Colorado’s Coal Exit: IEEFA Urges Renewables and Battery Storage Over Costly SMRs and Carbon-Capture Gas

As Colorado moves to phase out coal-fired electricity generation, the state is weighing its options carefully amid concerns over cost, construction timelines, and reliability. A recent report by the Institute for Energy Economics and Financial Analysis (IEEFA) warns that new nuclear reactors or gas-fired plants with carbon capture could delay the transition and increase costs for ratepayers and taxpayers.

Public Service of Colorado (PSCo) is currently evaluating alternatives to replace output from Unit 3 at the Comanche coal-fired power plant in Pueblo, which is scheduled for shutdown in 2030. The IEEFA report notes that carbon capture for gas-fired plants remains an unproven technology prone to underperformance, while traditional nuclear projects often face long construction timelines and significant cost overruns. Small Modular Reactors (SMRs), which have yet to be built in the U.S., are expected to encounter similar challenges, making them a potentially unreliable solution for the state’s near-term energy needs.

“Renewable energy like solar and wind resources are already available and quickly deployable options to meet electricity generation needs,” said David Schlissel, former director of resource planning and analysis at IEEFA and lead author of the report. He emphasized that Colorado and other coal-reliant states should be cautious about adopting technologies that may not materialize in time to address the climate crisis.

The report concludes that Colorado faces a clear choice: pursue unproven, expensive options with uncertain commercialization timelines, or accelerate deployment of cost-competitive wind, solar, and dispatchable battery storage to meet electricity demands and climate goals efficiently.