Federal funding freezes are impacting Gunnison County residents in more ways than one and may show up in the form of higher electricity bills.
A memorandum, signed in late January, ordered a “temporary pause” of federal financial assistance for activities related to “foreign aid, nongovernmental organizations, DEI, woke gender ideology and the green new deal.” Financial assistance instead should be dedicated to “eliminating the financial burden of inflation for citizens, unleashing American energy and manufacturing,” it stated.
“The use of Federal resources to advance Marxist equity, transgenderism and green new deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve,” the memo reads.
As a result, the flow of nearly $3.2 billion in grants and loans to Colorado rural electric cooperatives and Tri-State Generation and Transmission Association has stalled. The funding freeze could affect the Gunnison County Electric Association (GCEA), as Tri-State is its power supplier. GCEA is a member-owned, nonprofit electric cooperative that delivers electricity to homes and businesses throughout Gunnison and Hinsdale counties and parts of Saguache.
A portion of the frozen funds was granted to Colorado communities through the Bipartisan Infrastructure Law (BIL). Passed in 2021 under former President Joe Biden, the legislation was intended to help repair and modernize the nation’s aging infrastructure, such as roads and bridges, public transit systems and utility grids. The rest came through the U.S. Department of Agriculture’s Empowering Rural America program, or “New ERA,” meant to aid the transition to cleaner, more affordable energy.
The pause in federal assistance has the potential to hinder electric system upgrades around the Western Slope and other rural areas of Colorado. One project in Gunnison County is not only designed to improve the reliability of the grid, but to decrease the chance wildfires are ignited by aging powerlines. Others are meant to help Colorado shift to more solar- and wind-generated power. In case funding is not restored, utility customers will ultimately be responsible for covering a portion of the cost.
As a member of the Colorado Rural Electric Association (CREA), GCEA is working with other co-ops to preserve the grant funding. Some managers, including GCEA Chief Executive Officer Mike McBride, visited Washington D.C. in early March to advocate for all of these projects. A number of co-op directors have plans to return in April.
CREA serves 1.5 million people, many of whom live in some of the most “economically challenged” areas of the state, according to a letter sent from CREA Executive Director Kent Singer to Colorado representatives and senators. The recently announced freeze on the distribution of BIL and Inflation Reduction Act money has “cast doubt on the viability of these important projects,” which help communities increase grid reliability and provide affordable energy, the letter states. Without the certainty the money will be disbursed, contracts may be lost and the price of supplies and construction materials may rise.
“We're actively trying to do all we can to get these funds … The loss of those grant funds do seem to have a higher impact on rural America. That's the message we're going to be carrying,” McBride told the Times.
In May 2024, GCEA received a $5 million grant from the U.S. Department of Energy to replace a roughly 33-mile section of aged, overhead electric lines that run along Hwy. 149 between Gunnison and Lake City. By increasing the durability of the lines, the project will create redundancy within the electric grid and reduce the risk the system accidentally sparks a wildfire. Government funding was supposed to cover approximately 70% of the project.
Across the United States, old power lines, paired with hotter, drier weather, are increasing the chance of fire. A downed power pole is believed to have started the largest wildfire in Texas’ history in 2024. Strong winds and downed power lines were investigated as possible causes of the catastrophic fires in Hawaii in 2023, and the California fires outside of Los Angeles earlier this year.
“We've seen wildfire issues related to antiquated infrastructure, not here in our state, but we've definitely watched it in other[s],” said Hinsdale County Commissioner Kristie Borchers.
“That's another reason why we're glad to support this.”
The electrical distribution lines that serve customers between Gunnison and Lake City have not been updated since the 1960s, and over the last two years, the area has experienced more than 70 power outages due to extreme weather events. This included a 28-hour outage during sub-zero overnight temperatures in February 2023. And during the winter, many residents rely on electric heat.
“With the remoteness already of our community … we really feel the impacts of that electricity being out,” she said.
According to McBride, the intent is to start the power line upgrades this year, with or without the grant funding. If GCEA must borrow money, some of the costs associated with the project would be reflected in rate increases. It would be shared by all of GCEA’s customers.
“The grant funding is a real help to the community, but regardless, the project has to be done,” McBride said. “I think we will be moving forward even if there's some uncertainty.”
Frozen funding at Tri-State could have a similar impact on electricity rates, McBride said. The Colorado-based electric cooperative, which provides wholesale power to customers in four states, received $2.5 billion in grants and low-interest loans from the New ERA program. The money was set aside to help the co-op weave more renewable energy sources into its power portfolio, support the early retirement of coal power plants and meet the state’s requirements for greenhouse gas reductions.
Tri-State goes through a resource planning process every three years with the Colorado Public Utilities Commission to look at different possible energy mixes. The resulting project approvals are not dependent on the grants’ arrival, McBride said. If Tri-State is forced to borrow money at a higher interest rate than the co-op would have received through the federal programs, it will have a rate impact for GCEA members. He estimated it could be as much as a 4.5% increase in the early years of the new debt.
“Tri-state has a multi-faceted [energy] resource plan, and generally speaking, this big federal assistance was going to help pay for all of that,” McBride said.
GCEA has been laying the groundwork for a renewable energy project just outside the Crested Butte. The 1,125-kilowatt solar array will be owned by GCEA. Luckily, this project is not as dependent on federal grants, McBride said. Despite rising interest rates and supply chain problems, the co-op is still striving to build the array this year, he said.
(Bella Biondini can be contacted at 970.641.1414 or bella@gunnisontimes.com.)
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