When the city learns more and further refines its cost estimates, it updates its financial modeling. Learn more about this effort on the Financial Forecast Tool page. The city updated financial modeling in December 2018.
A major component of our work between now and the community decision is ongoing financial analysis of the potential electric utility. We're working to identify potential costs to develop the utility so that the public can weigh the costs with the benefits when making the go/no-go decision. This analysis includes both short- and long-term financial feasibility: can the city afford the start-up costs to develop the utility and will the utility be financially sound for the long term?
Costs the city will determine prior to the community decision:
What is it?
One of the most important steps in Boulder’s municipalization effort is the purchase of the Xcel Energy distribution system assets that serve Boulder customers. These assets, which include poles, wires, electric cabinets, easements and more, will make up large portions of the city's electric system if the city ultimately separates from Xcel.
Under the Colorado Constitution, the city has the right to purchase the assets of a retail electric utility, but it must pay a fair price. The city is working prior to the community decision is determining what this price is. Voters will know this price so that they can make an informed decision whether to move forward with the project.
They city would only pay for these assets if approved by the voters in the community decision.
What is it?
lf voters approve moving forward with Local Power, significant construction will be required to separate the existing distribution electric systems into two independently operating systems. The city plans to get an accurate picture of the construction costs by April 2020, prior to the community decision.
- April 2020: Complete distribution system design
- Summer 2020: Complete substation design
What is it?
If voters approve moving forward with Local Power in a future election, the city will have to pay for costs related to starting up the utility. These costs include:
- IT systems
- Billing and customer service infrastructure
- Staff for "Day 1" (the day the Boulder system can be operated separately from the Xcel distribution system)
- Offices and other properties needed for the utility
The city is working to get an accurate picture of these costs prior to the community decision.
- 2019: Refine Utility Operations plan
- 2020: Refine costs estimates of utility operations plan
What is it?
The city plans to buy most of the electricity it will supply to customers from the wholesale power suppliers. There are several companies that generate electricity, using both renewables and fossil fuels, that the city could buy power from.
The cost of the electricity the city will buy to sell to customers is the single greatest cost to the future utility. When evaluating the finances of a possible city-run utility, it's important to get an accurate estimate of these costs. The city is also working to develop these estimates prior to the community decision.
- Mid-2018: The city issues a "Request for Indicative Pricing" from potential power suppliers.
- Fall 2018: The city received responses to its request.
- Summer 2020: The city issues a Request for Proposals (RFP) for power supply and innovative finanicing
- The RFP sought bids that will help the city determine key details for the electric utility, including the cost to purchase power from one or more independent power suppliers; the percentage of renewables a city-run electricity could achieve on day one of operations, and by 2030, when the city seeks to achieve 100% renewable electricity; and opportunities to participate in community-scale renewable power.
- The city also sought innovative financing mechanisms to help the city complete municipalization. This could include financing for work leading up to the community vote, and/or — after voter approval — financing for start-up costs, separation costs and costs to purchase the necessary electric distribution infrastructure from Xcel Energy.
- Summer 2020: City received power supply bids
Latest: City releases information on responses to 2020 power supply RFP
The City of Boulder released a summary of responses to its request for proposals (RFP) to provide power supply and financing for a potential city-run electric utility.
The city received two bids that could fulfill all the power supply requirements of a local electric utility that would achieve the city’s 100% renewable electricity by 2030 target. The city also received additional bids for individual solar, wind and battery storage projects that could supply a municipal electric utility or could be developed in partnership with Xcel Energy.
“We are pleased with the bids received,” said Steve Catanach, director of Climate Initiatives. “We look forward to spending some time to dive in, evaluate the proposals and share more details as they become available.”
According to initial analysis, these bids are consistent with the pricing received in responses to the city’s 2018 Request for Indicative Pricing.
Archive January 2019: Updated analysis demonstrates that Boulder electric utility could achieve renewables goals
Based on recently updated information, a city-run electric utility could achieve 89% renewable energy by 2024 at an affordable cost. The city's analysis of the state of the power market revealed that there are power providers willing and able to serve Boulder's energy needs at costs consistent with low-cost bids across the industry and can meet the city's energy goals. Find out more about the city's power supply analysis in the city's Local Power Explainer.
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