First Regular Session
Seventy-fifth General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 25-0707.01 Jennifer Berman x3286
HOUSE BILL 25-1177
House Committees Senate Committees
Energy & Environment
A BILL FOR AN ACT
C
ONCERNING ADJUSTMENTS TO THE ECONOMIC DEVELOPMENT RATE101
TARIFF.102
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
HOUSE SPONSORSHIP
Mauro, Bird, Martinez
SENATE SPONSORSHIP
Hinrichsen and Pelton B., Roberts
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law. 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.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 40-3-104.3, amend2
(6)(b)(I), (6)(b)(II)(B), (6)(b)(III), (6)(c)(I), (6)(d)(I) introductory portion,3
(6)(d)(II) introductory portion, (6)(d)(II)(A), (7), and (8); and add4
(6)(c)(IV) and (6)(c)(V) as follows:5
40-3-104.3. Manner of regulation - competitive responses -6
economic development rate - definitions - repeal. (6) (b) (I) An7
economic development rate approved pursuant to this section
MUST BE IN8
THE PUBLIC INTEREST, MAY BE FILED WITH THE COMMISSION WITHOUT9
REFERENCE TO ANY TARIFF ON FILE, AND must be lower than the rate or10
rates that the qualifying commercial or industrial customer would be or11
currently is subject to under the
INVESTOR-OWNED ELECTRIC utility's12
tariffs in effect at the time the qualifying commercial or industrial13
HB25-1177-2- customer seeks to qualify for the economic development rate; except that1
an economic development rate must not be lower than the utility's2
marginal cost of providing service to the qualifying commercial or3
industrial customer.4
(II) (B) Notwithstanding subsection (6)(b)(II)(A) of this section,5
the
INVESTOR-OWNED ELECTRIC utility may negotiate and enter into6
agreements related to economic development rates with individual7
qualifying commercial or industrial customers without commission8
approval so long as the agreed-upon economic development rate complies9
with the commission-approved tariff and the addition or expansion of10
existing load at a single location is less than or equal to twenty
FORTY11
megawatts. I
N APPROVING A UTILITY'S APPLICATION FOR AN ECONOMIC12
DEVELOPMENT RATE, FOR LOADS BETWEEN TWENTY -ONE AND FORTY13
MEGAWATTS, THE COMMISSION MAY REQUIRE THE INVESTOR -OWNED14
ELECTRIC UTILITY TO MAKE ADDITIONAL DEMONSTRATIONS , INCLUDING A15
MARGINAL COST DETERMINATION , AN ADDITIONAL POWER FLOW ANALYSIS16
TO DEMONSTRATE THAT THE ADDED L OAD WILL BE SUPPORTED BY17
ADEQUATE TRANSMISSION CAPABILITIES AND WILL NOT NEGATIVELY18
IMPACT RELIABILITY OR RESOURCE ADEQUACY , A DEMONSTRATION THAT19
THE ADDITIONAL INFRASTRUCTURE COSTS WILL NOT BE BORNE BY OTHER20
CUSTOMERS, AND A DEMONSTRATION THAT PROJECTS ABOVE TWENTY -ONE21
MEGAWATTS WILL PROVIDE ADDITIONAL COMMUNITY BENEFITS . Any22
addition or expansion of existing load at a single location that is greater23
than twenty
FORTY megawatts requires separate commission approval24
based upon a finding that the addition or expansion is consistent with this25
section
AND IN THE PUBLIC INTEREST.26
(III) (A) An investor-owned
ELECTRIC utility may offer an27
HB25-1177
-3- economic development rate to a qualifying commercial or industrial1
customer for up to ten years.2
(B) N
OTWITHSTANDING SUBSECTION (6)(b)(III)(A) OF THIS3
SECTION, THE INVESTOR-OWNED ELECTRIC UTILITY MAY PROPOSE , AND4
THE COMMISSION MAY CONSIDER APPROVING , AN ECONOMIC5
DEVELOPMENT RATE TO A QUALIFYING COMMERCIAL OR INDUSTRIAL6
