Renewable energy a contender to natural gas as second source of power for Colorado; coal still leads
DENVER — Renewable energy appears to be taking the lead over natural gas power generation in Colorado, but coal-fired energy remains the leader by a substantial amount.
In a presentation Wednesday to reporters, Erica Bowman, chief economist for the American Petroleum Institute, discussed the future of the oil and natural gas industry at the Colorado Petroleum Council’s office. She highlighted the oil and gas industry is turning around after two years of depressed prices, and Tracee Bentley, executive director of the Colorado office, said the state now has 26 drilling rigs up-and-running — a dramatic up-tick from about 15 rigs in the lows of 2016.
Bowman presented data from Electric Power Monthly that showed in October 2016, coal-fired power generation in Colorado was at about 2.3 million megawatts used per hour. In second was nonhydroelectric renewables — which includes wind and solar energy — at about 800,000 megawatts used per hour, with natural gas behind at about 750,000 megawatts used per hour. Hydroelectric was last with about 150,000 megawatts per hour.
This ultimately points to a Renewable Energy Standard set by the state Legislature in 2004. In 2010, the Legislature required investor-owned electricity companies, such as Xcel Energy, to generate 30 percent their electricity from renewable energy by 2020. Bentley noted the incentives and tax credits those companies receive for incorporating renewable energy per the bill, which is why a high use of renewable energy power over natural gas didn’t come as much of a surprise to her.
Bowman said the coal-fired generation will likely decline, with natural gas and renewable energy continuing to increase. She noted the types of energies being used are ultimately market-driven, and there might be a slight coal climb under Donald Trump’s administration, but not as much as the administration’s rhetoric insinuates. She said the state’s production of natural gas production has remained steady, which is notable given their unconventional prices the past few years.
“There is an opportunity in Colorado to use more natural gas in power generation and use domestically produced gas,” she said. “From our perspective, natural gas is a very affordable, reliable, power-generating resource.”
Bowman said API is not necessarily threatened that renewable energy will entirely take over as a main source of energy for the state, but she said the markets should drive what energies are being used.
“In some ways, Colorado has been blessed with everything,” she said. “It has a good wind resource, it has great sun for solar and it has natural gas. But from our perspective, we think you should let markets decide what the best option is, and if you’re putting in mandates to mandate a certain technology over another, you’re certainly raising costs for consumers to do that.”