Coloradans are bracing for what winter will hold. In December, customers of our state’s largest gas utility, Xcel Energy, will see a 54% increase in their monthly bills compared to a year ago. The average bill will increase from $115 to $177. This means financial pain for households burning fossil fuels for heating, especially in Latino communities that reported experiencing economic hardship since the COVID-19 pandemic started.
The sky-high price of natural gas is a big reason why bills are soaring. The price Colorado households pay for this volatile fossil fuel reached a 30-year high over the summer, and it’s forecast to climb even higher over the winter. Coloradans bear this financial burden while the gas industry and utilities pocket the profits.
It could have been worse. In October, the Public Utilities Commission issued a groundbreaking decision that will save ratepayers a lot of money. Xcel was asking for Coloradans to shoulder $188 million for infrastructure projects to expand the gas system. The PUC authorized less than a third of that.
The PUC decision removes a major financial incentive for the utility’s plans to build miles of new gas pipelines to Front Range suburbs that we don’t need and can’t afford. The commissioners’ ruling strikes a blow against the “business as usual” expansion of Colorado’s gas system. State law requires Xcel to reduce greenhouse gas emissions from its gas service by 4% by 2025 and 22% by 2030, yet the company increased gas sales to residential, commercial, and industrial customers from 2018-2021, according to Western Resource Advocates.
This is also one glimpse of a larger problem Colorado must confront as it transitions off fossil fuels and onto clean electricity. Latino families, along with other disproportionately impacted communities across the state, are getting hit hard by price volatility and rate hikes. Their financial pain will only increase if we allow utilities like Xcel to continue to expand the gas system, because ratepayers must shoulder the costs of maintaining the gas system.
As an architect, I have worked with families who want affordable, healthy homes with stable energy bills. It’s cheaper to build a home that wholly relies on Colorado’s increasingly clean electricity for heating and cooking. In Denver, all-electric home construction is, on average, $3,000 cheaper and results in approximately 2% savings on energy bills annually, compared to a home that uses gas, according to RMI. Rebates and tax credits in the Inflation Reduction Act will make going all-electric even more affordable when they begin to reach consumers next year.
We should celebrate this progress toward cleaner, healthier communities while thinking carefully about our trajectory. If wealthier households are first to exit the gas system, the remaining customers will be stuck with higher and higher prices. To avoid this, we must gear our policies and incentives so low- to moderate-income households switch off gas first. Creating an orderly transition off of gas in Colorado benefits everyone.
One way we can do this is by confronting a bias that excludes Latino families from receiving culturally relevant and bilingual information about building electrification’s benefits and incentive programs. I’ve designed many Latino families’ homes. I see how information about electrification, weatherization, and rooftop solar excludes Latino constituencies.
This is a missed opportunity. Latino households are one of the largest and fastest growing home-buying demographics in America. In the next 20 years, 70 percent of new homeowners in the U.S. will be Latino, according to the National Association of Hispanic Real Estate Professionals. Latino families’ cultural values and customs have multiple generations living under one roof, so our houses are denser. We already use less energy. Our homes also use 41% less floor space per capita, making them easier to weatherize and re-wire for electric appliances.
Electrification’s benefits and incentives must be available to renters as well as homeowners, including mobile home owners. Latino homes are primed for electrification, and regardless of whether the household owns or rents, outreach programs must be tailored for and include Latino constituencies.
We can’t be elbowed out or overlooked in the energy transition. The Inflation Reduction Act’s clean energy, electrification, and weatherization investments are coming to Colorado. As our regulators and lawmakers develop programs and distribute funding from this historic climate law, we must ensure they’re equitably distributed and pave the way for a just transition away from fossil fuels.
They can do this through President’s Biden Justice40 initiative, which guarantees that at least 40% of climate investments support historically underinvested and purposefully excluded communities.
At the same time, the Public Utilities Commission must continue to ensure we don’t expand the gas system. October’s ruling was an important step in the right direction. Building electrification is a powerful tool to fight climate change and protect the air we breathe. Let’s use it wisely and set an example for the nation.
Beatriz Soto, of New Castle, is the director of Protégete at Conservation Colorado, which advocates for equitable access to a healthy environment, specifically for Colorado’s Latino communities on the frontlines of pollution.
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