Xcel Switch To Natural Gas Popular

A new poll finds that Xcel energy's plan to shift about 900 MWs of electricity production from coal to natural gas and add new emissions controls at coal powered plants with about 950 MWs of power production has bipartisan support. Colorado's total summer electricity generation capacity is about 8,142 megawatts.

In 2008, Xcel generated about 68% of its electricity with coal, 9% with natural gas, and about 3.5% with hydroelectric power. The conversion will roughly double the share of Xcel electricity generated with natural gas by reducing coal production by a like amount. This continues a move away from coal and towards natural gas for Xcel in Colorado that has been in progress since 1998 when natural gas accounted for 2.5% of electricity generation and coal accounted for about 85%.

A separate initiative also mandates that Xcel increase the share of electricity that it generates from renewable sources (mostly wind and to a much lesser extent solar power), so the two initatives combined will significantly reduce coal consumption in Colorado, probably to under half of the state's total electricity generation in a decade or two.

Natural gas is safer over the production cycle to produce, is cheap to distribute, and is much environmentally cleaner when used than coal, but buying it costs about 3.5 times as much as coal per BTU of heat generated. Over the long term, peak natural gas may be a few decades away, while "peak coal" is vastly more distant, because we have more coal reserves than we do natural gas reserves. So, natural gas prices are more likely to increase over time than coal prices.

I have made detailed comments to the linked post detailing the environmental impacts of coal relative to natural gas and renewables, the jobs that the shift will cost Colorado in the coal industry (about 300), the jobs that will be created elsewhere from $1.2 billion of constructive activity over 12 years, and cost impacts of the plan on customers. During the twelve years of construction, the construction work will add many more jobs than the reduced coal use will when the new retooled plants start to open, starting in 2017.