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Boulder legislator cites missing faces at table in community choice aggregation testimony

by Allen Best

Colorado State Rep. Edie Hooton, a Democrat from Boulder, accused some environmental organizations in Colorado of being weak in the knee when it came to supporting her bill that, in theory, all environmental groups should like.

Who was she referring to? We’ll get to that.

Hooton is submitting a bill this week that calls for study of community choice aggregation. It would allow municipalities to procure power from an alternative supplier while still receiving transmission and distribution services from an existing utility. This is different from Boulder’s efforts to form its own utility.

She describes community choice aggregation, also called community choice energy, as a way for Boulder and other jurisdictions to more rapidly decarbonize their electrical supplies.

In a recent video-conferenced meeting sponsored by Empower Our Future, Hooton was asked what the politics of the bill are.

Colorado’s investor-owned utilities – Xcel Energy and Black Hills Energy—were opposed. “And we can understand why. I don’t have to explain that,” she said.

“My biggest challenge is that we have some environmental partners who are not in a neutral position,” she went on to say. “That is a great source of frustration to me. Through their promotional materials to their members and to attract new members, they talk about all they’re doing at the Capitol to advance aggressive renewable energy goals. But at the end of the day, they don’t want to rock the boat. They would maintain their comfortable relationships with the utilities that have had representation at the Capitol for over 100 years. They would rather take the regulatory approach, what I call the slow-boat to China approach, and they are not supporting my bill.”

Some readers will want this statement deconstructed. First, why the investor-owned utilities would oppose this bill?

In Colorado, and most other states, investor-owned utilities have monopolies, but are regulated by the state. In Colorado, that’s the Public Utilities Commission. Xcel and Black Hills sold 56% of the electricity in Colorado as of 2018. State regulators allow the utilities profits, not vast riches but good enough and some would say better.

This would remove some of their profit-making potential.

Given the fluid change in energy, some jurisdictions have been shopping. Fountain, a municipality near Colorado Springs, elected to let its franchise with Xcel Energy lapse and will instead be supplied by Guzman Energy, a relatively new Denver-based wholesaler.

Guzman also is supplying two former electrical cooperatives, Delta-Montrose Electric Association in Colorado and Kit Carson Electrical Cooperative. Both had previously been supplied by Tri-State Generation and Transmission.

Low-priced renewables have opened up new opportunities. Some organizations, such as Kit Carson, are driven by carbon-reduction goals. Fountain? Not quite so much. In both cases, traditional wholesale providers don’t have the same price advantage.

Might Boulder be able to decarbonize more rapidly if it was able to break away from Xcel? The city studied that option from 2010 until voters in November 2020 chose to renew a franchise with Xcel. That agreement, however has many off-ramps for the city in coming years from the franchise agreement.

This was published in the March 31, 2021, issue of Big Pivots, an e-magazine. For a free subscription, go to BigPivots.com

At the outset of her presentation to Clean Energy Action, a group that promoted municipalization in Boulder, Hooton described her bill as being “not about Xcel. This is about options for communities.” She said that option is why she has drawn support from the Denver City Council, Golden, Pueblo, San Miguel County, and Boulder County. She said the bill is also supported by Gov. Jared Polis because of his belief in the value of the market for effecting change.

The bill would open a docket at the Public Utilities Commission with the intent to investigate the feasibility of this. If the report is favorable, further enabling legislation would be required. The earliest any community could take advantage of the new provision would be 2025.

“2025 would be the first year, if everything went according to plan, that a community like Boulder, Denver or Pueblo could consider adoption of CCE authority,” she said. That will give Xcel the time necessary to meet some of their more decarbonization goals, she added.

Why does it matter if some of the environmental groups – whom she did not identify – stay on the sidelines of this bill?

Their absence in testimony before legislative committees would send a signal to legislators, said Hooton. “That would be a challenge for me,” she said.

Conservation Colorado has confirmed that it will stay neutral on Hooton’s bill, as will Western Resource Advocates. The Sierra Club has not indicated what its position will be. Big Pivots did not ask other environmental groups for their positions.

The Empower Our Future session can be seen here.

 

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