January 6, 2020
Even a renewable energy leader like Xcel, one of the first to pledge net zero emissions by mid-century, is finding it hard to end coal without adding natural gas.
As major U.S. utilities began making pledges this past year to cut their greenhouse gas emissions to net-zero, or close to it, by mid-century, one of them was already drawing up a road map to make it happen.
Minneapolis-based Xcel was the first large investor-owned utility in the country to set the goal, in December 2018, and it spent 2019 planning how to get there.
But even a leader in renewable energy like Xcel is finding it difficult to shed fossil fuels completely before the 2040s, raising questions about any utility’s ability to break from coal without adding new carbon energy in other forms, mainly natural gas.
Xcel, which serves 3.6 million customers in eight states, laid out a detailed proposal in 2019 for the Upper Midwest part of its territory. It is proposing to retire coal plants early, extend the life of a nuclear plant, and dramatically expand solar and wind energy.
“They are putting some very tangible flesh on the bones to get to their 2050 goal,” said Kevin Lee, director of the climate and energy program for the Minnesota Center for Environmental Advocacy. It’s a “pretty monumental thing,” he said.
But Xcel’s plan would also expand its use of natural gas by purchasing a gas plant and converting one of its coal plants to run on gas. The utility says it needs the fossil fuel to maintain reliability.
That decision is dividing local activists and is a microcosm of the broader debate around gas’s future that has become pervasive in the fight over the nation’s energy economy, as scientists warn about locking in decades of planet-warming greenhouse gas emissions.
Lee’s group was one of several that agreed not to oppose Xcel’s purchase of a natural gas plant in exchange for the company making firm commitments to close its two coal plants in Minnesota a decade earlier than planned and expand programs that help customers use less electricity.
The Citizens Utility Board, a consumer advocacy group, was more critical. It has described Xcel’s large new investments in natural gas plants as being financially risky because the costs of renewable energy technologies are falling and the gas plants are a multi-decade commitment.
“Because this is the first resource plan, both in the state and nationally, in which an investor-owned utility is voluntarily offering a pathway to 100 percent decarbonization, it represents a significant place in the resource plan continuum,” said Joseph Pereira, regulatory director for the Citizens Utility Board, in a July filing. “The resource mix selected in the upcoming plan will set the foundation for moving forward toward 100 percent decarbonization.”