The City of Boulder, Colorado, is transitioning from Xcel Energy to local, sustainable energy—using wind and solar power—through municipalization.
The city of Boulder, Colorado found that a local, sustainable energy utility could reduce the city’s carbon emissions by 66 percent, increase its use of renewables to 40 percent, and keep rates the same as, or lower than, those charged by Xcel.
The city of Boulder, Colorado, has won the right to take its power supply—and carbon emissions—from corporate control. The change came in November when voters passed measures allowing the city to begin the process of forming its own municipal power utility.
The city’s current supplier, Xcel Energy, sources more than 60 percent of its power from coal. Colorado activists tried for years to persuade Xcel to transition to local, sustainable energy, arguing that the state’s plains, mountains, and 300 days of annual sunshine give it abundant potential for the development of wind and solar power. They found Xcel’s take-up of renewables frustratingly slow. Xcel is investing $400 million in its coal-powered plants, and its plans for renewables stops at 30 percent in 2020, with no further increase until 2028.
“Municipalization”—the legal process whereby the city would form its own utility company—has been on the table since 2004. When Xcel countered, offering a city-wide smart grid in 2008, Boulder accepted. But Xcel didn’t do a cost-benefit analysis prior to starting the project, and consumer cost rose from a projected $15.3 million to (at last count) $44.8 million.
Meanwhile, the corporation’s reliance on coal affected its use of wind power. Coal plants can’t be switched on and off as the wind blows. When there was more electricity generated than needed to meet consumer demand, Xcel would curtail wind power purchases in favor of selling power from its coal plants.
As Xcel’s 20-year franchise with Boulder came due for renewal, city officials were skeptical about the corporation’s willingness to meet their clean energy goals. Analysis showed a municipal utility could work, prioritizing climate change action over profits to shareholders. In 2011, the city drafted two ballots to fund the planning process, authorize the city to form the utility, and issue bonds to buy the distribution system—providing that the new municipal utility’s rates would be equal to or less than Xcel’s.
Thus began a closely fought battle between corporate money and grassroots activism. Xcel financed a “vote no” campaign to the tune of nearly $1 million, buying extensive (and some said, misleading) advertising and hiring door-to-door canvassers. Additionally, Leslie Glustrom, research director for the climate group Clean Energy Action, was banned from carrying out her watchdog role at the Public Utility Commission—which regulates Xcel.
But the “yes” campaign drew on Boulder’s strengths—it’s a college town populated with progressives and technical experts, a hub for clean energy start-ups and atmospheric research. The campaign support group, RenewablesYes, assembled a volunteer team to analyze Boulder’s electricity mix. They found that a local, sustainable energy utility could reduce the city’s carbon emissions by 66 percent, increase its use of renewables to 40 percent, and keep rates the same as, or lower than, those charged by Xcel.
The list of endorsements grew to include dozens of elected officials, a roster of businesses, three local newspapers, and over 1,000 residents. Political action organization New Era Colorado put additional vitality into the effort by mobilizing young people, who worked phone banks and pounded the pavement to counter Xcel’s advertising.
The ballot measures passed by a whisker—a major victory given that the corporation outspent the grassroots campaign 10 to 1. Ken Regelson, a leader in the campaign, noted that personal contacts with voters, “are worth more than a utility can spend.”
Municipal utilities aren’t the untested experiments Xcel’s “vote no” campaign made them out to be—there are more than 2,000 public utilities serving 46 million customers in the United States. While some of these utilities are in small or rural markets, Boulder generates at least $100 million in annual revenue for Xcel. This means the shift could keep millions of dollars in the local economy.
If all goes well, Boulder officials estimate it will take three to five years to create the power and light utility. Climate change activists working on the plan hope it will be a successful model for other cities. “Everything we are doing,” says Regelson, “we plan on sharing as widely as possible … there are lots of lessons to learn and share.” As Boulder works out the details, other cities are watching. They may already be planning to “go Boulder,” ditch the corporation, and take control of their local power.
Valerie Schloredt is associate editor at YES!, and John Farrell from the Institute for Local Self-Reliance contributed to this story. Excerpted from YES! (Spring 2012), a quarterly magazine concerned with building a more just, sustainable, and compassionate future with articles about economic alternatives and peace options.