Xcel Energy is seeking approval for a large load tariff in Colorado that includes an optional clean transition tariff to encourage the development of carbon-free resources.
Public Service Company of Colorado (PSCo), an Xcel subsidiary, filed the proposal with the Colorado Public Utilities Commission on April 2.
The proposal is intended to address concerns “over the immense energy needs of new, large customers, such as data centers,” Robert Kenney, president of Xcel Energy Colorado, said in a release.
“Addressing those concerns by updating rules and policies will help make sure we manage this growth responsibly as we protect customers,” said Kenney, who noted the potential jobs, investments and innovation that large load customers bring.
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The tariff would apply to new customers with an electric load of at least 50 MW and to existing customers that are expanding by 50 MW or more. Large customers would pay for the power infrastructure needed to serve them, including transmission, substations, interconnection upgrades and new electric generation.
“This ensures that existing customers are not paying for the needs of the large load customers,” Xcel said.
In other provisions, customers would be required to provide credit support such as a guaranty or cash deposit. The minimum service period would be 15 years. Customers would be able to cancel service with 24 months’ notice but could be required to pay an exit fee.
Clean Transition Tariff
PSCo also proposed an optional clean transition tariff (CTT), aimed at supporting the acquisition of certain carbon-free generation resources.
A CTT resource is one that uses “emerging carbon-free electric generation technologies or long-duration storage technologies,” PSCo said in its filing. Examples include geothermal, hydroelectric, hydrokinetic, nuclear, renewably sourced hydrogen or fossil resources with carbon capture and storage. “Commercially mature” wind, solar, short-duration storage and carbon-emitting resources would not be eligible.
Under the proposal, the CTT resources may be those identified through PSCo’s resource planning process but not chosen for development or procurement. Alternatively, they could be emerging-technology projects that would not be selected through the company’s least-cost procurement process.
The customer would choose the resources and pay for them through agreements with PSCo, which would have discretion to evaluate project feasibility and negotiate the ownership structure.
The PUC has not yet set a procedural schedule for considering the tariff. Xcel asked that the new tariff become effective May 3.
Xcel is also working on large load tariffs in Minnesota, Wisconsin and Texas, CEO Bob Frenzel said during a fourth-quarter earnings call in February.
Large Load Tariffs Spreading
As the number of large load customers grows across the U.S., so does the adoption of large load tariffs.
In its Database of Emerging Large-Load Tariffs (DELTa), the Smart Electric Power Alliance found 77 either in place or being considered at utilities around the country. Large load tariffs have not been considered or adopted in only 12 states. (See SEPA Tracks 77 Large Load Tariffs Nationally with DELTa Database.)
A November 2025 study by RMI looked at the most common safeguards in 65 large load tariffs. Those included a minimum contract term, minimum monthly billing, collateral requirements and exit fees. Twelve of the tariffs reviewed allow large customers to transfer to another customer contracted capacity that is no longer needed — along with financial responsibility for the capacity.
PSCo’s commitment to filing a large load tariff came out of a PUC proceeding on the company’s Just Transition Solicitation, its proposal for how much energy it needs to serve customers for the next five years, with coal plant retirements factored in. The proposal also aims to reduce emissions and support communities where coal plants are retiring.
During the proceeding, environmental groups including the Natural Resources Defense Council, Sierra Club, Southwest Energy Efficiency Project and Western Resource Advocates backed the idea of a CTT.
Many companies developing large data centers might be willing to pay more for resources that help them meet clean energy goals, the groups said.
“At a high level, the clean transition tariff should allow large customers to voluntarily pay to be served by innovative, zero-emission resources that Public Service would not otherwise procure,” the commission said in November in its Phase I decision on the JTS.
