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City Council Gives Xcel Another Chance – Updated


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The bold attitude City Council brandished toward Xcel Energy at its April 13, 2010 study session fizzled somewhat during Tuesday night’s City Council meeting.  Following Council member Ken Wilson’s lead, the City Council moved the 20-year franchise agreement ahead, despite the fact that it is missing key concessions on renewable energy.

A first reading of the ordinance putting the franchise agreement on the November ballot was on the Council’s June 1, 2010 consent agenda (requiring no public hearing) but was pulled off by Council member Morzel.  Pulling an item off the consent agenda gives the public a chance to weigh in before Council votes on the item.  And weigh in they did.  Steve Pomerance, Leslie Glustrom, Dan McGuire, Micah Parkin, Shirley Jin, Ken Bonetti, Julie Zahniser, Dan Friedlander, Alison Burchell, Ken Regelson and Greg Ching all testified on the issue.  The arguments for not advancing the franchise agreement put forward by the public included:

  • It isn’t wise to sign a 20-year agreement in a political and technological environment that is undergoing rapid change.
  • The City should consider how expensive it will be to be locked into current technologies.
  • The franchise agreement negotiations should be open to the public so that the considerable expertise of Boulder citizens can be engaged.
  • Boulder should have as much freedom as possible to determine its own energy mix.
  • Boulder should be creative and look to a diverse mix of smaller sources such as methane, solar and small-scale hydro.
  • A diverse energy mix will provide more security and reliability.
  • Boulder could take advantage of this opportunity to become a leader in clean technology.
  • Boulder is weakening its negotiating position by advancing a 20-year commitment to Xcel.
  • Municipalization (the City taking control of its own energy supply mix) should be on the table.
  • The basis for Xcel’s Windsource pricing is impossible to determine.

Representatives of Xcel were also on hand to offer their input.  Craig Eicher, Xcel’s Area Manager, said that the franchise agreement doesn’t restrict Boulder’s options – it’s the state that is restricting the options.  He believes that negotiations have been productive and that the franchise agreement should be put on the ballot for the citizens to decide.  He also commented that Windsource is available now and the City could become 100% Windsource powered if it wanted to.  Jerome Davis, Xcel’s Director of Community Relations, thanked the City staff for their hard work and urged the Council to move the agreement along.

This is like saying, if you want to be green, just go buy a Tesla. 
Leslie Glustrom, Clean Energy Action

Council deliberations began with a motion by Wilson, seconded by Council member Karakehian, to authorize the City staff to put the franchise agreement on the November 2, 2010 ballot.  Wilson stated that his objective in making the motion was to keep the City’s options open.  Karakehian agreed, saying that advancing the agreement past first reading is not the same as endorsement.  Council members Ageton and Becker argued that, as advised by Acting City Attorney David Gehr, first reading needed to pass in order to keep alive the possibility of putting the issue on the ballot in the Fall, and that this would allow 60 days to negotiate “side agreements” with Xcel that would stipulate the proportion of renewable energy  in the Boulder portfolio.  Council member Appelbaum suggested that there is no chance that this can or will get done in a 60-day time-frame.

At its April 13 meeting, Council unanimously agreed to direct staff to ask Xcel for a 1 or 2 year extension of the franchise agreement past its expiration date on August 3.  In a May 6 letter, Xcel indicated that it was not interested in a franchise extension.  Xcel was then asked if it would provide a franchise extension until the end of 2010.  Xcel responded that it would provide an answer on June 3.  Deferring an answer until after the City had voted on first reading was an issue that raised the ire of a number of Council members.  Appelbaum said, “Xcel is conveniently taking advantage of their leverage.”  Morzel observed that this was normal Xcel strategy and that, “It takes two to tango.  Xcel needs to tango better.”  On the other side, Becker said that she wanted the City to show willingness to give Xcel some certainty.  “We have to step forward,” she said.

Wilson and Becker suggested that putting the franchise agreement on the ballot would let the voters decide.  Appelbaum and Council member Gray cautioned that Xcel could easily outspend community groups advocating for clean energy and that “Xcel could play rough if they want to.”

Wilson’s motion passed 6 to 3, with Appelbaum, Gray and Morzel opposed.

When sought out for reaction, Clean Energy Action founder Glustrom, surrounded by decarbonization tech team members, said, “I’m pleased that the City Council recognized significant progress is needed in order to have an agreement that is worthy to be put on the ballot.  They also recognized the need for citizen involvement.”

Regarding Windsource and Xcel representatives’ statements that the City could buy 100% Windsource if they wanted to, Glustrom and other members of her team pointed out that the Windsource pricing is too high.  The Poudre Valley Rural Electric Association has just lowered the cost of green power to its customers to $0.09 per 100 KWH blockXcel imposes a $2.16 adjustment for the same unit of Windsource energy.  “This is like saying, if you want to be green, just go buy a Tesla,” said Glustrom.

Council will take up the issue again on Thursday, June 3, 2010 in a study session. According to a City press release, the study session will include updates on ongoing franchise negotiations with Xcel Energy and staff findings about alternatives to a franchise agreement.  The energy future study session is scheduled to begin at 7:30 p.m. The session will take place in City Council Chambers and will be broadcast live on Channel 8.

A memo has been prepared for council on this topic and is available on a new City-maintained website dedicated to the issue of Boulder’s energy future. This site can be found at: http://www.bouldercolorado.gov/energyfuture. Information will be updated here as it becomes available.

UPDATE:  This afternoon (June 3, 2010), Xcel sent a letter to City Manager Jane Brautigam stating that they would be willing to extend the existing franchise agreement beyond its August expiration date to December 31, 2010.

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