This article was originally published by Colorado Newsline.

The state commission that regulates Colorado’s oil and gas industry this week adopted its first set of rules governing geothermal drilling, taking another step towards fulfilling the broader mandate it was given as part of a legislative makeover of the agency last year. But regulators and experts say not to expect a “boom” in the new technology just yet.

The Energy and Carbon Management Commission was formerly known as the Colorado Oil and Gas Conservation Commission until lawmakers rebranded it in 2023. The name change that came with new authority to regulate emerging industries like carbon capture and so-called deep geothermal energy.

ECMC adopted its Deep Geothermal Operations rules on a unanimous 5-0 vote Monday. The 59-page addition to the agency’s rulebook outlines permitting and enforcement procedures broadly similar to those already in place for oil and gas operations, giving the commission the power to approve or deny permits to protect health and safety and ensuring that local governments have a say in the process.

While existing technologies like heat pumps involve drilling geothermal wells hundreds of feet into the ground to heat and cool homes and even entire neighborhoods, the deep geothermal industry aims to help power the electric grid by drilling thousands of feet down into much hotter pockets of the Earth’s crust. To date, the application of deep geothermal technology has been limited by a variety of factors, but some experts point to its potential to serve as a “baseload” source of clean energy to help offset the intermittency of renewables like wind and solar.

Gov. Jared Polis, who has touted geothermal energy’s potential in his “Heat Beneath Our Feet” initiative, said in a statement Monday that with the ECMC’s new rules, the state is “poised to leverage this clean, renewable energy resource.”

“Colorado has incredible low-cost renewable energy resources like geothermal that can help reduce emissions and save Coloradans money,” Polis said. “Geothermal energy can play an integral role in powering the way Coloradans live, work and play, and will help future generations.”

The feasibility of tapping into deep geothermal resources can vary widely according to local geology. A study released last month by the ECMC, the Colorado Geological Survey and Atlanta-based energy firm Teverra analyzed “geothermal utilization opportunities” and found that the Piceance Basin north of Grand Junction, the Raton Basin near Trinidad and a “localized hot spot” along the Colorado-Kansas border rank as the state’s most promising locations.

Colorado Communities for Climate Action, a coalition of 43 local governments supportive of clean energy policies, said the rules adopted by the ECMC struck an “impressive balance.”

“Local governments are optimistic about the role of deep geothermal electricity in efficiently decarbonizing Colorado’s power grid,” Emma Pinter, an Adams County commissioner and vice president of Colorado Communities for Climate Action, said in a statement. “But we have to make sure this new technology benefits all Coloradans and their environment while avoiding the damage we have seen from oil and gas development and other extractive industries.”

“Despite its promise as a clean energy source, (deep geothermal operations) will have some adverse impacts, although we don’t yet know the scope of them, and it’s important to recognize that,” Kate Burke, an assistant county attorney for Boulder County, told commissioners in a rulemaking hearing last week. “The net impacts … should be less than oil and gas, and in some instances, the scale may be smaller, but that doesn’t mean there won’t be impacts to the people, plants and animals living near the facilities.”

Geothermal Rising, a trade group representing geothermal energy companies, was “very satisfied with where the draft rules have landed,” an attorney for the group, Matt Lepore, told commissioners Monday. Lepore is a former chair of the agency who departed in 2018 and has gone on to represent the oil and gas industry in commission proceedings.

Environmental groups have urged the ECMC to follow up with a second geothermal rulemaking process to flesh out its regulations before operations ramp up. Commissioner Brett Ackerman, a former Colorado Parks and Wildlife official, said prior to Monday’s vote that it was important not to “hamper industry” at an early stage, but the agency should “appropriately address future concerns and opportunities as they arise.”

“I agree that it’s highly unlikely that there’s any pending boom of deep geothermal development,” Ackerman said. “We’re rather more at a pilot stage.”

Colorado oil and gas regulators adopt ‘deep geothermal’ drilling rules is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

This article was originally published by Canary Media.

A hefty chunk of U.S. emissions comes from the energy used to heat buildings. That means millions of homes must be converted to electric heating in order to meet climate targets. 

In Colorado, a 2021 law spurred the state’s largest investor-owned utility to produce a plan that could transition a lot of homes to clean heating — and fast.

Xcel Energy’s Clean Heat Plan was approved this May. It directs more than $440 million over the next three years mainly to electrification and energy-efficiency measures that are meant to reduce reliance on the gas system and cut annual emissions by 725,000 tons.

