Colorado declared nuclear clean energy, but not for property taxes

By Shaina Cole | Contributing Writer, Rocky Mountain Voice

Fort St. Vrain, near Platteville, was permanently shut down in 1989 and decommissioned. No nuclear plant has operated in Colorado since.

In January 2025, a bipartisan group of state lawmakers set out to change the legal standing of the technology, if not yet the ground it sits on.

Their bill added nuclear energy to the statutory definitions of “clean energy” and “clean energy resource.” The first governs which projects qualify for county clean energy financing. The second decides what a utility may count toward Colorado’s 2050 clean energy target.

Four sections in, past the legislative findings, sat a single sentence doing the opposite.

Nuclear would not count as a clean energy resource for property tax purposes.

That sentence stayed in the bill all the way to the governor’s desk. It also changed on the way there.

The Common Sense Institute report, published Oct. 14, prices out what the new generation Colorado needs by 2050 would cost with nuclear instead of renewables. It also lists seven places where state law still favors renewable energy over nuclear.

The property tax exclusion is one of them. It is also the only one the legislature wrote while it was in the act of calling nuclear clean.

What the bill did

HB25-1040 passed the House 43-18 and the Senate 29-5. Gov. Jared Polis signed it March 31, 2025, and it took effect that August.

Prime sponsors were Reps. Alex Valdez and Ty Winter, and Sens. Dylan Roberts and Larry Liston, two Democrats and two Republicans. Thirty-eight lawmakers signed on in all.

The findings section lays out why. Peak demand, the bill said in January 2025, was projected to double within five years. The current path to eliminating emissions runs through wind, geothermal, solar and battery storage. More options would make that path cheaper and more reliable.

Then comes Section 4.

The exclusion got wider

As introduced, the carve-out carried a qualifier. It read that “clean energy resource” does not include nuclear energy generated by a public utility.

On Feb. 13, 2025, in the House Energy and Environment Committee, four of those words came out.

The amendment struck the sentence and replaced it with the version that became law. Clean energy resource, for purposes of property taxation under this section, does not include nuclear energy. On its face, the enacted language excludes nuclear energy regardless of who generates it. The introduced version limited the exclusion to nuclear energy generated by a public utility.

Valdez moved it at 8:18 p.m. Rep. Ryan Gonzalez seconded. The committee adopted it on a voice vote without objection, so there is no record of how any individual member stood.

Ratepayer money for studies, in and back out

Sixty-nine seconds later, Valdez moved a second amendment.

That one would have added a new section to state utility law. A regulated utility could apply to spend and recover up to $15 million on studies of potential sites, facility designs and other nuclear development work. The language said the Public Utilities Commission “shall approve” the application. Utilities would recover the cost from ratepayers, either through an existing rate adjustment or through deferred accounting in the next rate case.

It also passed without objection.

One week later, on second reading, Valdez struck it himself.

The final version has five sections and no study funding. It directs no money toward figuring out where a reactor would go.

What the Senate tried

The bill was heard in Senate Transportation and Energy on March 10, 2025. Two amendments were offered there. Neither one went after the tax exclusion.

Sen. Faith Winter moved the first. It would have redefined nuclear energy to mean only energy produced by next-generation fission reactor technologies, including small modular reactors, very small modular reactors and micro-reactors. Conventional large-scale nuclear would have fallen outside both definitions.

It failed 2-7. Faith Winter and Sen. Lisa Cutter voted yes.

Cutter moved the second. No owner or operator of a reactor could have the reactor’s power treated as clean until it had a plan for the safe, viable and commercially feasible permanent disposal or recycling of at least 96% of the spent fuel and byproducts.

That 96% came from the bill itself. The same House committee amendment that widened the tax exclusion had added a legislative finding that recycling can recover up to 96% of the reusable material in spent fuel. Cutter applied the number to a wider measure, the spent fuel and byproducts a reactor produces.

It failed 3-6, with Sen. Tom Sullivan joining Cutter and Faith Winter.

The committee sent the bill forward 6-3.

Across both chambers, five amendments were formally offered on HB25-1040. One widened the property tax exclusion. Two would have narrowed the circumstances in which nuclear counts as clean. One added study money and one took it away.

Not one sought to give nuclear the property tax treatment the state’s renewable resources receive.

What CSI says the alternatives cost

The report, credited to Erik Gamm and former state Sen. Paul Lundeen, models six ways of meeting Colorado’s projected 2050 electricity demand using clean energy sources state law approves for utility-scale use.

State-contracted modeling, the report says, puts demand at 120 million megawatt-hours in 2050, against 56.8 million purchased in 2024.

CSI estimates the annual cost of supplying seven gigawatts of new average generation, while also meeting peak demand, at $5.79 billion for conventional nuclear and $5.55 billion for small modular reactors, against $7.34 billion for an optimal wind and solar mix. That is 21% to 24% less.

The gap, CSI says, is not in the cost of building or running the plants. Wind and solar win on both. It is in what has to be built around them.

CSI cites Xcel Energy’s own estimates that the next gigawatt of solar capacity in its Colorado territory carries an effective load carrying capability of 21.1%, falling to 5.4% beyond two gigawatts. Wind runs 19.4%, falling to 11.3%.

Averaged across the full seven gigawatts, those figures fall to 6.3% for solar and 12% for wind. On those averages, seven gigawatts from solar would add about 1.5 gigawatts of power the grid can count on at peak. Nuclear would add 7.2.

Closing that gap takes storage, and in CSI’s model that is where the money goes. Those storage and system costs make up one of the three components inside the annual totals already given. CSI puts them at $4.79 billion a year for the wind and solar mix against $1.63 billion for nuclear.

Those are estimates. Every capital cost in the model, nuclear and renewable alike, comes from a national laboratory baseline rather than from projects actually built. CSI used that baseline’s 2030 figures, which assume a fully mature supply chain and economies of scale already reached.

The report recommends the legislature level nuclear’s treatment under state law. Lawmakers return in January.