A BLUEPRINT FOR A New Energy Economy Report authored by Todd Hartman Photo, Above Mike Stewart looks over an array of solar panels at the Greater Sandhill Solar Project being constructed by SunPower Corporation outside of Alamosa. Photography by Matt McClain unless otherwise indicated

Design by Communication Infrastructure Group, LLC

No taxpayer dollars were used in the production of this report.

On the Cover The light of the setting sun reflects off solar panels at SunEdison’s 8.2-megawatt solar photovoltaic plant outside of Alamosa. A LETTER FROM GOVERNOR RITTER

A Letter From Governor Ritter

Dear Reader, In four years as Governor of Colorado, I have made it a top priority to position Colorado as an economic and energy leader by creating sustainable jobs for our residents, encouraging economic growth for our businesses, and fostering new innovations and new technologies from our public, non-profit and private institutions. We call it the New Energy Economy, and it is built on the recognition that the world is changing the way it produces and consumes energy.

By harnessing the creative forces of advancing the diversified energy resources In Colorado, we’ve elected to join that race, world, and give them the knowledge that we entrepreneurs, researchers, educators, that we turn to today, and will increasingly and together, we believe America can win worked with their futures in mind in hopes foundations, business leaders and policy do so in the future: solar, wind, geothermal, it. Colorado is proof positive that we can that they will do the same. makers, we have in Colorado created biomass, small hydro, Smart Grid and other create new opportunities for new forms of Sincerely, an ecosystem that is supporting private elements of the emerging new energy world. clean energy that will ease our dependence economic activity, creating new jobs and on foreign energy, conserve finite fossil fuels, putting our state at the forefront of a fast- In the pages that follow, we are sharing protect our environment and allow us to changing world. In Colorado, we intend to Colorado’s New Energy Economy story compete in the global fields of new energy help America remain a global economic in hopes that it can serve as a blueprint manufacturing, research and business. Bill Ritter, Jr. power by leading – not following – in the for states, local governments and others We hope you find Colorado’s story Colorado Governor race to a new energy future. interested in preparing for, and engaging with, a world where China, Europe, Asia and instructive, and employ its lessons to January 2007 to January 2011 While our state remains a strong – and proud other fast-rising economies are speeding advance the New Energy Economy in other – producer of traditional energy resources, ahead while America risks falling behind. regions. By taking these steps, we can deliver we have also become a national center for to our children and grandchildren a better

Table of Contents

INTRODUCTION The New Energy Economy ...... 2

CHAPTER ONE Setting The Stage ...... 4

CHAPTER TWO Campaigning on the New Energy Economy ...... 8

CHAPTER THREE First Steps are Giant Steps ...... 12

CHAPTER FOUR Sustaining Momentum ...... 18

CHAPTER FIVE Economic Impact ...... 22

CHAPTER SIX Market Transformation ...... 30

CHAPTER SEVEN Conclusion ...... 34

Photo, Left Gov. Ritter, center, tours Confluence Energy in Kremmling with owner Mark Mathis, left. Confluence Energy’s wood pellet plant is the largest of its kind west of the Mississippi River. The company is a leading recycler of beetle kill trees.

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INTRODUCTION – THE NEW ENERGY ECONOMY

Introduction

The state of Colorado, under the leadership of Governor Bill Ritter Jr., has in • The focused work of non-profits and energy. This is offered as important history, foundations helping educate Americans but more significantly as a blueprint for recent years led the country in the creation and expansion of a “New Energy about the imperative for a new states and local governments interested in Economy.” This successful economic transformation, recognized in Washington energy course replicating this effort to the extent possible D.C. and in many countries around the world, has evolved through a series in other regions. Colorado’s success with the • The desire to ensure America remains New Energy Economy shows that forward- of policy, legislative and economic development actions that recognize a 21st economically competitive globally looking policies that take into account century shift in the way the world will produce and consume energy. by understanding the shift in jobs, global economic and environmental trends manufacturing and technology will lead to opportunities to expand local tied to a new energy movement economies, build energy security, protect The commitment to developing a New The basis for building a New Energy the climate, clean the air and reduce Energy Economy has transformed Colorado Economy rests on a convergence of factors. This document tells the story of Colorado’s dependence on finite fossil energy. into an important national and international New Energy Economy, its origins, its hub for renewable energy companies and Those include: development under Governor Ritter’s entrepreneurs, clean-energy research and leadership from January 2007 to January • Forecasts of rising energy prices production, and has fostered growth in 2011, and key elements that ensure long- companies that focus on energy efficiency. • Growing concern over the impacts term market transformation built around The New Energy Economy grew in Colorado of climate change tied to fossil homegrown jobs, protection of the state’s even in a period of severe national recession. fuel combustion postcard beauty and clean, inexhaustible Manufacturers were building factories and Gov. Ritter pumps insulation into a home in hiring employees on the Front Range of • The increasingly mainstream interest Colorado Springs. Weatherization of existing the Rocky Mountains, even at the height in protecting the environment and structures is a key aspect of building Colorado’s of the economic downturn. These projects conserving natural resources New Energy Economy. Photo courtesy Energy produced, at least in part, an antidote to • A growing emphasis on Resource Center. the swirl of difficult economic news that energy independence dominated the last years of the decade.

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CHAPTER ONE – SETTING THE STAGE

Setting the Stage

Various political, technological, regulatory and market forces began to align Key developments included the creation of the Colorado Legislature in 2002 and 2003 Xcel Energy’s Windsource program, which without success. By 2004, however, the in important ways in the late 1990s and early 2000s, planting the seeds for gave customers the option to pay slightly effort had gained significant momentum Colorado’s blooming New Energy Economy. Advances in wind energy technology higher electricity rates to purchase power and supporters - including a fledgling and production were nudging the price of wind-turbine power into a competitive from renewable sources. Response to the renewable energy industry, economic program was enthusiastic, and Xcel Energy development groups, the ski industry position with some fossil fuels. At the same time, a public increasingly concerned saw demand exceed supply as Windsource and major environmental organizations. about carbon emissions, climate stability and pollutants associated with coal- became one of the country’s leading green Importantly, advocates emerged in the energy programs. In this same period, Republican Party as well. These were chiefly fired power plants were pressuring utilities to deploy more renewable energy. the Colorado Public Utilities Commission rural conservatives who saw how farmers Utilities, including Xcel Energy – Colorado’s largest electricity provider – were determined that wind was a so-called “least- and ranchers could benefit from the leases also concerned about the potential for deregulation that appeared to threaten cost” resource and required Xcel Energy needed to erect wind turbines on the to acquire wind to meet its generation Eastern Plains. their future viability. demands. This led Xcel Energy to purchase electricity from a 162-megawatt wind farm Frustration with the legislature’s failure to near Lamar, a town along the Arkansas approve an RPS led to a ballot initiative in River in southeastern Colorado. the fall of 2004. That initiative, known as Amendment 37, would require Xcel Energy These events encouraged environmental and other utilities to acquire 10 percent of activists and led to a series of efforts to their electricity from renewable sources, develop a “renewable portfolio standard,” including solar and wind, by 2015. Notably, or RPS, designed to require utilities to the initiative also came at a time when the generate a certain amount of electricity United States was engaged in the Iraq War, Photo, Left from green sources. Bipartisan attempts with public attention focused – once again Jim Wedeman of Ascent Solar holds up a piece of Polyimide film were made to move such measures through – on our dependence on foreign energy and used at the company’s manufacturing facility in Littleton.

5 CHAPTER ONE – SETTING THE STAGE

rising gasoline prices. Traditional electricity But voters were not persuaded by assertions and energy companies fought Amendment the initiative would drive up energy costs. 37, marshalling an estimated $1.5 million Instead, signaling a desire to move the state in an attempt to defeat the measure, edging into a new energy future, voters passed the out supporters who raised $1.1 million for ballot proposal 53 percent to 47 percent and the fall campaign. Colorado became the first state with a voter- approved renewable energy standard.

David Poindexter puts insulation in the crawl space of a house in Denver. The weatherization program insulates low income housing.

Governor’s Energy Office to reduce Xcel Energy, as it did throughout K E Y S TO T HE N E W E NERGY E C O N O M Y energy consumption in schools, Governor Ritter’s tenure, showed Climate Action Plan buildings and homes, to build markets important leadership. It began folding for renewable energy, and to expand the closure of some coal units into its transmission to bring green electrons resource plan following the release A single policy document underlies in our homes, stores and factories, into the grid, were built with the of the CAP. Later, as part of the 2010 almost all the components of and training thousands of others to targets of the CAP in mind. Colorado Clean Air-Clean Jobs Act, Colorado’s New Energy Economy. build wind farms, solar facilities and Xcel Energy agreed to close some of The Colorado Climate Action Plan (CAP), geothermal plants across the state, Initiatives at the Colorado legislature its largest coal plants to help clear issued near the end of Governor and by aggressively pursuing new to raise the level of renewable energy Colorado skies. “His Climate Action Ritter’s first year in office in 2007, sets technologies for using our abundant used in the state, and to require that Plan goals did not have enforceability, forth how the state can reduce global coal resources cleanly – we can reduce utilities work with customers to but (Governor Ritter) effectively … warming emissions 20 percent below our emissions, create jobs and build reduce demand also tied back to the cajoled utilities to close a significant 2005 levels by 2020. more sustainable communities.” CAP goals. The state’s utilities and amount of coal plants,” said Craig Cox, many local governments also took the The CAP was fundamental to most The 33-page plan set out in detail executive director of the Interwest document to heart – even though the everything the New Energy Economy numerous actions and goals for state Energy Alliance. plan does not carry the weight of law. strived to do: “By training thousands of departments, utilities and policy workers to improve energy efficiency makers. The myriad efforts at the

6 THE N E W E NERGY E C O N O M Y Solar Totals

SOLAR (PV) [MEGAWATTS] 103 (CUMULATIVE)

59

36

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1 4 2005 2006 2007 2008 2009 2010

A July afternoon sun reflects off United Power’s Brighton Solar Farm. The facility allows customers to buy their own share of the facility’s solar power.

