Xcel Energy customers could be billed $100 million to make sure electricity keeps flowing in the summer if regulators OK the company’s plan to shore up its power on the grid in the short term.
The plan filed late last week is a response to the Colorado Public Utilities Commission’s order that Xcel explain how it will ensure that customers’ needs will be met as temperatures and the use of air conditioning rise.
A big driver behind the concern is the loss of the 750-megawatt Comanche 3 coal plant, Xcel’s largest generation source. The long-troubled plant near Pueblo hasn’t worked since last August and isn’t expected to be fixed until mid-July.
Xcel, the operator and majority owner of Comanche 3, said in a recent filing that its share of repairing the unit is estimated at $4.6 million. The cost was released after Boulder resident Leslie Glustrom , an adviser to the nonprofit Clean Energy Action, filed a Colorado Open Records Act request, and discussions with the Colorado Office of the Utility Consumer Advocate.
Xcel has warned of projected shortfalls as it tries to meet peak summer demand. Xcel predicts the need for power will grow at the same time that its coal plants are being retired to make the transition to more renewable energy.
In a March hearing, PUC member Tom Plant said he wasn’t convinced Xcel would be able to meet summer peak demand. “Particularly when we have 85-degree temperatures in March,” he said.
Xcel Energy’s plan for the next couple of summers includes upgrades of natural gas and coal plants to generate more power and continuing to run a smaller coal unit at the Comanche Generating State past its original retirement date of December 2025.
The utility has also proposed increasing incentives for larger customers to agree to have their electricity curtailed in emergencies and a short term contract with Tri-State Generation and Transmission Association for power from a coal-fired plant in Craig. The plant was scheduled to close in December, but the U.S. Department of Energy ordered it to remain open, citing an emergency with meeting the country’s power needs.
Xcel asked the PUC to allow it to recover $100 million from customers for the money it spends to fill potential power gaps this summer and next. The company said $25 million could be recovered per quarter and any unused money could be returned to ratepayers.
The PUC is also considering Xcel’s requests for a $355.5 million electric rate increase and a $190 million boost in its revenue for natural gas services. Those increases would become part of Xcel’s rate base, unlike the short-term expenditures.
The $100 million proposal is an effort to maintain reliable service as Xcel plans for high-demand summer seasons this year and in 2027, spokeswoman Sydney Isenberg said in an email.
“We have identified resource adequacy as a growing risk for several years now and have previously proposed solutions to address this concern,” Isenberg said. “We will also continue to work with the PUC on longer-term resource planning efforts to support the state’s continued growth and clean energy goals.”
On Aug. 7, 2025, Xcel asked customers to conserve energy to avoid blackouts caused by the heat and high demands for electricity. A report by the PUC staff said there were unplanned outages of several fossil fuel power plants that day.
The Colorado Office of the Utility Consumer Advocate is reviewing Xcel’s plan to maintain service this summer. Joseph Pereira, director of the office, said in an email that Xcel’s worries about having enough power don’t mean people’s electricity is going to go out. State law requires utilities to report on the adequacy of their power resources and identify .
However, Pereira said that Xcel’s report makes clear that outages and other issues at the utility’s facilities are the primary reason for the company’s projected electricity shortfalls.
“These plant issues fall squarely under the purview of Xcel. Why should customers be on the hook for these costs when the company struggles operationally?” Pereira asked. “It is clear the company thinks customers are its backstop any time it falls short on its obligations.”
The Sierra Club will likely support several parts of Xcel’s plan on meeting summertime energy demands, said Matthew Gerhart, an attorney with the organization.
But Gerhart took issue with Xcel’s suggestion to buy electricity from the Craig coal plant. He said once Xcel’s Comanche 3 plant starts working again, the utility won’t need the power from Craig.
“It is quite ironic to be saying that to solve a problem caused by unreliable coal, we’re going to go out and purchase more coal capacity,” Gerhart said.
While Gerhart agreed with Xcel’s suggestions to use solar energy and battery storage to supplement power, he criticized consideration of connecting mobile natural gas generators to the distribution system. The gas generators would be one of the most expensive solutions, he said.
