The Winds of Change

LAMAR, Colorado — After limping past the strip malls and sprawl of Pueblo, Highway 50 darts east across the Arkansas River Valley, stretching its legs over the Colorado plains. The road passes through Las Animas, home of the long-closed Kit Carson Museum, and brushes the mostly abandoned town of Hasty, where little is left beyond a liquor store, a post office with an Army Navy surplus store in the attic, and the abandoned "Hasty Gems" storefront.

About 30 miles from the Kansas border, the highway lopes into Lamar, a town of 9,000. At first glance, Lamar could be any one of eastern Colorado’s crumbling prairie towns. On the outskirts, seagulls tilt on the thermals rising from cattle feedlots, and the incessant gale has whipped an American flag to tatters. But downtown Lamar is hopping; the parking lot of a brand-new Thai restaurant is packed at lunchtime. Lamar Community College is bustling, and though the Sand and Sage Rodeo Grounds sit empty on a weekday in March, they hold the promise of wild nights in the summertime.

Lamar stands apart from other boom-and-bust agricultural burgs, in part because it is making use of what has always been considered the bane of existence here: the wind. In the grass in front of the Colorado Welcome Center, the Lamar Chamber of Commerce displays a 111-foot-long General Electric wind turbine blade. Banners on Main Street proudly announce "Winds of progress, powering our future."

South of town, State Highway 287 crests a hill and reveals a battalion of three-armed steel sentries along the horizon. Stretched in rows across more than 11,000 acres of ranchland are 108 wind turbines, each standing 328 feet tall and turned toward the prevailing wind. Travelers with Texas and Oklahoma license plates slow and stare.

Pulling off the road, one expects a rush, a tremor — or at least a sound. But the prairie is quiet, and the turbines spin without so much as a creak. A meadowlark trills. The wind blows. And 162 megawatts of electricity power about 52,000 homes.

PPM Energy and Shell WindEnergy co-own the wind farm — one of the biggest in the country — and sell the electricity to Xcel Energy, Colorado’s largest electricity provider. Lamar Light and Power, the local power company, also owns three turbines, which stand in an irrigated wheat field just outside of town and generate 5 megawatts, almost a sixth of the company’s electricity.

Rick Rigel, Lamar Light and Power’s superintendent, runs through the statistics as he maneuvers his gold Crown Victoria along the gravel road leading to Lamar’s miniature wind farm. "The nacelles," or rotors atop the towers, "detect the wind and can turn 900 degrees," says Rigel. "Then they ‘unwind’ themselves automatically." Each tower is designed to be able to sway six feet back and forth, and each has a wireless satellite dish on its flank and a computer in its belly. That way, says Rigel, technicians in the control room back in town can tell if the gear box needs lubrication, or if the wind is blowing so hard that the turbine has shut itself down to avoid overheating.

Turbines like these should be a hopeful sign for the future of the state. Last fall, Colorado voters approved a ballot initiative requiring the state’s seven largest utilities to generate 10 percent of their electricity from wind, solar, biomass, geothermal and some hydroelectric sources by 2015 (HCN, 9/13/04: Colorado voters hold the cards on renewable energy). With the vote, Colorado became the 18th state to adopt a "renewable portfolio standard" that requires the companies that provide electricity to get more of it from clean sources.

But creating a renewable standard and actually implementing it are two entirely different challenges. Wind power is probably the easiest renewable technology to drop into the current system, but in Colorado, more than five months after the election, no one is yet breaking ground for new wind farms. Here in Lamar, where excitement about wind power is palpable, Lamar Light and Power has no plans for more windmills; instead, it wants to convert a small natural gas power plant to burn cheap coal. Xcel Energy, meanwhile, wants to build a massive new coal-fired plant not far from here. It’s not exactly what voters had in mind last Election Day.

"It’s so hard for people to back off this obsession with coal, and instead focus on efficiency and new technology," says Matt Baker, executive director of Environment Colorado. This is true not only because industry has spent the last century investing in the fossil fuel infrastructure, particularly for coal, but also because of a certain attitude within the utilities. "People who run utilities are not ones for taking risks," he says. "There is a cultural predisposition to doing things the same way — and they don’t want environmentalists telling them what to do."