The utility, which provides both gas and electricity to its customers, filed an initial plan that included proposals to spend heavily on hydrogen blending, biomethane, and certified natural gas. But after strong opposition from clean energy advocates who say these routes do not represent viable pathways to decarbonization, those proposals were reevaluated. Following a motion filed by the Sierra Club, Natural Resources Defense Council, and others last November, Xcel amended its original plan filed with the Colorado Public Utilities Commission.

Now the majority of funds will go toward building electrification and energy efficiency, which the commission found to be the ​“most cost effective and scalable ways to reduce emissions from burning gas and buildings, both in the short run as well as in the long term,” said Meera Fickling, building decarbonization manager at Western Resource Advocates.

Electrification efforts will primarily take the form of incentives that make it cheaper for customers to switch gas heating appliances to electric heat pumps. The incentives can be combined with federal electrification tax credits and extend to all-electric new construction as well. One-fifth of the program’s funding is earmarked for low-income customers. The plan’s funding is roughly three times the $140 million that the Inflation Reduction Act allocated to Colorado for similar measures.

The utility forecasts gas sales to decline by 14 percent between this year and 2028, The Colorado Sun reports.

While many states have incentives and rebates available for upgrading to energy-efficient appliances and heating solutions, Colorado specifically directs its gas utilities to lead those programs — and holds them accountable for contributing to the state’s climate goals.

That’s why Xcel’s new clean heat program will be ​“a test case of a utility-led model towards decarbonizing the gas distribution system,” Fickling said. ​“It really serves as a model — a nationwide model — for how gas utilities can allocate resources to decarbonize their system in the long term.”

From state laws to utility plans 

Colorado’s push to clean up home heating started three years ago with the Clean Heat Law, which requires gas distribution utilities to create concrete plans to reduce their greenhouse gas emissions 4 percent below 2015 levels by 2025 and 22 percent by 2030. Xcel’s recently approved Clean Heat Plan will carry the utility through 2027, and the utility must propose a new plan in the coming years to meet the next target.

“I expect the next plan to really take a close look at the 2030 target and the trajectory to achieve it,” said Jack Ihle, regional vice president of regulatory policy at Xcel.

The Clean Heat Law was the first of its kind in any state, Fickling said, though others have since taken steps to curtail the climate impact of heating.

Following Colorado’s 2021 law, in 2023 Vermont passed the Affordable Heat Act to reduce emissions from home heating, and Massachusetts drafted similar legislation. This year, Illinois and New Jersey have both introduced bills with clean heating and decarbonization standards.

In Minnesota, the state’s largest gas utility just received approval for a five-year, $106 million plan to reduce its emissions following the state’s 2021 Natural Gas Innovation Act. The utility, CenterPoint Energy, says the plan would ​“reduce or avoid an estimated 1.2 million tons of carbon emissions over the lifetime of the projects,” though advocates have criticized the approach.

But utilities in Colorado ​“have a lot more flexibility in terms of the portfolio that they propose,” said Joe Dammel, manager of carbon-free buildings at RMI. While Xcel can prioritize energy efficiency and electrification in Colorado, Minnesota’s Natural Gas Innovation Act requires gas utilities to produce emissions-reduction plans that spend at least half of their budgets on alternative fuels like renewable natural gas, which can still heavily pollute. In Colorado, a much smaller amount is dedicated to alternative fuels; only around $10 million out of the $440 million can be spent on renewable natural gas and recovered methane, and all projects must specifically be approved by the commission.

Another difference between the two recently approved plans is that Xcel delivers gas and electricity to about 1.5 million customers in Colorado, which gives it an opportunity to counterbalance lost gas revenue with increased sales from its electricity business. 

Meanwhile, CenterPoint serves gas to about 910,000 customers but has no electricity customers. That gives it fewer opportunities to make up for losses from its gas business driven by electrification mandates, and more incentive to prioritize the use of alternative fuels delivered through the pipelines it owns — and not electrification.

Investing in 100,000 heat pumps 

Now that the funds have been approved, Xcel is waiting on a final written order from regulators, which should arrive later this month. From there, it will start implementing the plan and work on defining rebate levels and informing customers on how to access incentives.

The details are still being decided, but customers will likely need to pay first and then get reimbursed later, as is the case for many current rebate programs, said Emmett Romine, vice president of energy and transportation solutions at Xcel. Customers would also get higher rebates if they choose more advanced technologies, like high-efficiency cold-climate heat pumps.

Beyond educating customers, the company is putting workforce-training plans together to ensure there are enough heat-pump installers ready to help customers convert. Xcel is also working with distributors and manufacturers ​“to make sure that there’s a supply chain that will come to Colorado when we stimulate demand,” Romine said.

