Learn about the City of Boulder's municipalization effort. This presentation covers background on the project, the city's climate and energy goals and the 2017 PUC process.
2. Agenda
SECTION 1: Background
• Goals
• How we got here
SECTION 2: Municipalization Overview
• Project timeline
• Goals
SECTION 3: Where are we now? A PUC Deep Dive
• What’s going on
• Next steps
3. Background
Boulder has long cared for the natural environment and the climate.
1967
Open Space
Tax
2002
Res. to support
Kyoto Protocol
2006
First carbon tax
in nation
2013
Net Zero Energy
Code passed
7. Progress toward Climate Goals
• Five percent reduction in GHG emissions (below 2005)
• Over 20 MW city-wide installed solar capacity
• 46 city-run electric vehicle charging stations
• Securing funding for the first all-electric HOP bus
• Building resilience hubs across the community
• Via operations center
• CU micogrid
• Boulder Energy Challenge
• SNUGG Home
• Solar plus storage pilot, led to Sen. Steve Fenberg’s storage bill
• Several replicable projects…
8. Replicable Projects
• Electric Vehicle Group Purchase
• 392 EV purchases total, 289 EV purchases in Boulder County, 198 by city residents
• Boulder Solar Tool
• Before Google did it, the city mapped the solar potential of each roof and made a tool
available to the public
• City-County Solar Group Purchase
• 952 KW installed in the city of Boulder through the program
• 65 homes, 6 businesses
• Total of 1.47 MW installed in Boulder county
Boulder’s leadership has an impact—across the county, state and country!
10. Background
…but the city’s analysis shows that energy efficiency alone would
not be enough.
We needed a way to change how our electricity is generated. In
2013, Xcel’s resource mix (in MWh generated) was 78% fossil fuels.
(in 2016, it’s 71% fossil fuels).
There are many options to add more renewables and reduce carbon
fuel sources.
11. Background
Options for changing our energy generation sources
1. Work with Xcel Energy
2. Advocate for state-level policy changes
3. Explore creating our own local electric utility
(municipalization)
We’ve been working on all three. More info at
www.BoulderEnergyFuture.com
12. Background
This presentation will focus on Municipalization,
Boulder’s primary tool for establishing control over
what we use to generate electricity.
15. Municipalization Goals
• Democratize Energy Decision Making: Boulder customers should have more direct
control and involvement in decisions about their energy, including opportunities to
invest in their long-term energy needs and to have a say in energy investments made on
their behalf.
• Decentralize Energy Generation and Management: energy should be generated locally or
within the region to the maximum extent feasible, reducing reliance on external fuel
sources ; customers should be able to manage and reduce their energy use as directly and
effectively as possible; and energy service companies should be empowered to compete
and innovate within a diverse and robust local energy economy .
• Decarbonize the Energy Supply: renewable and clean fuel sources should be maximized
as much as possible, as quickly as possible, minimizing both short- and long-
term environmental impacts and maximizing energy independence over time.
16. Municipalization Sub-Goals
• Ensure a stable, safe and reliable energy supply
• Ensure competitive rates , balancing short-term and long-
term interests
• Significantly reduce carbon emissions and pollutants
• Provide energy customers with a greater say about their
energy supply
• Promote local economic vitality
• Promote social and environmental justice
17. So, why have we considered
municipalization?
According to the American Public Power Association,
municipal utilities can
• Offer local control over utility policies
• Energy sources
• Infrastructure investment
• Offer reliable and affordable service
• Can support the local economy
• Work with local energy innovators
18. So, why have we considered
municipalization?
Our own analysis in 2013 and 2016 showed that
• We could afford to create it
• A local electric utility would be cost-effective
• Many potential opportunities to become the “utility of
the future”
• Innovative programs and services
• Affordable and reliable power
19. How much have we spent?
Year 2012 2013 2014 2015 2016 2017
Total
(2012 through
Q2 2017)
Energy Future
Project: Actual
Expenditures
1,033,762 2,512,615 1,942,452 2,021,490 2,147,073 1,245,418
$1 Million
Contingency:
Actual
Expenditures
- - - 134,709 239,691 126,895
TOTAL 1,033,762 2,512,615 1,942,452 2,156,199 2,386,764 1,372,313 11,404,105
20. What are the potential future costs?
Engineering: $4.5M
Construction: $77M
Transition Plan: $14 to $32M
Debt for Acquisition: Existing assets capped
at $214M
23. PUC Overview
• Three-person regulatory body, appointed by the
governor
• Regulates Investor-Owned Utilities (like Xcel)
• District Court decision directed Boulder to file at
the Commission
• Separation Application filed on May 12, 2017
• Nine-day hearing held from July 24 through
Aug. 7
• PUC expected to rule mid-September
There are no guidelines or roadmap for
municipalization process at PUC.