CHAPTER TWO – CAMPAIGNING ON THE NEW ENERGY ECONOMY

Campaigning on the New Energy Economy

When candidate Bill Ritter intensified his run for Governor in the summer and He recognized an untapped potential That Colorado was ripe for this kind of in Colorado for a kind of market strategy made sense. The passage of fall of 2006, his opponents pursued a traditional political strategy of attacking his transformation. “He had a line about how Amendment 37 two years earlier – in record as a public office holder (Ritter had served as Denver’s District Attorney his grandchildren would use power in a very a year when Republican President George from 1993 to 2005). Candidate Ritter was under pressure from media consultants different way,” recalled deputy chief of staff W. Bush carried the state – sent a message Ken Weil. “They’d switch on the light and it’s to political watchers that something to respond in kind, by portraying himself as a tough-on-crime prosecutor. But not going to be power coming from a coal about clean energy was capturing Ritter rejected that course. He had a different vision, one developed through plant; you’re not going to drive a car to a gas the public imagination. station and fill it up. It’s just going to be a his own upbringing on a Colorado farm, through his appreciation of Colorado’s completely different world.” Candidate Ritter and his team would natural beauty and through conversations with people about the future of the continue to embrace the clean energy With this in mind, Ritter wanted to make concept as the election season progressed. state’s environment, climate change, the need to reduce dependence on foreign his first television advertisement not In a campaign document, The Colorado oil - and the links between these issues and job creation. about his past performance as DA, but Promise, Ritter outlined over five pages how about the future, Colorado’s future. He he would build a New Energy Economy to wanted it filmed with wind turbines in drive clean energy, job creation and reduce the background. “He said, ‘I want my first dependence on foreign oil. “He identified the ad to be about turning wheat fields into new energy movement as one he wanted wind farms,” Weil said. “This was Bill to pursue and pursue aggressively,” said Ritter traveling the state, talking to people, Don Elliman, who served first as Governor watching how the public responded when Ritter’s economic development director and he talked about New Energy Economy later as his chief operating officer. issues.” The ad was “hugely successful,” Weil said, and other politicians later mimicked At the same time, as Ritter’s team assessed Photo, Left the approach. the state’s assets and liabilities, the quality Gov. Ritter on the roof of the state capitol in downtown Denver. of Colorado’s labor force was one of its top

9 CHAPTER TWO – CAMPAIGNING ON THE NEW ENERGY ECONOMY

strengths. Colorado is home to one of the The serious-minded approach was aided lexicon when trying to describe the most highly educated workforces in the by some fortunate branding, when one benefits of a clean energy future.” country, as well as home to a remarkable of Ritter’s energy advisers, Melody Harris, research network of universities and suggested the term “New Energy Economy” federal science facilities focused on energy to describe what the candidate was trying and climate. “Early on, this appeared to to develop and advance. “This was pivotal,” be a sweet spot for us: clean-tech, and Ritter said. “It helped us brand it in a way Photo, Below specifically the energy generation portion that stuck, and people across the country Equipment mechanic Elie Mardiros works on a flex fuel car that is part of of it,” Elliman said. starting using it as part of the energy the State Motor Pool’s fleet of fuel-efficient vehicles in downtown Denver.

10 CHAPTER TWO – CAMPAIGNING ON THE NEW ENERGY ECONOMY

states, and companies themselves developed the rules,” Governor Ritter K E Y S TO T HE N E W E NERGY E C O N O M Y acknowledge that the new rules explained. “It was an important part of Tightening O i l a n d haven’t been a significant factor this.” A key lesson from the experience in decisions about where to drill. was the necessity of taking the long Gas Drilling O versight Governor Ritter has also spent much view, even as many opponents might of his term promoting Colorado’s take a hostile position in the short- It was the most politically hazardous board, long heavily tilted to industry, natural gas as a “mission critical” part term. “They see these battles as just component of the New Energy was expanded and populated with a of the New Energy Economy, as well short-term wars that everybody wants Economy. At the outset of his more diverse group of members with as pushing for opportunities to use to fight without asking what are the administration, Governor Ritter set concern for wildlife, public health and it as a transportation fuel. He’s also long-term benefits? As Governor, I out to develop oil and gas drilling the environment. That, itself, created worked to push for greater pipeline surrounded myself with people who rules that put greater emphasis on a major political fracas at the Capitol. construction to ensure Colorado gas could think about the long-term the protection of Colorado’s signature Then, over the next year, the newly can reach more out-of-state markets. and shared a vision. We might have wildlife herds, water, air, communities constructed commission set about encountered pain, but the pain is and landscapes. What he sought was developing an array of new rules that “I wouldn’t have been comfortable worth the long-term gain.” balance between a healthy industry required more thought to how locating promoting natural gas if we hadn’t and healthy environment. and managing drilling would affect wildlife, habitat, water quality and The move was critical. If the Governor people and communities near was to promote Colorado’s rich gas fields. natural gas reserves as a part of the new energy picture, better rules The process generated significant were needed to preserve Colorado’s backlash from the oil and gas treasured environment – itself a industry and the Governor’s political major economic driver for the state. opponents. They framed the new Additionally, as he campaigned for regulations as “job-killers” that would Governor he heard over and over again force companies to leave Colorado’s concerns from communities impacted gas fields for those in other regions. by what was then – in 2006 and 2007– As it happened, a crash in natural a drilling boom in Colorado. gas prices did lead to a drop in industry activity both in Colorado and To get it done, first the Governor nationally. Factual analysis has since had to remake the Colorado Oil and shown that Colorado continues to Gas Conservation Commission. That draw as much drilling as surrounding

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CHAPTER THREE – FIRST STEPS ARE GIANT STEPS

First Steps are Giant Steps

The newly elected governor immediately set to work on an ambitious slate of The administration published the state’s move foundational legislation that would first Climate Action Plan, laying out a create jobs and signal to the world’s new legislative and policy goals designed to accelerate job creation in the New Energy path to reduce greenhouse gas emissions energy industry that Colorado was open Economy. The accomplishments of the first year came in a whirlwind. Working 20 percent by 2020, and invested in a for business. in concert with Xcel Energy, lawmakers doubled the state’s renewable energy “Collaboratory” to develop closer ties between three top universities and the Passage of an expanded Renewable Energy standard – from 10 percent by 2015 to 20 percent by 2020, and diversified the National Renewable Energy Laboratory. Standard (RES) was spotlighted as the top state’s Oil and Gas Conservation Commission, ending its industry-dominated Governor Ritter established an ambitious priority the day after candidate Ritter was new energy office, appointed new members elected in November 2006. Administration makeup by including a wider variety of perspectives. to the Public Utilities Commission and the officials and top lawmakers settled on it administration courted major new energy almost immediately, according to deputy companies, including the first big prize: chief of staff Weil. “The issue that received the world’s largest wind turbine the single most attention during the manufacturer, Vestas. transition, including countless meetings with (Colorado’s largest utility) Xcel Legislation Energy and a broad range of stakeholders Within 48 hours of this election, Governor was passage of that legislation.” Ritter Ritter met with the president of the Senate and administration officials knew that and the Speaker of the House and they increasing the RES would immediately draw jointly decided that advancing the New attention to Colorado among companies Energy Economy would be a priority for the looking for markets to expand new energy upcoming session. “Your first session is the companies and research. time to do as much as you possibly can on Photo, Left the agenda,” Governor Ritter said. And so it That signature legislation doubled the Portions of wind mills manufactured by Vestas sit in a field waiting was. The administration worked rapidly to state’s renewable energy standard from assembly at the Cedar Point Wind Project outside of Limon. 10 to 20 percent that had been approved 13 CHAPTER THREE – FIRST STEPS ARE GIANT STEPS

Workers from Texas Placement of Fort Worth work on the foundations of wind towers at the Cedar Point Wind Project outside of Limon.

by voters through Amendment 37. It also removing barriers to transmission build-out, A “net-metering” bill the first year (and a These laws formed the fundamental required that rural electric associations the bill helped address the “chicken-and- follow-up bill the next year) established building blocks for the New Energy – which had largely chosen to opt-out egg” cycle that left wind-energy developers a statewide policy that Coloradans be Economy. The Governor ‘s repeatedly of Amendment 37 – meet a 10 percent uneasy about building projects without credited for the power they generated vocalized support for new energy concepts renewable energy goal by 2015, assuring an adequate transmission, and left utilities from their own rooftop solar or small alone was a draw to companies big and economic boost for rural areas as well as reluctant to build transmission without wind system. That reduced the cost for small looking for the right place to open Colorado’s Front Range. Matt Baker, a leading wind turbines. A companion bill also set consumers and simplified the process of or expand. Laws driving more renewable environmentalist at the time and now a up a task force to map Colorado’s rich installing renewable energy systems in energy and energy efficiency would also member of the state’s PUC, called the new renewable energy zones for solar, wind, the state. Another important bill assured mean jobs – jobs for workers to construct standard “the most important environmental geothermal and other resources. This big energy efficiency gains by requiring solar collectors, insulate homes and install legislation in 20 years.” project provided project developers a critical dramatic increases in “demand-side furnaces; jobs tied to companies that tool to see where the most important management” from investor-owned electric build solar panels, wind turbines; and jobs Another bill encouraged the development of resources existed in the state, and where and gas utilities. The bill created tools for around research and development that new transmission lines, providing utilities transmission lines might need to be the utilities to provide more incentives expanded in the state as venture capitalists more financial flexibility to build systems constructed to bring those clean for residences and businesses to upgrade and technology firms eagerly planted their that would import green electrons from electrons to market. equipment, furnaces, appliances, insulation dollars and themselves in Colorado’s fertile large-scale wind and solar projects. By and reduce consumption. new energy ground.

