Report says many utilities are slow-walking clean energy goals

Xcel Energy in Colorado with B grade performing comparatively well according to Sierra Club

By: - October 12, 2022 4:00 am

A view of Xcel Energy’s retired fossil fuel-fired Zuni Generating Station at Zuni Street and West 13th Avenue in Denver on Aug. 6, 2022. (Quentin Young/Colorado Newsline)

DENVER – A report released last week by the Sierra Club faults dozens of utilities that provide a major chunk of U.S. electric generation for failing to speed up their decarbonization efforts. 

“For the sake of our communities and planet, we must do everything in our power to create a clean, renewable electric grid by 2030,” the Sierra’s Club’s “Dirty Truth” report says. “Utilities must lead this transition, but our research shows they are wholly unprepared to do their part. Clean energy is reliable and affordable; electric utilities have no excuse to delay and no time left to waste.”

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The report is an update of a 2021 study the group did. The Sierra Club analyzed plans of 77 utilities that collectively supply about 40% of U.S. electric generation and gave out letter grades based on how well utilities, many with their own clean energy goals, were working to decarbonize.

“Most are still not on the path to achieve 80% clean electricity by 2030. Of the 77 utilities we studied, nearly half of them (44%) made no progress or received a lower score than in our previous report,” the Sierra Club said. “This disappointing inaction occurred despite a tumultuous 18 months of grid reliability crises, blackouts, energy price spikes and extreme weather events; many of these trace their roots in large part to utilities’ stubborn reliance on expensive and unreliable fossil fuels.”

To determine the grades, the Sierra Club looked at the latest versions of the utilities’ integrated resource plans, documents that lay out how they will meet future electric demand, evaluating how quickly they intend to retire coal plants and penalizing them for plans that include building new gas generation.

“If a company includes multiple scenarios in their IRP, we use the scenario they denote as their preferred scenario,” said Cara Bottorff, a Sierra Club managing senior analyst. “If they do not denote a preferred scenario, we use the scenario that is the worst case for gas (i.e., the one that would add the most gas) to demonstrate the largest amount of gas that the company is considering building.”

Xcel Energy, Colorado’s largest energy provider, received a B grade in the report. It performed comparatively well next to the other utilities analyzed in the report, and it achieved one of the most dramatic improvements from the 2021 version of the report, when it received a D score. The report notes that it plans to replace 60% of existing coal and natural gas energy generation with clean energy by 2030.

Xcel plans to retire all its coal units by the end of 2030 in Colorado and Upper Midwest states, and its goal is to provide “net-zero” energy by 2050, noted Xcel spokesperson Michelle Aguayo.

“We were the first major U.S. energy provider in December 2018 to set ambitious and progressive voluntary goals for delivering 100% carbon-free electricity by 2050 and reducing carbon emissions 80% by 2030” from 2005 levels, Aguayo wrote to Newsline in an email.

The report also analyzed Westminster-based power wholesaler Tri-State Generation and Transmission Association, which also received a B grade. Tri-State plans to replace 70% of existing fossil fuel energy generation with clean energy by 2030, according to the report.

“Our cooperative’s high grade from Sierra Club recognizes Tri-State’s increasing renewable energy resources and decreasing emissions, and our robust planning to continue progress,” Tri-State CEO Duane Highley said in a statement to Newsline.

Tri-State in 2020 announced the retirement of all its coal generation in Colorado and New Mexico by 2030.

Xcel Energy’s headquarters in downtown Denver. (Google Maps)

Overall, 56% of the utilities examined in the report improved their scores, 9% made no progress and 35% got worse grades. You can check how your local utility did here.

The Edison Electric Institute, an association that represents investor-owned utilities, called the metrics “arbitrary” and dismissed the report as a “messaging document.” 

“The reality is that existing nuclear generation and the flexibility provided by natural gas generation are what enabled the U.S. electric power industry to deploy 27 gigawatts of new renewables, reliably and cost-effectively, last year,” said Brian Reil, an EEI spokesman. 

“The emissions reductions goals set by America’s investor-owned electric companies are firmly grounded in our current understanding of technology and economics, and they also reflect our responsibility to prioritize customer affordability and reliability.”

Reil noted that more than 40% of U.S. electricity is now generated by carbon-free resources and said electric utilities are investing in new technologies to deliver more. 

“If the Sierra Club truly wants to accelerate the deployment of clean energy, they should consider joining the other environmental, industry and government leaders who are working together constructively to identify ways to overcome the barriers to building the transmission and other clean energy infrastructure we clearly need in order to deliver more resilient clean energy to customers,” he said. 

We’re being pulled between those people who think we are going too fast and those who think we are going too slow.

– Duane Highley, of Tri-State Generation and Transmission Association

At the Experience POWER conference for energy industry professionals last week in Denver, the pace of the renewable energy transition was a major theme. Highley — the CEO of Tri-State, a not-for-profit cooperative supplier which operates in New Mexico, Colorado, Wyoming and Nebraska and includes 42 electric distribution cooperatives and public power districts that provide power to more than a million consumers — used an old George Carlin comedy bit about driving to illustrate the competing tensions on utilities and electric co-ops trying to decarbonize without risking reliability.

Anybody driving slower than you is an idiot, Carlin said, while anybody going faster is a maniac.

“We’re being pulled between those people who think we are going too fast and those who think we are going too slow,” he said, noting that two states his co-op operates in, New Mexico and Colorado, are much more green-energy oriented than the other two: Nebraska and Wyoming.

“There’s no map for this,” he said. “We’re in uncharted territory.” 

He said the ability to generate electricity from fuel oil helped bail out Tri-State during the 2021 winter storm that caused the grid to collapse in Texas, resulting in an estimated 246 deaths. That makes it hard for utilities to ditch the reliability benefits of certain kinds of fossil fuel generation as quickly as some would like. 

“We can make this happen and it is happening,” Highley said. He added that Tri-State, which got a B grade on the Sierra Club report, is on pace to have 50% of the electricity used by its members come from renewable sources by 2024 thanks to bountiful wind and solar resources, with an eventual goal of getting to 80% decarbonization, though that will still require some fossil fuel generation to stay in the mix. 

“We’re going to clean up the grid and then we’re going to electrify everything,” he said.

Quentin Young contributed to this report. Robert Zullo can be reached at [email protected]

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