Report examines Colorado’s rising electricity prices and economic impact

Common Sense Institute Colorado (CSI) has released a report analyzing the projected rise in electricity prices in Colorado and its potential impact on households, businesses, and the state’s economy. The findings provide a data-driven look at the economic ripple effects of the state’s energy transition goals.

“Colorado households will each pay up to $9,200 to meet state policy mandates to reduce greenhouse gas emissions — this equates to three to four paychecks for the average Coloradan or four to six months of rent. ,”said Kelly Caufield, executive director of the Common Sense Institute. “Given the high cost of living in Colorado (14th highest in the country), and the bipartisan interest in making Colorado more affordable, it is critical that energy policy discussions account for anticipated costs to consumers.”

The CSI report shows that electricity prices will surge because of large investments in wind and solar, not because of natural gas. The state’s report, which CSI analyzed, estimates that wind and solar will need to provide over 70% of Colorado’s electricity.

Key Findings

Electricity Prices to Rise Significantly By 2040: Due to state mandates, electricity prices are projected to grow at more than 3X the rate of inflation and nearly 13X the historical growth rate seen between 2010-2020.

• $6,400 – $9,280 more per household
• $41,700 and $60,200 per commercial business
• $771,000 to $1.1 million per industrial business

Higher electricity prices cause economic ripple effects: By 2030 Colorado’s economy could see a GDP slowdown of $2.6 billion annually.

The state could see 25,000 fewer jobs.

Questions remain on the full cost and feasibility of the power sources needed to comply with state policy: The state’s report estimates that wind and solar will provide over 70% of Colorado’s electricity. However, that level of renewables relies on the untested assumption that remaining gas power plants will only need to run “a few hours each year.”

“The data reflects the economic pressures Colorado’s mandates to reduce greenhouse gas emissions will create on household electricity prices ,” said Caufield. “Electricity prices increasing at this pace will not only affect household budgets but also reduce overall economic output and job growth.”