14 CHAPTER THREE – FIRST STEPS ARE GIANT STEPS

Policy 10 percent, paper consumption by 20 sectors across Colorado – from agriculture universities: Colorado State University, the The Governor also took ambitious policy percent and petroleum use by 25 percent to power production to transportation. University of Colorado and the Colorado steps outside the legislature in his inaugural – all by 2012. “It’s important that state The Climate Action Plan became a driving School of Mines. The Collaboratory’s year, especially in his first 100 days, with government leads by example,” he said. document for the work of the Governor’s highest priority would be to expedite the key executive orders and personnel Energy Office, with initiatives adopted development and transition of new energy In another bold step, the Governor appointments. He redefined the mission of by program managers who set about technologies to the marketplace. appointed Colorado’s first climate change the state’s Office of Energy Conservation partnering with utilities, community groups, advisor and created a cross-departments The state’s Public Utilities Commission, and Management, converting it to the non-profits, fellow government agencies, climate group charged with creating a which regulates Colorado’s investor- Governor’s Energy Office, with a clear legislators and the private sector to Colorado Climate Action Plan. The plan, owned utilities, was revamped in Governor goal to build markets for the New Energy implement them. published by the end of 2007, set out in Ritter’s first year, with appointments Economy through programs that would help detail how Colorado would make progress The Governor also supported funding who – as the governor pledged during residents and business owners incorporate toward reducing greenhouse gas emissions for the Colorado Renewable Energy the campaign – would “share my vision clean energy and energy-saving measures. 20 percent by 2020 and make even deeper Collaboratory, a partnership between the for a cleaner and more secure energy He also issued “Greening Government” goals cuts by 2050. The plan proposed initiatives National Renewable Energy Laboratory and future.” Two new members in 2007 and directing state agencies to reduce energy that could reduce fossil fuel emissions in Colorado’s three major science research a third in early 2008 were much more consumption by 20 percent, water use by

utility-scale wind and solar farms. opportunity – and jobs – for companies K E Y S TO T HE N E W E NERGY E C O N O M Y Colorado’s RES has undergone installing distributed renewables and Renewable Energy Standard important adjustments at every turn, has been a key force in Colorado’s but the latest version may provide the dramatic growth in solar best lesson for policy makers. photovoltaic firms. Colorado’s work to develop a in his final year in office – with both requirement for utilities to generate increases approved by the state Colorado’s RES now includes a 3 The impact of an expanded RES a percentage of their electricity from legislature. Solar, wind and other percent “carve out” for distributed in 2010 was immediate. Jeff Scott, clean sources – a Renewable Energy renewable energy companies cite the renewables. That means that utility founder and president of SolSource Standard (RES) – has been the single RES repeatedly as a key factor in their companies must obtain 3 percent of Inc., one of many Colorado-based greatest driver in building a New decisions to relocate to, or expand their electricity from smaller-scale solar firms, announced on the day the Energy Economy. within, Colorado. systems on residential rooftops, bill was signed: “We will be training small, environmentally sensitive and employing 20 to 30 new people The state’s RES grew from 10 percent An RES creates market certainty for hydro-electric projects or small wind in the next 30 days, and we see (this after voters first approved it in 2004 renewable energy companies selling turbines often found on rural farms bill) signing by Governor Ritter as a to 20 percent during Governor Ritter’s rooftop solar, small wind turbine and ranches. This requirement commitment to supporting Colorado first term, and finally to 30 percent markers and developers constructing guarantees an explosive business clean-tech jobs.”

15 CHAPTER THREE – FIRST STEPS ARE GIANT STEPS

“Loop field” or coils are staged and ready for installation at Colorado Mountain College in Glenwood Springs-Spring Valley. These coils enable the new geoexchange system for energy- efficient cooling and heating of the residence halls. The highly efficient system is the first of many energy-saving measures slated for the college’s 11 sites this academic year, and was made possible, in part, by the Governor’s Energy Office. Photo courtesy Colorado Mountain College.

closely aligned with the governor’s efforts interests traditionally dominated the board, economy and saw it as a cleaner-burning commission from seven to nine members to move Colorado and electricity and and it proved controversial as it moved Colorado energy source that could be a and balanced its membership with the gas providers into a 21st century energy through the Legislature. But the effort significant component of the New Energy addition of members representing public economy. These appointments would prove came at a critical time, when Colorado was Economy - as a heating fuel, source of health, environmental and wildlife critical throughout the governor’s term, experiencing a natural gas drilling boom electricity and even as a transportation concerns. A companion bill required the as they worked closely with stakeholders unrivaled in its history. Many residents of fuel. But before he could amplify its role in newly constituted commission to more to implement important regulations the state’s Western Slope were concerned the state’s clean energy portfolio he had to deeply consider how to protect wildlife that expanded renewable energy, energy about the dramatic increase in drilling, address decades of lax regulation and the habitat from fast-growing oil and gas efficiency and low-carbon resources. truck traffic, air emissions, erosion, threats serious concerns of residents most affected development. The new commission would to water quality, intrusion on wildlife by the enormous rise in drilling activity then set about a significant rewrite of Shift in oil and gas oversight habitat and the region’s recreation economy. (by 2007, drilling applications submitted to regulations guiding oil and gas exploration In the most difficult step of his initial regulators had more than doubled – to 6,400 to take into account myriad impacts on year, Governor Ritter moved to bring Bringing more balance to the commission - from the numbers submitted in 2004). land, water, air, wildlife and communities. more balance to the state Oil and Gas was crucial if Colorado was to put in place Despite blaring political noise, much of Conservation Commission, which oversees stronger rules to guide the development Following contentious, often partisan the hue and cry dissipated as industry and Colorado’s extraction of natural gas, oil of oil and gas drilling. Governor Ritter debate, lawmakers passed two bills regulators worked to implement the rules and related fuels. This was a challenging long supported the natural gas industry; advancing this effort in the 2007 legislative and drilling continued. “That statute has move in a Western state where industry he acknowledged its importance to the session. One bill expanded the oil and gas

16 CHAPTER THREE – FIRST STEPS ARE GIANT STEPS

now become a landmark, kind of a flagship “The deal was at some level maturing Vestas was the first in a parade of Vestas’ arrival prompted this prophetic law for all other states” dealing with when we came into office, but it had some New Energy Economy companies arriving public statement from Governor Ritter at heavy natural gas extraction, said Robert pretty significant speed bumps in front of and expanding in Colorado. Vestas alone the time: “We are quickly making a name F. Kennedy Jr., who has become one of the it,” recalled Don Elliman, who at the time would announce plans to bring three for ourselves as a state that’s open for nation’s leading clean-energy advocates. directed the state’s economic development additional manufacturing facilities and a business in what will be one of the most office. “We found the resources to flatten research and development group to important industries of the 21st century.” Vestas comes to Colorado out the speed bumps.” Colorado. Vestas also attracted suppliers, Amid the avalanche of far-sighted such as Bach Composite and HeXcel policy and legislation, the New Energy That administration officials were able to Energy. With critical legislation and policy Economy began bearing true fruit almost complete the deal with far fewer economic steps moving fast, the private sector was immediately. The Ritter administration enticements than offered by other states responding. “It all just started to come had been working tirelessly to convince was notable. Vestas could have received far together,” Elliman said. Denmark-based Vestas – the world’s more money from Texas, Iowa or others, largest wind turbine manufacturer – to Elliman said. “They liked the fact we had locate its North American manufacturing a strong labor force and a very supportive facilities in Colorado. In March 2007, just administrative structure to help a week after state lawmakers approved them through the permitting” that a big the expanded Renewable Energy Standard, manufacturing facility faces, Elliman said. the company announced it would open its first plant in Windsor, a community on Governor Ritter’s repeated public pledge to THE N E W E NERGY E C O N O M Y Colorado’s northern Front Range. The plant build a New Energy Economy was ultimately was projected to produce 1,200 turbine key, Elliman said. They saw a Governor Wind Totals blades a year and employ nearly 500 people. testifying before Congress, speaking publicly – repeatedly – about a new energy future. Ultimately VESTAS committed to making an WIND [MEGAWATTS] 1295 investment in Colorado of around $1 billion ”They looked at Colorado and said, ‘We’re (CUMULATIVE) 1244 spread over four plants that will create well not going to find another state where this 1067 1068 over 2,000 new jobs. is as important to an administration as it is here,’” Elliman said. The Office of Economic Development and International Trade and the Governor’s Ditlev Engel, the company’s CEO, said the Energy Office were critical in luring Vestas, decision to build in Colorado was based on which was attracted to Colorado by its well- the good rail system, qualified work force and the state’s leadership on energy. “The educated labor force, its access to railroads 291 231 and its geography, among other reasons. But decision by the Governor to go for the clean Colorado was up against Texas and other energy agenda and really seeing that we can regions, some of whom could offer greater make a transformation is very important to financial incentives. us,” said Engel. “The leadership is crucial.” 2005 2006 2007 2008 2009 2010

