I’ve documented that Xcel Energy has excess electricity generation capacity. I just didn’t realize how much. According to a source close to an electricity wholesaler and generator, “Right now they can buy power cheaper than they can make it. A week or two ago Excel [sic] was paying us $18 a MW to buy power from them so that they could get the subsidies.”
The subsidy referenced is the Production Tax Credit (PTC) for wind. Apparently the source believes that PTC is so profitable that Xcel can pay wholesalers to take the monopoly utility’s excess capacity and still make money as hard working Colorado ratepayers foot the bill for the wind farms and the tax credit.
Soon, Xcel will charging ratepayers even more so it can build additional industrial wind (that we don’t need) so shareholders can collect more taxpayer-funded subsidies. It’s obscene. But our state legislature enables it, and our Public Utilities Commission authorizes it.
The most recent revelation comes in the shadow of the State Senate hearing to reauthorize monopoly utilities’ so-called Demand-Side Management (DSM) programs.
Here’s the gist of DSM: the state legislature directs the monopoly utilities such as Xcel to profit, “without limitation”, at a higher rate of return on programs that lecture ratepayers about using less electricity than the utility would earn on actually producing electricity. In other words, ratepayers are forced to pay their monopoly utility to NOT produce electricity and be shamed for using electricity regardless of ratepayers’ personal circumstances.
Now add to that, Xcel is paying (really ratepayers are paying because Xcel just passes along the cost) wholesale generators to take excess.
Sound absurd? It is. And we pay for it.