Colorado to expedite clean energy development before US tax credits expire

Colorado Governor Jared Polis asked state agencies to help accelerate renewable energy development in a bid to ensure that utilities meet clean energy targets and lock in savings for their customers while federal subsidies remain available.

The Democratic governor requested that state agencies prioritize the deployment of clean energy projects and infrastructure by expediting review of permits and removing administrative barriers Aug. 1, citing the need to harness valuable federal tax credits before they expire under President Donald Trump's new budget law, signed July 4.

"Simply put, we must move forward together to remove barriers to projects and to ensure the success of utility clean energy plans in Colorado," Polis said in an Aug. 1 letter.

The letter comes amid mounting uncertainty for solar and other renewables as a result of an accelerated phaseout for federal investment and production tax credits.

"We must provide confidence to the clean energy industry that Colorado is open for business as tariffs, shifting federal rules, supply chain crunches and market uncertainty risk delaying investment in these affordable domestic energy resources," Polis said. "We have a time-limited window for procurement of tax-advantaged wind and solar."

Specifically, Colorado will update its interconnection standards for customer-cited projects and look to reduce interconnection review for smaller systems before energization. The state will work with utility partners, the Colorado Electric Transmission Authority and the private sector to deliver additional transmission capacity. Colorado will prioritize quick review of projects as they seek consultation and permitting.

The state will also work to identify and eliminate redundancies and inefficiencies to deploy more wind, solar and battery energy storage, according to the letter.

Colorado plans to pursue "flexible interconnection and voluntary curtailment for distributed energy and community solar projects," it added.

The state also aims to help "facilitate the pre-purchase of project equipment and/or affiliated electric transmission and distribution infrastructure" while working to "augment utility procurement of annual allocations for community solar" and seek "immediate opportunities for timely utility interconnection of both distributed and utility-scale clean energy."

'Goal is to integrate maximal clean energy'

The state intends to rely on existing Colorado Public Utilities Commission authorities to evaluate and approve resource acquisitions, utilize PUC appeal authority when projects are denied locally and issue decisions in a timely fashion.

"The goal is to integrate maximal clean energy by securing as much cost-effective electric generation under construction or placed in service as soon as possible, along with any necessary electricity balancing resources and supporting infrastructure," Polis said.

Colorado will also take additional steps to help residents and businesses save money on renewables, according to the letter, pointing to the launch of a new on-site Colorado Energy Savings Navigator. It will also offer rebates on energy efficiency equipment and free or low-cost energy efficiency upgrade, the PUC website said.

"Today we are taking action to ensure that Coloradans can easily access clean energy savings, especially ones that expire soon," Polis said. "We continue to do all we can to make people aware of how you can reduce costs on energy bills and keep money in your pocket. That's what the launch of this new tool and executive action are all about."

Polis added that new federal policies are expected to increase energy costs in the state by $500 per year by 2035.

Clean energy groups applauded the moves.

"This executive direction fast-tracks affordable, reliable clean energy in Colorado by removing local barriers, streamlining permitting, accelerating interconnection and advancing utility-scale procurement," Wil Gehl, InterMountain West senior manager for the Solar Energy Industries Association, said in an Aug. 1 news release. "These steps will save Coloradans billions of dollars in avoided energy costs while creating good local jobs and strengthening grid reliability."

Advanced Energy United, a national business group, also supported the state's actions.

"We don't need to wait on the federal government to make progress on the clean energy future that our state leaders have committed to," Emilie Olson, Colorado lead at Advanced Energy United, said in an Aug. 1 statement. "Today's executive action from the governor reinforces that Colorado is not skipping a beat in making sure we are preserving certainty for the clean energy industry and strong state policies that have gotten us this far."

Xcel Energy Inc., which serves 1.6 million electric customers and 1.5 million natural gas customers in Colorado, did not immediately respond to an Aug. 4 request for comment on the governor's letter.