Colorado PUC Approves Smart Grid Investment and Revenue Decoupling for Xcel Energy

(Denver, CO) JUNE 21, 2017 – On June 21, the Colorado Public Utilities Commission (PUC) approved two important policies for Xcel Energy, Colorado’s largest electric utility. One policy gives Xcel Energy the green light to invest $612 million in modernizing the electric grid (including the installation of improved voltage controls in most of the utility’s power distribution system and new smart meters for all of Xcel Energy’s 1.4 million customers).

“The investment in smart meters and improved voltage controls will result in Xcel’s customers saving energy and reducing their electric bills,” said Howard Geller, executive director of the Southwest Energy Efficiency Project (SWEEP). In addition, this investment will enable customers to obtain:

  • better information about their energy use,
  • enhanced energy services such as energy management systems that make use of smart meter data,
  • and more sophisticated energy pricing such as rates that vary by time of use during the day.

The second policy approves revenue decoupling for Xcel’s residential and small business customers. This policy means that Xcel Energy will collect the amount of revenues that the PUC authorizes it to collect in future rate cases, and no more or no less. If the utility collects more than the authorized amount, it will refund the difference to consumers; conversely if it collects less than the authorized amount a small surcharge will be implemented to make the company whole. This policy ensures that Xcel Energy is not harmed financially when its customers save energy or adopt rooftop solar or other distributed energy systems. The PUC approved revenue decoupling on a pilot basis through 2023.

“Revenue decoupling is common in states that have strong utility energy efficiency programs,” Geller said. “With this new policy in place, Xcel Energy should ramp up its efforts to help consumers and businesses become more efficient, thereby cutting wasteful electricity use.”

SWEEP participated in both proceedings where the PUC considered these new policies and investments.  SWEEP supported the adoption of revenue decoupling, which has been successfully implemented for electric utilities in 15 other states. SWEEP also joined the Unopposed Settlement Agreement that recommended the PUC approve the investment in smart meters and improved voltage controls on the electric grid.