On September 25, 2026, the Department of Energy directed the coal-fired Craig Unit 1 to remain available through December 25, marking the fourth 90-day order under federal emergency authority. An Independence Institute analysis published this fall examines why the order was issued, pointing to three Energy Emergency Alerts during summer 2026 that brought the Southwest Power Pool West grid to the brink of blackouts. The report argues these alerts demonstrate the kind of concrete supply crisis that justifies federal intervention, even as environmental groups and Colorado's attorney general challenge the order in court.
The Southwest Power Pool issued an EEA 3 alert on July 20, 2026—the highest level, indicating blackouts were imminent or already happening—and narrowly avoided cutting power to customers. SPP followed with an EEA 2 alert on July 24 and an EEA 1 on August 9, according to Department of Energy records cited in the report. Craig Unit 1 generated 20,478 megawatt-hours in July 2026 to help satisfy demand during the crisis, after an earlier April 2026 run that produced 56,782 MWh. Meanwhile, SPP's western territory saw market participants deliver only 4.7 GW of available capacity from April through August, despite 9.2 GW of nameplate capacity and SPP's expectation of 6.5 GW. Colorado's coal share of electricity generation dropped from 45 percent to 25 percent between 2019 and 2024 as the state retired coal plants and added wind and solar. Xcel Energy's Comanche 3 coal plant, which went offline for repairs in August 2025, didn't return to service until September 1, 2026, while Comanche 2's first-quarter output fell 33 percent year-over-year.
The newest federal order specifies that "SPP is directed to take every step to employ economic dispatch of Craig Unit 1 only during hours necessary to meet the emergency and to minimize costs to ratepayers," the report notes. The analysis points out that SPP told federal regulators in September that its western footprint lacks resource adequacy requirements until June 1, 2027, and that this absence has "significantly contributed" to advisories and the three summer emergency alerts. According to the report, Xcel Energy informed Colorado's Public Utilities Commission that "no viable alternatives" existed to repairing Comanche 3, and that replacing it would "cost billions of dollars" and arrive in 2029 "at best"—far too late to address near-term shortages.
The report explains that Colorado's shift away from coal-fired generation has created reliability gaps that wind and solar haven't filled, leaving grid operators short of dependable capacity during peak demand. SPP has proposed penalties for participants who fail to deliver energy during emergencies, but the Federal Energy Regulatory Commission hasn't yet ruled on that stopgap measure. Xcel has asked state regulators to postpone Comanche 2's retirement until March 31, 2028, projecting a 527 MW shortfall next summer even with Comanche 3 back online—a calculation that turned Xcel's Colorado system from a net exporter to a net importer. The Public Utilities Commission will hold an evidentiary hearing on Comanche 2 in November. Until regulators and market reforms catch up, the report concludes, Craig Unit 1 will serve as a "narrow, last-resort backstop" to prevent blackouts in a region still figuring out how to keep the lights on.