Colorado rejects Xcel's community solar plan

Dive Brief:

The Colorado Public Utilities Commission this week rejected a proposal by Xcel Energy and three solar companies, saying plans to develop up to 60 MW of solar energy would wind up costing consumers too much money, as well as appearing inconsistent with state law.
In February, Xcel announced it struck a deal with SunShare, Clean Energy Collective and Community Energy to develop more renewable energy in solar gardens, but regulators say the rate $0.03/kWh rate for the Renewable Energy Credits (RECs) produced was higher than bid prices offered in 2015.
Regulators added that their decision to reject the agreements did not change a 2014 directive that requires Xcel to acquire between 19.5 MW and 90 MW of community solar capacity by the end of this year.

Dive Insight:

Colorado regulators say Xcel went outside the process they set up to acquire community solar capacity, and wound up with a higher price than necessary.

“Rather than utilize the commission-approved competitive process, the parties filed a settlement that is not in the public interest,” PUC Chairman Joshua Epel said in a statement issued by the PUC.

SunShare, Clean Energy Collective and Community Solar Energy reached a deal with Xcel to build and operate community solar gardens, and the utility had declared the companies the winning bidders of the company’s 2015 competitive solicitation for 29.5 MW of of community solar resources. Under the terms of the proposed settlement, Xcel would pay a rate of $0.03/kWh for the Renewable Energy Credits produced by the CSGs, but according to regulators that rate would be "instead of the bid prices offered in response to the 2015 request for proposals."

But those three developers last year in a competitive process agreed to "negative" credits, essentially agreeing to pay Xcel, the news outlets reported.

The PUC questioned the nature of the negotiations and said the single, higher REC price made it unlikely that the settlement would result in cost- effective implementation of community solar. Regulators said PUC staff estimated that the settlement would increase the cost of the development of solar gardens by hundreds of thousands of dollars per facility.

Regulators also noted that Xcel is still expected to acquire between 19.5 and 90 MW of community solar capacity by the end of the year.