The Colorado Sun recently published an opinion article that diagnoses a real problem — rising energy costs — but misdiagnoses the cause. Policies forcing wind, solar, and batteries onto the grid and mandating electrification are raising costs for Colorado consumers, not natural gas.
Set aside that the authors, Silvio Marcacci and Dan Esposito, work for Energy Innovation, a San Francisco-based policy firm whose stated mission is “to accelerate progress in clean energy by supporting the policies that most effectively reduce greenhouse gas emission.” That perspective is their prerogative, but readers should understand their starting point prioritizes emissions reduction over affordability.
The authors argue that Xcel Energy “profits by keeping us hooked on pipelines,” earning “a 9%-11% return for infrastructure investments,” and making revenue “from a captive customer base.” That’s true, as far as it goes. But Xcel earns the same regulated rate of return on every dollar of capital it puts into its rate base, whether that’s a gas pipeline, wind turbines, solar panels, or battery storage. In other words, regulated monopoly utilities are incentivized to build more capital and recover profits from customers, no matter the technology.
Wind and solar mandates have triggered the largest capital spending spree in Xcel’s history. Xcel Energy has become a growth stock thanks to the “green-plating,” of the grid, building vast wind, solar, and battery infrastructure that earns guaranteed returns.
The company plans to spend $17 billion in Colorado over the next five years and poured $5 billion into new clean energy plants last year alone. Nationally, Xcel has laid out a $60 billion capital plan through 2030, which will build 9,400 MW of wind, solar, and batteries, and only 3,000 MW of natural gas. Transmission to integrate wind and solar into the grid will comprise $15.4 billion of Xcel’s nationwide capital plan, and only $3.7 billion on natural gas infrastructure.
The Colorado PUC approves these capital plans and sets the allowed rate of return. The Colorado PUC has recently fast-tracked Xcel to build another 4,100 MW of new wind, solar, and batteries, with only 200 MW of natural-gas generation. Rate increases are far more about “keeping us hooked on wind and solar,” than natural gas, to borrow the authors’ framing.
Natural gas is going to become even more expensive thanks to Colorado’s own Clean Heat Plan, which mandates that gas utilities cut greenhouse gas emissions 22% by 2030 and — as the PUC unilaterally decided — 41% by 2035. The Independence Institute has extensively documented that the mandates will be costly and difficult to meet. Meeting these mandates will require pushing customers off gas and spreading fixed system costs across a shrinking base.
The authors tout their own heat pump conversions as proof the technology works. Good for them. But for the seven out of 10 Colorado households heating with natural gas, the cost of replacing a working gas furnace, water heater, and stove with heat pumps and induction appliances runs $15,000 to $30,000 or more per household.
How much will they save? A 2024 study from the National Renewable Energy Laboratory found that for Colorado households currently heated by natural gas, switching to a high-efficiency cold-climate heat pump would pencil out for approximately zero percent of state households. A separate GTI Energy analysis for Colorado found that switching to all-electric appliances would increase annual consumer energy costs by 112% compared to efficient gas alternatives.
Heat pumps and electrification are in reach for well-off homeowners in well-insulated Denver houses, but often not for renters who have no control over their building’s heating system, seniors on fixed incomes, or families in older homes in mountain communities. Electrification shifts winter heating demand onto the grid during Colorado’s coldest months, making it harder to meet peak demand.
If LNG volatility is a concern, so is heavy reliance on Chinese-dominated supply chains for solar panels, batteries, and critical minerals. The authors seem to ignore also that natural gas has been the single largest contributor to U.S. carbon emissions reductions over the past two decades, primarily by displacing coal in the power sector. And importantly, most Colorado households still choose natural gas because it is affordable, responsive, and reliable, and policymakers should respect that preference.
If the priority is protecting consumers, the path forward is clear: preserve fuel diversity, enforce cost discipline at the PUC, and let technologies compete on price and performance rather than mandate. Colorado families need lower bills and reliable heat, not a political experiment with their monthly bill statement.
