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Colo. utility regulator delivers a win for Boulder municipalization mission

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Colo. utility regulator delivers a win for Boulder municipalization mission

Efforts by Boulder, Colo., to form its own municipal electric utility took a step forward Oct. 10 when the Colorado Public Utilities Commission verbally approved the city's request for permission to condemn certain Xcel Energy Inc. assets.

"We are completely free to condemn the assets outside of the substations," the city's attorney, Tom Carr, said at a City Council study session held that same day. The city has been pushing for a municipalized electric utility for nearly a decade and expects a final commission order to be issued "in the coming days," it said in a news release.

"I am pleased with this outcome and I want to thank the commissioners and their staff for their commitment to helping Boulder define a path for 21st-century municipalization," Boulder City Manager Jane Brautigam said in a statement. "This process has not been without setbacks and challenges, and it is gratifying to receive today's decision."

In September, a Colorado judge granted an Xcel Energy motion to dismiss Boulder's request to condemn and take over the company's Boulder-based assets. The judge knocked the city for not "giving the PUC the opportunity to rule on the proposed designation of assets for transfer" and mandated that the city first obtain that agency's approval as a precondition to condemnation. While the PUC's ruling fulfills that requirement, a separate Federal Energy Regulatory Commission proceeding related to the municipalization effort still must run its course, according to Emily Sandoval, a communications specialist with the city.

"This is just a small part of all the work that we're doing, but it is a really big step," Sandoval said, adding that the city will hold off on condemning any assets until that additional FERC-governed process concludes and the city can execute "one big condemnation."

Boulder residents already should be familiar with the plan, as they voted in both 2011 and 2017 on issues related to the effort. The city will need to put the matter back on the ballot, however, so that voters can provide a final mandate for the municipalization and issue debt on it.

"The takeaway is: Are we going, or are we not going?" Sandoval said. Although Boulder still aims to have the issue on the ballot in November 2020, she continued, delays stemming from the FERC and condemnation processes may push it to 2021.

Xcel Energy did not immediately respond to requests for comment.

Meanwhile, about 130 miles south of Boulder, the city of Pueblo, Colo., also is considering establishing its own municipal electric utility. Pueblo released a feasibility study stating that it would cost the city up to $334 million to do so. However, Black Hills Energy has published its own study saying the city would have to spend up to $402 million to replace it as the local utility.