Colorado

Craig, CO creates new economic development role to implement community economic development programs. El Pomar Foundation provided resources for the position, as well as a Moffat County transition roadmap

Tourism, retail, and real estate markets have grown in the town of Craig, providing a spark to its transition planning efforts.

The draft plan includes recommendations for worker benefits, local transition plans, and community investment.

A municipally owned power company will transfer workers to new jobs as it shuts down coal-fired power. “"I believe we can do this with no layoffs," the company CEO said.

The latest plant retirement announcements—in Colorado, Illinois, Maryland, New Mexico, North Dakota, and Wisconsin—highlight how coal continues to lose its historical stature as a baseload source of electricity.

A union leader, a county commissioner, and a state official say the pandemic won’t thwart their push for reinvesting in communities hurt by the shift in how electricity is generated.

As the ongoing and “inevitable” decline of coal proceeds, the former lieutenant governor of North Dakota calls for foresight and planning, citing post-coal initiatives in Colorado, New Mexico, and Washington.

Vestas Windmills employees 900 people at its local turbine factory, and Xcel Energy is installing a 240-megawatt solar farm, the biggest in the state, to power a 139-year-old steel mill.

In the news lately for its existential downturn, Craig, Colo., has a skilled workforce, rail infrastructure, world-class scenery, and an enviable quality of life. But no plan for the future.

As closure looms for a power plant and two mines, half the local tax base is at risk. “You’ve got law enforcement. You’ve got social services. You’ve got fire departments.”

The disruption is happening sooner than anyone thought,” one official said. “There were plans that it would happen by 2030, 2035, 2040. Market conditions are bringing those sooner and sooner.

In announcing its acceleration of coal-plant closures in Colorado and New Mexico, Tri-State Generation and Transmission Association said it would keep the affected 600 workers and their communities in mind.

“The region has become a flashpoint in the debate over how best to use public lands, and whether communities are best served by drilling or by emphasizing recreation and preservation.”

In Delta County, Colo., public education now includes solar-panel installation, part of a sector that is helping fill gaps in an economy damaged by the loss of 900 coal jobs.

Rich in renewable resources and governed now by a modernization-minded regime, “no state is better positioned to accelerate a transition to clean energy.”

The Evraz Rocky Mountain Steel plant will soon be powered mostly by utility-scale solar as industries along the Front Range retrofit for the new energy economy.

“There have been ongoing discussions of how the community will reinvent itself. It’s just a matter of time, one business proprietor told me.”

Closing all of the state’s coal-fired plants and replacing them with wind or solar would save customers billions of dollars, a new study concludes.

Coal’s share of the electricity-generation market is down three points this year, to a record low 24 percent, driving two big producers to combine operations in Colorado and Wyoming owing to “cutthroat competition.”

Tri-State Generation Transmission, which has 43 co-op members in four states and remains disproportionately reliant on coal, declined an overture from a company seeking to bring cheaper, greener energy to the region.

As the utility industry moves to cleaner energy, the National Association of Counties met in Denver to emphasize the importance of post-coal economic-diversification initiatives, “many a work in progress.” 

Colorado will open a Coal Just Transition Office to encourage economic diversification in coal-dependent communities. The initiative is backed by labor interests, environmentalists, county governments and state-level politicians.

A bill to ease the community impact of coal plant closures in Colorado would allow bonding that would benefit utilities. But 15 percent of savings would go to towns and workers.

A refinancing mechanism called securitization may be adopted this year by Colorado legislators as a step toward helping the state’s utility industry step away from increasingly outdated coal-fired generation assets.

Delta Montrose Electric Association’s exit from a long-term deal with coal-heavy Tri-State Generation & Transmission shows how renewables are “upending the economics of power production in the American West.”

Momentum is growing around modernizing tribal renewable-energy policies on the Navajo Nation of Arizona, Colorado, New Mexico and Utah, according to a new report. The shift is being driven in part by the large-scale deployment of solar generation throughout the Southwest, where Navajo lands remain something of an island in a growing regional sea of utility-scale solar installations.

A western Colorado electric co-op that is seeking to sever ties with an energy supplier disproportionately reliant on coal is typical of small electricity providers nationally who are investing in other forms of generation. “You can politicize it all you want, but in the end economics is really what drives it,” said the president of the co-op. “It is really going from being a utility-defined market to a customer-defined market.”

The Delta-Montrose Electric Association in western Colorado is seeking to buy out its contract with Tri-State Generation and Transmission Association, a regional supplier heavily dependent on coal-fired generation. The move follows a decision by Kit Carson Electric Cooperative to pay $37 million to break its contract with Tri-State, a Denver-based company that sells electricity in Colorado, New Mexico, Nebraska and Wyoming. “I think it’s fair to say it’s economics, but also for diversification, a more diverse power supply,” said Virginia Harman, Delta-Montrose’s chief operating officer.

A bill being considered by state legislators in Colorado would incentivize utilities to adopt a special bonding mechanism to help finance coal-plant retirements. The proposal, which would securitize debt among many investors, would include revenue earmarked for communities services affected by transition. “This is not some liberal fantasy,” says the lawmaker sponsoring the proposal. “This is all hard math.”

Three forces are driving a national shift from coal to other forms of power generation, says an executive for Xcel Energy, a Minneapolis-based company that provides electricity to almost for million customers through subsidiaries in Colorado, Minnesota, New Mexico, North Dakota, Texas, South Dakota and Wisconsin. “It fundamentally comes down to economics,” said Jonathan Adelman, an Xcel vice president. “The secondary driver is customer expectations. Lastly, policy both at a state and federal level.”

