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Stingy car electrification plan by Black Hills Energy drives Pueblo inequity, advocates say

Southern Colorado utility’s first required Transportation Electrification Plan offers far fewer public benefits than Xcel’s in a place that needs it much more, the groups say.

Black Hills Energy EVs vehicle electrification Pueblo activism
Jamie Valdez, shown here in an Oct. 25, 2021 photo, says electric vehicle incentives offered by Black Hills Energy are non-starters in Pueblo, where 25 percent of the population lives at the poverty level. Valdez says Pueblo would better benefit from EVs used in mass transit. (Mike Sweeney, Special to The Colorado Sun)
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Jamie Valdez is on the lookout for a used car deal, and the longtime Pueblo environmental activist is ready to put his money where his advocacy is. 

But the used hybrid he wants rarely turns up in southern Colorado car markets, and when one does, the price has jumped again. National electric vehicle reports say used prices rose 18% just from March to September. 

So Valdez says he could use some help, along with most of the people he grew up with and still works with in Pueblo’s lower-income communities. That’s why a state-mandated Transportation Electrification Plan from his utility, Black Hills Energy, came as a huge disappointment. 

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Green energy advocates who are appealing Black Hills’ proposal say the utility’s electrification spending per capita is only 3% of what Xcel Energy is offering as EV promotion to more than a million customers in the rest of Colorado. Black Hills’ sole proposal was a $1,300 rebate to install a Level 2 charger in residences; the company added in $100,000 total in EV purchase rebates after an initial round of protests at the Public Utilities Commission, which approves the newly-required transportation plans.

Black Hills’ overall budget for the electrification assistance is $1.2 million over three years and would raise the average customer monthly bill by about 19 cents. The population of Pueblo County, the heart of Black Hills’ service area, is 168,000, and the utility says it has 96,000 customers in the region

The proposed spending is less than the $1.5 million spent by a dark money group to defeat a 2020 Pueblo vote on whether Black Hills should keep its exclusive utility franchise after years of complaints about high prices, Valdez noted. 

“I recognize the urgency to transition our transportation to electric vehicles,” Valdez said. “My big concern is Pueblo being such a low-income community, I don’t currently see any path forward for the majority of our residents who are in that bracket.” 

Environmental and economic equity provisions are now written into most new Colorado laws that touch on the climate. And some environmental advocates see the Black Hills plan as falling short in one of the early efforts to create practical results from those equity ideals.

Xcel’s vehicle plan got more support

In January, the PUC approved a $110 million transportation electrification plan from Xcel Energy’s Colorado operations, including $20 million aimed at assisting lower income communities acquire electric cars and chargers. An environmental coalition protesting the Black Hills plan said they are disappointed the PUC rejected their proposal to set aside at least 30% of the utility’s spending for electrification in lower income communities.

Black Hills’ Pueblo territory has a higher proportion of lower-income customers than Xcel’s, and therefore should have a higher portion of the new plan set aside for those customers, said Michael Hiatt, an attorney for Earthjustice’s Rocky Mountain Office. Earthjustice is providing legal services in the protest to a coalition including Vote Solar, Colorado GreenLatinos and others. Xcel has about 1.4 million electric customers in Colorado, concentrated in the Denver metro area. 

Senate Bill 77 in 2019, which required the utilities to file the plans for transportation by this year, has strong language promoting equity in extending vehicle electrification to Coloradans, Hiatt said. 

Covered in cob webs, a Charge Point electric vehicle charger stands idle near the public parking garage on Court Street in Pueblo Oct. 25, 2021. (Mike Sweeney, Special to The Colorado Sun)

“I think the unintended consequences will be exacerbating existing inequities that folks in Pueblo experience, because they will have less opportunity in the next three years to purchase electric vehicles and have financial help installing chargers,” Hiatt said. 

The PUC also rejected groups seeking to have the Black Hills plan run by a third-party administrator. Advocates sought the move after years of Pueblo residents paying the highest utility rates in the state, and the bitter battle over the utility franchise vote last year, Hiatt said. 

“There’s a big distrust issue for Black Hills and their customers,” he said. 

Black Hills officials touted their plan when they first announced preliminary PUC approval. “Our program, called Ready EV, will significantly lower the cost of electric vehicle charging equipment for customers and help expand the commercial infrastructure needed to make EV charging more accessible to drivers,” Black Hills regulatory vice president Nick Wagner said in a press release in September. 

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Black Hills says it is trying to create a significant EV program without adding too much new cost to customer bills. The utilities are allowed to recover some of the transportation electrification costs from consumers if the PUC approves. 

“The program is funded by all customers, so we put together a plan that considers the impacts on all customers and meets the needs of the communities we serve,” said Ashley Campbell, a Black Hills spokesperson.  

The coalition counters that its own proposal for the Pueblo area, roughly triple the spending Black Hills proposes over the three years, would add another 24 cents to the average bill each month, for a total of 40 cents. Moreover, they say, since renewable energy like wind and solar keep coming down in price compared to fossil fuel generation, electrifying cars will bring utility bills down in the long run. They also say their plan would also make faster improvements to local air pollution and greenhouse gas emissions.

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The PUC’s staff, which gives technical and legal analysis of utility plans and makes recommendations to the commissioners for a vote, did not support calls by environmental groups for a major expansion of the Black Hills electrification plan. 

The PUC staff reports to commissioners say the proposed Black Hills budget for vehicle programs advances the goal of the original legislation promoting electric vehicles “while minimizing bill impacts for Black Hills’ ratepayers. Black Hills’ ratepayers are already subject to some of the highest rates in the state.” 

Equity and cost for Southern Colorado

The debate over how much to spend and who should pay forced multiple parties to take sides on the complex equity and cost issues. Pueblo County filed a brief in the Black Hills case asking the PUC to block any plan that would raise local rates, noting the commission has said in the past that Pueblo has nearly twice the state’s poverty rate and residents pay 34% more than the state average for utilities.

The state’s Office of the Utility Consumer Advocate, which can intervene on behalf of customers, also did not seek an expansion of the Black Hills EV spending program in its final comments, citing cost sensitivity for Pueblo.  

Using a metro Denver standard to judge a new, costly environmental program, the Pueblo County Commissioners wrote in their brief, “is a persistent and frustrating situation.”

The Legislature’s 2019 electrification bill was part of a series of state efforts to carry out previous climate change mandates and Gov. Jared Polis’ Greenhouse Gas Emissions Reduction Roadmap. State laws call for a 26% cut in carbon emissions by 2025, and 50% by 2030. Electrifying the traditionally gas- and diesel-driven transportation sector in Colorado is one of the next keys to achieving those reductions, state officials and environmental groups say. 

The environmental coalition realizes their final protests against approval of the Black Hills plan are unlikely to succeed. But Pueblo residents like Valdez, who organizes for Mothers Out Front and Colorado GreenLatinos, say they will continue to demand more equitable electrification, and utilities switching to cleaner generating sources. 

Valdez is still shopping for a used EV, but said “it’s pretty slim pickings, the prices are really outrageous from the perspective of someone who personally spent quite a bit of time in the ranks of the low income.” 

Holding a better job now, he said, he may be able to afford it if the right one comes along. But most of the people he knows still can’t. 

“When folks are working two or three jobs just to keep a roof over their heads or food on the table,” Valdez said, “switching to an electric vehicle just isn’t a concern that can take any kind of priority for them.” 


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