The Colorado Public Utilities Commission is holding the line on a big climate target that hits right at the gas line. In a 2 to 1 vote, regulators refused to ease a key greenhouse gas benchmark for the state’s natural gas utilities, keeping a 41% emissions reduction by 2035 in place. That decision means companies such as Xcel, Black Hills, and Atmos must return with updated Clean Heat Plans that cut pollution from pipelines and home heating, while still giving commissioners room to weigh cost and reliability. The commission also sharpened its long-range language, emphasizing a net-zero planning goal for 2050 and setting a mid decade review to revisit the numbers and the technology.
Commissioners Tom Plant and Megan Gilman backed the benchmark as a planning tool, while Chairman Eric Blank cast the lone no vote. Plant argued regulators should hang onto the 41% target because “we don't know what the technologies are going to be between 2030 and 2035,” saying the figure is meant to guide planning rather than automatically trigger expensive measures. Gilman backed that framing, stressing that the benchmark “is simply a target” that leaves regulators discretion when they review utility proposals, according to The Denver Gazette.
What the rule requires
In its written decision, the PUC ordered a 41% cut from 2015 emissions by 2035 and delayed setting binding numbers for 2040 through 2050 until a later rulemaking. The commission left in place allowances for recovered methane and kept the statutory cost cap framework intact. Under the Clean Heat Plans process, investor-owned gas utilities must file portfolios that show how they will hit the target using tools such as energy efficiency, beneficial electrification, recovered methane, or other approved resources. Regulators said they will weigh those plans against the 2.5% retail cost cap and the broader public interest, as detailed by the Colorado PUC.
Utilities and consumer advocates react
Utilities and consumer advocates did not exactly cheer the steep near-term goal. In filings, they warned that an aggressive target could trigger wasteful investment, strand long-lived gas infrastructure, and push costs onto ratepayers if new technologies and customer participation do not materialize on schedule. The state’s Utility Consumer Advocate cautioned about “wasteful investment, asset stranding, and unjustified costs to ratepayers,” and the commission acknowledged those risks even as it kept the 41% benchmark. Utilities also argued the target increases the chance of a mismatch between what they build into their plans and what customers ultimately demand, a concern regulators said they will monitor, according to The Denver Gazette.
How the target was set
The 41% figure emerged from a tug of war inside the state government. The Colorado Energy Office and the Air Pollution Control Division, at different points, called for higher ambition, then at other moments urged a more modest 31% pathway because of feasibility concerns. That back and forth among state agencies, utilities, and environmental groups helps explain why the PUC locked in an aggressive 2035 benchmark while postponing later decisions until it can reevaluate progress and available technology, per reporting by The Colorado Sun.
Costs and the customer math
Analysts and utility filings suggest that hundreds of thousands of customers would need to replace appliances or undertake home retrofits to reach the 41% goal, with total conversion costs statewide potentially running into the billions. Consumer advocates warn that low-income households could shoulder an outsized share of those expenses unless programs, rebates, and equity protections ramp up alongside electrification efforts. Those cost questions sit at the center of the political and regulatory fight, according to Colorado Politics.
What is next for regulators and utilities
The commission has committed to an interim rulemaking around 2029 to review technology, costs, and emissions progress, then decide whether the 2035 target needs to be adjusted. Parties that asked the PUC to reopen its December rule can still pursue rehearing or legal review. In the meantime, utilities must file updated Clean Heat Plans that show how combinations of efficiency, electrification, recovered methane, and other resources can meet the benchmark within statutory limits, as outlined by the Colorado PUC.
Legal questions linger
Colorado’s 2021 Clean Heat law set emissions targets through 2030 and told the PUC to establish later goals, but critics argue that extending a specific numeric standard to 2035 through rulemaking raises statutory and constitutional issues. The Independence Institute and other commenters urged the commission to stay strictly within explicit legislative authority and warned that ambitious targets without clear backing from lawmakers could invite legal challenges. The enabling statute is posted at leg.colorado.gov, and the Independence Institute’s comments are available from the Independence Institute.
For now, Colorado regulators have staked out a firm near-term benchmark and circled a date to reconsider. The 2029 interim review will be the moment to see whether the state’s aggressive path is delivering results within its cost caps, or whether policymakers need to tweak the pace, programs, and protections before higher costs wash through households and businesses.
