Xcel Energy sets goal of 100 percent carbon-free electricity by 2050

Xcel Energy on Tuesday pledged a commitment to delivering 100 percent carbon-free electricity for its customers by 2050, a new aggressive goal that the company called unprecedented within the electric power industry.

By 2030, the company, which serves customers in eight Western and Midwestern states, also plans to reduce carbon emissions by 80 percent by 2030, from 2005 levels in its service territory. Previously, Xcel Energy had set a goal of reducing carbon emissions by 60 percent by 2030. The utility has already cut its carbon emissions by 35 percent as compared to 2005 levels.

“We’re accelerating our carbon reduction goals because we’re encouraged by advances in technology, motivated by customers who are asking for it and committed to working with partners to make it happen,” Ben Fowke, chairman, president and CEO of Xcel Energy, said in a written statement.

“We’re starting the conversation today to make sure we can achieve this groundbreaking transition while continuing to keep energy affordable and reliable for customers,” Fowke added.

The company said it believes it can affordably achieve its 2030 goal with currently available renewable energy and other technologies. Achieving the 2050 target, it said, will require technologies that are not currently cost-effective or commercially available. “That is why Xcel Energy is committed to ongoing work to develop advanced technologies while putting the necessary policies in place to achieve this transition,” the company said.

Xcel Energy’s announcement was met with praise by environment groups and renewable energy industry leaders.

“Xcel Energy’s groundbreaking climate commitment is an act of true leadership,” said Fred Krupp, president of the Environmental Defense Fund. “It is anchored in proven clean energy solutions that are already delivering healthier air, low cost electricity, major economic investments and jobs to local communities.”

Tom Kiernan, CEO of the American Wind Energy Association (AWEA), said, “Rapid advances in wind farm technology have cut costs and increased output to the point where zero-carbon wind power is now both cleaner and more affordable than traditional sources. Xcel Energy’s outstanding leadership in large-scale wind power investments will help ensure these ambitious carbon cutting goals can be met while keeping electricity service affordable and reliable for consumers.”

Indeed, the latest Levelized Cost of Energy Analysis from Lazard noted that in some scenarios, alternative energy costs are now at or below the marginal cost of conventional generation. The low end levelized cost of onshore wind-generated energy is $29/MWh, compared to an average illustrative marginal cost of $36/MWh for coal, according to the report. A diversified generation fleet is necessary for the modern grid and the optimal solution in many regions, Lazard added.

In Colorado, where Xcel Energy is the largest utility, the state has a renewable energy standard that requires investor-owned utilities to obtain 30 percent of their energy from renewables by 2020.

In August, the Colorado Public Utilities Commission approved Xcel Energy’s Colorado Energy Plan as part of its Electric Resource Plan proceeding. The plan calls for an increase in solar and wind power and the retirement of a third of its coal generation. According to Xcel, the plan will result in approximately 55 percent renewable energy by 2026 and a 60 percent reduction in carbon emissions compared to 2005 levels.

Colorado Gov.-Elect Jared Polis recently ran a campaign on getting the state to 100 percent renewable energy by 2040. And already 10 municipalities across Colorado have committed to 100 percent renewables. “Xcel Energy’s exciting announcement today, along with the strong climate goals communities like Pueblo, Summit County, Ft. Collins, Denver and others across the state have embraced, shows we are leading the way forward right here in Colorado — by committing to a renewable and clean energy future” Polis said.

Because Xcel set a carbon emissions reduction goal rather than a renewable energy goal, it could also potentially utilize solutions such as nuclear power and carbon capture to help achieve it.

Denver Mayor Michael B. Hancock praised the city’s partnership with Xcel Energy. “Reducing carbon emissions is a must, and Denver is committed to an affordable, reliable and sustainable energy future. This is a game-changer for addressing the threats of climate change and will be a tremendous asset in achieving our own renewable electricity and emission reduction goals,” Hancock said.