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CHAPTER FOUR – SUSTAINING MOMENTUM

Sustaining Momentum

Sustaining momentum in advancing the New Energy Economy might appear The ability of the Governor’s Energy Office provided companies wishing to provide to energize markets would be boosted by a those services with a wider customer base. challenging following such an accomplished and an ambitious inaugural year. massive influx of federal stimulus dollars But the Ritter administration and lawmakers would continue their charge. “It under President Obama. And the work of a A series of additional bills further advanced the marketplace, particularly for solar wasn’t like we achieved something and rested on our laurels,” recalled Alice newly constituted Oil and Gas Conservation Commission to fashion rules protecting air, energy. Successful measures included one Madden, the Governor’s Climate Change Advisor. “You always knew that Bill water and wildlife would make it easier for requiring new home developers to provide Ritter was in this for the long haul.” Dozens of pieces of legislation that built on the administration to champion the cleaner- the option for solar energy, or for solar “pre- burning qualities of homegrown natural wire,” for homebuyers. Another bill limited the strong foundation of a higher Renewable Energy Standard and the Colorado gas as a “mission critical” component of the the ability of homeowner associations to Climate Action Plan would emerge over the next three years. The ability of the New Energy Economy. stop residents from adding solar power and other clean-energy and energy-saving Governor’s Energy Office to energize markets would be boosted by a massive Additional legislation measures through restrictive convenants. influx of federal stimulus dollars under President Obama. Administration officials and lawmakers set about building on the advances of 2007, One of the most significant new bills, with bills that developed more opportunities in 2009, took steps to make solar energy for the clean energy marketplace to grow. systems more affordable by allowing A follow-up net-metering proposal was financing models that help homes and introduced that more firmly expanded its businesses spread out the expensive up- benefits to customers of municipal utilities front costs of a system over several years. It and rural electric associations, so that they, also offered treasury bonds to participating too, would be credited for the energy they banks and lenders that provide more generated through their own solar or wind financing options for solar installation. Photo, Left systems. That further increased incentives The model allowed third-party ownership Gov. Ritter, left, tours Confluence Energy in Kremmling with owner, Mark Mathis, center. to adopt distributed renewable energy and of a system – often by the company that Confluence Energy’s facility is a key component of Colorado’s biomass production industry. installed it – while a homeowner leases it

19 CHAPTER FOUR – SUSTAINING MOMENTUM

Chris Roma, left, and Danny Smith, right, of Shaw Environmental, construct a piping system to extract methane gas from the Larimer County Landfill. The methane gas will be converted to electricity and represents the first clean energy project partially funded by the Colorado Carbon Fund.

at less than the cost of its monthly electric Colorado, which has long struggled to American Recovery and Reinvestment Act array of new energy initiatives in bill, thereby saving money from day one. compete with other states to lay out cash On Feb. 17, 2009, President Obama Colorado by the summer of 2010. The impacts were dramatic: installers saw or property incentives to lure companies acknowledged Colorado’s New Energy Additionally, Colorado directed roughly $150 a spike in business opportunity, and solar to the state. But a long list of bills did away Economy leadership with a visit to Denver’s million of its own energy-related Recovery energy companies rapidly expanded into with various financial barriers that stood Museum of Nature and Science to sign Act dollars in dynamic and creative ways Colorado. The bill led to 700 such systems in the way of development of small hydro, the $787 billion American Recovery and through the Governor’s Energy Office (GEO). in 2010 alone. biomass, biofuels and other facilities. Other Reinvestment Act. This package of economic The office developed an array of grant, bills offered out-right tax exemptions – for stimulus, designed to help pull the country Another important package of New Energy rebate and loan programs that created example, on solar power systems owned out of the toughest recession since the Economy legislation provided a wide variety significant stimulus across the new energy by third parties, such as those discussed 1930s, set aside $90 billion for research of financing tools, tax incentives and sector – for solar installers, insulation earlier, to even the playing field between and capital projects across the country property tax valuation rules to encourage companies and high efficiency furnace customer-owned and leased solar power to steer the entire United States in the development of renewable energy and installers. It created a popular new website systems. Another bill created a financing same direction as Colorado’s New Energy installation of energy efficiency upgrades. – rechargecolorado.com – that enabled the tool to make it easier to upgrade energy Economy. Of those dollars, some $770 These bills were particularly important to public to access rebates and other efficiency in state buildings and repay the million had been directed into a wide costs through utility bill savings. 20 CHAPTER FOUR – SUSTAINING MOMENTUM

incentives through state, local and utility Natural gas supported the changes. It was the they need for business planning. “This partners simply by entering their zip code. The New Energy Economy does not most contentious fight of Governor balanced approach will drive our economy exclude fossil fuels. It looks for ways to Ritter’s administration. forward, allow us to maximize our vast The GEO also dramatically stepped up use fossil fuels with greater efficiency, energy resources and ensure sustainable weatherization and efficiency efforts geared But the ordeal represented the kind of fewer emissions and more environmental communities for years to come,” Governor toward low-income Coloradans to ensure all difficult steps Governor Ritter was willing to protections, including “mission critical” Ritter said. economic levels of the state were sharing in take throughout his tenure, and what had natural gas. Governor Ritter’s support the benefits. The office added a new partner to happen to get the state to the right place The administration has also worked closely for increasing the use of cleaner-burning – Veterans Green Jobs – that specializes in for increasing natural gas use in the New with the natural gas industry to expand natural gas in Colorado has at times been putting returning military veterans to work Energy Economy, according to deputy chief the use of compressed natural gas (CNG) overshadowed by his initial efforts to on weatherization projects. Such a wide of staff Weil. “The industry through those as a transportation fuel. In 2009, the GEO strengthen oversight of the gas drilling spectrum approach to building the new times completely vilified Bill Ritter,” he awarded two grants totaling nearly $800,000 industry. That came through the regulatory energy marketplace drew praise from across recalled. But, “Bill Ritter’s vision was living to develop fueling stations in two Western overhaul designed to protect air, water, land, the sector. Jeff Scott, founder of SolSource his campaign phrase - to be a ‘stubborn Slope communities with heavy natural gas wildlife and local communities from what Solar – one of nearly 400 new solar steward’ of the environment and to find production. The grants would allow public, was an unprecedented expansion of companies in Colorado - said his company a constructive balance between energy private and heavy-duty vehicles powered drilling during a boom period from added 34 new employees in two months to development and environmental protection. with CNG to more easily access the fuel and 2004 through 2008. keep up with the demand for solar systems This is a brilliant example of why politicians provide more options for fill-up along the generated by rebates. Combined with But greater oversight was also strategic – need to do remain committed to what Interstate 70 corridor. Colorado’s new energy policies, they are a prelude to a higher-profile role for natural is in the best long-term interest of their Creating a regulatory structure that allowed “definitely getting people employed and off gas in Colorado. To generate support for constituents. You go through these cycles natural gas drilling to keep growing, of unemployment,” he said. greater use, residents needed assurances where you’re the devil one day and a saint while also protecting the scenic natural of environmental protections. In 2009, the next. In this environment, having a solid Colorado’s far-sighted views on energy environment that is key to Colorado’s Governor Ritter – in a speech to an oil and core and strong vision is essential.” made it a magnet for additional Recovery economy, was a critical part of the gas industry conference – made it clear that Act dollars beyond those administered by The rules set the stage for the industry’s Governor’s New Energy Economy strategy. it was a “mission critical” part of Colorado’s state officials. Indeed, some $600 million long-term presence in Colorado and as a It would set the stage for a revolutionary New Energy Economy. It was not a bridge in additional stimulus was directed critical energy and economic player and measure in the final legislative session that fuel, but an important component of the toward wind farms, next-generation solar important partner. As the firestorm over would cement natural gas a cornerstone energy picture, providing baseload electric companies, the National Renewable Energy the rules calmed, and the economy began of Colorado’s energy picture for decades power, lower emissions of carbon and Laboratory and energy efficiency projects to stabilize, natural gas firms continued to come. pollutants and a growing role as in federal buildings. Dozens of recipients to drill and many announced new, a transportation fuel for fleet and included UQM Technologies, which received expanded development plans. A major heavy-duty vehicles. $45 million to accelerate the manufacturing announcement in the summer of 2010 saw and deployment of electric vehicle batteries, The reconstituted Oil and Gas Conservation the administration forge agreements with two utilities, which shared $24 million to Commission set out in 2007 to strengthen nine major energy companies to protect advance the Smart Grid, along with rules guiding oil and gas development more than 350,000 acres of wildlife habitat Vestas and Abound Solar to advance in Colorado. The process was arduous. on Colorado’s Western Slope while also innovation in manufacturing their Industry groups were opposed, while allowing for drilling at an accelerated pace, wind and solar products. sporting and environmental groups and providing the firms with the certainty 21

