A Bill for an Act
Page 1, Line 101Concerning adjustments to the economic development rate
Page 1, Line 102tariff.
Bill Summary
(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)
Under current law, an investor-owned electric utility (utility) may apply to the public utilities commission (commission) for approval to charge certain commercial or industrial customers of the utility an economic development rate (economic development rate), which is a reduced rate offered to a commercial or industrial customer that locates or expands their operations in Colorado, that adds at least 3 megawatts of new load at a single location within the utility's service territory, and that demonstrates certain other requirements to the satisfaction of the utility (qualifying commercial or industrial customer).
The bill makes adjustments to the economic development rate tariff by:
- Authorizing the utility to apply to the commission for an expansion of the maximum duration of the economic development rate from 10 years to 25 years;
- Expanding the maximum load at a single location of a qualifying commercial or industrial customer for an individual project that does not require commission approval from 20 megawatts to 40 megawatts; and
- Updating the application process required for seeking approval of an economic development rate by requiring that the commission:
- Approve or deny an application within 120 days after a notice period of 14 business days after the application was filed; and
- Consider the broader economic benefits associated with the application for other classes of utility customers and for the surrounding community.
This Unofficial Version Includes Committee
Amendments Not Yet Adopted on Second Reading
Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:
Page 2, Line 2SECTION 1. In Colorado Revised Statutes, 40-3-104.3, amend
Page 2, Line 3(6)(b)(I), (6)(b)(II)(B), (6)(b)(III), (6)(c)(I), (6)(d)(I) introductory portion,
Page 2, Line 4(6)(d)(II) introductory portion, (6)(d)(II)(A), (7), and (8); and add(6)(c)(IV), (6)(c)(V), and (6)(c)(VI) as follows:
Page 2, Line 540-3-104.3. Manner of regulation - competitive responses -
Page 2, Line 6economic development rate - definitions - repeal. (6) (b) (I) (A) An
Page 2, Line 7economic development rate approved pursuant to this section must be in
Page 2, Line 8the public interest and must be lower than the rate or rates that the
Page 2, Line 9qualifying commercial or industrial customer would be or currently is
Page 2, Line 10subject to under the investor-owned electric utility's tariffs in effect
Page 2, Line 11at the time the qualifying commercial or industrial customer seeks to
Page 2, Line 12qualify for the economic development rate; except that an economic
Page 3, Line 1development rate must not be lower than the utility's marginal cost of
Page 3, Line 2providing service to the qualifying commercial or industrial customer. An
Page 3, Line 3economic development rate must not directly increase costs of electric service for other customers.
Page 3, Line 4(B) An economic development rate approved pursuant to
Page 3, Line 5this section does not relieve an investor-owned electric utility
Page 3, Line 6of its ability to achieve compliance with greenhouse gas emission reduction requirements.
Page 3, Line 7(II) (B) Notwithstanding subsection (6)(b)(II)(A) of this section,
Page 3, Line 8the investor-owned electric utility may negotiate and enter into
Page 3, Line 9agreements related to economic development rates with individual
Page 3, Line 10qualifying commercial or industrial customers without commission
Page 3, Line 11approval so long as the agreed-upon economic development rate complies
Page 3, Line 12with the commission-approved tariff and the addition or expansion of
Page 3, Line 13existing load at a single location is less than or equal to
twentyPage 3, Line 14megawatts. In approving a utility's application for an economic
Page 3, Line 15development rate, for loads between twenty-one and forty
Page 3, Line 16megawatts, the commission may require the investor-owned
Page 3, Line 17electric utility to make additional demonstrations, including a
Page 3, Line 18marginal cost determination, an additional power flow analysis
Page 3, Line 19to demonstrate that the added load will be supported by
Page 3, Line 20adequate transmission capabilities and will not negatively
Page 3, Line 21impact reliability or resource adequacy, a demonstration that
Page 3, Line 22the additional infrastructure costs will not be borne by other
Page 3, Line 23customers, and a demonstration that projects above twenty-one
Page 3, Line 24megawatts will provide additional community benefits. Any
Page 3, Line 25addition or expansion of existing load at a single location that is greater
Page 4, Line 1than
twentyPage 4, Line 2based upon a finding that the addition or expansion is consistent with this section and in the public interest.