Besides, Baker says, "When we use less electricity, no one is making money off of that, so the utilities have no incentive to do this."

Throughout the 1980s and most of the 1990s, Coloradans didn’t really think much about electricity. In the 1980s, anticipating a surge in growth caused by the oil shale industry, utilities built two big coal-fired power plants in the state. Oil shale busted before it ever boomed, however, leaving Colorado with more power than it needed. It wasn’t until after increased electricity demand during the steamy summer of 1999 led to brownouts and blackouts across the state that Xcel Energy began a new expansion campaign, saying that demand was outpacing generation. Clean energy advocates saw a chance to try to shape the state’s energy future.

Hoping to tap the state’s abundant wind, solar and other renewable energy sources, activists such as Rick Gilliam of Western Resource Advocates lobbied the Legislature for three years to create a renewable portfolio standard, a sort of quota for using renewable energy. But despite the efforts of then-State House Speaker Lola Spradley, R-Beulah, the bill was watered down and tossed out session after session.

Xcel was the only utility to support the bill, largely because it had a heavy hand in shaping the legislation. Meanwhile, the state’s 22 small rural electric cooperatives opposed the bill, even though they were exempt from its provisions.

"Utilities are very conservative by their nature," says Dan McClendon, general manager of the Delta-Montrose Electric Association, a rural co-op on the Western Slope of the Colorado Rockies. "Their mission has been to provide reliable energy at low cost." Coal is by far the cheapest alternative, he says, and alternatives such as wind can add costs: "It’s all about the money."

By 2004, however, Spradley had won the support of Colorado’s Farm Bureau and the agricultural community, and she nearly convinced the Legislature to pass the bill. At the time, only two of the state’s 22 rural co-ops were on board. "It lost by one vote because one of the large (rural electric associations) was opposed to it," says Gilliam, a senior energy advisor with the Boulder-based Western Resource Advocates.

With public support for a standard growing — along with frustration with the Legislature — activists decided to take the issue to the polls. Organized as Coloradans for Clean Energy, they collected 110,000 signatures and put the standard on the ballot. Gilliam, who was a manager in Xcel’s rate department for 12 years before leaving in 1994, was the main author of the initiative. "I thought, ‘Let’s ask the people and have them decide,’ " he says, adding, "I was naive."

In response, the state’s biggest utilities — now including Xcel — banded together with most of the rural cooperatives to form Citizens for Sensible Energy Choices. They spent an estimated $1.5 million on the campaign, taking out advertisements warning voters that if they passed 37, their electricity bills would skyrocket and the economy would suffer.

Clean-energy advocates countered with their own ads and gained support from environmental and public health groups nationwide, ranging from The Wilderness Society to the American Lung Association and the American Solar Energy Society. Activists held fund-raising events, asked city councils to endorse the measure, and even convinced Robert Redford and Goose Gossage — a Hall of Fame baseball pitcher and Colorado Springs native — to speak out on its behalf.

In November, Colorado voters approved Amendment 37 by a margin of 53 percent to 47 percent. The standard applies to the seven utilities that provide power to much of the booming Front Range and the mountain resort areas: Xcel Energy, Aquila, Fort Collins Utility, Colorado Springs Utility, Intermountain Rural Electric Association, United Power and Holy Cross Energy.

But the ballot box success was only the first step. The initiative didn’t force utilities to immediately move toward renewables. It only directed the Colorado Public Utilities Commission, which regulates the state’s public utilities, to come up with a plan by mid-2006 to turn the renewable portfolio standard into reality. That makes it somewhat doubtful that the utilities will achieve their first goal — providing 3 percent renewable energy by 2007.

After the election, the organizations that had championed Amendment 37 drafted a 34-page proposal to guide the utility commission in its planning. According to Gilliam, they invited Xcel to help write it, but the utility’s representatives refused, and submitted a separate proposal instead. Among other things, the industry plan would allow Xcel to act as the administrator and enforcer of the renewable portfolio standard — thus leaving the new rules in the hands of the company that led the charge to kill them.