The plan represents a significant step up from Xcel’s current pace of upgrades. ​“The goals are really aggressive,” Romine said. ​“When you look at the number of heat pumps and the number of water heaters we’ve got to contemplate getting into homes, it’s an enormous amount of work.” Currently, Xcel does around 10,000 rebates a year for traditional gas furnaces. Now, it’s aiming to do 20,000 heat-pump conversions this year and just under 100,000 total by the end of 2026, Romine said.

That supercharged effort won’t come without costs. Ratepayers will see electricity rates go up by 1.1 percent and gas rates rise by 7 percent over the next four years due to the plan. But advocates say it’s worth it to avoid pouring money into a gas system that must be phased out — and that the climate benefits outweigh the upfront costs. Even without the Clean Heat Plan, Xcel projected it would need to increase base rate revenue by 32 percent between 2023 and 2030, The Colorado Sun reported.

Colorado’s plan ​“is a very good example of needing to pursue both sides of the equation at the same time — decarbonization, electrification — but at the same time ensuring that we’re starting to shrink and eliminate unnecessary investments in the gas system,” said Alejandra Mejia Cunningham, senior manager of state buildings policy at the Natural Resources Defense Council.

The Public Utilities Commission has encouraged Xcel to report its progress by 2026, ahead of the legally mandated schedule, Ihle said. Advocates will be watching closely to see how it all plays out.

“We’re gonna have to make sure that we’re seeing the results of that in terms of participation, customer satisfaction, and ultimately emissions and cost reductions,” Dammel said. ​“There’s going to be a lot of utilities across the country following this.” 

Xcel Colorado’s new clean heat plan is a big deal. Here’s why. is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

The following commentary was written by Kelley Trombley, senior manager of state policy at Ceres. See our commentary guidelines for more information.

With housing prices skyrocketing, far too many Colorado workers can’t afford homes. Traffic, already slowing down commutes and deliveries, is getting worse. And a warming planet is already hurting iconic Colorado industries, from farmlands to mountaintops. 

These are some of the major challenges keeping the state’s business leaders up at night — a sort of three-legged crisis with each individual prong presenting a real threat to the state’s economy. 

Make no mistake: Colorado is a great place to live and work. The state’s population growth in recent years is proof of its allure. But growing economies risk falling victim to their own success, as new challenges threaten to limit further growth. Right now, you can find those exact types of challenges in the housing market and on the roads. 

Home prices across the state have spiked by about 50% over the last five years, making it increasingly difficult for young workers and families to stick around at a time when the state’s workforce is rapidly aging. Meanwhile, around Denver, commuters now spend 54 hours a year stuck in traffic, making it the 17th most congested city in the country and slowing down workers, vendors, and really anybody who needs to get anywhere. 

Even more challenging: these problems risk building upon one another. If the only affordable places to live are further and further away from the places where people tend to work, that means people must drive even more. More traffic means slower commutes, delayed deliveries, and a less productive economy. 

And more traffic — as well as sprawling housing development that has greater energy needs — also means more pollution, which in turn causes the climate to warm. That is no longer a distant risk: Colorado’s mountain resorts, breweries, and other companies have repeatedly sounded the alarm about the impacts from climate change on their businesses and the broader economy. 

The good news is that for such a complex and interwoven set of challenges, there is a simple and low-cost solution that could go a long way toward resolving them — and it’s in front of state lawmakers as we speak. HB1313 would make it easier to put housing where people drive the least by removing burdensome red tape that makes it more difficult to build near public transit. As part of the legislation, cities, towns, and counties would gain access to new affordable housing tax credits and infrastructure grants to support the new development. 

Just judging by how hard it is to get it, there is plenty of demand to live near transit and jobs. Housing builders want to make more homes there but are restricted by regulations that limit how much housing can go anywhere. If those restrictions are softened, it’s all but certain that more housing will be built to meet that growing demand and ensure people can afford to live closer to work. And when people live closer to transit, they drive less because they have other options to get around — meaning less traffic and less pollution. Moreover, HB1313 would come at a time when the federal government has significantly increased infrastructure spending, which would help the state improve transit options to further bolster this policy. 

Like I said, it’s a simple change — but one with profound effects for taking on that three-headed monster of housing, transportation, and climate risks. In fact, if passed, this legislation will cut down on household driving by an estimated 13%, reduce climate-warming pollution by 8%, and have major positive impacts on land conservation and building energy usage. 

With public policy to unlock housing development near where people want to live, Colorado can make real progress against the housing and transportation challenges that are confronting so many American cities right now, while further brandishing its role as a leader in the fight against climate change. Since each of these challenges tends to get worse the longer it goes unaddressed, it is critical that action be taken quickly soon. I strongly encourage Colorado lawmakers to pass HB1313 this spring to ensure another generation of growth for the state and its key industries while protecting the resources that have made it so attractive to so many. 