CHAPTER FIVE – ECONOMIC IMPACT

Economic Impact

The Ritter administration’s work to drive legislation, policy and economic Trade missions to several foreign countries more than 400 companies by the summer of planted additional seeds, as did the rising 2010 – up from 40 prior to Amendment 37. development began netting results even as the building blocks of the New profile of the state’s “Collaboratory,” which Energy Economy were only beginning to fall into place. The arrival of Vestas in joined universities with the National A bill in 2009 allowing homeowners to lease solar energy systems from third-parties early 2007 acted as what one administration official likes to term a “bell cow” Renewable Energy Lab to advance new energy technology. All told, Colorado’s was another big driver, bringing companies and other companies began to follow. Work by Governor Ritter, his staff and ambitious renewable energy goals, its including SolarCity and SunRun Solar from officials inside the Office of Economic Development and International Trade and natural and intellectual attributes, the California and other solar-heavy states into Governor’s trumpet and a hard-driving the Colorado market. The CEO of SolarCity the Governor’s Energy Office also helped drive employers to Colorado. recruitment effort combined to bring in December 2009 credited the state’s thousands of New Energy Economy jobs “forward thinking” in creating policies to to the state. attract companies like his. “Colorado has the potential to become a national leader Solar flare in solar power adoption per capita,” said Colorado was on the map with the solar Lyndon Rive. Importantly, this migration was energy industry since late 2004, when happening amid the worst of the national voters created a 10 percent renewable economic downturn. energy standard through Amendment 37. The vote saw the market surge in the two Colorado’s progressive renewable energy years prior to Governor Ritter’s election. The policies were attracting companies domestic administration, teaming with lawmakers, and from overseas. A small sampling: doubled the renewable energy standard Abengoa arrived from Spain and SMA, a to 20 percent within two months of solar inverter maker, came from Germany. Photo, Left taking office, leading to additional growth. PrimeStar Solar, specializing in thin-film Kyle Remley and Chris Martin of Headwaters Energy get a helping hand from clients Colorado’s solar energy industry grew to photovoltaics, debuted in Colorado just Lou and Betsy Puls as they install a windmill at the Puls’ Westcliffe home. a 10-minute drive from the National

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Renewable Energy Laboratory. Ascent Solar company opened an office in late 2010. effect. The first couple, you have to fight hard, Ritter administration’s close work with opened its solar cell manufacturing facility “Colorado, particularly the Denver County then … Well, it’s like they say, the first million Vestas would pay additional dividends in Thornton, north of Denver, in 2009. region, has emerged as a strong solar dollars is the hardest.” when the Danish company announced it Namaste Solar in Boulder dramatically market,” SES President David Buckner said. would open three more manufacturing expanded its workforce to keep up with “We are looking forward to contributing to A blossoming New Energy Economy plants in the state for different turbine growing demand. More firms arrived from Denver’s renewable energy movement.” It wasn’t only solar companies. Renewable components. Companies supplying Vestas solar hotbeds of California and Arizona. energy companies across the board were with turbine components also arrived. Wind Abound Solar, a technology spin-off from “I do think it created a kind of a herd expanding within, or moving to Colorado. giant RES Americas moved its headquarters Colorado State University, broke ground on a mentality,” said Jeff Lyng, Renewable Energy So were firms specializing in energy to Broomfield and another wind company, manufacturing facility in Longmont in 2008. Policy Manager at the GEO. “We were meeting efficiency, “smart grid” and biomass and RE Power USA, moved its headquarters to SkyFuel – a maker of parabolic troughs with a company recently; they were asking biofuel companies. In 2008, ConocoPhillips Denver. Siemens opened a wind energy for concentrating solar power – moved its how many other renewable energy companies announced it would build a massive R&D facility. Again and again companies headquarters to Colorado in the fall of 2010. do you have in the Denver metro area? Who research cluster geared toward clean energy announced a new Colorado presence. Even the East Coast has taken notice. Solar are they? Where are they located? This many in Louisville, a suburb outside Denver. The Energy Systems, a New York-based solar companies can’t be wrong. It’s a snowball

Dick Kelly, the Minnesota-based got this kind of relationship with the K E Y S TO T HE N E W E NERGY E C O N O M Y utility’s chief executive officer, said the Governor of Colorado. And as X c el Energy company was motivated to support I told them, quite candidly, a lot of it the move into new energy because is just the Governor, and the rest of it wants to be part of improving it is that he surrounded himself with Colorado’s largest utility, Xcel Energy, The utility worked closely with Colorado’s quality of life. “As Colorado people who were willing to listen deserves significant credit for advancing the administration and lawmakers thrives, Xcel Energy thrives,” Kelly said. and cooperate.” a New Energy Economy in the state. to increase Colorado’s renewable “That’s why it was so easy to get on The utility opposed a ballot measure energy standard from 10 percent by board with the Governor and what he The Ritter administration, too, credited in 2004 to create a renewable energy 2015 to 20 percent by 2020. It also was trying to do.” Kelly as a CEO with vision. “They had standard out of concerns about its supported policies to reduce demand a leader in Dick Kelly who decided this feasibility including cost to customers, by increasing energy efficiency on the The collaboration worked, too, is an important part of the future. … but would later say it took the wrong customer side, invested in emerging thanks largely to good relationships I think Dick had the vision of the CEO position and went on to become an “smart grid” technology and legislation and a willingness by both parties to to move this ball forward,” said Don important partner in the administration to replace a suite of coal-fired power compromise, Kelly said. “I can’t tell Elliman, chief operating officer for of Governor Ritter. plants with facilities fueled instead you how many people have called me the state. with cleaner fuels such as natural gas. from other utilities, wondering how I

24 CHAPTER FIVE – ECONOMIC IMPACT

Keith Goshia, principal engineer at Abound Solar in Loveland cleans off solar modules inside a Light Soaker. Abound, a spinoff from Colorado State University, opened in the spring of 2009 in Longmont.

In all, through the summer of 2010, the Colorado’s New Energy Economy to be programs fueled the company’s growth, as Energy Laboratory and the National Center Ritter administration was directly involved a welcoming home. Through programs it installed $50 million worth of efficiency for Atmospheric Research, as well as with some 40 company expansions or at the Governor’s Energy Office that and renewable retrofits in four years. The universities committed to energy. Quality relocations to Colorado, creating 6,500 aggressively promoted energy efficiency in office directly employs 26 “green collar” of life in the state is also high, making it an primary jobs. A study found that by 2009, schools, public buildings and businesses professionals and has created hundreds of easy draw for companies and institutions the state was home to the fourth-highest to legislation that required utilities help localized jobs in green construction. The looking to attract top talent. It also concentration of clean-energy workers in customers reduce energy use, energy firm’s work has saved its customers $3 benefited from good timing. The director of the country and had more than 1,500 clean efficiency has been another job engine that million a year in utility costs. the Governor’s Energy Office, Tom Plant, said energy companies operating throughout the has driven dramatic growth at engineering the administration was “slightly ahead of state. Colorado was also attracting some and construction firms with expertise in Colorado was well-positioned for this kind the curve” and took advantage of a national of the highest levels of clean-tech venture energy retrofits. of economic expansion. It was home to a shift toward clean energy by pursuing capital in the country. highly educated workforce. It sat at the opportunities before others. “There’s an old One company, McKinstry, serves as a telling crossroads of some of the country’s top Cherokee saying: the success of a rain dance Sometimes lost in the glamorous glow of example. The firm coincidentally opened wind resources in the Midwest and its best depends a great deal on timing,” Plant said. new technology and renewable energy its Rocky Mountain Region office the same solar resources in the Southwest. It was companies are firms with expertise in month Governor Ritter was elected. Since home to a slew of topical federal research Everything came together under Governor conserving energy. But they, too, found then, a variety of state-driven efficiency centers, such as the National Renewable Ritter, Plant explained. “You have your 25 CHAPTER FIVE – ECONOMIC IMPACT

Jose Guillen, working with the Northeastern Colorado Association of Local Governments, weatherizes the attic of a Greeley home.

natural assets, you’ve got a policy structure, expertise and lean on the strengths of the economic development office assigned a regulatory processes. A fast-moving, fair- you’ve got the benefits of the Governor others. “It just facilitates communication full-time employee to work solely with minded bureaucracy is “real money,” Clark using his position to loudly trumpet the when (these agencies) are not in completely Vestas to solve problems. And while it said, and can be as important as other opportunities out there and make Colorado different, siloed departments,” Plant said. couldn’t provide the big cash and tax higher-profile incentives when attracting a player in the market, and then the “I know this just from having colleagues incentives that competing states could offer, industry. “The way the services of the Governor actively went out and started in other states that aren’t in the same it could deliver a regulatory process that, as government were provided, there was recruiting.” There were other, less apparent, situation, and being asked by them how Tom Clark of the Metro Denver Economic incredible partnership (between agencies),” advantages too. One key factor missing in we were able to do this.” Development Corporation described, “is he said. “There was no in-fighting, no hair- many competing states was a bureaucratic predictable and speedy” while adhering pulling, everybody had the opportunity structure that had Colorado’s energy office The administration took other important to the letter and spirit of the state’s to lead at the local and regional level at and economic development office as arms steps. In the case of Vestas, Governor environmental rules. the appropriate time. From the company’s of the Governor’s office, and the directors of Ritter realized the state needed an “anchor standpoint, it feels incredibly seamless that both offices were members of the Governor’s tenant” for the New Energy Economy. Vestas officials said they’d never worked everybody is on the same page. It starts at cabinet. This made it easier for all three Understanding the magnitude of what with a government that was so collaborative the top with the Governor and it really is a to work together, cross-pollinate their the company could bring to the state, the and nimble when it came to navigating part of what sets us apart.”