The commission has now rolled Xcel’s proposal, along with its other recommendations, into a list of options to be considered. All this has Gilliam worried. "Given the track record of this commission (in siding with utilities)," he says, it will likely take up Xcel on its offer to run the renewable portfolio program.

According to PUC spokesman Terry Bote, the commission is "just starting" the rule-making process. It will accept public comments until May 18, and hold hearings in mid-July in Denver.

During its campaign against Amendment 37, Xcel Energy pledged to generate 500 megawatts from renewable sources by the end of 2006. But meanwhile, the utility is moving ahead to build the largest coal-fired power plant the state has seen in more than 20 years. And another company has announced plans for another, even bigger plant.

On the outskirts of Pueblo, Xcel Energy’s Comanche Station rises from dry brown rangeland, where a few cows graze beneath a maze of transmission lines. The coal-fired power plant consists of two units, each with a smokestack, a cooling tower billowing steam, and a gnarled mass of steel and pipes.

Inside, operations manager and 30-year Xcel employee David Edmission exhibits the kind of pride in the plant that a teenager might take in a hot rod. The wall behind his desk is lined with glam shots of power plants, including a nighttime view of Denver’s Cherokee plant that, at first glance, is reminiscent of a postcard of a Greek harbor, with twinkling lights reflected in a water storage pond.

Each day at Comanche, Edmission explains, 7,700 tons of coal from Wyoming’s Powder River Basin are pulverized to "face-powder" consistency, then burned to heat more than 8 million gallons of water from reservoirs in the Rockies. The resulting steam spins turbines that create about 700 megawatts of electricity. The plant itself uses about 9 percent of that to run its computers, pumps, fans and other electrical equipment. The rest is sold to commercial customers, such as the nearby Rocky Mountain Steel Mill, or goes to power TVs, lightbulbs, dishwashers, air conditioners and blow driers in more than 1.2 million homes, mostly along the state’s burgeoning Front Range.

On a tour of the plant, Edmission shows off the control room, which looks like something out of a Captain Kirk-era Star Trek episode. He points out the mounds of coal piled along the railroad tracks outside the plant and the "hoppers" inside, where the coal is stored for pulverizing. He even opens the inspection doors, allowing a peek into the white-hot furnaces.

The 30-plus-year-old turbines are beginning to show signs of wear, however. The equipment runs nonstop, under remarkably harsh conditions: Boilers heat water into steam that is 1,000 degrees Fahrenheit and under 2,400 pounds of pressure per square inch. Water leaks lead to shut-downs, coal hoppers catch fire, and about once a month, one of the units, usually the older one, has to be taken off-line for repairs.

But Xcel plans to keep both units in operation, saying that its electricity is in high demand. Last spring, in fact, the utility announced plans to build a third unit, Comanche 3, which would more than double the station’s output, generating another 750 megawatts.

Xcel spokesman Mark Stutz explains that the average household uses 10 to 15 percent more electricity than it did 10 years ago. Not only are more people and businesses moving to the area; the ones already here use more power all the time, he says. Coloradans are buying more computers and installing larger entertainment centers, and everyone these days wants air conditioning. Says Stutz: "Colorado is setting new record demands every summer."

And coal has obvious appeal: It’s a known technology, it’s reliable and traditionally, it’s been cheap.

But the price of coal has been rising since 2003. Even the Powder River Basin coal that Xcel uses to fuel Comanche — the nation’s cheapest — is becoming more expensive. The current breakdown of price per kilowatt hour, according to Xcel’s own numbers, are: 3 to 4 cents for wind, 4 to 5 cents for coal, 5 to 6 cents for natural gas and 10 to 15 cents for solar.

