Only advanced nuclear generation will make Pueblo's economy whole after Comanche 3

Only advanced nuclear generation will make Pueblo's economy whole after Comanche 3

Op-ed Published in the Pueblo Chieftain 1/14/2024

The closure of Comanche 3 in 2031 will have serious negative impacts on Pueblo workers, county and city governments, school, fire, library and conservation districts, and the Pueblo economy.

In 2031, Holy Cross Electric and CORE, part owners of Comanche, will stop paying almost $6 million in property taxes. While Xcel Energy has agreed to make a $15.9 million payment in lieu of taxes for 10 years, Pueblo must start planning now for how Pueblo can make up for the loss of these taxes and the highly paid jobs that Comanche has provided to its workers for decades.

After 10 months of study and analysis with the help of independent experts, the Pueblo Innovative Energy Solutions Advisory Committee (“PIESAC”) has come to the conclusion that only advanced nuclear generation will make Pueblo whole from the losses it will suffer when Comanche 3 closes. Advanced nuclear provides 200 to 300 jobs paying $60,000 to $200,000 a year and annual property taxes of $95.3 million. Our second recommendation, a new combined cycle gas plant with carbon capture, would provide 20-25 jobs paying $80,000 to $120,000 a year and annual property taxes of $16.52 million. On the other hand, a new solar farm produces 5 to 10 jobs paying $40,000 to $80,000 a year and annual property taxes of $1.69 million a year.

As part of our study, the Keating Group conducted a poll which indicates that over 66% support the construction of advanced nuclear in Pueblo.

We are the co-chairs of PIESAC. Xcel Energy established PIESAC to obtain recommendations for the types of zero- or low-emission technologies that could replace Comanche 3. Our 11 members (representing labor, community leaders in education and business development, former elected officials, and a former regulator at the Colorado Public Utilities Commission) listened to presentations and data from outside experts and company experts, Tetra-Tech conducted public outreach and obtained stakeholder involvement through focus groups, one-on-one interviews and open houses.

Dr. Wakefield of the Healy Center at Colorado State University Pueblo concluded that Comanche 3 is one of the most economically impactful industries in the Pueblo community with a total annual impact of over $196 million a year. Xcel Energy and the other owners of Comanche 3 pay a total of $31 million in property taxes to Pueblo County each year. Pueblo County then allocates these payments to the operating budgets of the county, the city of Pueblo, the school districts, fire, library, and conservation districts. Workers and these community groups will suffer if there is not a replacement for the high-paying jobs and tax payments that Comanche 3 provides.

In order to reduce emissions, state law requires Xcel Energy to close all three coal units at the Comanche station. Comanche 1 closed in 2022. Comanche 2 will close in 2025. Comanche 3 will close no later than January 1, 2031. These closures will reduce Xcel’s Energy’s emission of CO2 by 36.8% and will reduce Colorado emissions by 20.5%. In addition, the closure of the Comanche station will result in the annual reductions of 3,000 tons of Sulfur Oxide and 4,300 tons of Nitrogen Oxides. By agreeing to the early closure of these three Comanche units, Pueblo residents will make a larger contribution to emission reductions in the state of Colorado than any other community. Pueblo should be proud of its contribution to the health of the citizens of Colorado and protecting the health of our planet. However, these benefits for the rest of the state come with great costs for the Pueblo community.

We considered numerous zero or low emission technologies. In our goal to make Pueblo whole, we kept an open mind and took nothing off the table. The choice was clear — 200 to 300 high-paying family supporting jobs and $95.3 million a year in property taxes. Only an advanced nuclear plant will make Pueblo whole from the losses it will suffer with the closure of Comanche 3. Advanced nuclear will provide Pueblo an opportunity to be a leader in the clean energy transition and to prosper.

Pueblo is rich in community spirit and has been a loyal partner in reducing emissions for all the citizens in Colorado. Pueblo, however, has a high rate of poverty. It ranks in the bottom quarter of per capita personal income —50th of 64 counties in the state.

Tatiana Bailey, the executive Director of Data Driven Economic Strategies who prepares the economic dashboard for the City of Pueblo recently explained that there are few high-paying jobs in Pueblo and Pueblo is not regarded as a high tech community that attracts high-paying jobs and companies.

A review of the budget for the City of Pueblo for the last several years shows that sales taxes are down, and the City has been spending more than it takes in. As a result, the City of Pueblo has been tapping into the reserves in its general fund — an additional $10 million in 2024, so that the general fund will be reduced to $20 million with some of those funds restricted.

Advanced nuclear generation in Pueblo would be a game changer for the community. Pueblo could be a leader in the clean energy transition. The high-paying jobs and tax payments could provide the city and the county with enough resources to fund numerous services and facilities in Pueblo.

Having no plan about how to replace the $6 million in taxes that will go away in 2030 is reckless. Having no plan about how to replace the additional $15.9 million in taxes in 2040 is reckless. Replacing the loss of $15.9 million in taxes would require the construction of 7,950 new homes paying $2,000 a year in property taxes to offset that loss. Or Pueblo could develop a plan to attract 1,590 new businesses paying $10,000 a year in property taxes. Adding another 7,950 homes and or adding another 1,590 new businesses is not likely to occur, which is why the community needs to start planning now.

It takes a long time to do big things and replacing high-paying skilled jobs and taxes from Comanche is a big thing. We hope that the members of the Pueblo community will analyze and study the concerns that PIESAC has laid out and the recommendations that we have made. We believe that the community will come to the same conclusions. Only advanced nuclear will make the community whole from the economic damage caused by the closure of Comanche 3 and provide Pueblo a path to prosper and lead.