Why Boulder Voted to Abandon Xcel Energy In Favor of City-Owned Power Utility

Search form

Why Boulder Voted to Abandon Xcel Energy In Favor of City-Owned Power Utility

Why Boulder Voted to Abandon Xcel Energy In Favor of City-Owned Power Utility
Tue, 12/17/2013 - by Bob Massie
This article originally appeared on Cognoscenti

In a ground-breaking move in November, voters in Boulder, Colo., approved an initiative to end their relationship with Xcel Energy, a utility with $10.7 billion in revenues, thus clearing the way for the city to form its own municipal utility that would lower rates and make greater use of renewable energy.

Opponents of the effort had themselves put the question on the ballot in order to block measures by the city council. They also tried through a second initiative to hamstring the city from issuing enough bonds to be able to afford the purchase of Xcel’s facilities.

During the fierce battle that attracted national attention, corporate executives and their allies argued that the city had neither the money nor the expertise to manage such a complex enterprise.

Advocates for the municipal utility, including New Era Colorado Foundation, fought back with a crowd-funding campaign that raised more than three times their financial goal. In a landslide, two-thirds of voters supported the idea of bringing the utility under public control and then rejected the borrowing limits designed to kill the deal by a similar margin.

Though the utility industry has gone through a wave of consolidation over the last two decades, they are starting to show the strains of technological, economic and political change.

Municipal utilities are far more common than most people are aware, with more than 1,000 already functioning in the United States, serving 50 million customers, a population greater than the size of Spain. Most of these entities are owned by cities, and controlled by panels of local citizens. Some are even cooperatives owned by their members.

Proponents of change, not only in Boulder but around the country, have argued that public control creates three vital benefits.

First, decisions are made not by distant corporate managers whose first priority is to generate returns for absentee shareholders or to pay enormous salaries for executives, but by managers who are accountable to the community.

Second, because of this, municipal utilities can focus on important local goals, such as investing in renewable energy, efficiency, and other factors that increase community resilience.

And finally, the rates of municipal utilities are traditionally lower than their counterparts, and they channel any financial surplus—also known as profit—back into the community.

All of this comes at a time when the entire model of a corporate utility operating a centralized grid is facing steady erosion. Universities and cities across the country are expressing their desire to move away from both hiring—or even owning stocks in—companies that remain committed to fossil fuels.

In addition, every family who installs solar on their roof not only slashes their need for energy from a utility, but also cuts the revenue for those same firms.

As the number of customers inexorably drops, the firm must spread its costs across a smaller and smaller number of customers, which increases their rates and creates even more demand to leave the grid.

This long-term shift has caught the attention of both the U.S. Department of Energy, which supports it, but also the Edison Institute, the industry association of large utilities, which warned in January 2013 that the entire energy industry may follow the path of the phone companies, which struggled to maintain a vast system of land-lines even as customers flooded to widely distributed cell phones.

As the price of solar energy steadily comes down—and as oil continues to rise—the transformation of America’s energy economy is underway.

The critical question for those who want to see America shift to a new economy that is just and sustainable for people and the planet is whether the technological shift from a centralized fossil-fuel grid will be matched by a smaller shift from centralized, large-scale corporations to democratic control.

If this happens, with cities like Boulder leading the way, the energy, the dollars, and the decisions about the future will move into the hands of local communities, which would free more Americans to take the transformative steps we both want and need.

Bob Massie is president and CEO of the New Economics Institute.

ORIGINALLY PUBLISHED BY Cognoscenti

Article Tabs

Despite propaganda from Big Ag, biotech and the Grocery Manufacturers Association, surveys show vast majority of residents in Washington, Oregon and Idaho want to know what's in their food.

When a journalist in a news article refers to a woman as “strident,” you know what you’re reading is a hit piece – and that's what the New York Times produced about Occupy Wall Street activist McMillan.

A new kind of tracking tool, canvas fingerprinting, is being used to follow visitors to thousands of top websites, from WhiteHouse.gov to YouPorn.

Reporting that CEOs in the U.K. earn 162 times more than the average worker, the High Pay Centre calls on government to put immediate caps on executive salaries.

On Monday, 80 protesters with Utah Tar Sands Resistance halted access to equipment where the company seeks to begin work on the first fuel-producing tar sands mine in the state.

In the 80s and 90s they called them "IMF Riots" – but what the biggest international investment organizations and consultants now see happening looks a whole lot bigger.

Posted 6 days 16 hours ago

Part 3: Chris Hedges interviewed Harvard professor and MayDay SuperPAC founder Lawrence Lessig about his plans to break the hold of big money on American elections.

Posted 6 days 16 hours ago

Patient details were shared with organizations including private health insurance companies, many based in the United States.

Posted 6 days 16 hours ago

The aggressive foreclosures and water shut-offs are a deliberate scheme to shock the population, drive long-time residents out of the city center, seize property and gentrify downtown Detroit and the waterfront.

Posted 6 days 16 hours ago

All over the world, publics are beginning to reject the privatization mantra – because the privatizers, it turns out, have a serious problem with their pitch.

Posted 6 days 16 hours ago

Not only do the FBI and Secret Service have standing authority to jam cellphone signals, but they along with state and local authorities can also push for the shutdown of cell towers.

Scott Walker Rebuked By Court

In a major labor victory, Wisconsin circuit court Judge Juan Colas struck down key parts of Gov. Scott Walker's anti-union law, restoring collective bargaining rights for city, county and school-district employees.

At least five and perhaps as many as eight of the nine members of the U.S. Supreme Court are millionaires according to recently released financial disclosures, and only two hold any consumer debt.

Nathan Weber

What the world is witnessing in Chicago as thousands of teachers, staff and support personnel strike is the emergence of a revolutionary ideal.

Greetings from Michigan, the Right-to-Rip-Off-Unions State

What should one call these Orwellian “right to work” laws?

Sign Up