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Now on Governor's Desk, Colorado's SB100 Would Create Transmission Resource Zones

Mar 19, 2007 Wind Energy Weekly

A bill aimed at getting the transmission built that's crucial to connecting renewable energy resources with load centers in Colorado cleared the state legislature and at press time was sitting on Governor Bill Ritter's (D) desk, awaiting his signature. The governor is expected to sign the legislation.

SB 100 would require utilities to identify "energy resource zones" where transmission constraints hinder the delivery of electricity to consumers or the development of new electric generation facilities to serve the state's consumers. The bill requires utilities to undertake biennial reviews to designate areas in which transmission capacity lags behind generating capacity; for such areas, utilities would submit proposed plans for development of additional transmission facilities. The Colorado Public Utilities Commission would be required to grant or deny any necessary certificates for such development within 180 days.

The legislation also addresses a persistent obstacle to new transmission: funding and cost recovery. SB 100 would allow utilities to recover costs during construction of new or expanded transmission facilities through a rate adjustment clause. For that and other reasons, utility Xcel Energy is fully behind the legislation. "We understand there's great need for transmission, and we feel that there should be energy resource zones," spokesperson Tom Henley told Wind Energy Weekly.

Notably, the zones are not specific to renewable energy resources, a detail that Xcel Energy certainly supports, and in fact Henley did note that the zones would apply to all forms of generation. Still, renewable energy advocates viewed the legislation's passage as a clear victory. "It's really a cornerstone bill in building Colorado's transmission capacity for new wind development," said Craig Cox, executive director of the Interwest Energy Alliance.

In spite of the fact that the zones include all energy resources, the legislation has an obvious renewables bent because unlike wind farms and other renewables facilities, fossil fuel plants can theoretically be located anywhere, making energy resource zones unnecessary. The legislation, in fact, is somewhat similar to Texas's Competitive Renewable Energy Zone (CREZ) policy that is currently being implemented. CREZs are Texas's designation, for transmission planning purposes, for suitable land possessing a renewable resource. The CREZ system - which, as its name suggests, applies specifically to renewables - is considered something of a model for other states in their efforts to build transmission that will tap clean, renewable resources.

AWEA Western Regional Representative Ron Lehr summed up the significance of the Colorado and Texas legislation in terms of its meaning for wind. "Transmission has always been built to generators," he told Wind Energy Weekly. "With SB 100, and previously SB 20 [the Texas CREZ legislation], transmission is built to resources." With renewables development already an established public policy in Colorado, he said, SB 100 paves the way for wind development. Beyond renewables policies already in place, a bill that would double the renewable portfolio standard in the state from 10% to 20% is currently making its way through the legislature.