Colorado § 40-2-130.5 - Dispatchable distributed generation - energy storage - definitions - program capacity - program administration - rules.

§ 40-2-130.5. Dispatchable distributed generation - energy storage - definitions - program capacity - program administration - rules.

(1) Definitions. As used in this section, unless the context otherwise requires:

(a) "Dispatchable distributed generation" means distributed generation paired with either a co-located energy storage system or a standalone energy storage system that is:

(I) Directly interconnected to an investor-owned electric utility's distribution system and is not behind a customer meter; and

(II) Measured by the capacity of the energy storage system in alternating current.

(b) "Distributed generation" means a renewable energy resource as defined in section 40-2-124 (1)(a)(VII) that interconnects to a utility's distribution system.

(c) "Energy storage system" has the same meaning as set forth in section 40-2-130 (2)(a).

(d) "Investor-owned electric utility" or "utility" means a retail electric utility in the state that is not a cooperative electric association or a municipally owned electric utility.

(2) Program capacity.

(a) On or before June 1, 2026, an investor-owned electric utility with more than five hundred thousand customers shall acquire at least fifty megawatts of dispatchable distributed generation.

(b) On or after January 1, 2027, but before June 1, 2027, an investor-owned electric utility with more than five hundred thousand customers shall acquire at least fifty megawatts of dispatchable distributed generation.

(c) To ensure that an investor-owned electric utility with more than five hundred thousand customers acquires dispatchable distributed generation in accordance with subsections (2)(a) and (2)(b) of this section, the commission shall:

(I) Determine the procedures for a utility to acquire dispatchable distributed generation;

(II) Establish a methodology that ascribes value to dispatchable distributed generation located in specific areas of the electric grid in order to direct the development of dispatchable distributed generation resources in optimal locations; and

(III) Adopt any other program- or project-specific requirements the commission deems necessary to facilitate the acquisition of dispatchable distributed generation, including all applicable requirements of the "Colorado Energy Sector Public Works Project Craft Labor Requirements Act", part 3 of article 92 of title 24, for dispatchable distributed generation projects that qualify as an "energy sector public works project" as defined in section 24-92-303 (5).

(d) On or before June 1, 2028, and periodically thereafter, the commission shall determine the procedure and capacity amounts for future acquisitions of dispatchable distributed generation by an investor-owned electric utility.

(3) Program administration. The commission shall:

(a) Adopt and enforce all rules required under this section;

(b) Require all applicable investor-owned electric utilities to file the tariffs, agreements, or other forms and documents necessary for the implementation of this section; and

(c) Consult with the Colorado electric transmission authority, created in section 40-42-103, as necessary to plan for and optimize the use of dispatchable distributed generation that is acquired and developed in accordance with this section.

Source: L. 2024: Entire section added, (SB 24-207), ch. 231, p. 1434, § 4, effective May 22. L. 2026: IP(1)(a) and (1)(a)(II) amended, (HB 26-1225), ch. 293, p. 1613, § 5, effective August 12.

Cross references: (1) For the legislative declaration in SB 24-207, see section 1 of chapter 231, Session Laws of Colorado 2024.

(2) For the short title ("Advancing Grid Resilience Using Distributed Energy Resources Act") and the legislative declaration in HB 26-1225, see sections 1 and 2 of chapter 293, Session Laws of Colorado 2026.