This story was originally published by Canary Media.

California has long led the way on electric vehicles, but another Western state is challenging the Golden State’s top spot.

Between July and September, nearly 25 percent of the vehicles registered in Colorado were electric or plug-in hybrids. In California, that figure was just over 24 percent. It’s not enough to crown Colorado the new undisputed leader in EVs, but it’s a notable milestone — no other state has ever surpassed California in terms of EV registrations, according to James Di Filippo, principal policy analyst at Atlas Public Policy.

It’s the culmination of a ​“pretty dramatic” trend line for Colorado’s EV adoption since the start of 2023, Di Filippo said. Coloradans bought just over 41,000 EVs last year, up from roughly 23,000 in 2022.

Governor Jared Polis, a Democrat, announced the accomplishment last week, touting it as a sign of the state’s commitment to reaching its climate goals and improving air quality. ​“This new data shows that demand for EVs continues to increase and especially with competitive state and federal rebates, drastically cutting the cost of an EV and saving people money,” Polis said in a press release.

Colorado has some of the most generous incentives for EV sales in the country, Di Filippo said. Its policies and incentives have helped make the cars more affordable, while the state’s investments in charging infrastructure have made owning an electric car more practical.

All Coloradans can receive a $5,000 state tax credit for purchasing or leasing a new EV or plug-in hybrid priced up to $80,000. That credit is available through the end of this year, then will decrease to $3,500 starting in 2025. EVs valued under $35,000 are eligible for an additional tax credit of $2,500 — for a total potential state credit of $7,500.

Through the Vehicle Exchange Colorado program, income-qualified residents can trade in old or highly polluting gas cars in exchange for a $6,000 rebate to put toward a new EV or plug-in hybrid purchase or lease, or $4,000 for a used one.

The state tax credits and the vehicle-exchange rebates can be combined with federal tax credits, which currently offer up to $7,500 for a new EV lease or purchase or $4,000 for a used EV.

The state has also worked over the past few years to install more public chargers. There are currently over 5,500 public charging ports across Colorado. This year, the state plans to install another 576 ports using $5 million in funding from the Colorado Energy Office.

In 2020, the U.S. Energy Information Administration projected that 580,000 zero-emission vehicles would be sold in the U.S. in 2023. But actual sales last year were almost two and a half times greater at 1.43 million. This year, Cox Automotive expects sales to climb even higher, despite gloomy forecasts issued by some analysts earlier in 2024.

According to estimates from Kelley Blue Book, EV sales made up 8.9 percent of all vehicle sales in the country in the third quarter of this year — the highest share ever recorded, and an increase from 7.8 percent in the same time period last year.

The Biden administration set a goal for EVs to make up half of all new vehicle sales by 2030. As of this February, sales were on track to meet that goal, though the picture is more uncertain heading into the second Trump administration. The president-elect reportedly plans to eliminate federal EV tax credits and roll back Environmental Protection Agency tailpipe emissions rules — against the wishes of the nation’s largest automakers, including Ford, General Motors, and Stellantis.

Transportation is the single largest category of carbon emissions in the country, at 28 percent, driven mainly by trucks, SUVs, and other road vehicles.

Colorado has an even more aggressive EV goal than the federal government, aiming for 82 percent of all car sales to be electric by 2032. Looking ahead, EV registrations and sales in the state likely won’t continue to outpace California, Di Filippo said, since ​“the trend line for California is still steeper overall.”

“This isn’t necessarily a story of Colorado just beating California out right,” he said. ​“This is really a story of EV success.” 

Which state is rivaling California on EV leadership? Colorado is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

This article was originally published by Canary Media.

A hefty chunk of U.S. emissions comes from the energy used to heat buildings. That means millions of homes must be converted to electric heating in order to meet climate targets. 

In Colorado, a 2021 law spurred the state’s largest investor-owned utility to produce a plan that could transition a lot of homes to clean heating — and fast.

Xcel Energy’s Clean Heat Plan was approved this May. It directs more than $440 million over the next three years mainly to electrification and energy-efficiency measures that are meant to reduce reliance on the gas system and cut annual emissions by 725,000 tons.

The utility, which provides both gas and electricity to its customers, filed an initial plan that included proposals to spend heavily on hydrogen blending, biomethane, and certified natural gas. But after strong opposition from clean energy advocates who say these routes do not represent viable pathways to decarbonization, those proposals were reevaluated. Following a motion filed by the Sierra Club, Natural Resources Defense Council, and others last November, Xcel amended its original plan filed with the Colorado Public Utilities Commission.

Now the majority of funds will go toward building electrification and energy efficiency, which the commission found to be the ​“most cost effective and scalable ways to reduce emissions from burning gas and buildings, both in the short run as well as in the long term,” said Meera Fickling, building decarbonization manager at Western Resource Advocates.

Electrification efforts will primarily take the form of incentives that make it cheaper for customers to switch gas heating appliances to electric heat pumps. The incentives can be combined with federal electrification tax credits and extend to all-electric new construction as well. One-fifth of the program’s funding is earmarked for low-income customers. The plan’s funding is roughly three times the $140 million that the Inflation Reduction Act allocated to Colorado for similar measures.

The utility forecasts gas sales to decline by 14 percent between this year and 2028, The Colorado Sun reports.

