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Colorado Springs nears decision on early closure of Drake power plant

Estimated cost is at least $160 million

Colorado Springs nears decision on early closure of Drake power plant

COLORADO SPRINGS, Colo. - Colorado Springs Utilities presented the city's utilities board with six scenarios Tuesday for an early closing of the aging Drake power plant west of downtown.

The board, comprised of Colorado Springs City Council members, discussed the options and will choose one at its next meeting on Dec. 18.

According to CSU financial analysts, decommissioning Drake by 2025 or 2030, instead of the original planned date of 2035, will cost at least $160 million and possibly more, depending on future fuel costs.

"The earlier we close it, the more expensive it'll be," said John Romero, CSU's general manager of energy acquisition engineering and planning.

Furthermore, some of the scenarios include also closing the Birdsall power plant near Nevada Avenue and Fillmore Street, an an additional cost of at least $30 million.

The coming changes mean rates for utility customers will increase to pay for the costs of closing the plants and building new generation and transmission systems.

"We're going to study at least one of the scenarios to determine how much more our customers will have to pay, and how long they'll have to pay it," Tom Strand, board chairman, said.

The final decision also depends on whether CSU builds a new plant on the current Drake or Birdsall sites, or opts to build as many as eight smaller plants that would be fueled by natural gas instead of coal.

At least one major employer said he's concerned about higher operating costs during and after the plant closures.

"I'd rather you keep Drake open until 2035 because it's the cheapest source of energy for us, but I know that's not possible," said Dan Malinaric, vice president of Microchip.

The Sierra Club has criticized the city for Drake's emission levels in the past and is glad an early closure plan is in place.

"But we're not ready to say natural gas-fired plants are a better option," said Sierra Club spokesman Zach Pierce.  "Natural gas prices tend to fluctuate.  We need to study the scenarios more before we can endorse which one is best.  That doesn't give us much time before the final vote next month."

There was some concern expressed at the meeting that the scenarios don't include enough use of wind power, solar power or other renewable energy, with some saying those technologies still are not cost-efficient and there is  no guarantee they will be in the future.

Board members said the scenario recommending smaller plants fits in well with a request from local military installations for CSU to improve its reliance and resiliency of utility systems.

"That could mean building plants near or on military property," Romero said.

In other matters, the board approved the billing system for the stormwater fee approved by voters last month.

Residential customers will be billed by CSU and nonresidential customers will be billed by the city.

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