, dragging [their] feet, acting like a more narrow option is… all that’s necessary… gets to the bigger question…, of ‘Does it appear The Company is actually strategically trying to meet those state goals?’”
Effective Exercise of Regulatory Authority
This decision is a notable example of regulators exercising their responsibility to hold monopoly utilities accountable for noncompliance and failure to deliver on important services for their ratepayers. In fact, the Commission discussed the possibility of exploring new financial incentives or penalties to drive compliance. In its deliberation and decision-making, the Commission demonstrated its seriousness about meaningful improvements from Xcel.
IREC commends the Colorado Public Utilities Commission for establishing concrete steps for Xcel Energy that will improve Coloradans’ utility service. The decision is a positive step towards holding Xcel Energy accountable for customer needs and achieving broader State of Colorado clean energy and transportation goals. A formal written order documenting the verbal decisions from the public proceeding is expected in December.
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