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The city council met at a workshop to consider the options laid out in a white paper released Dec. 6 by the city. The paper was sent to Xcel Energy (NYSE: XEL), which did not collaborate in its creation. On Dec. 11, Xcel responded with a letter from its chief executive, David Eves.
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In November 2011, Boulder voters narrowly approved two measures giving Boulder the authority to pursue the possible formation of a city-owned electric utility. Since then, city staff members have been studying what it would take to form a utility and if it would meet the city’s financial requirements and environmental goals.
Most of the research has focused on creating an independent utility, which would require Boulder to purchase the grid from Xcel Energy or obtain it by claiming eminent domain.
The white paper, created by the city’s energy strategy staff, said the city should be open to remaining in the Xcel Energy system if the two sides could form a partnership open to creating Boulder-specific programs.
“The over-arching message of the white paper is we can think of a number of different ways” to work together, City Manager Jane Brautigam told the council. “But the point is this has to be done as a partnership, and a partnership is very different than a franchise agreement.”
Ideas include enhancing SmartGridCity and creating a plan to “decarbonize” Boulder’s power supply. The most ambitious would be the creation of “Xcel Boulder,” a partnership in which Boulder formed a utility and owned the system but hired Xcel Energy to run it.
SmartGridCity was a pilot program developed by Xcel Energy in partnership with the city of Boulder and other corporate partners.
In his letter to the city, Eves said Xcel Energy was open to discussions and would like to begin them immediately.
“We believe that many of the options referenced in the report would allow you to meet your objectives, while allowing us to preserve principles that we view as important, as well,” the letter said.
Eves wrote that Xcel likely could not agree to some options, but declined to identify them.
“Still, we see no reason not to move forward with a dialogue about the options presented,” Eves said.
Council members mostly welcomed the prospect of negotiations but directed staff to keep working on its studies to see if Boulder could create a viable utility. The staff is scheduled to present its findings in February.
Members of the council also recognized that even if it were a willing partner, Xcel Energy might be unable to form the type of partnership the city wants.
“Some of the things we mention would require a huge shift in corporate thinking for them to happen,” Councilman Tim Plass said.
Some of the options would require major changes to state regulations and law, which could later be undone by the Legislature or the Public Utilities Commission, Mayor Matt Applebaum said.
“It’s honestly hard to see how any of these give you a comprehensive solution, other than some form of municipalization,” Applebaum said.
The 17-page white paper was authored by the Energy Strategy and Electric Utility Development Department, which is headed by executive director Heather Bailey.
The authors said achieving goals Boulder already has established should be the priority. Those goals include ensuring Boulder has a stable, safe and reliable energy supply while getting power at a competitive price. The city also wants a provider that can cut carbon emissions and pollutants and gives Boulder residents and customers a greater say about their energy supply and sources.