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CAP Tax

Boulder’s Climate Action Plan

Boulder’s Climate Action Plan, often referred to as the CAP, is a set of aggressive, city-funded programs and services designed to reduce local greenhouse gas emissions and mitigate climate change.

Climate TargetsClimate action status

  • 80% Emissions Reduction by 2050
  • 80% City organization emissions reduction by 2030
  • 100% Renewable Electricity by 2030
  • 100MW of local renewable generation by 2030

What is the CAP tax?

  • The nation’s first voter-approved tax dedicated to addressing climate change
  • Generates approximately $1.8 million per year
  • Levied on city residents and businesses based on the amount of electricity they consume
  • Tax rates are different depending on the sector. Annual average costs:
    • Residential: $21
    • Commercial: $94 
    • Industrial: $9,600
  • Originally passed in 2006
  • Extended in 2015 to continue through March 31, 2023

Read more about the history of the CAP tax pdf.

Results of CAP-funded programs

  • Approximately 250,000 to 750,000 cumulative metrics tons (MT) of avoided greenhouse gas emissions since 2007
  • CAP tax has generated $17.3 million in revenue which has funded policies, programs, direct advising services and rebates to homes and businesses.
  • CAP-funded programs have helped the community reduce GHG emissions 16% from 2005 levels

Read our CAP at a Glance pdf handout to get a brief overview of the CAP tax and programs.

 

Progress reports of CAP-funded programs

 

​CAP Tax in Detail

  • Stopped the growth of greenhouse gas emissions and achieved real emissions reductions
  • Helped thousands of residents and businesses implement energy efficiency improvements at home and at work
  • Significantly increased the number of property owners and tenants investing in, and benefitting from, energy efficiency programs
  • Earned Boulder one of highest rates of installed solar capacity per capita in the United States, and recognition as a Platinum-level Solar Friendly Community
  • Piloted new programs and approaches that have been replicated across Colorado.

The below numbers are current as of December 2018. The current CAP tax revenue funds a variety of effective efforts and is currently allocated to:

  •  EnergySmart energy advising services and rebates for residents
    • More than 11,000 City of Boulder housing units have participated in EnergySmart since the program’s inception in 2010.
    • More than $1.8M in rebates have been paid and over $16.7M in private investments have been made.
    • Over 16,000 MTCO2e have been reduced to date from these upgrades, with an anticipated lifetime impact of 65,000 MTCO2e reduced.

 

  •  SmartRegs energy efficiency requirements for rental properties
    • ​​ SmartRegs requires that all rental housing units comply with energy efficient requirements by December 31, 2018.
    • More than 20,500 rental units (out of about 23,000) are compliant with SmartRegs
    • More than $880K in rebates have been paid and over $6.7M in private investments have been made
    • Over 14,000 MTCO2e have been reduced to date from these upgrades, with an anticipated lifetime impact of 56,000 MTCO2e reduced.

       

  • Pilot programs that spur market innovation and local renewable energy generation
     
    • Boulder Energy Challenge   grant program has provided over $490,000 funding for innovative solutions from the community to reduce emissions
    • Growth of the Comfort365 program has provided ongoing support to homeowners adopting heat pumps as natural gas replacement alternatives
    • 48 City operated electric vehicle charging stations are available for public charging

     

  • Programs and policies designed to improve energy efficiency in commercial properties  
     
    • EnergySmart for Businesses pdf: More than 2,300 City of Boulder businesses have participated in EnergySmart since 2010. More than $3.3M in rebates have been issued and more than $17.9M in private investments have been made
    • Building Performance Ordinance: Launched in 2015, the ordinance requires owners of large commercial and industrial buildings to annually rate and report their buildings’ energy use, and perform periodic energy efficiency measures. The ordinance has experienced a 99% compliance rate since implementation, covering over 32 million sqft of commercial building space
       
  • Program tracking, reporting and evaluation
    • Tracking community greenhouse gas emissions using a new international standard used by other global cities. As of the 2017 completed inventory, community emissions have been reduced by 16.2% from a 2005 baseline. 
    • Development of a sustainability data tracking, management and reporting system
    • Development of a roadmap to reduce greenhouse gas emissions in collaboration with community partners and experts​

​Additionally, a number of successful programs and services born from the CAP tax and developed in Boulder have since been adopted by other cities and organizations.  EnergySmart’s  energy advisor model is now used by organizations nationwide. Boulder’s Small Building Tune-Up pilot (2010-2013) encouraged Platte River Power Authority and Xcel Energy to launch utility incentive programs now available to thousands of customers across the state.