Page 4, Line 3(III) (A) An investor-owned electric utility may offer an
Page 4, Line 4economic development rate to a qualifying commercial or industrial customer for up to ten years.
Page 4, Line 5(B) Notwithstanding subsection (6)(b)(III)(A) of this
Page 4, Line 6section, the investor-owned electric utility may propose, and
Page 4, Line 7the commission may consider approving, an economic
Page 4, Line 8development rate to a qualifying commercial or industrial
Page 4, Line 9customer for a period of greater than ten years, but no more than twenty-five years.
Page 4, Line 10(C) In evaluating whether it is in the public interest for an
Page 4, Line 11investor-owned electric utility's proposal to allow a qualifying
Page 4, Line 12commercial or industrial customer to remain on an economic
Page 4, Line 13development rate for longer than ten years, the commission
Page 4, Line 14shall evaluate the proposed duration of the qualifying
Page 4, Line 15commercial or industrial customer's proposed project,
Page 4, Line 16community impacts, and impacts to rates of other customers of the utility.
Page 4, Line 17(c) (I) An
authorizationPage 4, Line 18pursuant to this section must include such terms and conditions as the
Page 4, Line 19commission determines are necessary to ensure that the economic
Page 4, Line 20development rates or charges assessed to other customers do not subsidize
Page 4, Line 21the cost of providing service to qualifying commercial and industrial
Page 4, Line 22customers consistent with subsection (6)(b)(I) of this section and that
Page 4, Line 23there is no other subsidization of such service. In
developingPage 5, Line 1the terms and conditions of an economic development rate, the commission shall consider, among other things:
Page 5, Line 2(A) The rates and charges assessed to the investor-owned electric utility's wholesale customers;
andPage 5, Line 3(B) The effects on other transmission system owners and users
Page 5, Line 4resulting from new transmission facilities constructed in connection with
Page 5, Line 5the utility's expansion of an existing voluntary
renewablePage 5, Line 6(C) For all of the investor-owned electric utility's
Page 5, Line 7customer classes, the broader economic development benefits
Page 5, Line 8associated with the qualifying commercial or industrial
Page 5, Line 9customer based on a determination of the marginal cost and on
Page 5, Line 10a societal economic benefit test developed by the investor-owned electric utility.
Page 5, Line 11(IV) Following a notice period of fourteen business days
Page 5, Line 12after an investor-owned electric utility files an application for
Page 5, Line 13approval of economic development rates, and the addition or
Page 5, Line 14expansion of existing load at a single location that is forty-one
Page 5, Line 15or more megawatts, the commission shall approve or deny the
Page 5, Line 16application within one hundred twenty days after the expiration of the notice period.
Page 5, Line 17(V) Following a notice period of fourteen business days
Page 5, Line 18after an investor-owned electric utility files an application for
Page 5, Line 19approval of economic development rates, and the addition or
Page 5, Line 20expansion of existing load at a single location that is more than
Page 5, Line 21one hundred fifty megawatts, the commission shall approve or
Page 5, Line 22deny the application within two hundred ten days after the expiration of the notice period.
Page 6, Line 1(VI) (A) If an investor-owned electric utility does not
Page 6, Line 2have a commission-approved tariff pursuant to subsection
Page 6, Line 3(6)(b)(II)(A) of this section, the commission, following a notice
Page 6, Line 4period of fourteen business days after the investor-owned
Page 6, Line 5electric utility files an application for approval of economic
Page 6, Line 6development rates, shall approve or deny the application within
Page 6, Line 7one hundred twenty days after the expiration of the notice period.
Page 6, Line 8(B) This subsection(6)(c)(VI)is repealed, effective June 1, 2026.
