Xcel Energy Inc. said it is proposing to add more solar in Colorado because it is cost-competitive with natural gas-fired resources. The company filed a confidential report Sept. 10 asking for the state Public Utilities Commission's approval of its updated plans.

Xcel Energy, the state's largest investor-owned electric utility, filed its 2014 renewable energy standard, or RES, plan with the PUC on July 24. In the plan, the company recommended maintaining current solar program levels.

However, in the just-filed report, the company's recommendations include 170 MW of new, utility-scale solar generating capacity and 450 MW of additional wind energy generating capacity in Colorado, which would be a decrease from 550 MW that the company initially sought after a request for proposals. Still, the additional wind would bring the installed wind capacity on the company's system in Colorado to 2,650 MW.

Xcel Energy spokeswoman Michelle Aguayo said the company's latest proposal is not an attempt to meet the objectives of the RES plan, but rather to fill basic generation needs because the company is now seeing bids for solar and wind that are very competitive with bids for natural gas generation.

"We are asking the PUC to take a look at this plan because we believe it is the best class of energy bids to fill future generation needs," Aguayo said. "Based on generation needs, the most reliable and most cost-effective resources happen to be solar and wind. We are not taking on solar because we have to, but because it is cost-effective and economical."

The report was filed to dovetail with the company's resource plan through 2018, she said. Xcel Energy first asked the PUC to approve 550 MW of new wind resources, but the PUC said it would approve only 200 MW because the regulators did not know whether the rest would be cost-effective, Aguayo said. "So we looked at the resource plan and continued to bid and determined another 250 MW would be cost-effective and we will recommend the PUC approve 450 MW," she said.

"For the first time ever, we are adding cost competitive utility scale solar to the system," Public Service Co. of Colorado President and CEO David Eves said in a Sept. 10 statement. Xcel Energy goes by the PSCo name for regulatory purposes in the state.

"The 170 MW we recommend would triple Xcel Energy's current utility scale solar in Colorado and it equates to all of the customer-sited solar in the state of Colorado, at about one half of the cost," Eves said.

Xcel Energy's RES plan offers a proposed strategy for meeting the state's renewable energy goals, which include further diversifying Colorado's energy mix with solar, wind and other renewables, such as biogas, small hydro and recycled energy. Xcel Energy said it is ahead of schedule in meeting the state's RES goal of 30% renewable energy by 2020.

The latest request for solar generation would use single-axis tracking to maximize solar energy output. The company currently has about 80 MW of utility-scale solar and 160 MW of customer-sited solar generation.

Xcel Energy also asked the PUC to approve 317 MW of gas-fired generation in its latest filing. The gas-fired capacity would provide operational flexibility to integrate renewable resources into its electric supply mix, Xcel Energy said in a press release.

The proposed gas-fired generation would come from existing Colorado power plants that previously supplied Xcel Energy, but would do so under contractual terms at reduced prices. This flexible generation allows the company to start, ramp up and turn down generation in relatively short time to compensate for variations in wind and solar generation output.

Xcel Energy also is recommending permanent closure of the 109-MW, coal-fired unit 4 at the Arapahoe Generating Station in Denver at the end of 2013 and continued operation of Cherokee Generating Station's unit 4 in Denver as a natural gas facility after 2017. The fuel switch by the end of 2017 is part of a plan to comply with the state's Clean Air-Clean Jobs Act.

An independent evaluator for the PUC will review the company's report. The commission is scheduled to approve the plan as filed or make amendments to it by Dec. 9.

A number of low-cost resource combinations could meet Xcel Energy's needs by relying on varying amounts of new wind and solar and various gas-fired generation resources, Eves said. "Commissioners will have a great deal to consider as they review this plan and take comments from other parties," he said.

The details of the acquisition are in the 2013 All-Source Solicitation "120-Day Report," as required through the 2011 Electric Resource Plan bid process previously approved by the PUC. However, project details, including resource locations, remain confidential, so the report is sealed, the press release said. Access to it on the PUC's website was denied.

The proposed facilities in Xcel Energy's report would be acquired in addition to 42.5 MW of on-site solar that the company has proposed through separate proceedings with the PUC under the 2014 Renewable Energy Standard Compliance Plan. That proposal recently was sent to an administrative law judge with the PUC for further regulatory action.

The company said the plan would reduce carbon dioxide emissions by more than one-third from 2005 levels.