The Colorado Public Utilities Commission ordered a review Wednesday of Xcel Energy’s negotiations with companies that bid unsuccessfully last year to build a new coal-fired generation plant in the state.
Staff for the commission alleged in a draft complaint against Xcel last month that the state’s largest utility negotiated in bad faith with the companies. Xcel denies the allegation and says it chose not to proceed with the coal plant because the bids were too high.
The negotiations were part of a PUC-mandated program in which Xcel was to enter into contracts to meet Colorado’s power needs through 2013. The Minnesota-based utility, which operates here as Public Service Co. of Colorado, was able to secure most but not all of its projected energy requirements.
The PUC staff drafted a complaint seeking financial penalties against Xcel. The complaint also sought to force Xcel to award a contract to build the coal plant. But two of the commission’s three members – chairman Ron Binz and Carl Miller – objected to that part of the complaint.
Binz and Miller voted Wednesday to abandon the complaint, with commissioner Polly Page dissenting. They then voted 2-1, with Miller dissenting, to order the staff to create a report to answer the following questions:
Xcel says it dealt in good faith.
“We followed the rules of the regulatory process to the letter of the law,” said Xcel spokesman Mark Stutz. “Our analysis for not signing the coal contract was based solely on economic considerations. We thought it was too expensive for our customers.”
He said a new coal plant would have cost up to $236 million more than generating power with natural gas and renewable energies.
The names of the companies that bid for the coal contract were not disclosed. They will be given an opportunity to submit comments for the PUC staff’s report. No timeline was set for completion of the report.
Nick Muller, who represents independent power providers, could not be reached for comment.
Staff writer Greg Griffin can be reached at 303-954-1241 or ggriffin@denverpost.com.
