Rail Repairs Mean Higher Utility Bills for Xcel Energy Customers in Colorado
Posted on: Thursday, 7 July 2005, 00:00 CDT
Jul. 6--Colorado customers of Xcel Energy face higher utility bills because railroad repairs have slowed the flow of Wyoming coal through at least November.
Xcel will continue to produce ample power for customers, but the slowdown will force an undetermined hike in coming bills, Xcel spokesman Mark Stutz said.
Three Colorado power plants that use coal from Wyoming's Powder River Basin are switching to natural gas for a portion of their electric generation, he said.
"Natural gas is more expensive (than coal), and it will increase our costs," he said. "But from a reliability standpoint, we don't see any impact on our customers."
Union Pacific Corp., the largest U.S. railroad, said it is cutting coal shipments from Wyoming mines as much as 20 percent until November -- and possibly into 2006 -- while repairs are made to tracks along the busy Wyoming line.
The shipments have been slowed since two derailments in May. Record rain and snow weakened portions of the 107 miles of track jointly used with competitor Burlington Northern Santa Fe Corp.
Each of the three Xcel plants that burn Wyoming coal -- Comanche in Pueblo, Pawnee in Brush and Arapahoe in south Denver -- can switch to natural gas with no loss of power production, Stutz said.
Five other Colorado power plants owned or operated by Xcel use coal from Colorado or Montana.
Xcel won't be able to calculate the effect on customer bills until it purchases the extra natural gas and determines when full coal shipments will resume, Stutz said.
Union Pacific said on its Web site it will allocate shipments among utilities, filling 80 percent to 85 percent of demand. Repairs may stretch into next year if the area has a wet summer or an early winter that limits work time, spokesman Robert Turner said.
Bloomberg News contributed to this report.
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XEL, UNP, BNI,
Source: The Denver Post
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