26 CHAPTER FIVE – ECONOMIC IMPACT

Colorado also took policy steps that would advantage of things that come along outside large institutions, including universities, the earliest projects providing clean power prove appealing to new energy companies. that stream, but I think the governor was military bases, federal complexes, hospitals, to rural electric associations in Colorado. Legislation in 2009 provided a tax credit very early to identify (the New Energy schools, even prisons, added numerous All told, wind-generated energy more than for firms that produced 20 or more jobs, a Economy) as an area he was going to put a solar projects, often of 1 to 3 megawatts, quadrupled between 2006 and 2010 under policy that some companies – much like lot of time and energy into.” Added Clark: providing clean electricity for the facility Governor Ritter. Colorado is projected to policies to create solar energy incentives – “This is a state that knows where it’s going, that offset fossil fuel use and will protect have nearly 1,800 megawatts of wind energy cited as the primary reason for moving to and has a purpose.” The Governor’s focus on taxpayers from rising electricity prices into on-line by 2011, keeping it in the top 10 the state. The administration in 2008 also economic development was critical, Clark the future. wind-producing states in the country. led a rewrite of state corporate tax policy said, “when the whole country was going that significantly simplified the tax code through a meltdown.” Wind farms also expanded dramatically The construction of these facilities provided for companies such as Vestas that must under Governor Ritter. Three utility-scale thousands of jobs in rural parts of the state allocate across multiple states. That helped Governor Ritter said he focused so hard wind farms producing 775 megawatts had in great need of the economic injection. the new energy manufacturers exporting on economic development “because it been announced prior to Ritter coming Going forward, the projects also boost their materials and gave Colorado another has the most direct correlation to quality into office, driven by the passage of a the counties’ property tax base and often way to compete for cleantech companies. of life for Colorado families. That’s why renewable energy standard in 2004. Two include lease payments to local farmers and our focus has been on these 21st century expansions and two new wind farms ranchers for the use of their land – creating The creation of the Colorado Jobs Cabinet jobs, things that will be sustainable going totaling another 775 megawatts were a long-term flow of dollars into often weaved another crucial thread into the forward. A call center comes and goes, but a built or under construction during the struggling communities. The facilities also New Energy Economy tapestry. It aligned turbine manufacturer doesn’t, a biomedical Governor’s term. Included in those is one create long-term local jobs for workers who the state’s economic development and research job doesn’t. I want the families of of the most encouraging developments. supervise and maintain the projects. Again, education goals with funding and strategies Colorado to enjoy the fruits of our efforts, Tri-State Generation and Transmission Xcel Energy – the purchaser of much of this to prepare the modern workforce for new and that happens if you have a focused Association, which supplies power to rural utility-scale clean energy – deserves credit energy jobs. Top business leaders and strategy on what the 21st century is going cooperatives in Colorado and adjoining for helping drive demand for these projects. representatives from K-12 and higher to be about.” states, neared completion of a 51-megawatt education, as well as economic and wind farm in Colorado’s Kit Carson County workforce development officials, joined to Utility-scale power grows in the state in late 2010. The wind farm will be one of see where opportunities to prepare more Sometimes lost in the exciting news about Coloradans for the kind of 21st century jobs New Energy Economy manufacturers, the state’s laws and policies were attracting installers and research and development to the state. companies moving to, or expanding within, Colorado was the rise in large, utility- Perhaps most simply, experts credit the scale renewable energy projects in the Ritter administration with focusing on what state. Under Governor Ritter, plans for Xcel Energy proved a reliable partner in it wanted, and keeping its energy channeled three utility-sized solar power plants were helping develop Colorado’s New Energy into a handful of initiatives, instead of announced for southern Colorado. Two of Economy. The public utility will spend more allowing itself to be spread so thin that it those, an 8.2 megawatt and 19-megawatt than $1 billion converting coal-fired power couldn’t accomplish anything – an all-too- site, were completed in his four-year term. plants to burn natural gas, which is a $225 common outcome. “You have to pick a few Another, a 30-megawatt complex to be million savings over installing pollution control things you’re going to focus on,” Elliman built by the firm Iberdrola Renewables, was equipment. Photo courtesy Xcel Energy. said. “It doesn’t mean you don’t take announced in October 2010. Additionally,

27 CHAPTER FIVE – ECONOMIC IMPACT

Trade missions but I can guarantee without doing it, we critical resource for industry. By making That’s really what the Collaboratory is Colorado officials made countless trips wouldn’t get investment.” Colorado a center for that kind of education, aimed at doing,” said Dan Arvizu, director of domestically and numerous trips abroad, to it would reinforce the reputation of the National Renewable Energy Laboratory. The Collaboratory advertise Colorado’s New Energy Economy. Colorado as a leader in renewable “It brings together a number of the One of Colorado’s greatest assets in building Governor Ritter as well as directors and energy,” Hiller said. institutions that have expertise so that the a New Energy Economy was its established staffers at the economic development office collective domain expertise is a real value status as an intellectual garden, sprouting During Governor Ritter’s tenure, the and the Governor’s Energy Office visited to attracting investors that can begin to do ideas and technologies that were pushing Collaboratory developed three renewable Spain, France, Japan, China, Denmark, business incubation and those kinds forward energy innovations without much energy research centers: the Colorado Finland, Israel and Germany in trips that in of things.” of the world even knowing it. U.S. Senator Center for Biorefining and Biofuels, some cases yielded fruit quickly. “You’ve got Ken Salazar helped tie it all together in the Center for Revolutionary Solar The Collaboratory represents in a way the to get out there and let people know,” Plant an effort to raise Colorado’s profile in Photoconversion, and the Center for cherry atop a strong academic environment said. He described a recent trip to France 2006, when he worked with political and Research and Education in Wind. These tied to clean energy and energy efficiency where he spoke to a large company heavily academic leaders to create the Colorado centers work together to accomplish in Colorado, from research universities invested in solar. “They thought their best Renewable Energy Collaboratory, a three goals: into the community college system. play was in California and Arizona – they partnership tying the National Renewable Increasingly, the state’s universities have knew little about our renewable energy Energy Laboratory to Colorado’s three major • Create and commercialize renewable spun off innovations in solar, battery and standard and about our policies to advance research universities: the University of energy technology biofuel technologies into private companies. solar energy in the state.” Now, Plant said, Colorado, Colorado State University and the Community colleges, too, dramatically Colorado is on their map. “We are a state • Serve as an economic driver for Colorado Colorado School of Mines. expanded offerings and certificates to they will look at investing in.” • Act as a sophisticated workforce training train students in a variety of new energy Governor Ritter’s focus on the New Energy Trips to Copenhagen to meet personally center to develop engineers and scientists disciplines, from weatherization to solar Economy created momentum for, and with Vestas executives continued to bolster for industry and academia. installation. Private, for-profit colleges also raised the profile of, the Collaboratory. “He the productive relationship between the increased their focus. EcoTech Institute and quickly became the best booster we had. He two parties. In the fall of 2010, Vestas The Collaboratory also worked closely Redstone College are preparing students helped cement the Collaboratory as a leader announced it would be building a fifth with private companies, including Xcel for careers in renewable energy, sustainable in renewable energy R&D. For companies, facility in the state devoted to research and Energy, Abengoa Solar and SunEdison, design and energy efficiency in an effort it became another Colorado selling point – development. The site selected, Louisville, to support the creation of a solar energy to ride the wave of New Energy Economy and an important one. “Even with Colorado’s Colorado, is the same community where test and demonstration center: the Solar momentum moving Colorado forward. other assets, you can’t attract the private ConocoPhillips plans a massive alternative Technology Acceleration Center (SolarTAC). research offices as we have if you don’t energy research facility. Clark of the Metro The fundamental idea: create research have an outstanding research community,” Denver Economic Development Corp. centers that combine existing capabilities, said David Hiller, the Collaboratory’s said Governor Ritter helped strengthened labs and research talent and link them with executive director. Colorado’s relationship with trade partners, private industry. That, in turn, becomes a particularly Japan. Traveling to their lighthouse for innovation companies. The administration was deliberate about homelands, and developing the personal uniting researchers and the private sector: “It’s important because you need relationships, has been a critical part of the idea was “to create a process by which that critical mass around a variety of growing the New Energy Economy. Said we would be ready to train the next technologies and technical ideas and Plant: “It’s no guarantee we get investment, generation of scientists and engineers, a innovation to attract private sector capital.

