The Independence Institute has submitted written testimony on HB26-1326, “Sunset Review of the Public Utilities Commission,” which will be heard in the Colorado House Energy & Environment Committee tomorrow, April 24, 2026, at 1:30 p.m., pending any further schedule changes. Unfortunately, the bill will make the PUC less transparent and accountable, as well as cement the PUC’s role in picking and choosing energy technologies.
The hearing promises to be a marathon agenda, with two other bills, HB26-1030 pertaining to data centers, and HB26-1246 to allow consumer-regulated electric utilities, which the Independence Institute has testified on before.
You can read the transcript of the Independence Institute’s testimony below. We’ll be tuning into the hearing here.
April 23, 2026
Testimony of the Independence Institute on HB26-1326, Sunset Review of the Public Utilities Commission
Chair Valdez and members of the committee,
My name is Sarah Montalbano, and I am an energy policy analyst at the Independence Institute, a free market think tank based in Denver. I urge the committee to reconsider several provisions in HB26-1326, adopted from the 2025 Office of Policy, Research, and Regulatory Reform (COPRRR) report,[i] which will make the Colorado Public Utilities Commission less accountable and transparent.
The PUC exists to protect Colorado consumers by setting just and reasonable rates, ensuring reliable service, and holding monopoly utilities accountable in markets where ratepayers have no alternatives. It has drifted from least-cost principles toward an “economic, environmental and social values,” mission broad enough that it subordinates affordability to other policy goals.[ii]
HB26-1326 would erode the accountability, transparency, and consumer protection functions of the PUC. The bill recommends not reviewing the PUC again until 2037, an 11-year window. Colorado has used a roughly five-year sunset review cycle since the General Assembly established it in 1976.[iii] COPRRR justifies recommending this extension because the legislature passes energy bills frequently.
But that gets accountability backwards: the more consequential and frequent the legislature’s mandates, the more important it is to examine whether the PUC is implementing them in the public interest. Continuing to oversee the PUC on a 5-year cycle is the wiser path for ratepayers than what is proposed today.
The bill also permits PUC Commissioners to deliberate privately on adjudicatory matters. COPPPR says that open meetings “impede the timeliness and quality of decision-making” and that the Open Meetings Law “may hamper creative solutions, or delay solutions to highly technical matters.”[iv] In a quasi-judicial body that sets rates for monopoly utilities, we need transparency far more than creativity. The COPPPR report itself calls its recommendation “a dramatic departure from traditional notions of open meetings.”[v] Its proposed safeguard is that Commissioners “speak publicly about their decision after the private meeting,” but an announcement of a conclusion is not the same as a public deliberation.
This is especially troubling in light of the 2012 State Auditor performance audit of the PUC, which found Commissioners were not disclosing email communications at all, filing disclosure memos as many as 189 days after meetings, and omitting participant affiliations in nearly half of all filings.[vi] The Commission agreed to reforms. There has been no broad performance audit of PUC transparency and governance practices since then to verify they were sustained. The legislature should not loosen open meetings standards for an agency whose compliance has not been independently re-verified in over a decade.
This is not the first “dramatic departure” from traditional open meetings practices that the Colorado legislature has pursued. In 2024, the legislature exempted itself in a similar way from open meetings requirements, now allowing private, small-group discussions with no public notice, minutes, or accountability. If this were all, then the public might have recourse through records requests, but unfortunately, the legislature has also pushed to extend response timelines for records requests and refused to reduce fees. The last thing the public needs is the same playbook to be in place at the PUC.
This bill would also cement the PUC’s role in picking and choosing energy technologies, rather than an independent protector of ratepayer interests.
Under HB26-1326, utilities compliant with the Clean Energy Plan (CEP) could opt out of the Renewable Energy Standard (RES), in essence making the CEP the governing framework. The RES was passed by Colorado voters in 2004.[vii] The CEP was legislated, not voted on in a ballot measure, and carries more aggressive targets. The bill would also eliminate the RES’s requirement that renewable mandate costs be calculated “net of alternative sources of electricity supply from noneligible energy resources that are reasonably available.”[viii] HB26-1326 strikes the only statutory mechanism that requires regulators to ask whether renewables are actually cheaper for ratepayers. Removing it on the grounds that Colorado is “no longer pursuing” conventional generation eliminates a cost guardrail precisely because the policy has made the comparison inconvenient.