When Xcel first proposed the third unit last April, it looked like the company faced a fight. In September, Environment Colorado and the Southwest Energy Efficiency Project released a 41-page report detailing the proposed plant’s deficiencies: Not only would it accelerate global warming and strain the area’s water supplies, it would put Colorado residents at increased risk for asthma, heart and lung disease and childhood developmental disorders.

In 2003, according to the Environmental Protection Agency, Comanche released into the air 73,123 tons of sulfur dioxide and 71,853 tons of nitrogen oxide, both of which contribute to smog and haze. The plant emitted more than 6 million tons of carbon dioxide, the chief contributor to human-caused global warming — that’s more than one ton for every resident of the state. It’s also the second largest source of mercury in the state, releasing 177 pounds of the neurotoxin each year. Under Xcel’s original plan, the third unit would more than double these emissions.

Unit 3 would also cost its customers millions before it was even built. Rather than asking shareholders to foot the $1.3 billion construction bill, Xcel plans to charge ratepayers up front. According to the company, the increase for residential ratepayers will be around 89 cents per month in 2006, increasing to just under $2 month in 2009, when the plant is slated for completion. (For commercial customers, the increases will be about $1 in 2006 and $4 in 2009.)

But many of the same activists who fought so hard for Amendment 37 have settled for something less than a clear-cut victory over Comanche. On Dec. 9, a coalition including Environmental Defense, Sierra Club, Environment Colorado and the Southwest Energy Efficiency Project, signed a settlement with Xcel.

Under the agreement before the Public Utilities Commission, the groups pledge "not to initiate, fund or participate in any formal administrative or legal action to oppose or knowingly impede the permitting or approval of those activities necessary for the construction and operation of Comanche 3."

In return, Xcel has promised to cut overall emissions for both the existing and proposed units by 11,000 tons of sulfur dioxide and 2,300 tons of nitrogen oxide annually, and to install mercury controls on all three units. The utility will also promote energy conservation, pledge to build or buy 890 megawatts of new renewable energy resources by 2013, and promote legislation to reduce greenhouse gas emissions. The company also agreed to use a $9 per ton "carbon cost adder" when planning any new facilities, starting in 2010. The adder will factor in the social costs of carbon dioxide emissions when comparing the cost of generating electricity from fossil fuels versus renewable sources.

Xcel spokesman Mark Stutz believes his company’s new commitments are extraordinary. "Our position is we don’t really need to do anything. We meet state and federal standards for emissions; we go beyond what is required by (the Environmental Protection Agency) because we believe that is the right thing to do."

Environmentalists seem resigned, if less than enthusiastic. Ross Vincent of the grassroots group Better Pueblo says that they could have tried to slow the plant’s construction by fighting its state air permit. But had they done so, another company might have jumped into the queue. "We would end up with a bigger, dirtier plant operated by a company that has no interest in talking to us," he says. "It was one of those situations: If you win, you lose."

John Nielson, energy program director for Western Resource Advocates, says the decision to settle was part of a larger balancing act: "The coal plant will be built, and will lead to an increase in carbon dioxide emissions," he says. "But it’s important to recognize this (settlement) will dramatically lower air pollution emissions in Pueblo, and have impacts on the people who live there."

Both Vincent and Nielson are quick to note that the settlement should not be mistaken for support of coal-fired power plants. Says Vincent: "It is our fervent hope and expectation that Comanche 3 will be the last traditional coal plant ever built in Colorado."

That expectation may be unrealistic. Tri-State Generation and Transmission, the state’s second largest electricity provider, has announced plans to build a 1,000 MW coal-fired power plant. Tri-State spokesman Jim Van Someren says the utility plans to build the plant somewhere in southeastern Colorado, though it’s not yet saying when or where.

Grabbing some New Orleans-style grub between his daughters’ soccer games on a Saturday afternoon in the suburbs, Joe Santarella doesn’t seem to fit the role of an environmental enforcement attorney. He talks with a mafioso New York City accent, and sports a goatee and a gold hoop in one ear. He even admits to enjoying beer and football.