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New Energy Economy Job and Company Announcements Since 2007: K E Y S TO T HE N E W E NERGY E C O N O M Y Company Community Industry # of Jobs 2007 Creating Jobs, Attracting Businesses Vestas Blades Windsor Wind Energy 600 IBM Boulder Green Data Center 100 and Strengthening Our Economy Abengoa Solar Lakewood Solar Energy 65 Iberdrola Renewables Boulder Wind Energy 5 2008 ConocoPhillips Louisville Renewable Energy TBD RES Americas Broomfield Wind Energy 200 Dragon Manufacturing Lamar Wind Energy 200 Vestas Towers Pueblo Wind Energy 500 Vestas Blades Brighton Wind Energy 600 Vestas Nacelles Brighton Wind Energy 700 Broadwind Energy Englewood Wind Energy 100 Sun Edison Westminster Solar Energy 30 Woodward Governor Fort Collins Wind Energy 100 Confluence Energy Kremmling Biomass Energy 90 Rocky Mtn. Pellet Co. Walden Biomass Energy -- Camco Global Broomfield Carbon Management 10 2009 HeXcel Energy Corp. Windsor Wind Energy 100 Abound Solar Longmont Solar Energy 300 Ascent Solar Thornton Solar Energy 200 Solix Biofuels Ignacio Biomass Energy 10 Prime Star Solar Arvada Solar Energy 200 GE Energy Controls Longmont Wind Energy 200 Creative Foam Longmont Wind Energy 35 E.ON Renewables Denver Wind Energy 10 RE Power USA Denver Wind Energy HQ 75 Bach Composite Fort Lupton Wind Energy 150 UQM Technologies Frederick Hybrid Vehicles Parts 78+ SunRun Inc. Denver Solar Energy - Siemens R&D Boulder Wind Energy 50 SMA Solar Denver Solar Energy 700 SGB USA Wheat Ridge Wind Energy 15 PMC Technology Golden Wind Energy 40 SolarCity Westminster Solar Energy 40 2010 SPG Solar Denver Solar Energy 5 A+F Sun Carrier USA Lone Tree Solar Energy 5 Dacke PMC Golden Wind Energy 40 Aluwind Castle Rock Wind Energy 30 Abound Solar Longmont Solar Energy 300 Vestas R&D Louisville Wind Energy 125 Greg Voss climbs down a ladder as he unhooks a cable from a newly installed windmill Juwi Wind Boulder Wind Energy 20 by employees of Headwaters Energy at the Westcliffe home of Lou and Betsy Puls. American Zephyr Corp. Westminster Wind Energy 30

29

CHAPTER SIX – MARKET TRANSFORMATION

Market Transformation

A key ingredient to building a New Energy Economy was never letting up. Other bills further strengthened the One bill expanded the renewable energy renewable energy market, while the state standard to 30 percent by 2020 for investor- Entering the final year, Governor Ritter’s administration continued to move energy office advanced efforts to ease owned utilities. It also included a critical aggressively, working with lawmakers to pass the two most important pieces barriers to development of small hydro component that said 3 percent of Xcel of energy legislation in the Governor’s tenure. One of those further increased the electric and geothermal projects in coming Energy’s energy supply must come from years. The Governor continued to barnstorm so-called “distributed generation,” that state’s Renewable Energy Standard, pushing it up to a nationally front-running the state, the country and points overseas being from rooftop solar, small hydro, 30 percent. Another landmark measure called for the conversion of Denver and talked often of the need for states small wind and other systems not part of to lead the way on climate and clean large, utility-scale plants. Such a provision metro-area power plants to cleaner-burning fuel, such as natural gas, as a way energy – all while pitching Colorado ensured a predictable marketplace for to stay ahead of increasingly stringent federal air pollution regulations. as a welcoming place for clean renewable energy for years into the energy companies. future, and strengthened Colorado as a major center for solar energy and other Landmark legislation renewable companies that thrive on market The administration believed two additional certainty. One study found that, over the steps were needed to solidify the New lifetime of the systems, 1,000 megawatts of Energy Economy and sustain its momentum “distributed” solar energy would generate going forward. Two bills - one to again enough power for 146,000 homes, create expand the renewable energy standard and more than 33,500 jobs and produce $4.3 another to replace coal with natural gas - billion in total economic output. may prove to be the most significant actions of Governor Ritter’s four-year term in office. The measure gave Colorado one of the two And remarkably, both bills were passed with highest renewable energy standards in Photo, Left the support of the state’s largest utility, the country, and its passage reflected the PHd. student, Syndi Nettles-Anderson works on an alternative fuel engine for vegetable oil Xcel Energy - the organization most affected wisdom of the state’s step-by-step approach at the Colorado State University Engines and Energy Conversion Laboratory in Fort Collins. by the measures. to building the New Energy Economy, 31 CHAPTER SIX – MARKET TRANSFORMATION

beginning with the 10 percent standard in Xcel Energy once opposed a renewable that. And that’s why it was easier to tell the to bring the state into compliance with 2004. “It can be worth passing measures energy standard for Colorado, especially one governor that we could probably take a good federal Clean Air Act requirements that might seem terribly incremental. with solar energy requirements, believing it shot at 30 percent,” said Dick Kelly, Xcel while maximizing benefits for Colorado This is a case where you get the camel’s would be too expensive for customers. But Energy’s chief executive. consumers. The Act required Xcel Energy nose under the tent and people realize the the state’s gradual approach on a standard to dramatically reduce air pollutants by sky did not fall, and in fact, great things changed the utility’s view. “It turned out The new RES and strengthened rules retiring, retrofitting or repowering metro- happened; you can then steadily build on that we were wrong and that (and) it guiding oil and gas drilling set the stage for area coal-fired power plants by the end that progress,” said the Governor’s Climate became obvious we could do the 10 percent another revolutionary law incorporating of 2017 and replacing them with facilities Change Advisor, Alice Madden. “The building and blow through it. We went back and said more natural gas into Colorado’s diverse fueled by cleaner-burning natural gas and block approach in a state that’s not solidly let’s go up to 20 percent because we can do energy economy. The Clean Air-Clean Jobs other low- or non-emitting energy sources, progressive is a very strategic way to proceed.” Act created a comprehensive process

emissions that have also been found Environmental Protection Agency K E Y S TO T HE N E W E NERGY E C O N O M Y to harm the ecology of the state’s to deal with local air pollution Clean Air-Clean Jobs Act jewel: Rocky Mountain National Park. challenges. Significantly, the approach made But executing the bill required a tough It was – along with setting a 30 percent on the state’s Western Slope. “If winners out of an unusual coalition, political decision from Governor renewable energy standard – the (residents and activists) know the including key Republican lawmakers Ritter: setting aside the concerns of boldest policy advance of the Ritter drilling is going to proceed responsibly, that had been critical of Governor the state’s powerful coal lobby. “My administration. The Clean Air-Clean they’re going to be more at ease Ritter’s efforts to impose tough rules approach was always to try and get Jobs Act of 2010 united the state’s supporting natural gas” fueling large on natural gas drilling. “Gas folks as much stakeholder agreement as largest utility, environmentalists and power plants,” said Governor Ritter’s wanted to increase the use of gas,” possible, but there are just certain the natural gas industry to set a target climate change adviser, Alice Madden. Xcel Energy lobbyist Mike Beasley things in this world and in this date of 2017 for taking 900 megawatts said in a media interview before the building (the Capitol) where people of coal-based power off-line in Motivating the legislation were bill was signed. “Environmentalists are not going to agree with you,” Colorado, to be replaced by natural gas a desire to increase markets for wanted a cleaner, better utility Ritter said. “The coal interests said or other cleaner fuels, and making a Colorado’s homegrown natural fuel. And utilities wanted a cleaner they wanted a one-year study (of the dramatic cut in air pollution for a state gas, reduce air pollution tied to fuel but wanted to do it in a cost- proposal). My sense is that wouldn’t that prizes (and markets) its clean, decades-old power plants near the effective manner. Policy-wise, it was have gotten it done. I appreciate Rocky Mountain air. state’s major population center and one of those rare perfect storms.” having a broad group of stakeholders, proactive compliance with tightening The measure also appealed to some but at times if you broaden it wide Key to making this work in Colorado federal health and environmental limited-government conservatives, enough, there are people who will lie was, first, to develop tighter regulations for ground-level ozone who saw it as a smart way to head down in front of the train.” regulations on the gas drilling and regional haze. The change has off intervention from the U.S. industry, which has a heavy presence the complementary effect of reducing

