Xcel Energy may face jolt of penalties for delays in hooking up Colorado solar projects

1 month ago Longmont Times-Call

Regulators and lawmakers want Xcel Energy, Colorado’s largest electric utility, to turn up the juice and make sure that businesses and homeowners who want to go solar get connected to the grid more quickly.

The Colorado Public Utilities Commission is looking at ways to speed up the process that likely will include penalties. State Sen. Chris Hansen of Denver said he’ll soon introduce a bill that would set deadlines and impose fines if utilities don’t meet them.

As the outcry over skyrocketing utility bills has grown, so have complaints from people who want to install solar systems in part to cut their energy costs. Solar companies say getting customers connected to the electric grid used to take weeks and now can take several months.

Most of the complaints focus on Xcel Energy, according to the solar industry and regulators.

“This has been going on a while. We have plenty of complaints, we have plenty of data so I’m ready to move onto the action,” said Megan Gilman, a member of the PUC, which regulates utilities.

The PUC plans to discuss possible actions in a meeting Wednesday.

Hansen could introduce a bill setting deadlines for solar hookups as early as this week. The ability of people to install solar systems and connect to the grid is seen as important to helping reach the state’s goals for increasing the use of renewable energy and reducing greenhouse-gas emissions from fossil fuels.

“The delays we’re seeing are pretty significant. Some people are having to wait six to 12 months,” the Democratic lawmaker said. “You’re making a significant investment and you can’t get it interconnected and turned on. It’s basically burning money.”

Hansen said he has looked at a law in Minnesota, where Xcel Energy is based, that levies penalties for long wait times on interconnections.

During a news conference Feb. 6 about a wave of complaints concerning high utility bills, Gov. Jared Polis noted the recent frustration over holdups in getting solar systems online. One of the Denver-area residents who spoke about the high natural gas bills said she learned it would take up to six months to connect to the grid.

“It should not take anyone six months to go through red tape to get solar on their home. You should be able to move much quicker to begin saving money sooner,” Polis said.

Xcel Energy has connected more than 70,000 customer solar systems to its grid in Colorado, spokeswoman Michelle Aguayo said in an email.

“We apologize to those customers who have recently experienced delays in getting their new rooftop solar systems connected to the grid. We’ve seen a significant increase in the number of customers seeking rooftop solar,” Aguayo said.

The company completed more than 18,000 applications in 2022, up 34%, largely because of the increased federal and state tax incentives, Aguayo said. Xcel is hiring more employees and contractors to conduct the reviews of each individual installation, she said.

Solar companies and their customers have also been waiting for Xcel to launch new programs under a state mandate that a portion of the electricity sold by investor-owned utilities comes from renewable energy sources. The requirements include making room on the system for a certain amount of distributed generation, such as solar panels on homes or businesses and community solar gardens.

Cloudy forecast

Eliot Abel, co-owner of Namaste Solar in Boulder, said the old program ran out at the end of December. Xcel has indicated all the new programs will be open by the first of March.

“This is the first time I can think of that we’ve had an actual gap with no live program that customers could apply to,” Abel said.

The utility told companies the delay was caused in part by the need to clarify a provision on incentives for projects in disproportionately impacted communities, Abel said.

The result has been delays in both residential and commercial projects at a time when the federal government has extended and raised tax credits for solar power and the research firm Wood Mackenzie is forecasting 21% annual growth for the U.S. industry.

“It has impacted us significantly, both on the residential side and the commercial side,” Abel said. “On the commercial side, there’s a megawatt (worth) of projects we can’t move forward with, we can’t even apply for.

“And on the residential side, we have more than 130 projects that are tied up waiting for Xcel’s approval,” said Abel, referring to the interconnection delays.

The uncertainty is compounding the ongoing supply-chain problems, Abel added.  Namaste added more employees to keep up with increased business.

“Now we’re worried about being able to keep those crews busy despite the fact that the demand is obviously there,” Abel said.

Another stumbling block is a portal companies use to apply online for projects with Xcel, Abel said. “It’s been an unmitigated disaster.”

“We are working with our IT teams and contractors to address issues with our application portal, and they are being resolved,” Aguayo said. “We are also making efforts to further educate installers on how to use the application portal most efficiently and effectively.”

“Skeptically hopeful” is how one solar industry representative described his reaction to Xcel’s assurances.

“I don’t want to disparage the program teams. They’re operating in a system that doesn’t give them what they need,” said Mike Kruger, president and CEO of the trade group Colorado Solar and Storage Association.

The organization’s members haven’t reported similar problems with projects in areas served by Black Hills Energy, another investor-owned utility, or the electric cooperatives operating in fast-growing Front Range communities, Kruger said.

“Xcel is way behind and does not appear to have a plan to get caught up,” Kruger said. “We need the PUC to act, to figure out some way to get Xcel’s attention.”

Jerrold Pault has been trying to get Xcel Energy’s attention. Last spring, he paid thousands of dollars as a deposit to Namaste to add more solar arrays to his Fort Collins home and expected the work to be completed in December. Namaste and Pault have been told different reasons for the holdup in approval of the interconnection, but the result is the same: the project is in limbo.

“I was like a lot of people. I was shocked when I got our utility bill in January, which had a  huge natural gas (price) spike,” Pault said. “I’m several thousand dollars out of pocket for a year. What I planned tax-wise is not going to happen. The utility bill has doubled and I have no new energy to offset that.”

Pault, a retired contractor, is contemplating going to Xcel Energy’s Denver office and sitting in the lobby until he can get an estimate on when his solar addition will be approved. “It’s a black hole. They really should be a little more transparent.”

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