Page 6, Line 9(d) (I) An investor-owned electric utility may seek commission
Page 6, Line 10approval to expand any voluntary
renewablePage 6, Line 11service offering, except those covered by valid agreements to the contrary
Page 6, Line 12executed and approved by the commission as of January 1, 2019, through
Page 6, Line 13the acquisition of additional
renewablePage 6, Line 14(II) The commission may approve, within one hundred twenty
Page 6, Line 15days, an expansion of an existing voluntary
renewablePage 6, Line 16(A) There is not sufficient capacity and energy in the existing
Page 6, Line 17voluntary
renewablePage 6, Line 18the needs of the customer and the customer meets the requirements of subsection (6)(d)(I) of this section; and
Page 6, Line 19(7) As used in subsection (6) of this section and this subsection (7), unless the context otherwise requires:
Page 6, Line 20(a) "Marginal cost" means the incremental additional
Page 7, Line 1cost that an investor-owned electric utility incurs and charges
Page 7, Line 2to serve an electric customer over the contract period, which
Page 7, Line 3additional costs would not have been incurred if the customer
Page 7, Line 4did not take service on the utility's system, including, but not limited to:
Page 7, Line 5(I) Fuel;
(II) Purchased power;
Page 7, Line 6(III) Operating and maintenance costs;
(IV) Capital additions;
Page 7, Line 7(V) Overhead;
(VI) Taxes; and
Page 7, Line 8(VII) Fees.
(a)Page 7, Line 9(I) Means a utility customer that:
Page 7, Line 10(A) Agrees to: Locate commercial or industrial operations in
Page 7, Line 11Colorado and add at least three megawatts of new load at a single
Page 7, Line 12location, or expand existing commercial or industrial operations in
Page 7, Line 13Colorado and add at least three megawatts of new load at a single location; and
Page 7, Line 14(B) Demonstrates, to the satisfaction of the investor-owned
Page 7, Line 15electric utility, subject to review by the commission, that: The cost of
Page 7, Line 16electricity is a critical consideration in deciding where to locate new or
Page 7, Line 17expand existing operations, and the availability of economic development
Page 7, Line 18rates, either on their own or in combination with other economic
Page 7, Line 19development incentives, is a substantial factor in the customer's decision to locate new or expand existing business operations in Colorado; and
Page 7, Line 20(II) Does not include a customer that agrees to relocate or
Page 8, Line 1otherwise transfer its existing load of at least three megawatts from the
Page 8, Line 2service territory of another public utility, as defined in section 40-1-103,
Page 8, Line 3into the service territory of the utility offering economic development rates.
Page 8, Line 4(c) "Societal economic benefit test" means a test that takes into account:
Page 8, Line 5(I) The economic benefits received by all customer classes served by the utility; and
Page 8, Line 6(II) The economic development benefits, including:
Page 8, Line 7(A) The total net local and state taxes to be paid by the qualifying commercial or industrial customer;
Page 8, Line 8(B) The amount of full-time jobs created; and
Page 8, Line 9(C) Other economic growth, benefits, or both brought to
Page 8, Line 10the surrounding community that result from serving a
Page 8, Line 11qualifying commercial or industrial customer with an economic development rate.
Page 8, Line 12
(b)renewablePage 8, Line 13offering" means a program or other service offering approved by the
Page 8, Line 14commission that allows a qualifying commercial or industrial customer
Page 8, Line 15access to eligible energy resources, as that term is defined in section
Page 8, Line 1640-2-124 (1)(a), on a voluntary basis, on terms and conditions deemed
Page 8, Line 17necessary by the commission. For a voluntary
renewablePage 8, Line 18program or service offering to be expanded, it must have been approved
Page 8, Line 19by the commission prior to the expansion request of a qualifying
Page 8, Line 20commercial or industrial customer pursuant to subsection (6)(d)(I) of this section.
Page 8, Line 21(8)
This subsection (8) and2028Page 9, Line 1SECTION 2. Applicability. This act applies to applications filed on or after the effective date of this act.
Page 9, Line 2SECTION 3. Safety clause. The general assembly finds,
Page 9, Line 3determines, and declares that this act is necessary for the immediate
Page 9, Line 4preservation of the public peace, health, or safety or for appropriations for
Page 9, Line 5the support and maintenance of the departments of the state and state institutions.