But with some hard time with the U.S. Environmental Protection Agency behind him, and now in private practice, Santarella has squared off against some of the nation’s biggest corporate polluters, including Asarco and U.S. Magnesium. Today, as an attorney representing environmental and community activists who are allied with labor unions, Santarella is staging one last-ditch effort to beat back Xcel’s Comanche 3 unit.

Santarella represents the Rocky Mountain Environmental Labor Coalition, an alliance of unions representing the local building and construction trades, and local environmentalists and community activists. Another coal-fired power plant in Pueblo would increase the community’s exposure to mercury, smog and acid rain, he says. And while building such a plant would create about 1,000 temporary construction jobs, only 40 people would operate it once it’s completed, says Santarella, perpetuating Pueblo’s "history of boom and bust."

According to Santarella’s notice of intent to sue, filed in March, Comanche has been operating in violation of the federal Clean Air Act since 1994. The case is based on a 2002 "notice of violation" from the EPA, which said the utility had failed to install pollution controls on the two existing units when they were upgraded (one in 1994, the other in 2000), as required under the act’s "New Source Review" rules.

Under the Clinton administration, the EPA aggressively pursued utilities that had failed to meet New Source Review. But in 2002, on the recommendation of Vice President Dick Cheney, the EPA set about "reforming" its requirements. The new rules, which would essentially render the original rules meaningless, are currently held up in court by a lawsuit against the EPA from 14 states. But in the meantime, the agency has all but abandoned New Source Review, dropping a volley of legal cases against power plants that had violated them.

An EPA spokeswoman, who refused to comment on Santarella’s lawsuit, acknowledged that the agency had filed the violation against Xcel, but never took legal action.

The Environmental Protection Agency has always been chronically underfunded, and polluting companies have resisted regulation and change from the EPA’s inception in 1970. Santarella himself left EPA in 1997, "frustrated with being a political pawn," and he says things have gotten worse. Under President Bush, he says, the agency has been "handcuffed."

"The federal government is not allowed to enforce violations, the state is not willing," says Santarella, "and now the environmentalists have said, ‘We’ve done the best we can’ with this settlement."

If Santarella’s case goes to court, he’s going to be facing off against Bill Bumpers of the Houston-based lawfirm Baker Botts — that’s "Baker" as in James Baker, George H.W. Bush’s secretary of State and George W. Bush’s attorney during the 2000 Florida ballot recount fight before the Supreme Court.

Calls to Bumpers were returned by Xcel’s Stutz, who says the company is in discussions with Santarella. Stutz acknowledges that the lawsuit could "complicate the process of getting this plant built."

The environmental-labor coalition is proposing that Xcel consider building two 250-megawatt integrated gasification combined cycle plants. In a gasification plant, coal is converted into a gas form and burned in a way that’s similar to natural gas. Although gasification is a new technology, there are four plants in the United States, and according to the coalition, they are cleaner, use less water, drastically reduce carbon dioxide emissions, and provide more long-term jobs than traditional coal plants. But even that solution wouldn’t get the state any closer to the green goals its citizens set in November.

Colorado isn’t alone in its energy struggle. Historically speaking, the nation should be on the brink of a monumental change in energy policy. During the energy crisis of the late 1970s, President Jimmy Carter called for Americans to turn down the heat and pull on a sweater. The federal government funded research into renewable energy and energy efficiency. But political leadership has proven fickle. (Truth be told, the public has been fickle, too; witness the proliferation of SUVs and air conditioners.)

And today, the Bush administration is pushing coal like it was 1927. In his National Energy Policy, Vice President Dick Cheney has called for building between 1,300 and 1,900 new power plants, more than doubling the current number. In March, the administration loosened rules governing mercury emissions. The administration has also slashed budgets for renewable energy research, potentially setting projects back decades.

Congress, which consistently gives subsidies to the fossil fuel and nuclear industries, has also been slow to support renewables. When the federal tax credit for wind projects expired in 2003, it took Congress until mid-2004 to renew it — and legislators did so only until the end of 2005. The jerky approach to wind subsidies has effectively delayed billions of dollars of new wind farm construction.

