What does Xcel really care about?

I recently read about a group in the Denver area called Citizens Against Utility Abuse (CAUA). Their immediate focus is on the deal that cities that have granted Xcel franchises have received regarding undergrounding their power lines. All such franchises apparently have essentially the same terms as Boulder’s franchise does, which states, “The Company (Xcel) shall budget and allocate an annual amount, equivalent to one percent (1%) of the preceding year’s Electric Gross Revenues (what Boulder ratepayers paid Xcel for electricity), for the purpose of undergrounding its existing overhead electric distribution facilities located in City Streets…” plus details.

The group’s complaint is that equivalent undergrounding is not available in areas that don’t have franchises. (A franchise gives Xcel exclusive rights to serve electricity for periods up to 20 years.) Xcel makes money from undergrounding; the funds Xcel invests earn the same high return as if invested in power plants or transmission lines. So, it’s a good deal for Xcel. But it’s also leverage to get cities to sign franchise agreements, which apparently is why Xcel does not offer undergrounding to those not under franchise.

State law (CRS 40-3-101 et seq) appears to guarantee all ratepayers equal treatment. But the PUC has so far refused to address this issue, so I suspect it will end up in court. Thanks to CAUA for pushing back against this obvious inequity.

All this was totally overshadowed by the events of this weekend, with Xcel preemptively shutting down power to tens of thousands of customers in Boulder and surrounding areas, allegedly to avoid repeats of the power line failure-induced Marshall Fire (and those in the Texas panhandle). Since the Boulder area gets major windstorms almost every winter, and it’s now well over two years since the Marshall Fire, the obvious question is: Why hasn’t Xcel carefully inspected all its lines, replaced any sub-standard ones with lines that can handle 100 Mph-plus winds, and trimmed any trees that pose a risk? Or did Xcel calculate that it was cheaper to simply turn the power off? Or, as some have speculated, was this mismanaged shutdown some sort of perverted payback for suing Xcel for damages from the previous fire?

According to the news reports, any number of businesses, nonprofits and residents had to discard perishable food that didn’t survive the lack of refrigeration. And of course, there was all the lost business for restaurants, etc., that had to close, and the damage to residents from not having power for any number of normal uses. The issue was big enough for the chamber of commerce to host a session with its members — good for them, I say. (By the way, this last weekend thousands of families brought their prospective students to check out CU. So, the business loss was bigger than normal.)

The multi-million-dollar question then becomes: Will anyone force real action to address this mess? Given the now-obvious regulatory failures over the last two years, our county commissioners and city councils should immediately push our Legislature to pass some emergency legislation.

The commissioners should set up an independent panel of local experts to come up with specific proposals and monitor Xcel’s progress in real-time. And they should demand that the Legislature force Xcel to provide an immediate, full report of all actions taken (or not) over the last two years to address the windstorm issue.

The Legislature should require Xcel to immediately inspect all its power lines in relevant Front Range areas. Replace those that are sub-standard so they can resist our strong winds. Trim any trees that threaten them. Set up a proactive notification system that ensures customers are properly informed. Have the independent panel help determine the standards for notifications, the frequency of inspections and the timing of the power line fixes. That way all this would be done proactively and future shutdowns and notification failures would be avoided.

Put Xcel on the hook for the costs its customers incurred because of power shutdowns and lack of timely notification (like lost business for restaurants, loss of refrigerated foods in stores, upsets to residents’ lives, etc.) in addition to physical damage or losses, as occurred with the Marshall Fire. Set up the recovery process so it doesn’t require years-long court proceedings.

Force Xcel to divide their system into micro-grids so that power can be shut down in small areas. Consider adding backup storage and generators so that if transmission lines go down, power would still be available.

That’s a start for ideas. No doubt there are more. But take real action now!