In an update on damages to its largest power plant, Xcel Energy has listed keeping coal plants open longer than scheduled among the suggestions for ensuring it can meet electricity demands.
The March 2 report on the Comanche 3 coal plant, which hasn’t worked since August, has raised concerns about Xcel, Colorado’s largest electric utility, straying from its timeline to phase out coal facilities.
Late last year, the Colorado Public Utilities Commission allowed Xcel to keep the smaller Comanche 2 coal plant near Pueblo running past its original closure date at the end of 2025. Critics of the chronically malfunctioning Comanche 3 called for closing it rather than spending money to fix a plant that’s expected to close at the end of 2030.
The company hasn’t said yet how much the repairs will cost. Xcel’s report said repairing Comanche 3 is the most viable means to continue meeting customers’ needs, but also included possible options to ensure there’s enough juice to power the grid in the near term.
Options include keeping Comanche 2 operating beyond the current retirement date at the end of 2026 and keeping two coal units at Hayden Station in Routt County running until 2030. The planned closures are now for 2027 and 2028.
Agreements made among Xcel, the PUC and several parties in the past few years call for Xcel Energy to phase out coal for environmental and economic reasons. The utility will submit an application to the PUC in June to propose a way forward, whether that’s finishing repairs on Comanche 3 or investing in other resources.
“This report was meant only to be informative for the commission and stakeholders regarding these challenges, and the range of options being considered to ensure customers have the safe and reliable power they expect,” Xcel spokeswoman Lisa Andersen said in an email.
The report also looks at ensuring that Xcel can deal with what it calls “near-term capacity challenges,” making sure it can deliver the electricity needed despite current strains on the system. The company said growing demand for power, supply chain and other issues holding up new power sources and plant outages contributed to the need to keep Comanche 2 open longer than planned.
Xcel said even with Comanche 2 going, it will face the challenge of delivering enough electricity at peak demand this year and next.
“The company really seems to be considering not just bringing Comanche 3 back online and not just continuing reliance on Comanche 2, but it’s actually exploring operating all its coal units through 2030,” said Erin Overturf, the clean energy director for Western Resource Advocates.
That would be a substantial change from the state’s plans to transition from coal, Overturf said.
“We would hope and expect that the application would do a much deeper dive into extending the coal units and take a much harder look at other resources,” Matt Gerhart, a senior attorney for the Sierra Club, said of the proposal due in June.
An analysis by the PUC staff showed that Xcel coal plants struggled to stay online at points last summer. In early August, the utility asked customers to conserve energy to avoid managed, rotating blackouts.
“We know that even with Comanche 3 back online, that for 2027 and 2028, capacity margins are pretty slim,” said Joseph Pereira, deputy director of the Colorado Office of the Utility Consumer Advocate.
That doesn’t mean there’s a danger the lights will go out, Pereira said. The PUC and utilities set a planning reserve margin that’s built on top of the electricity needed to serve the load on the hottest day.
But Pereira said the challenges Xcel faces are concerning. He said the transition from fossil fuels to renewable energy sources is difficult as the demand for electricity increases.
“And because the transition is so hard, the company really needs to be doubled down on the basic fundamentals of its business,” Pereira said. “Sometimes it seems like they’re very focused on the financial returns to shareholders and the status of the company to the detriment of the operations of the company.”
Pereira noted that before having to pay out nearly $300 million for settlements in the Marshal fire lawsuits, according to a filing with the U.S. Securities and Exchange Commission. The company’s net income in 2024 was $782 million.
Andersen said it’s important that Xcel is financially healthy.
“We are a capital-intensive industry, and our investments in power plants, solar, wind, transmission and distribution lines, as well as natural gas pipelines and regular maintenance, are critical to providing customers with a safe, reliable and clean service,” she said.
Historically, the company’s generation fleet is unexpectedly offline less than 4% of the year, Andersen said.
