Cities Break from Private Utilities

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Boulder Colorado voters approved two ballot initiatives with the intent to sever their relationship with Xcel Energy and to develop a home ruled, municipally owned utility that would be environmentally greener and locally accountable. One of the initiatives, issue 2C gave the City permission to form a municipal utility by selling the necessary bonds to take over the current system from Xcel. Boulder’s City Council is scheduled to vote next month on creating its own municipal utility.  Boulder is not alone as Minneapolis, Santa Fe, and cities in Massachusetts are considering making the switch. The main drivers are local control, renewable energy sources, and carbon emissions.

Private utilities are resisting the proposal citing their inability to recoup investments already made in anticipation of customer needs, efficiency, and restoration recovery speeds.  They also cite the huge economic start up cost involved.  Government owned utilities counter that they are non profit entities that do not answer to shareholders, have access to tax exempt financing, do not pay federal income taxes, and do not pay exorbitant CEO salaries.  The biggest obstacle to municipilization may be the political power of the private utilities in the state legislatures.