Power Struggles: The Costs and Consequences of CSU’s Rate Changes

Readers have been reaching out over the past few weeks, upset about Colorado Springs Utilities (CSU) increasing electricity rates for those who use power during the on-peak hours of 5 p.m. to 9 p.m. on weekdays. This on-peak pricing is new to Colorado Springs, though many other utility companies in different cities already use this scheme. CSU’s on-peak hour pricing begins October 1, 2025.

For everyone concerned about a rate increase, let’s be clear: this isn’t meant to boost CSU’s bottom line. Their goal is behavior modification.

The grid is strained and nearly at maximum capacity. The on-peak pricing change is designed to capture your attention and encourage you to change your habits. Make no mistake—you’ve been put in a no-win situation.

Another Recent Rate Increase That Went Largely Unnoticed

In November 2024, CSU and Colorado Springs city council members approved a five-year plan to raise funds for utility infrastructure. While many citizens were distracted just before the holidays, CSU and the utility board (also known as city council members) decided to raise rates, aiming to achieve an average residential increase of $80 monthly per household by 2029.

One major project funded by this five-year plan is future infrastructure at CSU’s Horizon Campus, near the Colorado Springs Airport. CSU plans to build ten natural gas-fueled electric generators on the Horizon Campus land for $600 million. These are the same types of generators currently used at the old Martin Drake coal plant site.

The Grid is Strained

CSU was clear during a Horizon Campus informational meeting in May 2025: they are barely meeting electricity demand during weekday peak hours. On July 7, 2024, CSU’s total generating capacity was 1,026 megawatts, and customers reached 1,011 megawatts. Utility ratepayers nearly reached the grid’s maximum capacity. Houston, we have a problem.

How did we get here?

• Bad decisions and poor leadership from the city council and CSU
• Green energy activism
• Irresponsible and unrestrained growth
• State-mandated coal plant closures

The state’s poorly thought-out green energy plans, specifically, did not fully consider grid reliability when moving away from coal. Now, you must fix the government-created problem by conserving—and paying—more.

On-Peak Increased rates

We reached out to CSU’s Senior Public Affairs Specialist Danielle Nieves about how the on-peak rate increase will affect ratepayers. We were informed that the average ratepayer will see an increase of $4 per month, while those who use more electricity during the other 20 hours of the day may see a decrease of $4 per month. Rates were raised for on-peak hours and lowered for off-peak hours. CSU needs you to modify your behavior, pronto.

From CSU:

“Not all customer use is exactly the same. For instance, if you don’t have central AC (air conditioning), no EV (electric vehicle) charging at home, and work from home using most of your electricity before 5 p.m., you may be in the category that would experience a decrease, without having to change any of your habits. However, a household with a lot of electric use, central AC, or an EV that they charge right when they get home from work at 5 p.m., would likely see an increase – if they kept all their current habits the same. In this example, they could start charging after 9 p.m., or run the dishwasher or laundry later in the day to avoid the ‘peak’ charges. The new off-peak rates will be lower than our current (all-day) rate. Weekends do not have peak rates”.

CSU staff further clarified that the on-peak rate increase is “revenue neutral; in other words, it will not bring in more revenue.”

Advertising the Need to Conserve

Over the summer, we noticed a billboard encouraging CSU customers to reduce their electricity usage during on-peak hours—CSU was planting the seeds of conservation. The billboard prominently featured a clothes dryer as the villain appliance. It read, “Shift Your Electricity Use Weekdays Before 5 P.M. and After 9 P.M.” The three billboards were placed near Colorado Springs neighborhoods, specifically in the areas of Garden of the Gods and Centennial, Fillmore and Strauss, and Platte and Willamette. We requested details about the advertising purchases, given CSU’s history of wasting ratepayer dollars on ineffective, unnecessary advertising. CSU spent $8,800 on the billboards. Clothes dryers aren’t the only problem, but you’re smart enough to know that.

Our Take

Is anyone really surprised that we’re dealing with an energy crunch after years of unrestrained development, a growing number of grid-draining electric cars, and the early closure of a reliable coal-fired power plant?

It’s been a five-year journey toward less affordable and less reliable energy. CSU and the 2020 city council members put the cart before the horse when they decommissioned the Martin Drake.

Affordable and reliable energy is essential for a thriving community. Reach out to your city council members and ask them where mistakes were made and how to fix them without costing you more. You’re not their ATM.

Tom Bailey                                      Tom.Bailey@coloradosprings.gov

Lynette Crow-Iverson                  Lynette.Crow-Iverson@coloradosprings.gov

Dave Donelson                               Dave.Donelson@coloradosprings.gov

Kimberly Gold                                Kimberly.Gold@coloradosprings.gov

Nancy Henjum                               Nancy.Henjum@coloradosprings.gov

David Leinweber                           David.Leinweber@coloradosprings.gov

Roland Rainey                                Roland.RaineyJr@coloradosprings.gov

Brian Risley                                     brian.risley@coloradosprings.gov

Brandy Williams                            Brandy.Williams@coloradosprings.gov