In 2021, Colorado took a big step forward in the transition to cleaner, healthier buildings by passing the nation’s first law requiring a major utility to adhere to a new “clean heat standard.” The clean heat standard requires Xcel Energy, the state’s largest investor-owned utility, to cut climate-warming emissions 22 percent below 2015 levels by 2030.
After more than a year of discussions about the best way for Xcel to comply with the law, Colorado utility regulators approved the utility’s Clean Heat Plan, which will help shift its customers away from methane gas altogether. The Clean Heat Plan directs more than $440 million over the next three years mainly to electrification and energy-efficiency measures that will reduce reliance on the gas system and cut annual carbon emissions by 725,000 tons.
Clean Heat Standard in Colorado Leads the Way with a Focus on Cost-Effectiveness
Colorado’s clean heat standard reflects a strong collaborative effort, involving the legislature, utility regulators, utilities, and clean energy advocates, focused on the most cost-effective way to reduce emissions, which is electrifying buildings. This approach is already helping to inspire action in other states.
Following Colorado, in 2023 Vermont passed the Affordable Heat Act to reduce emissions from home heating, and Massachusetts developed a similar framework. In 2024, Illinois and New Jersey both introduced bills with clean heating and decarbonization standards.