While many states have incentives and rebates available for upgrading to energy-efficient appliances and heating solutions, Colorado specifically directs its gas utilities to lead those programs — and holds them accountable for contributing to the state’s climate goals.

That’s why Xcel’s new clean heat program will be ​“a test case of a utility-led model towards decarbonizing the gas distribution system,” Fickling said. ​“It really serves as a model — a nationwide model — for how gas utilities can allocate resources to decarbonize their system in the long term.”

From state laws to utility plans 

Colorado’s push to clean up home heating started three years ago with the Clean Heat Law, which requires gas distribution utilities to create concrete plans to reduce their greenhouse gas emissions 4 percent below 2015 levels by 2025 and 22 percent by 2030. Xcel’s recently approved Clean Heat Plan will carry the utility through 2027, and the utility must propose a new plan in the coming years to meet the next target.

“I expect the next plan to really take a close look at the 2030 target and the trajectory to achieve it,” said Jack Ihle, regional vice president of regulatory policy at Xcel.

The Clean Heat Law was the first of its kind in any state, Fickling said, though others have since taken steps to curtail the climate impact of heating.

Following Colorado’s 2021 law, in 2023 Vermont passed the Affordable Heat Act to reduce emissions from home heating, and Massachusetts drafted similar legislation. This year, Illinois and New Jersey have both introduced bills with clean heating and decarbonization standards.

In Minnesota, the state’s largest gas utility just received approval for a five-year, $106 million plan to reduce its emissions following the state’s 2021 Natural Gas Innovation Act. The utility, CenterPoint Energy, says the plan would ​“reduce or avoid an estimated 1.2 million tons of carbon emissions over the lifetime of the projects,” though advocates have criticized the approach.

But utilities in Colorado ​“have a lot more flexibility in terms of the portfolio that they propose,” said Joe Dammel, manager of carbon-free buildings at RMI. While Xcel can prioritize energy efficiency and electrification in Colorado, Minnesota’s Natural Gas Innovation Act requires gas utilities to produce emissions-reduction plans that spend at least half of their budgets on alternative fuels like renewable natural gas, which can still heavily pollute. In Colorado, a much smaller amount is dedicated to alternative fuels; only around $10 million out of the $440 million can be spent on renewable natural gas and recovered methane, and all projects must specifically be approved by the commission.

Another difference between the two recently approved plans is that Xcel delivers gas and electricity to about 1.5 million customers in Colorado, which gives it an opportunity to counterbalance lost gas revenue with increased sales from its electricity business. 

Meanwhile, CenterPoint serves gas to about 910,000 customers but has no electricity customers. That gives it fewer opportunities to make up for losses from its gas business driven by electrification mandates, and more incentive to prioritize the use of alternative fuels delivered through the pipelines it owns — and not electrification.

Investing in 100,000 heat pumps 

Now that the funds have been approved, Xcel is waiting on a final written order from regulators, which should arrive later this month. From there, it will start implementing the plan and work on defining rebate levels and informing customers on how to access incentives.

The details are still being decided, but customers will likely need to pay first and then get reimbursed later, as is the case for many current rebate programs, said Emmett Romine, vice president of energy and transportation solutions at Xcel. Customers would also get higher rebates if they choose more advanced technologies, like high-efficiency cold-climate heat pumps.

Beyond educating customers, the company is putting workforce-training plans together to ensure there are enough heat-pump installers ready to help customers convert. Xcel is also working with distributors and manufacturers ​“to make sure that there’s a supply chain that will come to Colorado when we stimulate demand,” Romine said.

The plan represents a significant step up from Xcel’s current pace of upgrades. ​“The goals are really aggressive,” Romine said. ​“When you look at the number of heat pumps and the number of water heaters we’ve got to contemplate getting into homes, it’s an enormous amount of work.” Currently, Xcel does around 10,000 rebates a year for traditional gas furnaces. Now, it’s aiming to do 20,000 heat-pump conversions this year and just under 100,000 total by the end of 2026, Romine said.

That supercharged effort won’t come without costs. Ratepayers will see electricity rates go up by 1.1 percent and gas rates rise by 7 percent over the next four years due to the plan. But advocates say it’s worth it to avoid pouring money into a gas system that must be phased out — and that the climate benefits outweigh the upfront costs. Even without the Clean Heat Plan, Xcel projected it would need to increase base rate revenue by 32 percent between 2023 and 2030, The Colorado Sun reported.

Colorado’s plan ​“is a very good example of needing to pursue both sides of the equation at the same time — decarbonization, electrification — but at the same time ensuring that we’re starting to shrink and eliminate unnecessary investments in the gas system,” said Alejandra Mejia Cunningham, senior manager of state buildings policy at the Natural Resources Defense Council.

The Public Utilities Commission has encouraged Xcel to report its progress by 2026, ahead of the legally mandated schedule, Ihle said. Advocates will be watching closely to see how it all plays out.

“We’re gonna have to make sure that we’re seeing the results of that in terms of participation, customer satisfaction, and ultimately emissions and cost reductions,” Dammel said. ​“There’s going to be a lot of utilities across the country following this.” 

Xcel Colorado’s new clean heat plan is a big deal. Here’s why. is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.