New regulatory agency over electric grid expansion begins early phase of work

A new regulatory agency with authority over electrical grid expansions and operations and which can finance and build infrastructure if utilities won't — or can't afford to — has begun

New regulatory agency over electric grid expansion begins early phase of work

A new regulatory agency with authority over electrical grid expansions and operations and which can finance and build infrastructure if utilities won't -- or can't afford to -- has begun getting organized, with the goal of ultimately adding power lines to aid Colorado's transition away from fossil fuel. The Colorado Electric Transmission Authority, which legislators created via legislation in 2021 to help reach Gov. Jared Polis' carbon-free goal by 2040, will get most of its funding from fees charged to developers and users of CETA-managed systems.In addition to collecting fees, the new agency has the power to issue revenue bonds. 'I hope we're able to get more transmissions built and I hope that it is done in a very strategic and efficient way,' Kathleen Staks, CETA interim board chair, told The Denver Gazette. 'I hope that we are able to unlock some public and private partnerships and bring some creative sources of funding to Colorado so that ultimately we can connect not only the renewable energy development in the state, but really connect Colorado to the rest of the west and the vast resources that we have across the west,' Staks added.Critics of Colorado's transition to carbon-free energy argue that residents will bear the burden of paying for new infrastructure, including the construction or expansion of high-voltage powerlines to get the electricity from dispersed renewable resources, such as wind and solar, to the electrical grid. Supporters, however, argue they're necessary to transition into a carbon-free society, which they insist is good for the environment and people's health/ So far, the authority is still in the organizing stages, and it may be too soon to define its authority in the public utilities regulatory world. 'Essentially at this point in time, we have the statute, and that is sort of the only official direction that we have,' Staks said.

'When we get an executive director on board, one of the first things that we're going to do is bring on a technical law firm to help us develop all of the processes and procedures that we need to do all of the tasks and responsibilities that we have in the statute. 'Staks said she hopes to have an executive director selected and appointed by mid-February.So far, CETA -- a political subdivision of the state that is not subject to administrative direction by any department, commission, board, or agency of the state, including the PUC -- has met four times by video conference to discuss organizational matters and appoint board officers. Lawmakers allocated $500,000 annually from existing cash fund managed by the Public Utilities Commission to pay for the authority's administrative expenses.Its board of directors is made up of nine persons: Two appointed by the governor, three appointed by the president of the state Senate; three appointed by the House Speaker; and, the director of the Colorado Energy Office or the latter's designee. All directors serve four-year terms and must have a variety of experience to qualify for appointment.The division of responsibilities between the CETA, the Colorado Energy Office and the PUC remains unclear, according to Staks. But, based on the enabling statute, CETA will have the power to site, fund, buy, sell, own and lease powerlines and power storage facilities statewide without any PUC oversight or control.Under the statutes, the authority has also the power of eminent domain, in which private land can be taken for public use without the owner's consent provided just compensation is paid.

Many different organizations, including pipeline operators, utility companies and irrigation ditch companies, also have eminent domain powers under state law.This means the authority will be able to locate and designate 'power trails' for local, state and regional power transmission needs, even if landowners disagree with the routing. 'I think building transmission anywhere is really hard and it takes a long time,' Staks said. 'And I think what the authority does is it creates another tool to get needed transmission projects built in Colorado. 'To get all the renewable power needed for a zero-carbon future to the grid, nationwide transmission infrastructure will have to increase by somewhere between two and five times, according to a 2021 Net Zero America study by Princeton University.Public utilities in Colorado are required by the same law that created CETA to join a Regional Transmission Organization by 2030.Those regional organizations, also known as 'organized wholesale markets,' are overarching groups made up of many different power generation and transmission companies and created for the purpose of coordinating and efficiently managing the dispatch and transmission of electricity among public utilities on a multistate or regional basis, according to state law.The state law said these markets will assist transmission utilities and the Colorado Electric Transmission Authority in ensuring the "resilience of the electric grid and its resistance to both natural disasters and intentional attack.' 'Giving CETA direction to do its work with a lens towards the regional benefits, I think, supports the ultimate goal of having our utilities participate in a Regional Transportation Organization," Staks said. 'I think this brings additional tools specifically related to planning, siting and funding transmission lines that don't currently exist outside of investor-owned utilities. 'Keith Hay, the board's representative from the Colorado Energy Office, briefed the board on recent federal legislation providing funding from the U.S.

Department of Energy for state-led powerline infrastructure projects at the Dec. 16 meeting.As part of the Infrastructure Investment and Jobs Act, the DOE can work with Colorado in improving electric infrastructure by, among other things, buying capacity on new powerlines or granting loans to eligible transmission line projects -- or through public-private partnerships. In that case, the DOE will participate in designing, developing, constructing, operating, maintaining, or owning the line, Hay said.At the CETA meeting, Hay said the Colorado Energy Office is looking at a plan to construct a powerline into the San Luis Valley which, Hay said, is 'one of the best solar resources in Colorado, certainly, and largely in the Southwest. 'Hay said the energy office is working on a concept paper to get DOE to help fund new transmission capacity into and out of the valley aimed at serving local electric needs, strengthening the local grid and also facilitating renewable energy development that would serve wider Colorado energy needs as well as potentially exporting power to a regional market.Colorado has a history of problems building powerlines, including in the San Luis Valley.Public friction over the years has complicated grid expansion.

Complaints submitted to the PUC over the years vary -- from the visual effects and concerns about the health effects of living close to hundreds of thousands of volts of electricity to the effects on wildlife and endangered species. In 2010, for example, Xcel Energy and partner Tri-State Generation and Transmission Association obtained PUC approval to build a $180 million power line from the San Luis Valley over La Veta Pass to Walsenburg and Pueblo.But the 171,000-acre Trinchera Ranch stood in the way. Its owner, the hedge fund manager Louis Bacon, who bought the ranch from billionaire Steve Forbs in 2007, objected. 'They want to railroad through an expensive, deeply flawed plan that causes unnecessary environmental damage to one of Colorado's last remaining undeveloped wildlife and scenic corridors,' Bacon told the Colorado Independent in 2010. 'There are better alternatives out there that they're unwilling to seriously study. 'In the same article, a spokesman for Xcel Energy said delays in getting the power line up killed the solar industry in the region: 'We are pushing back our estimates on how much solar power can be built because no one is going to build a solar project if they can't move the power out of the region.

Their efforts to delay this transmission line have for the short term killed the solar power industry in the San Luis Valley. 'On another front, Xcel in June received permission from the PUC to spend some $3 million per mile to build up to 610 miles of lines in eastern and southeastern Colorado as part of its Power Pathway initiative.Xcel announced on Dec. 20 that it has received land use permits from Cheyenne, Kiowa, Kit Carson, Morgan and Washington Counties in eastern Colorado that allow it to move forward with construction plans for 300 miles of the Power Pathway project.