Colorado Approves $110 Million Transportation Electrification Plan

Originally published on the NRDC Expert Blog.
By Miles Muller & Max Baumhefner

This blog was co-authored by Joe Halso of Sierra Club and Aaron Kressig of Western Resource Advocates

Xcel Energy will deploy approximately 20,000 electric vehicle (EV) charging stations at residential, commercial, and public sites across Colorado, under a $110 million plan formally approved by the Colorado Public Utilities Commission this week. The plan is the first full-scale electric vehicle infrastructure program approved in the state, and stakes out Colorado’s place among states leading the charge on electrifying the transportation sector.

Image by Jessica Russo, NRDC

Filed last year, Xcel’s “2021–2023 Transportation Electrification Plan” sets out the utility’s proposal for establishing about 20 new customer programs aimed at installing charging stations at residences, workplaces, community hubs, and along major public roadways over the next three years. The approved plan features a heavy emphasis on equity, requiring that a minimum of $20 million be invested towards promoting EV adoption in low-income households and communities most heavily impacted by air pollution.

Xcel’s proposal comes as a result of Senate Bill 77, a new law passed in 2019 with bipartisan support that directs Colorado’s electric utilities to file applications to facilitate the deployment of EV charging stations and support EV adoption in their service territories.

Colorado’s Transportation Landscape

The transportation sector is the leading source of greenhouse gas emissions in Colorado, with passenger vehicles accounting for a majority of the sector’s emissions. As recognized by the commission in its approval of Xcel’s plan, widespread transportation electrification enabled by utility investment has public health, economic and environmental benefits. The program can benefit all utility customers and Coloradans by reducing greenhouse gas and criteria pollutant emissions, while also decreasing annual vehicle operating costs relative to conventional internal combustion engines, as well as reducing utility customer electric bills by spreading the cost of maintaining the grid over a greater volume of electricity sales.

In fact, multiple forward-looking studies relied upon in Xcel’s proposal illustrate that widespread EV adoption would provide cumulative benefits of $43 billion to the state of Colorado, including:

• $4.1 billion accruing to utility customers in the form of reduced electric bills,
• $29.1 billion accruing to Colorado drivers in the form of reduced annual vehicle operating costs, and
• $9.7 billion accruing to society at large as the monetized value of reduced greenhouse gas emissions

Chart by M.J. Bradley & Associates, “Electric Vehicle Cost-Benefit Analysis: Colorado,” April 2017.

Xcel’s Roadmap for Accelerating EV Adoption in Colorado

Designed to help Colorado unlock these benefits and meet its goal of 940,000 charging stations by 2030, Xcel’s plan aims to address barriers to EV adoption by providing expanded access to charging infrastructure across residential, multi-family housing, commercial, and public locations. In addition, the program includes significant funding for education and outreach efforts to increase consumer awareness of EVs and the benefits of transportation electrification.

The plan offers residential customers rebates for defraying the upfront cost of installing charging stations and upgrading home wiring, with enhanced rebates for low-income customers. The goal is to make EV charging simple and affordable, and to encourage residential customers to charge EVs during off-peak periods.

For multi-family housing, Xcel will similarly provide rebates for installing charging at existing buildings and at new buildings during the time of construction. The multi-family portfolio also includes a requirement that drivers at these sites (who may not be the ones owning the charging stations and receiving the monthly electric bill) see time-varying price signals that encourage them to charge when renewable energy is abundant and the grid is underutilized. The aim is to tap the potential of EVs to help integrate renewable generation and ensure that drivers who charge in line with grid conditions realize fuel costs savings relative to gas and diesel.

The plan’s commercial portfolio will provide support for fleet and workplace charging, public fast charging stations, and community  charging hubs. Designed in partnership with cities and other local organizations, these community charging hubs will support access to shared mobility and other forms of electric transportation, including e-bikes, scooters, and ride sharing services.

Consistent with the program’s overall focus on equity, each of these portfolios has a dedicated low-income component—with enhanced rebates for low-income customers as well as targeted education and outreach designed specifically for low-income customers in coordination with local community-based organizations. A minimum of 15% of all funding will be dedicated to low-income customers and underserved communities.

On top of this, the plan importantly includes a $5 million “Equity Rebate” program to provide upfront rebates for eligible low-income customers purchasing new or used EVs. The program will offer a $5,500 rebate for new vehicles and $3,000 for used vehicles. This will help improve income-qualified customers’ access to clean transportation options.

The approval of Xcel’s plan reflects the support of a broad and diverse group of stakeholders who participated in the commission’s public process to review the proposal, including NRDC, Western Resource Advocates, Sierra Club, Southwest Energy Efficiency Project, Energy Outreach Colorado, the Colorado Latino Forum, GRID Alternatives, Vote Solar, ChargePoint, EVGo, EnelX, EV Box, Greenlots, and Electrify America.