American Oil and Gas Reporter - August 2019 - 39

velopment raised calls for city council
replacements in the next election, the
reports notes.
Rocky Start
COGCC has scheduled a series of 11
rule-making hearings through the end of
2020, with the Air Quality Control Commission to hold an additional six rulemaking hearings in September.
COGCC says it has convened hearings
to consider changes to the 500 series
regulations covering administrative hearings, anticipated by some to be simple
and noncontroversial. Instead, testimony
over the two-day session reflected the
ongoing antipathy carried by opposing
sides of the issue. Ultimately, the commission voted to postpone a decision
until its July 31 meeting.
According to a schedule released by
the commission in June, subsequent rulemaking sessions will tackle alternative
site assessments, local government provisions, a technical review board, wellbore
integrity, flowlines, cumulative impacts,
public health, safety, welfare and the environment, financial assurance, application
fees, worker certification, and the incorporation of rule changes adopted by the
Department of Public Health and Environment, if necessary.
For its part, the AQCC says it will
hold rule-making hearings to consider
changes to its Series 7 rules including
LDAR, pneumatics, performance standards
for transmission facilities, tank threshold
standards and statewide emissions inventories.
COGA will remain engaged in the
rule-making process to the end, Frommer
says, adding, "We are providing information and useful advice to the COGCC
staff to help give their recommendations
real value."
Frommer praises Jeff Robins, new director of the oil and gas commission, for
giving every stakeholder a voice at the
hearings. "However, he should learn to
filter through some of the noise and focus
on what's important. At the end of day,
the commission must come through with
workable rules. I am optimistic it can do
just that," he says.
Debt Shifted
In addition to new regulations of the
oil and gas industry, Colorado legislators
approved several bills designed to accelerate the state's shift to a low-carbon energy economy.
In early July, media reports indicate
that research into early retirement of the
state's coal-fired power plants under a

newly passed law allowing utilities to refinance debt would saddle ratepayers with
higher electricity costs for decades. Using
a securitization funding mechanism, the
law allows Colorado utilities to pass debt
to ratepayers that otherwise would be
amortized over the life of a coal plant
when the plant is closed early. The utility
then can switch to renewable energy
sources, driving demand for new wind
and solar plants.
According to a published report, the
Sierra Club estimates that XCEL Energy,
the state's largest utility, could realize
savings of $476 million over 20 years by
securitizing debt from closed coal plants.
However, the Institute for Energy Economics and Financial Analysis notes the
law provides the financial mechanism
and does not include mandates or timelines
for plant closures.
Because it is a company's decision
whether to apply to the Public Utilities
Commission for plant closure, "there is
no incentive to close anything faster,"
said Tom Sanzillo, director of finance at
IEEFA, told a Denver newspaper. Ratepayers could be billed for "economically
worthless assets" because the new law
does not set limits on how much debt a
utility could securitize, he added.
With Governor Polis leading Colorado's
charge into a low-carbon future, there
are important questions regarding energy
production that cannot be ignored, Frommer declares. "The governor said he believes SB 181 will end the state's oil and
gas wars. I sure hope so," he says. "We
can have a wonderful environment and a
viable oil and gas industry."
Growing Impact
In June, COGA released its second
annual Community Impact Report summarizing the contributions Colorado's
oil and gas industry makes to local nonprofits and community organizations.
For the preceding 12 months, the association says its members have contributed
more than $17 million in cash and nearly
71,000 volunteer hours.
The oil and gas industry has "gone
above and beyond in supporting our mission with generous philanthropic outreach
and countless volunteer hours," says Terry
Adams, executive director of the Boys
and Girls Clubs of Weld County.
The report highlights the industry's
leadership on issues Coloradans care
about, Haley notes. Produced from the
responses of 62 COGA member companies, the report "showcases the overwhelming commitment of our members
and their employees to Colorado."
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American Oil and Gas Reporter - August 2019

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