Pueblo, Colo., nicknamed “Steel City” for its industrial past, is investing in a renewable energy industry expansion around the presence of Vesta Wind Systems, a turbine-tower manufacturer that employees 4,000 people along the Front Range of the Colorado Rockies. Xcel Energy is pushing for approval of a power-generation transition that would include wind and solar, and several renewable energy companies are looking to move to the area because of its wind and solar resources and its proximity to major regional transmission lines. The city is “poised to become the renewable energy hub for Colorado and likely the region,” one economic-development official said.

Colorado regulators have approved a plan by Xcel Energy to shift to renewable energy for power production over the next few years while closing 660 megawatts of coal-fired capacity by shutting down two aging plants in Pueblo. Xcel is planning to have 1,100 megawatts of wind-powered electricity capacity online by 2027, 700 megawatts of solar, 275 megawatts of battery storage and 380 megawatts from existing natural gas sources (a megawatt is enough to power about homes). Xcel’s strategy would invest $2.5 billion in eight counties, and the company said the changes would result in $213 million in ratepayer savings.

With the U.S. coal industry “in frank decline,” the well-being of communities in the four corners region of Arizona, Colorado, New Mexico and Utah is at risk as three coal-fired plants in the region becoming increasingly uncompetitive. Activists, educators and elected officials have responded by pressing for more initiatives meant to diversify the region’s economy, including a pilot scholarship project at Navajo Technical University. “This is a unique program that specifically helps communities affected by the decline in the coal industry,” said the university’s president. “It’s making many opportunities available for Navajo students, but there’s still tremendous need out there.”

Plans by Xcel Energy to remake the electricity-generation industry in and around Pueblo, Colo., are being seen as a harbinger of a new energy economy. The company is seeking to close two of three coal-fired power plants in Pueblo and replace them with wind and solar facilities, a change that would create a net total of more than 50 jobs. The county, which has a population of about 165,000 and is strategically situated near major power transmission lines, is “poised to become the renewable energy hub for Colorado and likely the region,” said its director of economic development.

A labor leader lauds Denver’s mayor for an initiative that aims to make the city a renewable energy bastion over the next generation, but urges leaders to invest in rural communities, too, where railroad employees, pipe fitters and power plant specialists are being displaced by the electricity-production transition occurring nationally. “Workers who have toiled in the mines, hauled our coal, and operated our power plants for decades deserve our support as we move towards new ways of generating energy,” writes Joshua Downer of the AFL-CIO.

Citing the “historically low” cost of renewables, Xcel Energy is pressing for state approval to close two coal-fired generators in Colorado a decade earlier than planned. The plants, part of the Comanche Generating Station in Pueblo, would be retired in 2022 and 2025 under the proposal, and would be replaced by a pair of existing gas-fired plants, three windfarms and five utility-scale complexes.

A cash infusion from creditors will help stave off bankruptcy for Westmoreland Coal, but the company, which owns mines in five states, is still in trouble. “Westmoreland faces many of the same pressures irritating the coal sector nationwide,” reports a Wyoming newspaper, “including competition from cheap natural gas and environmental regulations that made some older coal units too expensive to keep running.”

Westmoreland Coal, which is based in Colorado and operates in five states, is facing the prospect of having to shrink its core business as it struggles to remain a viable company. “They will have to get rid of some of their debt, get new financing to consolidate things, but also restructure the company to make it more viable for the long-term,” one analyst says. “And it could mean selling off assets or closing some mines.”

A new survey finds that most voters in five swing states—Colorado, Michigan, Ohio, Pennsylvania and Virginia—favor state policies mandating 100 percent reliance on renewable energy for electricity generation. The survey results “serve as a potential warning to candidates to support renewable-energy policies or face possible voter backlash.”

An analysis of Colorado-based Westmoreland Coal shows that it is in deep financial peril, a situation that may affect communities in Montana, New Mexico, Ohio, and Wyoming as the company’s customer base dries up. “The cost inherent in coal-fired power are moving (utilities) away from coal," says the study’s author.

Colorado, which has six working coal mines, reports a 6.5 percent reduction in related job gains in 2017 as utility companies in the region shift toward other electricity-generation resources in a transition that is being led by utility giants that include Xcel Energy. One noted expert on energy markets: “A brand new wind farm will be cheaper to run than an already-paid-for coal-fired power plant.”

Costs for renewable technologies are decreasing. In Colorado, Xcel will replace two coal-burning units with built from scratch wind and solar plants and still save money.

"What stands out about the response Xcel received is that wind sources with storage are now cheaper than coal generation, and solar plus storage is now cheaper than about 75 percent of coal generation in the state, according to CarbonTracker."

Energy Transition Openings Now in the Four-Corners Region of Arizona, Colorado, New Mexico, and Utah

A Northern Colorado power plant, in Larimer County, could close 17 years ahead of schedule as the result of a review by its owner, the Platte River Power Authority, which is looking at cleaner and more affordable options. The plant is a significant customer of coal producers in the Powder River Basin of Wyoming.

The City Council has directed Colorado Springs Utility to “analyze possibilities” for closing the city’s coal-fired power plant in 2025, a decade soon than planned. Colorado regulators have ruled that the 80-year-old Martin Drake Power Plant, considered a blight on the downtown area, is out of compliance with air-pollution standards.