Don’t fall into ‘franchise trap’

This November, voters decide if Boulder should sign a longterm electric-franchise with Xcel Energy (Ballot Measure 2C). Those in favor of this say that it would push Xcel to higher carbon reduction targets while saving Boulder money. They also claim it offers an easy exit and an easy restart of Boulder’s local-power efforts if things don’t work out.

If this all sounds too good to be true, it is. Let’s have a look at what will really happen if we make the mistake of signing on to this agreement.

The most fundamental problem is that it will cost us a lot of money. Because Xcel is a protected monopoly, its rates will always be higher than what a free market offers. Furthermore, Xcel is overcapitalized in expensive coal-fired power at a time when clean, renewable energy is getting really cheap. This makes Xcel’s electricity much more costly and environmentally damaging than it should be.

Results from a recently submitted Request For Indicative Pricing (RFIP) show Boulder could get free market renewable energy for $40 million per year less than with Xcel. That’s a lot of potential savings for a COVID-19stressed local economy.

Yes, it can be argued that Boulder wouldn’t get those cheap rates simply by staying out of franchise. But it’s also true we will never get them while trapped in a franchise.

Which brings me to my next point: The ability to exit this deal is far from assured, due to Xcel’s welldocumented obstructionist tendencies. Xcel would likely overpower any Boulder attempt to leave, unleashing formidable public relations campaigns. Anyone in Boulder since 2010 will recall Boulder’s difficulty in claiming narrow victories against Xcel’s “full court press” in recent public votes — and that was without Xcel having the incumbency advantage a franchise would offer.

Furthermore, one of these close, hard-fought elections followed an Xcel pledge of non-interference, as is currently being “promised.”

Here’s a bigger problem: Even if the “off ramps” somehow worked, it wouldn’t matter. Xcel’s real objective in signing on Boulder is to eliminate our local power option, the real threat to Xcel’s protected monopoly (and Boulder’s best shot at combating climate change).

Boulder is actually within reach of completing condemnation proceedings, leading to a final costs determination for local power. Nothing is fundamentally blocking the current cases from completion – that is, unless Boulder signs onto this franchise agreement.

Some may disagree, claiming the contract has provisions facilitating resumption of local power efforts if Boulder exits. But does anyone actually believe Boulder could revive these complex technical and legal proceedings after a multi-year hiatus? Not likely — especially given the difficulties getting to this point, and with added political and cost liabilities, it’s simply not going to happen.

So, there you have it: A contract claiming you can leave early, but you can’t really. It also claims that Boulder could revive its local power option at some future “escape” point — also not really true.

And all this would be bad enough in itself, if it weren’t for a further problem: The only enforcement mechanism for key provisions of this contract (such as carbon reduction targets) happens to be a credible threat for Boulder to exit and resume local power efforts.

Let’s make sure we have this straight: This is a franchise proposal with provisions that aren’t really enforceable, along with “off ramps” that won’t really work. It effectively liquidates Boulder’s best shot at 100 percent renewables, our local-power option, gaining little in return. And it’s not a good-deal for Boulder’s economy or the environment.

In short, what’s good about this proposal? Why is it even on the ballot?

The good news is that by rejecting this ballot measure, Boulder preserves opportunities for a clean, cost-effective energy future. Local power is definitely within reach, especially with promising market-based options for continuing the effort without further public funding.

At the very least, getting to final costs could facilitate a legitimate “go/no-go” vote on this option.

Legislative changes could also help break through barriers currently limiting Boulder’s access to low-cost renewable energy opportunities. And remember, Boulder has done just fine out-of-franchise (since 2010), prodding Xcel to significantly cleaner power for the entire state simply by preserving its threat to leave.

Please join me in voting “no” on 2C. There’s no need to settle for an expensive and less environmental “franchise trap” when cleaner and cheaper options are available for Boulder’s energy future.

Brad D. Segal is a retired chemist, having lived in Boulder for 40 years. His experience includes 17 years as a project manager and analyst with Boulder’s municipal water utility.