The bill also directs the PUC to study joint procurement of wind, solar, and storage across its regulated utilities and utilities that have voluntarily opted out of PUC jurisdiction. In 1983, cooperative electric associations were allowed to exempt themselves from Commission regulation by majority vote of their members and consumers; municipal utilities were also exempted.[ix] Those entities govern themselves independently and are not subject to CEP mandates. While the bill itself does not extend PUC jurisdiction over exempt utilities, a study scoped to identify “barriers” to joint procurement with them is likely to be the first step to extending CEP-style requirements and PUC oversight to utilities that chose a different path.
HB26-1326 would allow independent power producers, including independent solar and wind developers not otherwise subject to PUC oversight, to appeal local government permit denials to the Commission rather than going to court. Currently, a developer denied by a county board must litigate in district court, a process that reflects the genuine weight of overriding property rights and local land use decisions made by elected officials. This provision would replace that check with an appeal to the PUC, a body increasingly oriented toward advancing renewable energy interests at the expense of local control. Shifting siting authority from elected county officials to an appointed state agency is a significant enough policy change to warrant standalone legislation.
Another concern is that HB26-1326 would authorize the PUC to order a utility to securitize assets rather than waiting for a voluntary application. Securitization is also currently limited to coal plant retirements and wildfire mitigation; this provision would expand its scope. The report frames natural gas infrastructure as future “stranded assets” as decarbonization policy moves customers off gas. But those assets would only be stranded by state mandates like the Clean Heat Plan and electrification requirements imposed by the legislature. Authorizing the PUC to compel utilities to write down those government-created losses converts securitization from a ratepayer protection tool into a financial mechanism for implementing legislative policy goals.
The Independence Institute urges the committee to address the Commission’s structure and composition. The PUC consists of three commissioners appointed by the governor with no diversity in geographic representation. As it stands now, the PUC well represents Boulder, Chaffee, and Eagle Counties, but there are no commissioners representing the best interests of communities on the Eastern Plains, the Western Slope, the San Luis Valley, or the rural communities whose economies depend just as much on the PUC’s decisions, if not more, than Boulder, Chaffee, and Eagle Counties.
Last legislative session, HB25-1126 was introduced to expand to Commission to five members, with two at-large members and three representing defined geographic districts spanning the Denver metro area, the western region, and the eastern region. The Independence Institute raised this idea during the sunset review process, and we continue to support it. The fiscal note associated with two more commissioners is modest relative to the billions of dollars in decisions the PUC makes every year. As HB26-1326 aims to make the PUC even more influential, it’s only fair that every region of Colorado has a voice at the table at the PUC.
The Independence Institute also urges the committee to direct the Office of the State Auditor to conduct a new performance audit of the PUC before, or in conjunction with, its continuation, and to extend the current review period by one year to allow adequate time for that work to be completed. The last broad performance audit was conducted in 2012. Before granting the PUC an extended sunset period and expanded authority over Colorado’s energy sector, the legislature should have an independent, current assessment of how the Commission actually operates and whether its governance practices meet the transparency standards it agreed to uphold. The Independence Institute supports strong oversight of Colorado’s monopoly utilities. That oversight is only meaningful if the Commission answers to ratepayers first.
Respectfully submitted,
Sarah Montalbano
Energy Policy Analyst
Independence Institute
[i] “2025 Sunset Review, Public Utilities Commission.” COPRRR. Google Drive, October 15, 2025. https://drive.google.com/file/d/1f3MySmG5Ap16W85kZIuKJwf_Y37JE2Jf/view.
[ii] Colorado Public Utilities Commission, Mission Statement. https://puc.colorado.gov/aboutpuc
[iii] COPRRR, 2025 Sunset Review: Public Utilities Commission, October 15, 2025, p. 9 (“Enacted in 1976, Colorado’s sunset law was the first of its kind in the United States.”). The current five-year cycle is established by § 24-34-104, C.R.S.
[iv] COPRRR, 2025 Sunset Review: Public Utilities Commission, p. 79.
[v] COPRRR, 2025 Sunset Review: Public Utilities Commission, p. 80.
[vi] Colorado Office of the State Auditor, Public Utilities Commission, Department of Regulatory Agencies — Performance Audit, May 2012, Report Control No. 2174. https://content.leg.colorado.gov/sites/default/files/documents/audits/07_2174_puc_final_may_2012.pdf
[vii] Colorado Amendment 37, Renewable Energy Sources for Utilities Initiative (2004). https://ballotpedia.org/Colorado_Amendment_37,_Renewable_Energy_Sources_for_Utilities_Initiative_(2004)
[viii] COPRRR, 2025 Sunset Review: Public Utilities Commission, p. 88.
[ix] COPRRR, 2025 Sunset Review: Public Utilities Commission, p. 25.
