Rocky Ford electrification pilot relies heavily on federal incentives; commission hears uncertainty about execution

The Rocky Ford whole‑home electrification pilot discussed at the Colorado Public Utilities Commission hearing on Oct. 31 is structured so that most incentive dollars come from external programs, company and intervenor witnesses said.

Company witness Will Cottrell said the Rocky Ford pilot as modeled assumes Black Hills Colorado Gas would pay administrative costs of about $40,000 per year, the electric utility would add roughly $80,000 per year for implementation, and the bulk of per‑participant incentives would be supplied from other sources. "All of the incentive dollars are coming through the Colorado Energy Office, as a result of federal dollars," Cottrell told commissioners.

Eric Haglund of PUC staff testified the electrification study and the Rocky Ford pilot are complementary: the staff hopes the study will provide territory‑specific evidence that could narrow differences among parties on costs and assumptions, and the pilot could provide implementation experience. Haglund acknowledged, however, that an electrification study alone might not resolve legal or incentive‑structure questions that affect a gas‑only utility’s willingness to implement BE programs.

Keith Hay, managing director of policy at the Colorado Energy Office, told the commission the CEO’s federal allocations for home electrification and home‑efficiency rebates are fully obligated statewide and the office is close to launching those programs. Hay said CEO staff told him the federal rebates were designed to be stackable with state and local incentives but cannot exceed total project cost. "Those dollars are fully obligated to the Energy Office, and we are getting very close to being able to open the door on those programs," Hay said. He added the CEO intends to coordinate outreach with the utilities.

Haglund and other parties noted the pilot’s reliance on federal funding raises contingency questions: if federal funds do not flow or take different shapes, the pilot’s incentives would change and its cost‑effectiveness outlook could shift. Commissioners asked whether there are contingency plans if the federal funds are not available; witnesses said no binding contingency plan is included in the settlement language, and the parties had not pre‑agreed a backstop.

Why it matters: Rocky Ford is the only geographically focused electrification pilot in the settlement language, and its design—administrative support from utilities but incentive dollars from CEO federal funds—substantially affects modeled carbon‑abatement costs and program economics. Reliance on outside incentives both lowers the utility’s modeled per‑ton cost and introduces execution risk if federal programs do not reach the assumed customers.

Ending: CEO said its programs are close to launch and that incentives may be stackable with utility offerings, but commissioners and staff asked parties to be explicit about contingencies and timelines as they prepare filings and statements of position.