City of Boulder

City files application for transfer of assets with Public Utilities Commission

Important next step in local electric utility effort

The City of Boulder today filed an application with the Colorado Public Utilities Commission (PUC) asking for approval to transfer the electric system assets necessary to operate a municipal electric utility. These assets are currently owned by Public Service Company of Colorado, also known as Xcel Energy.

The city’s application seeks to acquire only the facilities necessary to serve Boulder customers, achieve the community’s energy goals and meet the requirements approved by Boulder voters as part of the City Charter. Boulder is not seeking to transfer any generation (power plants) or the local transmission loop that serves the city. The PUC has an important regulatory role in ensuring that a transition to a local electric utility does not negatively affect reliability, safety, and service quality.

In order to form an electric utility, the charter requires the city to show it can have comparable reliability to Xcel. The filing outlines how Boulder plans to do just that. Expert witnesses describe the interconnection process and how this can be done without harming the remaining customers of Xcel.

“People have been asking us how we plan to operate an electric system to ensure excellent service and reliability. We are excited that the Boulder community and other interested parties can now see the engineering details of our plan,” said Heather Bailey, executive director of Energy Strategy and Electric Utility Development.

Because of the way the system was built, the electric system includes some poles and wires that serve customers both inside and outside the city limits. The PUC has an important regulatory role in ensuring that a transition to a local electric utility does not affect reliability, safety, and service quality.

While the city needs to acquire these lines and associated equipment to enable it to serve all Boulder customers, Boulder is not seeking to serve customers outside the city. Under the city’s filing, these customers would continue to be served by Xcel Energy. Xcel would deliver electricity to its customers over the city’s electric lines, a practice used in the utility industry where systems are adjacent.

“The filing shows that non-city customers will not be harmed by the departure of Boulder from the Xcel system. It also supports the Boulder community’s commitment to a cleaner power supply, prioritizes investments in resilience and reliability, provides access to more local generation, and supports economic vitality by creating a market for local and national innovative energy services,” said Bailey. “We look forward to having our plan reviewed by the commission, as well as additional engineers and others with expertise in this industry.”

The application also makes clear that the city is planning a transitional approach to its power supply. The city would continue to be a customer of Xcel Energy for a limited period of time. By gradually reducing its demand for power from Xcel in coordination with Xcel’s increasing need for electric resources, the city helps facilitate a smooth transition for all customers. This will ensure that other Xcel customers across the region are not impacted negatively. The resources released by Boulder could instead provide power to other customers, avoiding the expense of developing new energy supplies. Even with this approach, the city will be well-positioned to increase renewable sources of energy and decrease emissions much more quickly than it would by remaining a retail customer of Xcel.

The city had hoped to file the application with the PUC later in the municipalization process, while condemnation proceedings were underway in district court and more information about the system was known. However, regulators and a district court judge determined the city should go to the PUC first, a decision the city respects and with which it is complying.

The city has been pursuing the possible operation of its own electric utility as one way to achieve a set of energy goals set by the community in 2010 when Boulder City Council decided not to renew a 20-year franchise with Xcel Energy. The community said it wanted reliable and low-cost energy from cleaner sources, like wind, solar and hydro, and more say in decisions related to rates, investments, customer programs and supply. Extensive analysis has shown that a local electric utility could accomplish and balance these goals.

The city hopes the PUC will consider this application on an expedited timeline. The application was filed today and is available online. Testimony will be filed tomorrow.

For more information about the Energy Future Project, please visit BoulderEnergyFuture.com.