Commentary: A business-friendly plan to confront some of Colorado’s greatest challenges  is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

Environmental agencies in nine states will work together to reduce planet-warming carbon emissions by making electric heat pumps the norm for most new home HVAC equipment sales by 2040. 

The memorandum of understanding, spearheaded by the inter-agency nonprofit Northeast States for Coordinated Air Use Management, or NESCAUM, was released today and signed by officials in California, Colorado, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon and Rhode Island. 

While it is not legally binding and does not commit particular funding, the agreement calls for heat pumps to make up 90% of residential heating, air conditioning and water heating sales in these states by 2040. 

An interim goal of 65% by 2030 is based on last fall’s target from the U.S. Climate Alliance, a group of 25 governors, to quadruple their states’ heat pump installations to 20 million in the same timeframe. 

The residential sector is one of the top two or three contributors to greenhouse gas emissions in most of the East Coast states signing on to the agreement, driven in part by cold climates and a heavy reliance on oil and gas for home heating. Residential emissions rank far lower in the Western states participating.

In a press release, NESCAUM emphasized the harmful smog, haze and ozone driven by nitrogen oxide and particulate emissions from fossil fuel combustion, calling buildings “a hidden source of air pollution.” 

Senior policy advisor Emily Levin said states must move quickly to help residents replace these fossil-fired HVAC and water heating systems with heat pumps in time to limit the harms of global warming. 

“You may only have one more crack at these buildings between now and 2050, because these are long-lived pieces of equipment — they can last 10 or 20 years,” she said. “So we really can’t miss our opportunity.” 

Clear market signals

Matt Casale, senior manager of market transformation with the Building Decarbonization Coalition, said the new agreement’s market-share approach adds specificity to how states will meet existing, number-based goals for heat pump installations. 

“The idea is to send a clear signal to the market that heat pumps are the future of home heating and cooling, while reflecting the urgency with which we need to act to meet GHG emissions reduction targets,” he said. 

Manufacturers have called for this kind of “long-term signal,” said Levin — “they need to plan, they need to make significant investments.” She said agreements like this show companies that “this is the direction we need to go in” and that state governments are committed to helping make the transition happen.

“Greater demand for heat pumps will also put pressure on installers,” Casale added. “We will need policies that both grow and further develop the workforce. The MOU is a great opportunity to bring them in more directly, learn from them, and talk about their needs.” 

Under the new agreement, participating states will “collaborate to collect market data, track progress, and develop an action plan within a year to support the widespread electrification of residential buildings,” according to NESCAUM.

Afton Vigue, a spokesperson for the Maine Governor’s Energy Office, said taking advantage of consolidated industry data will help prevent another new reporting requirement for participating states and will help align with varying state metrics.

The states’ forthcoming action plan is expected to include emphasis on workforce development and supply chain constraints, which have tempered otherwise strong heat pump progress in states like Maine. 

“It really does focus on that element of driving the market and collaborating with manufacturers,” Levin said. “Right now, states don’t really necessarily know … how their heat pump market is developing. Creating systems to bring visibility to that, provide insights into that … it’s a really important element.” 

The agreement tees up annual reports on each state’s progress toward the 2030 and 2040 goals, and schedules a 2028 check-in about any necessary adjustments. 

Collaborative tools for affordability and access

“A greater focus on consumer education, workforce development, and affordability will be critical to the success of the transition,” said Casale. “This means getting the most out of the Inflation Reduction Act and other incentive programs, but we also need to answer the questions of how this solution best serves multi-family buildings, renters and others for whom purchasing a new system isn’t entirely within their control.” 

In the agreement, the states pledge to put at least 40% of energy efficiency and electrification investments toward disadvantaged communities — those facing high energy cost burdens or disproportionate pollution — in line with the federal Justice40 program, which underlies similar rules for the IRA.

Working through NESCAUM and other existing groups, the participating states will brainstorm tools for reaching these goals, potentially including funding for whole-home retrofits, building code enforcement and other uniform standards, data collection, research projects, use of federal resources and more. 

“It’s going to look a little different in every state,” Levin said. “But they’re committing to collaborate and to advance a set of policies and programs that work for their state to accomplish those broader goals.”

This could include adapting or building on each other’s approaches. Levin highlighted Maine and California as having successful models for consumer outreach and heat pump market coordination, and said Maryland has shown strong impact and ambition around clean building performance standards. 

