Steam to Electric Conversion Incentive

an icon of a radiator

The Colorado Public Utilities Commission approved rate changes that increased the price of steam in Denver by almost 40%. This prompted many building owners to explore disconnecting from the steam loop system. The alternative for these buildings is to either add a natural gas connection or to electrify it. Denver would like to encourage building owners to choose the electrification option. Electrification has many benefits:

  • Reduce greenhouse gas emissions. Xcel Energy is increasing the electricity that comes from renewable sources. By 2030, Xcel Energy will be 80% emissions-free. The more we rely on electricity, the more we take advantage of this renewable energy.
  • New strategies to electrify. The buildings in this program will be valuable case studies. They will teach us lessons about how to electrify future buildings.
  • Improve safety and indoor air quality. Natural gas leaks out of equipment that uses it. This presents a health risk to occupants.
  • Protecting communities most burdened by climate change. Some populations experience the effects of climate change more severely than others. Hotter temperatures can make chronic health conditions worse. Unhealthy living conditions for people living in low-income communities get worse too. Extreme heat also affects people with less access to green space and cooling.

Our goal is to reduce greenhouse gas emissions from steam-powered buildings. Buildings in this program will reduce their carbon emissions by at least 20%. This funding helps building owners disconnect from steam and electrify. 

Eligible Buildings

Incentive payment applicants must meet the following criteria to be eligible for consideration:

  • The building must be a customer on Xcel Energy’s steam system in Denver. Buildings will verify this by submitting a current Xcel Energy bill.
  • The applicant must be the building owner.
  • The applicant must be able to complete the project within 24 months.
  • The applicant must have gotten technical expertise and quotes. These will help determine the best method for conversion from steam to electric. You will need to submit quotes for both an electric conversion and a gas conversion with your application. We encourage you to include schematic design documents. The incentive cannot cover any costs incurred to prepare this application.
  • The applicant must submit a budget. The budget must include:
    • Total costs (labor and equipment) to convert the building from steam to electric
    • Total costs (labor and equipment) to convert the building from steam to natural gas
    • The cost difference between the two options. This difference between the two cost totals is the amount you may apply to receive from the city.
    • All prices quoted will be firm and fixed for the defined SOW and timeline
  • Data to inform a city assessment of greenhouse gas reduction for the conversion.

Evaluation of Applications - Criteria and Weights for Selection

The application will be evaluated according to the criteria described below, with the weights allocated to each criterion set forth in the table that follows.

  1. Greenhouse gas reduction assessment - Demonstrated reduction in greenhouse emissions by comparing the projected emissions from the all-electric and all-natural gas system options. The Office of Climate Action, Sustainability, and Resiliency (CASR) will prepare the GHG assessment using data submitted by the applicant, as described in the application.
  2. Cost effectiveness – Conversion represents a cost-effective opportunity to electrify rather than choosing natural gas when paired with Climate Protection Fund support.
  3. Non-energy benefits – Conversion captures non-energy benefits such as improved thermal comfort, improved reliability, improved occupant health, reduced noise, etc.
  4. Teaming plan and workforce standards – Please describe your team and qualifications, and any women and minority owned businesses that are part of your team. Applicants should also demonstrate, as applicable, how they utilize high road labor standards such as a skilled and trained workforce from certifications or apprenticeship programs; provide benefits such as health care, retirement, and wage standards; use best value/responsible contracting; and have regional targeted and local hire requirements.
Evaluation Criteria Points
Greenhouse gas reduction assessment 45
Cost effectiveness 40
Non-energy benefits 10
Teaming plan and workforce standards 5
Total 100

The city may request an interview as part of the evaluation process. Any such interviews will take place after CASR has conducted an initial review of submitted applications.

CASR encourages applicants to utilize small, minority, and woman-owned businesses on their project team and, where independent contractors are needed, consider utilizing individuals who identify as people of color, Indigenous people, LGBTQ+, people with disabilities, and people whose household income is below the area median.

Award(s) Notification

We will accept applications on a rolling basis and make award determinations by the end of each quarter. We reserve the right to not award any applications during a quarterly award period.

Selected applicants will receive an award notice via email. You should be prepared to collaborate with the city to establish a formal written agreement. The agreement will not be effective or binding on the city until it has been fully executed by all required signatories of the City and County of Denver. Contracts more than $500,000 require approval from the City Council and will take longer to process. Contracts will contain reporting and milestone requirements that must be satisfied before the city will reimburse project costs.

Maximum award expenditure for 2024 incentives is $4 million.

Submit an Application

Completed applications and required forms/documentation must be submitted via e-mail to Jeff Tejral. Denver Climate Action will evaluate applications on a quarterly basis. All required forms and supporting documentation must be included at the time the application is submitted. Please review the sample agreement with the city’s standard language and insurance requirements before submitting your application.

Back to top