What’s driving the surge in Colorado renewable energy?

Major solar flares hit Colorado, but not in the form of northern lights or the radio blackouts scientists have warned about in recent days.

Instead, the state has been absorbing powerful waves of solar and other renewable energy projects that independent experts say are keeping Colorado ahead of a fast-growing pack of successful green-development states.

Large projects across Colorado are being driven by the ongoing shift in the fundamental economics of energy toward cheaper renewables, experts say. Lucrative tax credits and grants from the Inflation Reduction Act pumped in accelerants.

“There’s this race to the top and Colorado is leading,” said Jacob Corvidae, an analyst and adviser in equitable climate action for the clean energy nonprofit RMI. And Colorado is in competition to see if it can keep securing that leader’s space in relation to all of its neighbors.

The surge is welcome but shouldn’t be a huge surprise to people following energy policy and economics, said Mike Kruger, chief of the Colorado Solar and Storage Association trade group.

“We are changing our entire economy from one that’s based on molecules to one that is based on electrons,” he said.

The burst of renewable energy projects goes well beyond installing routine solar panels, and promises to bolster Colorado’s position in both innovation and production of utility scale renewables.

A by-no-means comprehensive list of pending renewable energy projects:

• VSK Energy will build a photovoltaic panel factory in Brighton to open in 2024 with an initial capacity of 2 gigawatts of panels a year. The 900-job plant could expand up to 4 gigawatts of panel production a year, their announcement said. The company would be the first major panel producer in Colorado, and calls it a $250 million investment. United Power, the co-op with major clean energy expansion plans after splitting off from the Tri-State Generation, has designs on 300 megawatts of new power with an emphasis on renewables to serve customers north and west of Denver. The co-op also plans for nearly 80 megawatts of battery storage across multiple sites, which can help replace natural gas generation as a reliability base for the grid when renewables are offline.
• Colorado Springs Utilities is expected to issue a request for proposals this month for 525 megawatts of new solar arrays and 100 megawatts of battery storage, in another big sign that storage for renewable power has become viable at a large scale.
• Solar industry experts expect Black Hills Energy to have a late-summer RFP for 200 to 250 megawatts of new solar, with 50 megawatts of storage.
• Primergy wants to build 155 megawatts of solar power and an equal amount of battery storage, enough for 56,000 homes, at Hesperus, near Durango. The utility-scale array would be the first of anywhere near that size in the southwestern corner of Colorado, and is raising the kind of land-use and sightline opposition you’d expect in an exploratory effort.
• And, though it’s vehicle battery manufacturing instead of direct solar power, Amprus Technologies dazzled economic development officials in March with plans to open a lithium-ion battery factory at an existing Brighton warehouse by 2025. The site would be one of the first important clean- car component sites in Colorado, and could lead to other innovations in battery storage.

So what’s driving all the growth? Government money certainly helps. Amprius, for example, is relying on a $50 million clean energy grant through the federal Bipartisan Infrastructure Law. Many of the other projects will build on various grants and tax credits from Biden administration initiatives, as well as state and local development help.

Solar, though, had achieved momentum even before many of the new federal grants kicked in. Some of the Colorado announcements came just as the Energy Information Administration said solar and wind combined in the first five months of 2023 out-generated coal for US electrical power for the first time. E&E News first made the calculations of the turning point.

After a leveling off because of supply chain issues about two years ago, the price of solar panels started dropping again recently, Kruger said, extending a downward march that makes many more projects viable.

“The cost of solar panels and batteries, compared to just 10 years earlier, is less than 10% of what it used to be,” Corvidae echoed. “It’s just insane how much the costs have dropped, and this is the thing I think most people don’t realize.”

Then, the Inflation Reduction Act added in new incentives for renewable energy development and electrification of transportation and home energy, while also locking into place for the long term development tax credits builders have come to rely on, analyst said.

The act “really changed the economics of energy in all sectors, in power, transportation, buildings, etcetera,” Corvidae said. With the inflation reduction act, the US is now really kicking into high gear, leading the development of the clean energy economy for the world. It’s surprising in some ways that this has not gotten more attention in the US.”

The solar panel assembly plant planned for Brighton is particularly welcome as filling in a hole in the Colorado renewable energy economy, Kruger said. The basic parts will be made in the southeast US where water resources are abundant, and then shipped here for final assembly, Kruger said.

And then having those panels being used in Colorado and across the Southwest is phenomenal. That’s just great news for us,” Kruger said.

The abundance, however, will also reveal some lingering deficits, Kruger added. Colorado still needs to build out the transmission backbone in many regions in order to deliver generated renewable energy to cities. The sunny San Luis Valley is ripe for large solar arrays, but potential developers still have no way of getting large quantities of electricity out of the isolated region, he said.

And, Kruger said, “I need more human beings for sure. I especially need them on the Western Slope. There’s an absolute lack of master electricians on the Western Slope.”