 

Frequently Asked Questions

The CAP tax funds programs and services to reduce GHG emissions by encouraging residents and businesses to reduce energy consumption, save money on energy costs over time, and minimize reliance on external energy sources. Programs and services are periodically evaluated and adapted to be most effective and meet the needs of the community.​​

  • C&I Building Efficiency

    • EnergySmart  and  Partners for a Clean Environment (PACE) :  In partnership with Boulder County, these programs provide rebates and one-on-one energy advising services to businesses.
    • Building Performance Ordinance :  Requirements for all large (> 20,000 ft2) commercial and industrial buildings to rate and report their energy usage and perform cost effective efficiency actions over time.
    • Clean Energy Finance : Work with Boulder County to expand utilization of the Colorado Commercial Property Assessed Clean Energy (C-PACE) financing program, and to create other low interest financing options for energy projects.
    • Net Zero Energy Codes (Commercial) : Every three years, update energy codes to ensure the city is on pathway to the goal of net zero energy codes for all new buildings by 2031. Continuous implementation, evaluation and improvement of energy codes.
  • Residential Demand Side Management

    • SmartRegs :  Requirements for energy efficiency (equivalent to the 2000 International Energy Conservation Code) in rental housing units, which account for over half of the Boulder’s housing stock. In 2018, most of these program costs are being covered by the city’s general fund, due to CAP Tax revenue shortages.
    • Residential EnergySmart : Provides homeowners with energy advising services and rebates.
    • Residential Electrification Pilot : Boulder has initiated a collaborative effort with 20 U.S. cities and major heat pump manufacturers to accelerate the transition from natural gas furnaces and water heaters to electric heat pumps that can be powered by renewables. Boulder has launched two pilot projects locally in partnership with the County:
    • Comfort365 : Targeted advising and additional rebates for all electric air source heat pumps.
    • Roadmap to Renewable Living : Provides homeowners with a comprehensive roadmap that displays financing strategies for bundling efficiency, electrification and rooftop solar photovoltaic (PV) system.
    • Net Zero Energy Codes (Residential) : Every three years, update energy codes to ensure the city is on pathway to the goal of net zero energy codes for all new buildings by 2031. Continuous implementation, evaluation and improvement of energy codes.
  • Local Renewables, Electric Vehicles and Market Innovation

    • Local  solar  programs:  Our programs include providing grants for low-income residents and non-profits, as well as solar rebates (through EnergySmart) and a solar bulk purchasing program in partnership with Boulder County. Staff is now working on new strategies to develop more large scale solar within the city.
    • Marijuana Energy Requirements :  Continued tracking and enforcement of the requirements for marijuana business to offset 100% of their electricity consumption with renewable energy. Development of a new Energy Impact Offset Fund to use the offset payments to develop local renewable projects.
    • Electric vehicle  programs:  Subsidizing electric vehicle charging stations and creating bulk purchasing programs for electric vehicles and bikes.
    • Boulder Energy Challenge (BEC) : BEC was launched in June 2014 to support the development and commercialization of innovative emission-reducing technologies and strategies in Boulder. In that initial launch, the BEC funded all six finalist projects, totaling $337,500. The program was relaunched in 2017, and the challenge funded four projects, with $157,600 in total funding.
    • Policy Work : Promoting legislative and regulatory changes necessary to achieve the city’s climate and energy goals.
    • Energy Resilience : Implementing resilient energy systems to power the community’s critical energy needs.
  • Other

    • Administrative and overhead costs
    • External communications and outreach to the community and other key stakeholders
    • Program tracking and evaluation (including annual GHG Inventories)
    • Memberships in professional organizations, regional/national/international coalitions, etc.

The average residential account pays approximately $21/year toward the CAP tax. Because the CAP tax is based on carbon consumption, payment depends on how much electricity each customer uses. The tax rate and average annual CAP tax per sector:

 

Current CAP Tax Rates

    Electricity User Type    

      Tax Rate      

    Average Annual Tax    

Residential 

$0.0049 /kWh

$21

Commercial

$0.0009 /kWh

 $94

Industrial

$0.0003 /kWh

$9,600

 

Currently, Xcel Energy collects the tax for the city through its monthly customer utility billing. Customers who subscribe to wind- or solar-generated power through Xcel Energy's Renewable Connect program are not taxed for that portion of their electricity use. Xcel will no longer charge the CAP tax when the solar systems go into service. If the CAP tax is extended and during the new tax period the city begins operation of a municipal electric utility, the new utility could either continue collection of the tax under the current system or sunset the tax and fund efficiency and conservation programs through its rate structure or other means

 

Want to know more about the CAP tax?

Visit www.BoulderColorado.gov/Climate. Contact us via Inquire Boulder or at [email protected].

For billing questions, please contact Xcel Energy at (800) 895-4999