Maine, which relies more on heating oil than any other state, is among the participants with existing heat pump goals in their climate plans. The state surpassed an initial target — 100,000 installations by 2025 — last year, and now aims to install 175,000 more heat pumps by 2027. 

Officials in Maine have said that heating oil use appears to be slowly falling in concert with increasing use of electricity for home heat. Vigue said the new agreement lines up with existing state goals and will help Maine “bolster our ongoing collaboration with other states, share experiences, and see where gaps may exist.” 

Nine states pledge to boost heat pumps to 90% of home equipment sales by 2040 is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

The following commentary was written by Alli Gold Roberts, senior director for state policy at Ceres. See our commentary guidelines for more information.

As the harmful economic and financial effects of climate change become increasingly clear, investors and companies around the world are rapidly adjusting their business models — not just to reduce the risk and their exposure to climate catastrophes, but to capitalize on the industries of the future. 

That’s why, across the U.S. and in Colorado, businesses and investors are doubling down to the tune of hundreds of billions of dollars in innovative and sustainable clean technologies. And as that technology has advanced to make it easier and more advantageous for companies to cut their pollution, policymakers at both the state and federal level have worked to incentivize exactly these kinds of investments — to ensure their economies benefit from this windfall as they build for the future. 

In Colorado, we have seen officials take bold policy action to accelerate the adoption of clean electricity, clean transportation, clean buildings, clean appliances, and even clean lawn tools — an impressive suite of policies that have helped the state keep pace with other national climate leaders. Now the state has an opportunity to trailblaze in another sector of the economy, one that has so far lagged in pollution reduction: heavy industry and manufacturing. 

Under Colorado’s ambitious climate and environmental justice laws, the state is required to slash climate pollution from industrial sources — like factories and plants — by 2030. To achieve that goal, policymakers are in the process of crafting what will be a first-in-the-nation regulatory program: Phase II of the Greenhouse Gas Emissions and Energy Management for Manufacturers, otherwise known as GEMM II, will be adopted later this year and go into effect as soon as next year. 

At a time when cleaner products are growing their competitive advantage in the global marketplace, GEMM II gives the state a real chance to be at the vanguard of clean manufacturing. But to reap the economic benefits promised by this transition, Colorado must get the policy right. 

The sustainability nonprofit I work with, Ceres, partners with companies and investors to capture the economic benefits of clean energy and reduce the financial risks of climate change. Having done this work for more than 30 years, Ceres has developed a robust understanding of how public policy can best help the private sector achieve these goals so that they can benefit entire state economies. Even companies that are not part of the manufacturing sector have a strong interest in reducing emissions from within it, because they often rely on its products — from microchips to glass bottles — within their supply chains and know they cannot fully clean up their own operations without policy support. 

That is why Ceres recently submitted a letter to state officials outlining what we believe are the best ways to successfully achieve the goals of GEMM II. Chief among them is simplicity. Colorado is on the clock to meet its climate goals, and 2030 is coming up fast. Policy clarity is essential to helping manufacturers prepare.  

This is not the time to introduce complex programs that essentially allow manufacturers to keep polluting at the same rate. Instead, GEMM II should prioritize rules that directly reduce climate pollution from manufacturing sites, encouraging them to adopt innovative yet proven technologies that will achieve the program’s goals while better positioning industry to thrive into the future. 

The GEMM II program must also strongly favor solutions that reduce not only pollution that harms the climate, but also air pollution that harms people and often comes from the same sources. Air pollution is a serious issue in its own right, causing increased rates of heart disease, lung disease, and other serious health problems in nearby communities. Almost all of the facilities that would fall under the GEMM 2 policy are located in communities that currently suffer from disproportionately high levels of pollution. Beyond its health effects, the threat of air pollution to their health and livelihood is also a drag on local economies. In addition, Colorado law requires that these communities must benefit from GEMM II — and reducing their exposure to toxic pollution is a clear benefit.  

While GEMM II may sound like a challenge to some manufacturers, it should be better understood as an opportunity. New incentives from the Inflation Reduction Act and other recent federal climate investments, as well as state tax credits and grant programs for the industrial sector, have made it more feasible for manufacturers to clean up their operations. What’s more, they have also sparked a rush of investor and corporate interest in clean manufacturing, and a number of success stories as industry leaders move to embrace clean solutions. 

We urge Colorado policymakers to seize this momentum and help manufacturers capture the swelling interest by adopting the most ambitious version of GEMM II possible. This is a chance to set a gold-standard policy that will make the state’s industrial sector more competitive, its climate goals more achievable, its air cleaner, its communities healthier, and its economy better positioned for the decades ahead. 

Commentary: Colorado can lead the nation in clean industry — if it gets the policy right  is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.