Colorado utility regulators are holding evidentiary hearings on how Xcel Energy should charge data centers and other very large new customers. The case is Colorado Public Utilities Commission Proceeding No. 26AL-0137E, and it will set the terms for Colorado's largest utility to serve new loads of 50 megawatts or more. It will also decide how much of the cost of new transmission, substations and generation those customers must cover.

According to The Colorado Sun, the hearings were set to begin on Wednesday, Oct. 21. Rocky Mountain Voice reported the full evidentiary schedule as Oct. 21, 22, 26, 27 and 28, with a public comment hearing on Oct. 20. It also reported that the commission has not set a decision date.

The parties disagree on several points: how long large customers should be locked into contracts, how costs are split between them and everyone else, and whether a faster "Speed-to-Market" option weakens the protections the tariff is meant to provide. Below is a guide to what is on the table, based on the filings and reporting available.

What did Xcel file?

Public Service Company of Colorado, Xcel's Colorado utility, filed the proposal on April 2 as Advice Letter No. 2018-Electric, according to Rocky Mountain Voice. The docket caption appears on an intervenor hearing exhibit posted by Earthjustice. It describes the filing as revising Colorado P.U.C. No. 8 Electric Tariff "to address large loads, add a new Schedule Transmission Large Service (Schedule TL) rate, add a new Clean Transition Tariff (Schedule CTT), and implement changes to the Transmission Line Extension Policy." The caption lists a proposed effective date of May 3, 2026. That date has passed, and the hearings began after it.

In its April 2 announcement, Xcel said the tariff would require large customers such as data centers to pay for the power infrastructure needed to serve them, covering electric transmission, substations and interconnection upgrades as well as new generation, so that existing customers are not paying for the needs of those large customers. The company said large customers would have to make long-term contractual commitments, typically 15 years or more, and that financial security requirements would add protection if a project is delayed, scaled back or not completed.

Who would it cover?

Xcel's announcement says the tariff would apply to new customers, or significant expansions of existing load, of 50 MW or more. It adds that new customers using between 20 and 50 MW may also be subject to it. The Colorado Sun reported that the tariff would apply to new customers needing 50 megawatts or more, and that each would pay a $120,000 application fee to cover Xcel's costs in handling the request and doing the necessary studies.

What are the key terms?

As summarized by Rocky Mountain Voice, the proposed Schedule TL includes:

  • Contracts of 15 years or longer;
  • An 80% take-or-pay minimum billing demand, meaning a customer pays for at least 80% of its contracted demand whether or not it uses that much;
  • Credit collateral requirements;
  • Early-exit fees;
  • An optional Clean Transition Tariff; and
  • A Speed-to-Market pathway.

The Colorado Sun added that, in a filing, Xcel said the monthly minimum bill for a 500-MW data center could be $22 million. It also reported that a customer would have to provide a credit guarantee, such as 60 months of minimum bills, and that a customer wanting out of its contract would pay an exit fee equal to the sum of the remaining monthly bills.

Where do the parties disagree on contract length?

The Colorado Sun reported three different positions on contract term. Xcel proposed 15 years. The PUC's own staff recommended 20. The Data Center Coalition proposed 10. Rocky Mountain Voice reported further positions: Walmart supports the 15-year term, while the Conservation Coalition, made up of the Natural Resources Defense Council and the Sierra Club, proposes a tiered term reaching 25 years for loads above 100 megawatts.

Contract length matters because it sets how long a large customer is on the hook for the grid investments made to serve it. A longer term gives other ratepayers more protection if a project leaves. A shorter term gives the customer more flexibility.

What is Google arguing?

Google intervened and filed testimony from its witness, Dr. Carolyn Berry, according to Rocky Mountain Voice. Berry testified that the "higher-of" cost allocation method in the proposal is "biased, internally inconsistent, and not reflective of the cost to serve," and that it produces what she called a "substantial reverse subsidy." In other words, she argued that large-load customers would pay more than their share, not less. Rocky Mountain Voice reported that in one growth scenario based on Xcel's own modeling, she put the overpayment at $517 million over six years. That number is a litigation position presented by an intervenor's witness. It is not a finding by the commission.

Why is the Speed-to-Market pathway contested?

The Colorado Sun described the pathway as one that would let Xcel and a developer negotiate a confidential contract that would not necessarily carry the tariff's safeguards and would require rapid PUC approval. Xcel's Jack Ihle, its vice president for data centers and large loads, said in PUC testimony that the concept is needed to provide an option for large-load customers who require greater commercial flexibility. Eric Frankowski, executive director of the Western Clean Energy Campaign, told the paper that it could "potentially undermine the tariff."

According to the Sun, Xcel has since renamed these agreements "custom contracts," and under its proposal the PUC and other parties would have 120 days to review one. Xcel's Michael Pascucci said in testimony that a custom contract would remain consistent with the company's core commercial terms, including cost responsibility, minimum commitments and risk protections. The state's utility consumer advocate, Joe Pereira, said outside review would be limited by the tight timeframe and by how much of the detail is confidential.

What are other intervenors asking for?

Rocky Mountain Voice reported that intervenors include Walmart, the City and County of Denver, the City of Boulder, the electric cooperative United Power, the state energy office and PUC trial staff.

Rewiring America and the Southwest Energy Efficiency Project (SWEEP) filed answer testimony from Alexander Squires Lopez, dated Aug. 19. It was entered as Hearing Exhibit 1100, a 48-page document, as posted by Earthjustice. In it, the witness recommends revising the eligibility criteria for Schedule TL, including lowering the proposed threshold from 50 MW to 20 MW, and expanding Clean Transition Tariff eligibility to additional clean energy and demand-side resources that provide measurable, verifiable system value, with safeguards. These are intervenor positions, not findings by the commission.

What is the local backdrop?

The tariff case is moving forward as communities push back on data centers. According to The Colorado Sun, eight Colorado municipalities and counties have enacted or are considering moratoriums or caps on data centers. The paper also reported that a petition signed by nearly 5,000 Colorado residents was delivered to the PUC on Oct. 15.

A note on sourcing

DataCenterFeed did not read the Colorado PUC docket directly. The docket caption and filing details here come from an intervenor hearing exhibit filed in the proceeding, read through a copy posted by Earthjustice, along with Xcel's own announcement and reporting by The Colorado Sun and Rocky Mountain Voice. Hearing dates and party positions are attributed to those outlets.

What Happens Next

The remaining evidentiary hearing days are Oct. 26, 27 and 28, according to Rocky Mountain Voice. That outlet reported that the commission has not set a date for a decision. The Colorado Sun described the commission's task as deciding whether Xcel's tariff protects other customers. Contract length, the cost allocation method and the Speed-to-Market pathway are all in dispute before the commission.

Sources