So what will it take to effect real, lasting change? In the end, economics and global competition may finally force the U.S. to get with the times. The broad international recognition of global warming has forced many countries and multinational corporations to plan for the demise of fossil fuels — or at the very least, to plan for better control of carbon emissions. "There is a growing sense even in industry that the future is going to be a carbon-constrained future," says David McIntosh, a staff attorney for the Natural Resources Defense Council, who focuses on clean air issues. "There are very few people who say it will not happen — and it will happen within five to six years."

Foreign corporations are leaps and bounds ahead of their American counterparts in investing in — and profiting from — renewable energy technology, says Dan Kammen, director of the Renewable and Appropriate Energy Laboratory at the University of California, Berkeley. Some of those companies are even beginning to invest in projects in the U.S.; the wind farm in Lamar, Colo., for example, is owned by Scottish-owned PPM Energy and the Dutch-owned Shell WindEnergy.

And it’s not just foreign companies that are seeing business opportunities in renewables: Last June, the Western Governors’ Association, headed by New Mexico Gov. Bill Richardson, D, set a goal of producing 30,000 megawatts of "clean energy" by 2015, and increasing energy efficiency by 20 percent by 2020. Richardson frequently talks about turning the Interior West into a "renewable energy colony" for California. The U.S. Interior and Energy departments, perhaps with the same idea in mind, recently inventoried all the public lands for renewable energy potential (HCN, 2/21/05: HCN has it wrong on Bush).

"The issue is, how do you help the energy economy evolve so that many of these (different renewable technologies) evolve," asks Kammen. Part of the answer, he says, lies in initiatives such as the renewable portfolio standards now in place in 19 states, including Colorado.

As activists have learned in Colorado, making renewable energy standards work is difficult. But if anything, these standards show that Americans are willing to pay more for electricity that is generated from the wind or the sun.

It may be this perfect storm of grassroots activism and economic demand that finally spurs a clean energy revolution in the United States. Holy Cross Energy, based in Glenwood Springs, Colo., has been encouraging renewable energy and energy efficiency for more than a decade. In 1998, Holy Cross talked to Xcel Energy, its electricity provider, about purchasing wind power. The district, which includes Aspen and Vail, also began looking at local solutions. Its current program includes a rebate for consumers who install renewable energy systems such as solar, wind, micro-hydro, biomass or geothermal, a program to help businesses use less energy and a rebate for customers who buy energy-efficient appliances.

"This all started from feedback from our members," says Dave Church with Holy Cross. "They told us renewable energy is the way to go, and they wanted us to do more."

On Colorado’s working-class Western Slope, the Delta-Montrose Electric Association is also looking for new ways to increase its use of renewable energy — locally as well as within the portfolio of its provider, Tri-State. Located in largely conservative Delta and Montrose counties, where coal mines are more common than ski resorts, DMEA broke ranks with the Colorado Rural Electric Association last summer to support Amendment 37.

General manager Dan McClendon says that while utilities have done a good job of providing customers electricity from coal, they need to consider all the costs of burning coal, such as the health impacts and the problem of global warming. With respect to renewables, he says, "even if it’s ‘higher cost’ (electricity), if we don’t begin supporting development of renewables, we’re going to get into more of a pinch in this country."

And in eastern Colorado on the wind-whipped plains, towns such as Lamar may yet build a future on renewable energy: PPM Energy is interested in erecting 100 more wind turbines and selling the electricity to Xcel.

At the Lamar visitor’s center, an elderly, blue-eyed docent named Betty talks about how far wind technology has come since the 1930s, when her dad had a "wind charger." "When the wind would blow, it would charge the batteries, and we’d listen to the Grand Ole Opry on Saturday nights," she remembers.

Who could have known back then that those prairie winds might power a whole civilization along the Rocky Mountains — if only the people’s voices could be heard over the gale.

The author is HCN’s assistant editor.

The following sidebar articles accompany this feature story:

- Blades, birds and bats: Wind energy and wildlife not a cut-and-dried issue

- Renewable Energy Standards: How do states match up?

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