CUSTOMER FOR A PERIOD OF GREATER THAN TEN YEARS , BUT NO MORE7
THAN TWENTY-FIVE YEARS.8
(C) I
N EVALUATING WHETHER IT IS IN THE PUBLIC INTEREST FOR AN9
INVESTOR-OWNED ELECTRIC UTILITY'S PROPOSAL TO ALLOW A QUALIFYING10
COMMERCIAL OR INDUSTRIAL CUSTOMER TO REMAIN ON AN EC ONOMIC11
DEVELOPMENT RATE FOR LONGER THAN TEN YEARS , THE COMMISSION12
SHALL EVALUATE THE PROPOSED DURATION OF THE QUALIFYING13
COMMERCIAL OR INDUSTRIAL CUSTOMER 'S PROPOSED PROJECT ,14
COMMUNITY IMPACTS, AND IMPACTS TO RATES OF OTHER CUSTOMERS OF15
THE UTILITY.16
(c) (I) An authorization
APPROVAL granted by the commission17
pursuant to this section must include such terms and conditions as the18
commission determines are necessary to ensure that the economic19
development rates or charges assessed to other customers do not subsidize20
the cost of providing service to qualifying commercial and industrial21
customers consistent with subsection (6)(b)(I) of this section and that22
there is no other subsidization of such service. In developing APPROVING23
the terms and conditions
OF AN ECONOMIC DEVELOPMENT RATE , the24
commission shall consider, among other things:25
(A) The rates and charges assessed to the
INVESTOR-OWNED26
ELECTRIC utility's wholesale customers; and
27
HB25-1177
-4- (B) The effects on other transmission system owners and users1
resulting from new transmission facilities constructed in connection with2
the utility's expansion of an existing voluntary renewable CLEAN energy3
program or service offering;
AND4
(C) F
OR ALL OF THE INVESTOR -OWNED ELECTRIC UTILITY 'S5
CUSTOMER CLASSES, THE BROADER ECONOMIC DEVELOPMENT BENEFITS6
ASSOCIATED WITH THE QUALIFYING COMMERCIAL OR INDUSTRIAL7
CUSTOMER BASED ON A DETERMINATION OF THE MARGINAL COST AND ON8
A SOCIETAL ECONOMIC BENEFIT TEST DEVELOPED BY THE9
INVESTOR-OWNED ELECTRIC UTILITY.10
(IV) F
OLLOWING A NOTICE PERIOD OF FOURTEEN BUSINESS DAYS11
AFTER AN INVESTOR-OWNED ELECTRIC UTILITY FILES AN APPLICATION FOR12
APPROVAL OF ECONOMIC DEVELOPMENT RATES , AND THE ADDITION OR13
EXPANSION OF EXISTING LOAD AT A SINGLE LOCATION THAT IS FORTY -ONE14
OR MORE MEGAWATTS , THE COMMISSION SHALL APPROVE OR DENY THE15
APPLICATION WITHIN ONE HUNDRED TWENTY DAYS AFTER THE EXPIRATION16
OF THE NOTICE PERIOD.17
(V) (A) I
F AN INVESTOR-OWNED ELECTRIC UTILITY DOES NOT HAVE18
A COMMISSION-APPROVED TARIFF PURSUANT TO SUBSECTION (6)(b)(II)(A)19
OF THIS SECTION, THE COMMISSION, FOLLOWING A NOTICE PERIOD OF20
FOURTEEN BUSINESS DAYS AFTER THE INVESTOR -OWNED ELECTRIC UTILITY21
FILES AN APPLICATION FOR APPROVAL OF ECONOMIC DEVELOPMENT RATES ,22
SHALL APPROVE OR DENY THE APPLICATION WITHIN ONE HUNDRED23
TWENTY DAYS AFTER THE EXPIRATION OF THE NOTICE PERIOD .24
(B) T
HIS SUBSECTION (6)(c)(V) IS REPEALED, EFFECTIVE JUNE 1,25
2026.26
(d) (I) An investor-owned
ELECTRIC utility may seek commission27
HB25-1177
-5- approval to expand any voluntary renewable CLEAN energy program or1
service offering, except those covered by valid agreements to the contrary2
executed and approved by the commission as of January 1, 2019, through3
the acquisition of additional renewable CLEAN ENERGY generation4
capacity and energy to meet the current and projected demand of:5
(II) The commission may approve, within one hundred twenty6
days, an expansion of an existing voluntary renewable CLEAN energy7
program or service offering upon a showing by the utility that:8
(A) There is not sufficient capacity and energy in the existing9
voluntary renewable CLEAN energy program or service offering to satisfy10
