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City Files in District Court to Condemn Xcel Energy Assets Necessary for Local Electric Utility

The condemnation process will determine the price the city will pay for the assets, a key variable in the city’s municipalization exploration.

Today, the City of Boulder filed a petition to condemn Xcel Energy electric distribution assets pdf in Boulder District Court following good faith negotiations with the Minneapolis-based company. The filing is in support of Boulder’s Local Power project, the city’s exploration of creating a city-run, community-owned electric utility. 

The condemnation process will determine the price the city will pay for the assets, a key variable in the city’s municipalization exploration, sometimes referred to as “acquisition cost.” The city will not be required to pay the cost determined by the court until:

  • Voters approve moving forward with the creation of the utility after the condemnation amount and other key project costs are publicized; and
  • Construction to separate Boulder’s electric distribution system from Xcel’s is complete.

The petition describes the electric infrastructure the city seeks to acquire from Xcel, including the existing electric distribution facilities and the property interests necessary to operate those facilities. The petition does not include assets inside substations.

In a Nov. 20 letter, the city offered to purchase certain portions of Xcel Energy electric infrastructure for $93.96 million. The parties met to discuss the offer but could not reach an agreement.

Acquisition Background

  • December 2018: City council approved moving forward with the acquisition process, including condemnation of Xcel’s assets if the parties did not reach agreement.
  • Spring 2019: The city made its first offer to Xcel for the assets, $68.5 million based on the appraisal including assets inside substations.
  • June 2019: The city increased its final offer to $82 million. Xcel did not respond to the city’s offers.
  • June 2019: The city filed a petition in District Court to condemn Xcel Energy assets.
  • September 2019: The Boulder District Court dismissed the city’s condemnation petition, granting Xcel’s motion to dismiss on grounds that the Public Utilities Commission (PUC) process was incomplete.
  • October 2019: The PUC issued a final ruling Oct. 28 that allows the city to transfer assets outside substations; the city and Xcel must come to agreement for assets inside substations in a process that will not involve the PUC.
  • October 2019: The city filed a notice of appeal of the condemnation dismissal. This appeal will continue in parallel to the condemnation petition.
  • November 2019: The city offered to purchase Xcel’s assets outside substations for $93.96 million, an amount the city hoped Xcel would seriously consider. The basis for the city’s offer was twice the original cost of the assets, less depreciation ($46.98 million) that Xcel reports in its financial filings with the PUC and the state for property tax determinations.

About Local Power

Local Power is the city's effort to bring clean, local, affordable and reliable electricity to the community by developing a community-owned local electric utility. The project is a key component of the city's Energy Future strategy, as well as the city's Climate Commitment. The city seeks to build an energy future that is clean, local, reliable, secure and provides value.

For the latest Local Power news, including information on litigation, visit www.BoulderColorado.gov/local-power/latest.

Published: Dec. 19, 2019

Media Contact:
Emily Sandoval, Media Relations, 303-441-1927