24. PUC Overview
1. Direct testimony
2. Interveners submit answer testimony
3. City rebuttal/ others file cross answer testimony
4. Hearing
5. Statements of Position
6. Findings of Fact/Proposed Orders
7. Commission Deliberation
8. Order
25. PUC Application
• Boulder’s proposal to separate the electric
distribution systems—one serving city customers
and one serving Xcel customers
• Ensure that the systems can be operated
effectively, safely and reliably
• Introduced Phases for the PUC process
• The ask: Approve the list of assets to be
transferred and determine that the Separation
Plan is effective, reliable and safe
26. Separation Plan
• Boulder’s proposal to separate the electric
distribution systems—one serving city
customers and one serving Xcel customers
• Ensure that the systems can be operated
effectively, safely and reliably
• Introduced Phases for the PUC process
27. Boulder’s Application: Key Issues
• The completeness of the asset list
• Real property interests
• Separation Plan
• IBM
• Financing
• Phases
• Condemnation
30. Separation Plan
• Level of detail
• Co-location in substations
• Joint use of poles
• Who oversees and performs the work
(Internal, Xcel or Contracted Services)
33. Proposed Phases
1. Approval of assets to be transferred, approval of Boulder’s
plan to separate the electric distribution systems
2. Approval of Detailed Design Drawing and Specifications, bid
and timeline
3. Approval of “cut-over” plan
4. Compliance filing: Construction complete, entry of Rule and
Order and payment to Xcel for all separation and acquisition
costs. City takes ownership and operation of system.
CONDEMNATION
FINAL VOTER APPROVAL/ “GO/NO-GO” DECISION
CONSTRUCTION
34. Condemnation
• Delayed Rule and Order and payment
for assets until cutover of system to
allow PUC to retain jurisdiction
• PUC indicated in deliberations that they
would not enter this order
35. Boulder’s Statement of Position
• Boulder’s List of Assets is sufficient for the
Commission to approve
• The city’s Separation Plan is sufficient for
commission approval in Phase 1
• Boulder’s phased plan is a reasonable means for
proceeding towards Boulder’s municipalization
• Boulder is financially capable of funding
municipalization
• Proposed Alt. Financing Plan
• The city has a right to serve IBM
36. Xcel’s Proposed Order
• PUC does not have jurisdiction to
• require Xcel to finance entire separation and
construction
• construct new facilities for Boulder
• construct new facilities for separation on
Boulder’s terms
• Require Xcel to share poles with Boulder
• Require Xcel to share substations
37. IBM’s Proposed Order
• City has failed to demonstrate its proposed
separation plan will protect IBM’s effective,
reliable and safe service
• City has failed to demonstrate it can provide
adequate electric service to IBM
• City has failed to demonstrate Separation Plan is
not contrary to the public interest
• Requests five years before being served by the
city
• Deny reconfiguration of the substation
38. PUC Staff’s Statement of Position
• PUC should move forward with the city’s plan to
municipalize following city’s multi-phased
approach
• PUC should order Xcel and COB to work together
to finalize separation plan
• Approve List of Assets, subject to true-up
• Reservation of approval of real property
interests, pending completion of title search by
COB and Xcel; work with COB to identify
unrecorded real property assets
39. PUC Staff’s Statement of Position, Cont.
• COB can begin condemnation
• Approve transfer of assets, conditioned on
Boulder satisfying final obligations
• PUC should consider COB’s ability to operate
system before final transfer
• Xcel and the city are responsible for own
facilities, engineering and construction
• COB fund all costs
• PUC dispute resolution
• Securitize construction
40. OCC’s Statement of Position
• No harm
• No rate increases
• Issues around separation plan—premature to approve
• CenturyLink
• Alternative proposals
• Joint use
• Property rights
• PUC dispute resolution
• PUC has no authority to order Xcel to enter into contracts
• City pay’s Xcel’s litigation costs
• Supports alternative for two substations, two-way ATO
• Underground/ No joint-use of poles
• Consolidate phases and Xcel’s seven steps with deadlines
41. Other Statements of Position
• CU
• PUC does not have authority to retroactively remove from rates,
or order Boulder to pay, Xcel’s previously incurred costs
• Boulder should not be ordered to pay Xcel’s legal costs going
forward
• Boulder should only be ordered to pay actually and prudently
incurred costs of construction and separation
• Tri-State
• No position on muni
• Included in process to modify substations and ensure that no
changes harm them
42. PUC deliberations
• PUC created a path forward for municipalization
• Approved, with 3 conditions, the list of assets Boulder seeks to acquire (outside of
substations)
1. The filing of an agreement between Boulder and Xcel providing for “permanent
rights” to place and access facilities in Boulder it needs to serve its customers
2. The filing of a revised list of assets
3. The filing of an agreement that addresses payment from Boulder to Xcel for costs
incurred by Xcel during separation
• Declined to approve other parts of the city’s plan
• Proposal to have Xcel finance and construct the proposed separation work
• Proposal to require Xcel and the city to share substations or poles
• Denied IBM’s request to be excluded from the municipal utility’s service territory (IBM
can raise later)
We have always been open to working with Xcel—in fact, we’re still actively negotiating—but we see municipalization as a viable and effective way to meet our community goals.
We have always been open to working with Xcel—in fact, we’re still actively negotiating—but we see municipalization as a viable and effective way to meet our community goals.