Leslie Sermos, UCA supervisory rate financial analyst, briefed the board on Public Service Company of Colorado’s combined 2024 annual prudence review for the Economic Commodity Adjustment (ECA) and Purchase Capacity Cost Adjustment (PCCA), identified as proceeding 25A‑366E. "At stake is nearly $870,000,000 in costs that flow directly through to ratepayers," Sermos said, describing roughly $700 million in fuel and purchased energy costs and about $89 million in purchased capacity payments.

Sermos explained the ECA and PCCA are automatic adjustment mechanisms that allow the company to recover certain variable costs without a full base‑rate case, but that annual prudence reviews ensure the costs were reasonably incurred and limited to the adjustment’s scope. UCA’s review centers on three principles: scope enforcement (preventing unrelated costs from flowing through the adjustments), operational accountability (examining whether outages and operational decisions — such as those at Cherokee 4 and Comanche 3 — unnecessarily increased costs), and market behavior (whether purchases reflected reasonable alternatives available at the time).

Sermos highlighted a nine‑month Cherokee 4 outage caused by an underground pipe failure; when large units are offline utilities must buy replacement power, which flows through the ECA/PCCA to customers. She said Comanche unit 3 also experienced planned and unplanned outages in 2024 and that some Pueblo community members have petitioned federal officials to consider extending the plant’s operations beyond planned retirement dates. UCA’s role in the prudence review, Sermos said, is to assess whether operational or planning failures contributed to higher costs that should not be passed to ratepayers.

Board members discussed jurisdictional and cost issues, including federal actions under the Federal Power Act that in other states temporarily kept coal plants operating and the potential for large stranded‑asset costs if units retire early. UCA staff said the prudence review is not intended to relitigate public debates about plant retirements or energy transition policy, but to examine whether the costs utilities seek to recover in the ECA/PCCA were prudently incurred.

UCA said it has intervened and filed testimony in the proceeding and will continue to examine outage causes, outage duration, replacement power procurement, must‑run designations and whether operational practices met reasonable standards. The board was provided an overview; staff said detailed technical work and briefing will continue in the case record.