Xcel seeks to catalyze renewable energy growth

With the late February approval of Xcel Energy Inc.’s (NYSE: XEL) proposed $1.7-billion, 500-plus-mile Power Pathway electrical transmission line project, the utility says it is poised to make serious strides in its efforts to achieve carbon-free electricity generation by 2050.

The Power Pathway project is expected to stretch between 560 and 650 miles — which would make it Colorado’s longest transmission line — to deliver renewable energy in a loop from Longmont east into Weld County and the plains, then south to the corner of the state and back north to Denver. The Colorado Public Utilities Commission has signed off on the plan.

The overall purpose of the transmission line is to connect areas of the state where much of the renewable energy is generated to the highly populated areas around Denver and Colorado Springs.

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“Delivering new renewable energy to customers is a key component to Xcel Energy’s Clean Energy Plan, which is being considered by the [PUC] and includes the early retirement or transition of coal plants, while adding wind, solar and battery storage. The Pathway project is an investment of $1.7 [billion] to 2 billion and is expected to connect 5,500 megawatts of new renewable energy for our customers,” Xcel public affairs manager Randy Fordice told BizWest.

The project is in its planning stages with Xcel officials set to hold open houses with stakeholders throughout the year. 

The utility hopes “to begin construction on the first segments in eastern and northeast Colorado by mid-2023,” Fordice said. That segment would include the Longmont and Weld County lines. 

“As we move forward with permitting and pre-construction activities, we’ll begin the more detailed engineering, design, and procurement processes,” he said.

Xcel chose the proposed location of the transmission loop to connect some of Colorado’s best and most remote wind and solar resources to new and expanded electricity substations and ultimately the Front Range’s population centers. 

“I don’t think we’ve ever had a transmission line project of this magnitude,” PUC chief engineer Gene Camp said during a hearing on Power Pathway.

The first segments of the project are expected to be complete by 2025 with full buildout by 2027.

While ultimately approved by the PUC, Power Pathway was not without its critics. The main concerns voiced during hearings on the project related to the sheer scope of the project and the potential for cost overruns.

“We want to right-size the investment for the ratepayers so we’re not overpaying,” utilities transmission expert James Dauphinais said during the PUC hearing. “Ratepayers really have no idea how much this will end up costing them.”

The project is expected to cost Xcel ratepayers about $600 million over the next several years.

The utility hopes to tap into federal renewable energy tax credits to reduce the overall cost of the project.

To guard against the potential for extreme cost overruns and work delays, the PUC increased the maximum penalties it can pursue if the utility fails to deliver.