This op-ed by Paul Culnan and Erik Johnson appeared on Colorado Newsline on March 16, 2026.
Much ink has been spilled discussing Xcel Energy’s reliability and the price of electricity – which is a basic human need, alongside water, shelter, nourishment, and community. It’s useful to think of our electric transmission and distribution system not as Xcel’s grid, but as our grid.
It’s the only grid we have.
But today’s grid is obsolete.
Public utilities were designed in the 1900s to distribute energy from large central sources via a hub-and-spoke system. This made sense when power was generated in large fossil-fueled power plants. Connecting each home and business to multiple providers with multiple sets of wires was inefficient and dangerous, so it made sense to have just one provider of electricity, just as it does for water and sanitation. Public utilities were “natural monopolies.”
But monopolies are not subject to competition and can take advantage of their captive customers. So investor-owned utilities, and what they build and what they can charge, are regulated by government agency — the Public Utilities Commission.
How are regulated monopolies working out a century later? Not so well.
Electric rates are rising and reliability is uncertain. Investors are reaping large rates of return on their investments in expensive, centralized energy projects. Such projects are low risk for the investors, but burdensome to ratepayers, with all costs paid back by us in our monthly bills. And the hub-and-spoke design is poorly suited to integrate decentralized renewable energy and storage.
What’s to be done?
Some states propose to help ratepayers by putting limits on investor profits. And there are ambitious ideas for our energy future that reduce utility bills and speed the transition away from fossil fuels — a transition mandated by the climate emergency and state law. Engineers and energy analysts are proposing an architecture for our electrical grid resembling the structure of the internet, with energy flowing in multiple directions along pathways that connect nodes of supply and demand.
Energy flow to nearby nodes is favored and more efficient, thus reducing loss from long transmission lines. It improves reliability by integrating renewable clean power at many nodes in the system. We could call this Our Smart Grid — because it relies on communication among all parts of the energy web to keep the system balanced. Xcel Energy has been woefully slow to innovate in this way.
Existing legislation and PUC rules give Xcel a perverse incentive to build a costly centralized power grid. The PUC’s current cost-of-service model means we pay for the building of this infrastructure, while investors make handsome returns on their equity. An energy analyst quipped, “Investor-owned utilities will always find the most expensive solution for every problem.” We must reorient the incentives, while continuing to provide reasonable profits to Xcel.
Right now Xcel Energy has total control over power generation, transmission, distribution, and customer service. And Xcel also does the planning. There are several possible “decoupling” strategies.
In California, the utilities own the transmission and distribution systems and handle billing. But the generation of power is determined by the ratepayers according to their preferences for clean affordable power. A model for this is community choice energy, which unfortunately has stalled in the Colorado Legislature because of push-back from Xcel Energy and others.
Another proposal for decoupling is for the planning of our energy system to be done by a nonprofit entity that can operate in the public interest. Grid-planning by an investor-owned utility incentivizes gold-plating the existing system. That’s good for shareholders, not for the public. In the U.K., planning is done by an independent entity and decisions about modernizing the grid are not tied to profit.
Enlightened planning could also require Xcel to invest more in conservation and efficiency. The best source of grid capability is electricity not needed at all. Xcel has programs promoting energy-efficient heating and transportation, but thousands of homes and businesses in Colorado await weatherization for improved comfort and reduced energy use.
In the 21st century, Xcel’s profits must be based on keeping rates affordable, the grid reliable, and reaching or exceeding carbon emissions targets. New solar power with battery storage costs less than a new gas power plant. With proper incentives Xcel can accelerate deployment of solar and storage and retire expensive climate-damaging fossil generation.
Our climate is in trouble. Energy costs are rising. Accelerated adoption of renewable energy and limits on corporate profits are essential for our grid and for our climate and energy future. Write a letter, talk to neighbors, call lawmakers. Join an organization that protects community and climate.
Become a citizen lobbyist.
Paul Culnan is a retired computer programmer living in Boulder. He is on the board of 350 Colorado and also volunteers with Empower Our Future, Third Act Colorado, and Safe and Healthy Colorado.
Erik Johnson works as a consultant for energy-efficient multi-family housing and is a volunteer with 350 Colorado. He lives in Boulder.
Colorado Newsline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Colorado Newsline maintains editorial independence. Contact Editor Quentin Young for questions: info@coloradonewsline.com.
Colorado Newsline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Colorado Newsline maintains editorial independence. Contact Editor Quentin Young for questions: info@coloradonewsline.com.