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Colorado proposes regulations for wholesale power cooperatives

The Colorado Public Utilities Commission on July 31 released proposed rules governing resource planning for wholesale electric power cooperatives.

Gov. Jared Polis in May signed S.B. 236, a sweeping overhaul of utility regulation that requires the Public Utilities Commission to regulate resource plans filed by wholesale electric cooperatives.

The law in part was aimed at Tri-State Generation and Transmission Association Inc., a wholesale power cooperative that serves 43 rural electric cooperatives that collectively serve 1.3 million customers in Colorado, New Mexico, Nebraska and Wyoming. Tri-State has been under fire that it is not transitioning its coal-heavy resource portfolio to renewable energy quickly enough, but the cooperative has said it is making progress toward that end.

Some Tri-State members have said the co-op is not moving fast enough. Delta Montrose Electric Association reached a settlement with Tri-State in July under which it will withdraw from the co-op in 2020 so it can pursue cheaper, cleaner sources of electricity.

"The PUC's proposed rules build substantively on the stakeholder process already applicable to Tri-State Generation and Transmission Association, while taking into account differences between wholesale electric cooperatives and Colorado's investor-owned electric utilities," the commission said in a news release. "In developing such rules, the PUC must consider, among other factors, whether wholesale electric cooperatives service a multi-state operational jurisdiction, have a non-for-profit ownership structure, and have a resource plan that meets the energy policy goals of Colorado."

Under the proposed rules, Tri-State among other things must provide a detailed description of its projected carbon emissions, as well their cost.

Tri-State is asking that the Federal Energy Regulatory Commission regulate its rates. Tri-State says that will allow it to operate under one set of rate regulations instead of regulations imposed by four different states. Tri-State says FERC rate regulation would not prevent it from complying with emission reduction goals set by the individual states.

A hearing on the rule changes is scheduled for Oct. 15. (Proceeding No. 19R-0408E)