Staying with Xcel Is Too Risky

By Ben Harding

I support Ballot Issues 2B and 2C because staying with Xcel is too risky. Whoa, you say, that’s not what I’ve heard. That’s because what you’ve heard is what Xcel has spent half a million dollars, so far, to tell you. The next time you get a slick mailer with a dire message from the Boulder Smart Energy Coalition, remember that these “concerned citizens” have gotten $250,000 (so far) from Xcel. Full disclosure: I’m not getting paid a penny to write this.

The truth is that there are a number of bad things that could happen if Boulder stays with Xcel. Some are catastrophic, and less likely, but some bad things are virtually certain to happen. The first, and worst, is that Boulder citizens will continue to subsidize growth elsewhere in the state. Colorado is projected to double in size to between 9 and 10 million people by 2050. Xcel will build many new, large generating facilities to serve its share of 5,000,000 new electricity consumers, and these facilities will be built well in advance of need and will be paid for by existing Xcel customers, including the citizens of Boulder. But, that growth might not happen, you say. That’s even worse–Boulder will be stuck paying off plants that have no customers. It’s a lose-lose proposition and is certain to occur if we stick with Xcel.

Another bad thing is that Boulder will certainly continue to pay profits to Xcel shareholders and bonuses to its management, only a very small portion of which will return to Xcel shareholders who happen to live in Boulder. And, Xcel’s administrative costs will continue to leave Boulder (their headquarters are in Minneapolis).

Things could get even worse. Xcel is a publicly traded company, and investors, who set share prices, demand quarter-to-quarter revenue growth. There is no guarantee that Xcel management won’t make decisions that increase our electric rates and compromise reliability in order to feed that growth addition. Pshaw, you say? In fact, just such a thing happened to Montana Power, which would have been a 100-year-old company if it had survived until next year. Bored by by life in a regulated utility, MPC’s CEO, with help from Goldman Sachs and some slick lobbying, got a last-minute bill passed by the Montana Legislature to de-regulate electricity. MPC sold all of its generation and transmission assets and all of its natural gas infrastructure and got out of the utility business altogether. It invested the money in a small fiber optic firm called Touch America, which soon was worth pennies on the dollar. In Butte, the last working copper mine was forced to close when electricity rates increased up to 20 times, and many of those folks in Montana who were faced with skyrocketing electric rates were also MPC shareholders, who now owned worthless Touch America stock. The only things standing between Boulder electric consumers and the greediest investors, managers and investment bankers are the Colorado State Legislature and the Public Utilities Commission. Not a very comforting thought.

Voting no on Ballot Issues 2B and 2C will end any effort that could prevent these bad things from happening to Boulder. I strongly urge a Yes vote on 2B and 2C to allow us to examine the costs and benefits of municipalization. Those benefits include bringing control of our electricity supply into our own community, ending our subsidy of growth elsewhere in the state, and keeping profits and administrative expenses in our local economy.