§ 40-3.2-102 — Recovery of air quality improvement costs

Colorado § 40-3.2-102

• Jurisdiction: Colorado
• Title 40: Utilities
• Art.: Air Quality Improvement Costs

Text

(1) A public utility
shall be entitled to fully recover from its retail customers the air quality
improvement costs that it prudently incurs as a result of a voluntary agreement
entered into pursuant to part 12 of article 7 of title 25, C.R.S., after July 1, 1998,
except as provided in subsection (7) of this section.

(2) Repealed.

(3) Upon application by a public utility for cost recovery, the commission
shall determine an appropriate method of cost recovery that assures full cost
recovery for the public utility. The air quality improvement costs recovered by the
public utility shall not cause an average rate impact greater than the equivalent of
one and one-half mills per kilowatt hour in any period, nor shall such costs exceed a
total of two hundred eleven million dollars calculated using 1998 net present value
dollars. The air quality improvement costs for a generating facility shall be
recovered over a period of fifteen years or less.

(4) Any revenues a public utility receives from transferring, selling, banking,
or otherwise using allowances established under Title IV of the federal Clean Air
Act or under any other trading program of regional or national applicability shall
be credited to the public utility's customers to offset air quality improvement costs
if such revenues are a result of a voluntary agreement entered into under part 12 of
article 7 of title 25, C.R.S.

(5) To the extent that a voluntary agreement entered into under part 12 of
article 7 of title 25, C.R.S., does not increase the public utility's electric generating
capacity, the voluntary agreement shall not be subject to any restrictions that arise
from the commission's integrated resources planning rules.

(6) The commission shall assure that any future industry restructuring does
not adversely affect the ability of the public utility to recover its air quality
improvement costs. Nothing in this section shall prevent the commission from
considering the appropriate value, including market value, of a public utility's
generation assets in any future industry restructuring proceeding.

(7) (a) If a public utility's wholesale sales are subject to regulation by the
federal energy regulatory commission and the public utility sells power on the
wholesale market from generating facilities that are subject to a voluntary
agreement under part 12 of article 7 of title 25, C.R.S., the public utilities
commission shall determine whether to assign a portion of the air quality
improvement costs to be recovered from the public utility's wholesale customers.
The public utilities commission may assign a portion of the air quality improvement
costs to the public utility's wholesale customers to the extent that such portion of
such cost recovery does not conflict with the public utility's wholesale contracts
entered into prior to April 1, 1998.

(b) If the public utilities commission assigns a portion of the public utility's
air quality improvement costs to be recovered from the public utility's wholesale
customers, the public utility may apply to the federal energy regulatory commission
for recovery, effective on the date of filing, of the portion of costs assigned to the
public utility's wholesale customers. The public utilities commission shall permit
the public utility to recover the portion of costs assigned to the public utility's
wholesale customers from its retail customers pending the federal energy
regulatory commission's approval of recovery from the public utility's wholesale
customers.

(c) Notwithstanding paragraph (b) of this subsection (7), if the public utility
fails to apply to the federal energy regulatory commission within six months after
the public utilities commission's final order assigning a portion of the air quality
improvement costs to the public utility's wholesale customers or fails to make a
diligent, good faith effort to persuade the federal energy regulatory commission to
approve the cost recovery from the public utility's wholesale customers, the public
utility shall not be entitled to recover said portion of the costs from its retail
customers.

(d) All revenues that a public utility receives from its wholesale customers
for air quality improvement costs shall be credited as an offset to the air quality
improvement costs charged to the public utility's retail customers.

Legislative History

Source: L. 98: Entire article added, p. 1050, � 3, effective July 1. L. 2025: (2) repealed, (SB 25-275), ch. 377, p. 2109, � 336, effective August 6.