Colorado’s Investigation of Performance-Based Ratemaking Proceeding

On December 5, 2019, the Public Utilities Commission of Colorado opened the Investigation of Performance-Based Ratemaking Proceeding (19M-0661EG) in order to gather information and explore performance-based regulation (PBR) and performance-based incentive mechanisms (PIMs). The proceeding produced a report to the Legislature (as required by SB 236) in November 2020. Specifically, the Commission was directed to investigate and issue a report that identifies PBR options for aligning utility operations, expenditures, and investments with public benefit goals, including safety, reliability, cost-efficiency, emissions reductions, and the expansion of distributed energy resources.

The responsive report included:

1. A general determination as to whether a transition to performance-based metrics regulation of a
   regulated utility would be net beneficial to the State, in terms of meeting stated objectives of the
   Commission and other related statutory requirements;
2. Actions that the Commission may pursue to guide the change to performance-based metrics regulation;
3. Directives to be given to utilities;
4. A list of types of future litigated proceedings within which the report could be implemented;
5. A proposed timeline for transition to performance-based regulation.