Colorado Seeks a Renewable Energy Peak

But can Rocky Mountain power success be repeated in other terrain?

This story is part of a special series that explores energy issues. For more, visit The Great Energy Challenge.

The United States gets only 4 percent of its electricity from wind, solar and biomass, but Colorado thinks it can do better. A lot better. This spring, Democratic Governor Bill Ritter signed into law a program for Colorado to get 30 percent of its power from renewable energy by 2020.

Does Colorado have a secret it would like to share?

Experts agree that Colorado has made great strides in incorporating renewables into its energy mix. The state is on its way to meeting its original 10 percent goal way ahead of schedule, and has raised the bar twice since then. But it remains to be seen whether what works in the heart of the Rockies can translate to places that lack Colorado’s unique geography or political landscape.

Colorado’s renewables target is second only to California’s (33 percent by 2020) among the more than 30 states that have set so-called renewable energy portfolio standards. (On paper, Maine’s 40 percent target is higher, but much of that will come from the state’s long-existing wood and wood waste plants.) And there’s still no national renewable energy goal, despite years of effort by advocates to persuade Congress to set a standard even as low as 10 percent.

Utilities in the South of the United States especially have argued that it would be hard to keep electricity affordable if they were forced to meet such a goal, because they can’t tap into strong winds and cloudless skies as reliably as states in the Midwest and West.

Favorable winds

Colorado certainly boasts an edge in resources. The state ranks fourth in the country for utility-grade geothermal energy potential—although it hasn’t tapped into that yet—sixth for solar energy, and 11th for wind, said Carol Tombari, the manager of stakeholder relations for the Golden, Colorado-based National Renewable Energy Laboratory (NREL.)

Xcel Energy, the utility company serving the Denver metro area and other parts of the state, is currently exceeding those odds to be the number one producer of wind power in the country.

Southeastern Colorado benefits from a low-energy jet stream that pushes high winds in a belt from Texas north to the Dakotas, said Dennis Elliott, a principal scientist at NREL. That wind, blowing across relatively flat parts of the state, provides good potential—and good income for rural ranchers and farmers—in the summer months. (They lease their land to wind power developers, and the turbines co-exist with the agricultural activity on the ground.) In winter, winds are better in the north.

“This way, it smoothes out your wind resource throughout the year,” Elliott said. And while in other states, the strong winds typically gust far from the population centers that could use the power, Colorado’s wind potential lies within reach of Denver.

(See video, Iowa Wind Power)

But the state’s natural resources are only part of the story. The other part is the way people and organizations are taking advantage of them.

A push from the people

It started with voters, after the state legislature had voted down renewable energy standards four times. Renewable energy advocates decided to tap into Colorado’s long history of policymaking through ballot referendum—a tradition that has spanned the political spectrum. And so the state that rejected the Winter Olympics due to environmental concerns in the 1970s and gave birth to the political term-limit movement in the 1990s—both by voter initiative—became the first to enact a renewable energy standard at the ballot box in 2004.

Colorado’s voters “certainly make their own choices,” said Democratic state representative Max Tyler, who serves a district east of Denver.  But he said that 2004 happened to be a good year for taking advantage of the Centennial State’s independent streak.

“The voters of Colorado made a pretty tectonic shift back then,” he said. “The House and the Senate both went to the Democrats, after being with Republicans for as long as we can remember.”

Renewable energy resonated with Colorado’s voters, he said. “Because we have so many people going outdoors, we’re really tuned to the environment we live in,” Tyler said. And the 2004 referendum set the state’s first goal—10 percent of electricity from renewable sources by 2015—despite opposition from Xcel Energy.

Much has changed since then. First of all, the legislature took the lead in upping the ante, first in 2007, and then with the latest target—30 percent renewables by 2020—a proposal sponsored by Tyler and signed by Ritter on March 23.

Also, one of the most vocal supporters of setting a higher goal for renewable energy was none other than Xcel.

It turns out that once Xcel executives came to terms with the new rules, they discovered that federal tax credits made the wind power affordable. Xcel has emerged as the nation’s top provider of wind energy, without pushing electricity prices beyond what’s about average for consumers across the country.

Xcel spokesman Tom Henley said wind is becoming increasingly cost competitive.

“It’s still not very close to coal, but it’s getting closer to natural gas,” he said.

A renewable energy adjustment on utility bills—capped at 2 percent—helps offset the cost of new solar energy. Between state consumer contributions, rebates, and federal tax credits, a Colorado homeowner installing a new solar system will be reimbursed for half the cost.

And the expertise at the NREL has drawn renewable energy businesses to the state, including the wind power giant Vestas. Its 2009 opening north of Denver was celebrated widely, partly because it brought 2,500 jobs and $750 million in investments.

(See related, “Frozen Fish Help Reel in Germany's Wind Power.”)

Overcoming roadblocks

Colorado has successfully navigated some challenges in its push toward renewables. NREL’s Tombari said the state lacks a huge tax base that would allow it to offer incentives such as tax breaks to renewable energy companies.

“We’ve kind of had to be the mouse that roared in that respect,” she said.

One creative solution has been to allow state employees to take staff time to help companies like Vestas navigate Colorado’s permitting process.

“I dedicated the vast majority of my time over a two-year period as a consultant to that company,” said Mark Buschenfeldt, business development representative for the state’s Office of Economic Development and International Trade.

Other states have struggled with efforts to deploy more renewable energy.

“Some people believe it’s unsightly,” said Wayne Williams, director of the Bureau of Conservation, Economy and Energy Planning at the Public Utility Commission of Pennsylvania, where the renewables target is 8 to 10 percent by 2020.

In neighboring West Virginia, a federal judge recently threw a curveball to a large wind project, requiring it to halt operations until it obtains permits under the Endangered Species Act because of concerns the turbines might harm or kill endangered Indiana bats. Wind advocates say the decision at the Beech Ridge wind farm could foreshadow similar obstacles for wind projects across the country.

Colorado is not immune to such battles.

Xcel, for instance, is trying to kick-start a major solar project in the southwestern part of the state, but has run into roadblocks over the transmission lines needed to transport the power. Billionaire hedge-fund manager Louis Bacon has sued to keep the power lines from crossing his ranch west of the Great Sand Dunes National Monument. The San Luis Valley, where Xcel planned a large array of photovoltaic panels, is considered to have high potential for solar energy.

“The challenge,” said company spokesman Henley, “is getting the power out.”

(See related, “First U.S. Offshore Wind Power Project Approved.”)

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