32 CHAPTER SIX – MARKET TRANSFORMATION

including increased energy efficiency that nobody was out to get somebody else, Survey to assist updating and expanding in both the traditional energy and clean- measures. The bill had bipartisan support, and that this was not a ‘zero-sum game.’ the mapping of geothermal hotspots in tech practice. including Republicans from regions rich in Developing that level of trust among Colorado, and providing developers with with natural gas resources on the state’s stakeholders that weren’t natural allies in technical assistance. A key theme and one relevant to Western Slope. the past made all the difference in really policymakers interested in implementing moving the serious parts of the New Energy The state also worked with federal agencies, such efforts involved the need for states Natural gas plants play an important role in Economy agenda.” including the Bureau of Land Management and local governments to lead the way the New Energy Economy, too, because they and the Federal Energy Regulatory in moving to a clean energy future, can be readily integrated with wind energy. In all, lawmakers passed nearly 60 pieces Commission, to develop memorandums and not just wait for Congress to act. “As wind increases or decreases, you want of New Energy Economy legislation during of understanding designed to reduce Though analysts agree that congressional to have another generator you can toggle Governor Ritter’s term. The landmark barriers to develop of geothermal and small movement on carbon limits or the creation up or down, and you can do it much more steps taken in 2010 were a capstone finish. hydroelectric projects while maintaining of a national renewable energy standard are easily with gas plants,” said Paula Connelly, “Those two pieces coming into place in high-level environmental protections. crucial steps, Governor Ritter said it so far an attorney with Xcel Energy. “One benefit we the final year was no accident. It was The administration also worked with has been up to state governments to take see from the Clean Air-Clean Jobs Act is this after four hard years of work and a lot of lawmakers on bills to lower a variety of the actions that federal lawmakers will not. should enable us to integrate more wind.” groundwork that was laid,” said Pam Kiely hurdles at the state level for such projects. of Environment Colorado. In July of 2009, Governor Ritter testified A big key to building support for the Barnstorming before the U.S. Senate Committee on measure was the administration’s efforts More key policy steps A potentially overlooked factor in driving Environment and Public Works: “As in the previous years to develop stronger The administration executed other Colorado’s New Energy Economy was Congress debates energy and climate environmental protections around oil and important tasks to strengthen the clean Governor Ritter and his administration’s legislation, it may be helpful for you to hear gas drilling. With those in place, it was energy marketplace. The legislature passed relentless promotion of what the state was how these laws are working at the state and easier to build support from conservation a bill to ease the creation of “solar gardens” executing and accomplishing. He testified local levels. In Colorado, our New Energy groups even though the Act would increase – which gives people who may rent or twice before Congress, addressed national Economy is creating new jobs, attracting demand for natural gas.“We went through a whose property doesn’t have good access and international conferences, advocated new companies and leading the way to a war, but ended up with very thoughtful and to solar energy that ability to tap into solar to officials at the federal level and spoke to new energy future for America. This didn’t balanced rules for oil and gas drilling. That power, through ownership or participation countless groups and meetings in Colorado happen by accident.” really opened the door and allowed for the in an off-site project. Another bill called about the importance of the New Clean Air-Clean Jobs Act,” explained deputy for Colorado State Parks to be a “net-zero” Energy Economy. Governor Ritter cited dozens of laws chief of staff Weil. energy user by 2020, so that as much energy passed in Colorado to move the state into is produced from renewable sources as is The Governor’s tireless effort to drive the the energy future: “Laws that encourage Getting diverse players to the same place consumed by the agency. theme home has made an undeniable manufacturing; laws that increase demand was crucial. “Some of our success in the impact. “Perhaps the Ritter Administration’s for renewables; laws that make them more clean-energy economy was getting to the The Governor’s Energy Office took additional greatest legacy will be in reaching such a affordable. We even passed a law that lets point where our table included fossil-fuel steps to lay the groundwork for geothermal broad spectrum of sectors and creating residents sell excess electricity back to their industry and natural gas, environmentalists, and more small hydro-electric projects consensus that a New Energy Economy is utility company. … Colorado’s New Energy utilities, a variety of people from legislative in the state. The GEO funded a full-time not only good for our environment, but is Economy can be a model for all of America. constituencies,” explained Governor Ritter. professorship at the Colorado School of the foundation of a truly sustainable 21st- Our New Energy Economy can be America’s “And then developing a certain amount of Mines as well as an expert geologist in a century economy,” said Roger Freeman, a New Energy Economy.” trust among all the players – (signaling) full-time position at the Colorado Geological long-time Colorado attorney with deep roots

33 CHAPTER SEVEN – CONCLUSION

Conclusion

“Just as the industrial revolution created the jobs of the 20th century, we now “We have a story to tell in Colorado. We’re a New Energy Economy – one that proud of that story,” Governor Ritter told a keeps and creates jobs in the United usher in a new century of innovation, creativity and entrepreneurial vigor. The New Washington D.C. forum in the fall of 2010, States, insulates citizens and businesses Energy Economy is creating the pathway to these careers and a new American near the end of his term. “We don’t think it’s against the rising costs of dwindling and century of leadership.” – Colorado Governor Bill Ritter Jr. the end of that story at all. It’s really only high-demand fossil fuels, protects our the beginning.” environment and climate, keeps American on the front-edge of global competition, Colorado was a state ready to embrace a Through policies, vision and action, We hope this document provides and helps guide the country along the road new direction. Governor Ritter seized on Colorado has become a national leader in policymakers, governors, planners and other to a more secure, stable, sustainable and that public desire and set about positioning charting a new energy future. The Ritter decision-makers with a road map that will affordable energy future. Colorado for a change that is not just administration built markets for renewable accelerate the nationwide development of coming – but one that is here today. Under energy and energy efficiency companies Governor Ritter, Colorado has built a New through policies that made Colorado a Energy Economy that creates jobs, increases magnet. It broadcast its vision to the world, energy security and keeps Colorado and and recruited hard, signaling to researchers, the United States competitive with a world entrepreneurs, executives and investors that moving quickly to adopt cleaner, renewable the state supported their clean energy and and homegrown sources of energy. energy conservation work and they could find a home in the Rocky Mountains.

Photo, Right A drill rig is set up for a geothermal project in Vicente Apodaca carries solar panels at the Greater Sanhill Solar Project front of the state capitol in downtown Denver. being constructed by SunPower Corporation outside of Alamosa.

34 Note: 1/2” flap for gluing back pocket. 57 Pieces of New Energy Economy Legislation

1. HB07-1037, Energy Efficiency Rebates 17. SB07-126, Funding for the 32. SB08-186, Colorado Carbon Fund 47. SB10-100, Cross-Boundary for Consumers (Levy/Fitz-Gerald) Collaboratory (Keller/Pommer) Special License Plates (Johnson/Levy) Energy Improvement Districts 2. HB07-1060, Bioscience Research Grants 18. SB07-145, Local Incentives for 33. SB09-51, Renewable Energy Financing (Schwartz/Miklosi) (Riesberg/Shaffer) Renewable Energy (Tupa/Gibbs) Act (Carroll/Levy) 48. HB10-1333, Green Jobs Colorado Program 3. HB07-1087, Wind for Schools Grant 19. SB07-246, Clean Energy Fund 34. SB09-075, Low-Speed Electric Self- (Vigil/Schwartz & Newell) Program (A. Kerr/Romer) (Fitz-Gerald/Buescher) Propelled Vehicles (Schwartz/Marostica) 49. HB10-1342, Community Solar Gardens 4. HB07-1145, Renewable Energy Development 20. HB08-1160, Net Metering & Rural 35. SB09-092, State Motor Vehicles Use (Levy/Williams) on State Lands (Merrifield/Gordon) Electric Utilities (Solano/Shaffer & Isgar) Natural Gas (Kopp/Marostica) 50. HB10-1349, Renewable Electricity for 5. HB07-1146, Energy Conservation 21. HB08-1164, New Solar Energy 36. SB09-124, Extend Ag Energy-Related Parks (Fischer & Pace/Schwartz & Tapia) Building Codes (Levy/Gordon) Technologies (Solano/Schwartz) Projects (Isgar/Roberts) 51. HB 10-1418, Community-Based 6. HB07-1150, Clean Energy Authority 22. HB08-1207, Procure Environmentally 37. SB09-297, Expedite Federal Stimulus Renewable Energy Projects (C. Gardner/Kester) Preferable Products (Kefalas/Bacon) Act Projects (Sandoval/Judd) (McFadyen & Bacon) 7. HB07-1169, Net Metering (Solano/Shaffer) 23. HB08-1270, CICs Allow Energy 38. HB09-1126, Encourage Solar Thermal 52. HB 10-1431, Renewable Energy Facility Property Tax Valuation (McKinley/Penry) 8. HB07-1203, Energy Management Efficiency Measures (A. Kerr/Tupa) Installations (Hullinghorst/Shaffer) Conservation Studies (Fischer/Romer) 24. HB08-1350, Financing Renewable 39. HB09-1149, Solar Home Pre-Wire 53. SB10-019, Property Tax on New Hydro- Electricity Facilities (Schwartz/Fischer) 9. HB07-1228, Renewable Fuel Crops Energy (Madden/Romer) (Merrifield/M. Carroll) (C. Gardner/Shaffer) 25. HB08-1368, Tax Prop. Used to Prod. 40. HB09-1331, Innovative Auto Act 54. SB10-174, Promote Geothermal Renewable Energy (Buescher/Brophy) (Gagliardi/Boyd) Energy Development 10. HB07-1279, Tax Credits, Renewable (Schwartz/Massey & Scanlan) Energy Machines (McKinley/Romer) 26. HB08-1387, Low-Income Energy 41. HB10-1001, Renewable Energy Standard Assistance Funding (Buescher/Veiga) (Tyler & Schwartz/Whitehead) 55. SB10-177, Promote Biomass Energy 11. HB07-1281, Renewable Portfolio Development (Schwartz/Scanlan) Standard (Schwartz/Pommer & Witwer) 27. SB08-078, Energy Efficiency Hist. 42. HB10-1365, Clean Air-Clean Jobs Act Preserv. Grant (Renfroe/Sonnenberg) (Solano/Roberts & Schwartz/Penry) 56. SB10-180, Colorado Smart Grid Task 12. HB07-1309, School Energy Efficiency Force (Williams/Kerr) (Weissmann/Tupa) 28. SB08-081, Renewable Energy Authority 43. HB10-1098, REA Electric Co-op Board (Schwartz/Madden) of Director Elections (Levy/Hodge) 57. SB10-207, Financing State Energy 13. HB07-1379, County Enviro. Sustainability Efficiency Projects (Johnston/Romer) Program (Weissmann/Tupa) 29. SB08-117, Limit Local Bldg. Permit Fee 44. HB10-1182, Transmission Facilities and 14. SB07-51, High Performance State Solar Panels (S. Mitchell/McNulty) Clean Energy Project (Solano/Schwartz) Buildings (Gordon/Witwer) 30. SB08-147, Increase Energy Efficiency 45. HB10-1267, Property Tax on 15. SB07-91, Renewable Resource State Buildings (Gordon/Hodge & Levy) Independently-owned Residential Solar Generation Areas (Schwartz/Massey) 31. SB08-184, Colorado Clean Energy (Kerr/Romer) 16. SB07-100, Energy Transmission Finance Program (Romer/Levy) 46. HB10-1328, New Energy Jobs Development (Fitz-Gerald/McFadyen) Creation Act (Miklosi/Schwartz)

For more information on The New Energy Economy, visit www.rechargecolorado.com

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