the needs of the customer and the customer meets the requirements of11
subsection (6)(d)(I) of this section; and12
(7) As used in subsection (6) of this section and this subsection13
(7),
UNLESS THE CONTEXT OTHERWISE REQUIRES :14
(a) "M
ARGINAL COST" MEANS THE INCREMENTAL ADDITIONAL15
COST THAT AN INVESTOR-OWNED ELECTRIC UTILITY INCURS AND CHARGES16
TO SERVE AN ELECTRIC CUSTOMER OVER THE CONTRACT PERIOD , WHICH17
ADDITIONAL COSTS WOULD NOT HAVE BEEN INCURRED IF THE CUSTOMER18
DID NOT TAKE SERVICE ON THE UTILITY'S SYSTEM, INCLUDING, BUT NOT19
LIMITED TO:20
(I) F
UEL;21
(II) P
URCHASED POWER;22
(III) O
PERATING AND MAINTENANCE COSTS ;23
(IV) C
APITAL ADDITIONS;24
(V) O
VERHEAD;25
(VI) T
AXES; AND26
(VII) F
EES.27
HB25-1177
-6- (a) (b) "Qualifying commercial or industrial customer":1
(I) Means a utility customer that:2
(A) Agrees to: Locate commercial or industrial operations in3
Colorado and add at least three megawatts of new load at a single4
location, or expand existing commercial or industrial operations in5
Colorado and add at least three megawatts of new load at a single6
location; and7
(B) Demonstrates, to the satisfaction of the investor-owned8
ELECTRIC utility, subject to review by the commission, that: The cost of9
electricity is a critical consideration in deciding where to locate new or10
expand existing operations, and the availability of economic development11
rates, either on their own or in combination with other economic12
development incentives, is a substantial factor in the customer's decision13
to locate new or expand existing business operations in Colorado;
AND14
(II) Does not include a customer that agrees to relocate or15
otherwise transfer its existing load of at least three megawatts from the16
service territory of another public utility, as defined in section 40-1-103,17
into the service territory of the utility offering economic development18
rates.19
(c) "S
OCIETAL ECONOMIC BENEFIT TEST " MEANS A TEST THAT20
TAKES INTO ACCOUNT THE ECONOMIC BENEFITS RECEIVED BY ALL21
CUSTOMER CLASSES SERVED BY THE UTILITY AND THE ECONOMIC22
DEVELOPMENT BENEFITS TO THE SURROUNDING COMMUNITY THAT RESULT23
FROM SERVING A QUALIFYING COMMERCIAL OR I NDUSTRIAL CUSTOMER24
WITH AN ECONOMIC DEVELOPMENT RATE .25
(b)
(d) "Voluntary renewable CLEAN energy program or service26
offering" means a program or other service offering approved by the27
HB25-1177
-7- commission that allows a QUALIFYING commercial or industrial customer1
access to eligible energy resources, as that term is defined in section2
40-2-124 (1)(a), on a voluntary basis, on terms and conditions deemed3
necessary by the commission. For a voluntary renewable CLEAN energy4
program or service offering to be expanded, it must have been approved5
by the commission prior to the expansion request of a
QUALIFYING6
commercial or industrial customer pursuant to subsection (6)(d)(I) of this7
section.8
(8) This subsection (8) and
Subsections (6) and (7) of this section9
AND THIS SUBSECTION (8) are repealed, effective January 1, 2028 2035.10
SECTION 2. Applicability. This act applies to applications filed11
on or after the effective date of this act.12
SECTION 3. Safety clause. The general assembly finds,13
determines, and declares that this act is necessary for the immediate14
preservation of the public peace, health, or safety or for appropriations for15
the support and maintenance of the departments of the state and state16
institutions.17
HB25-1177
-8-