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Wyoming coal interests funneled money, experts to influence Colorado PUC decision on closing parts of Pueblo plant

The Coalition of Ratepayers, a group formed by the Denver-based Independence Institute and which received money from out of state, still couldn’t stop the shutdown of Comanche Station units in Pueblo.

Xcel Energy’s Comanche Generating Station, shown here in a March 7, 2020, photo, is the largest power plant in Colorado. The steam-driven, coal-fueled plant, located in Pueblo, generates 1,410 megawatts of power. (Mike Sweeney, Special to The Colorado Sun)
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When Xcel Energy proposed shuttering two coal-fired power generating units at Comanche Station in Pueblo, a group of “small business” customers intervened to oppose the closure. The group, organized by the Independence Institute, did not reveal it received backing from Wyoming coal interests.

The Coalition of Ratepayers, formed by the libertarian-leaning Independence Institute, said in its filings to the Colorado Public Utilities Commission that its members were “employers that operate businesses within the service territory” of Xcel Energy’s Colorado subsidiary.

Documents obtained through a Freedom of Information Act request by the nonprofit watchdog group Energy and Policy Institute, show that another organization with links to Wyoming coal was providing financial and technical support.

The Energy Policy Network (EPN), which according to a tax filing has received donations from coal companies and Wyoming governments, provided the Independence Institute with $45,000 and legal and technical experts.

Shayne Madsen, counsel for the Independence Institute and the coalition, said “the institute and coalition do not discuss or disclose our donors or contributors.” She referred any questions to EPN.

“There was never any intention not to be transparent,” said Randy Eminger, EPN’s executive director and sole employee.

Indeed, EPN in its newsletters offered blow-by-blow descriptions of events in Colorado and referred to the coalition as “our ratepayer coalition.”

EPN provided an expert who testified before the PUC on behalf of the coalition. He offered a number of criticisms of the way Xcel accounted for and modeled the value and benefits of the utility’s 2018 plan. The PUC found several of his points valid and adopted them in its evaluation. 

EPN has been involved in efforts to keep open coal-fired plants using western coal in several states including Arkansas, Oklahoma, Kansas, Louisiana and Indiana, according to the organization’s newsletters and presentations.

The group focuses on keeping open relatively new, more efficient coal-fired units with top-of-the-line pollution controls, Eminger said.

MORE: Coal-fired power plants are closing early and Colorado lawmakers want to ease towns’ tough transition

Eminger and Jason Begger, executive director of the Wyoming Infrastructure Authority, which contributed to EPN in 2017, say the aim of these forays is to defend Wyoming coal markets to avoid a severe economic downturn in the state.

“We are a very large fossil fuel producing state and we’ve set up our tax structure to reflect that,” Begger said. “We understand an energy transition is underway. We need to keep those jobs open and available until we can figure out what is next.”

And it isn’t only Wyoming that has a lot at stake, Begger said. “When you look at the jobs and tax base associated with power plants, no industry is going to replace that.”

EPN’s 2017 federal tax filing, the sole Form 990 obtained in the records request, shows that donors that year included the Wyoming Infrastructure Authority ($100,000), Campbell County government ($60,000), the state of Wyoming ($150,000), as well as coal miners Peabody Energy ($40,000) and Cloud Peak Energy ($150,000).

“We don’t have membership in EPN,” Eminger said. “We operate off donations. There is no way we can intervene in every case or match the Sierra Club with the millions they have.”

Michael Bloomberg, the billionaire former New York City mayor and former presidential candidate, has donated $150 million to the Sierra Club and other environmental groups pushing to close coal-fired power plants. In June, Bloomberg pledged another $500 million to the effort.

A conveyor system is used to bring coal to boiler furnaces at the Xcel Energy’s Comanche Generating Station Jan. 20, 2019 in Pueblo. Steam created in the boiler drives turbines, which in turn, produce electricity. (Mike Sweeney, Special to The Colorado Sun)

Begger said that overall Wyoming has spent about $1 million over the past five years to defend existing coal markets.

“We have won rate cases in places like Oklahoma, Arkansas and Nebraska,” Begger said. “This has kept plants open longer, generating power and providing an additional $40 million in coal production tax revenues to the state.”

The understanding was that the state funds given to EPN would be used for administrative purposes, “to keep them afloat” and not for specific state litigation campaigns, according to Shannon Anderson, an attorney with the Powder River Basin Resource Council, a Wyoming conservation group.

On March 11, Wyoming Gov. Mark Gordon signed into law a bill enabling him to take $1 million from the General Fund to create a Coal Marketing Program account, which the governor can use to fund programs to expand and protect Wyoming’s coal markets. 

Beggers said this was just formalizing the average annual $200,000 the state has been spending on market initiatives. Anderson called it a slush fund for the governor.

In addition to providing funds to the Colorado coalition, EPN counsel Meghan Griffiths, an attorney with the Austin, Texas, law firm of Jackson Walker LLP, represented the group and Charles Griffey filed expert testimony challenging Xcel’s financial calculations.

In a 2019 presentation at a Wyoming Infrastructure Authority conference, Eminger described Griffiths as the group’s “lead attorney” and Griffey as its technical expert.

“We’ve had Charles in several cases. He is a former executive vice president for regulatory affairs for Houston Light and Power and is very knowledgeable,” Eminger said.

In June 2018, Xcel Energy submitted a $2.5 billion “Colorado Energy Plan” to the PUC aimed at shifting its energy generation from coal and natural gas to renewable sources.

The plan included closing two coal-fired units at the Comanche Station, about 660 megawatts of generating capacity, 10 years ahead of schedule. Xcel estimated the shift would create overall savings to customers of about $213 million.

The Coalition of Ratepayers, primarily through Griffey’s testimony, challenged Xcel Energy’s estimate of savings and the cost customers would have to bear in writing off the asset value of the two coal plants.

The coalition contended some of Xcel’s accounting techniques — such as accelerated depreciation and the annuity method of depreciation — overstated the value of the renewable energy plan. The PUC ordered Xcel to provide figures with and without the accelerated depreciation.

“Those have potential to tip the financial scales against ratepayers, who will be burdened with the costs,” Amy Oliver Cooke, then the Independence Institute’s executive vice president, said in an interview at the time. Cooke has since left the institute and referred a request for comment there.

The coalition also called for an annual cost-impact report, which the commission adopted. “I think the coalition raised a good point,” then-PUC Commissioner Wendy Moser said in adopting the coalition recommendation.

Nevertheless, the PUC ruled that the plan did represent savings for customers and approved the closure of the two units by 2026. A third coal-fired unit at the plant will continue to operate.

“Colorado Energy Plan is going to save a quarter of a billion dollars by closing Comanche 1 and 2, and that isn’t going to change because an out-of-state group for coal interests is trying to stop this in its tracks,” said Anna McDevitt, a senior representative in the Sierra Club’s Beyond Coal Campaign.

The Sierra Club also intervened in the PUC case in support of closing the coal-fired Comanche units.

In choosing which battles to fight, Eminger said EPN looks at the state and assesses the chances of winning before its utility commission. “It wasn’t favorable in Colorado,” he said. “We knew it would be an uphill climb, but Amy was very convinced we needed to do this win or lose.”

Wyoming is also investing “hard dollars” in low-carbon technologies, including capturing carbon emissions from plants and developing new coal-based products, Begger said. “Society has quit thinking about coal as something to burn to boil water. … We just want to preserve what we have until the new transition is here.”


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