Xcel Energy believes the City of Boulder has missed out on a huge opportunity by denying its citizens a chance to vote on a franchising agreement that would have included a large purchase of wind power from the utility.
Xcel had proposed selling 200 MW of wind power to Boulder, but that deal was contingent on the city's signing a 20-year franchise agreement with the utility. The city, however, had already decided last year against renewing a franchise agreement with Xcel.
Discussions regarding the sale of wind power to the city broke down two weeks ago after both parties disagreed about whether Boulder citizens should have the chance to vote on the proposed wind/franchise agreement.
Boulder's city manager recommended that the city council not include the question of a franchise agreement on a November ballot, and instead ask citizens if they agree with forming a municipal utility. The city council agreed and voted on July 19 to include the municipalization question on the ballot. The measure was moved to a second reading on Aug. 2 and will get a third and final reading on Aug. 16. Citizens will then get a chance to vote on the measure on Nov. 1.
‘As a utility, we're disappointed that the path that [Boulder has] chosen to go on is more about municipalization rather than what the concerns of the citizens were,’ says Gabriel Romero, a spokesperson for Xcel Energy.
The utility says it wanted citizens to be able to choose from three options on the ballot measure: a 20-year franchise agreement between Boulder and Xcel; a franchise agreement coupled with the wind proposal; or a municipal utility created by the city.
Sarah Huntley, a spokesperson for the City of Boulder, contends that these options could have confused voters.
‘To put a choice out there for people to vote on that â�¦ could be kind of confusing because we're already talking about having three potential ballot questions about this,’ she says. ‘But this also does not represent what the city staff, city council and elected officials, most importantly, think is the right step for the city.’
Creating a municipal utility would essentially mean the end of Boulder's relationship with Xcel Energy.
‘We obviously don't want to lose them as a customer – that's a given,’ says Romero. ‘We have gone above and beyond to put the community at 70 percent renewables.’
If Boulder ended up purchasing the wind power, the city would have been able to obtain 70% of its power from renewable energy by next year and 90% by 2020, according to Xcel Energy.
Huntley says incorporating more clean energy into the city's mix is a priority, but adds that Boulder wants to be able to purchase more renewable energy from the open market and create local generation, rather than to rely on Xcel.
‘We are committed to having cleaner energy be a major part of this effort,’ she says.
The city currently has no local renewable energy projects. Romero, who says local generation in Boulder might not be possible due to a lack of resources, believes that officials are being naive.
‘I think some people are misunderstanding how it works: You have to go where the wind is. It may not necessarily be in your community,’ he notes.
Romero believes the City of Boulder is solely focused on creating a municipal utility and that it has made a rushed decision to exclude the wind/franchise question from the November ballot.
‘Essentially, what that says to Xcel Energy is that [Boulder] doesn't necessarily care about renewable energy; they just want to be a municipal utility,’ he says. ‘All we were really asking was to give the customers and the citizens of Boulder a chance to weigh in on all of this, but instead, they just said, 'No, we're either going to municipalize or not municipalize.'’
Huntley says the area's renewable energy goals can be achieved at lower costs without Xcel, which estimated an additional $4 per month per customer to add Xcel's 200 MW of wind power. City officials also decided last year that renewing another 20-year agreement with the utility would not be beneficial to its residents.
‘We feel like a straight, 20-year 'business as usual' franchise would not accomplish any of the goals that the community has set out for its energy future,’ Huntley says. ‘We also believe that the industry is changing so quickly that to lock into something for 20 years could tie our hands for future opportunities.’
Huntley acknowledges that Xcel's wind plan was creative, but says the utility presented it too late in the game.
‘On first blush, there are some things about it that were really attractive, in terms of bringing more renewables online quicker, for example,’ she says. ‘But there were also some real risks associated with it because we were going to have to pay the difference in cost. What we would have to pay over time was tied to what happens with natural-gas prices.’
Romero says city officials were wrong in denying residents a chance to vote on Xcel's plan to include wind power in Boulder's energy mix.
‘They obviously want to be very renewable, but they're missing some of the best wind prices that you can get on the market,’ he says. ‘They certainly will have access to wind sources like we do, but, guess what – they're going to be paying a lot more for it, and essentially, they're going to be starting out with zero renewables.’