The kernel of this very long letter by Mr. Wardwell appears to be this statement: "The Colorado Constitution, Article XX, grants home-rule cities like Boulder authority to condemn property outside the city limits, if needed for a legitimate municipal purpose."

Backing up for a minute, first, I don't believe there has been *any* argument---at all---as to a city's right to create a municipal utility. It can.

----Nor that in some isolated cases that there is some **minor** sharing (in other words, slight overlapping, for truly practical purposes) along the mere edges of a municipal utility territory. There is.

----Nor that utilities sometimes share ownership of facilities, such as generating facilities, with other entities (and, for the record's sake, Tri-State is not a retail utility). They do.

And I'd certainly bet that Xcel would not EVER make a statement denying anything I've written here, above. "None."

No. However, all of this misses the actual heart of the issue. If one has been following this saga closely, it seems clear that ***the intense and undeniable focus on the areas outside of city borders has occurred for a reason: Separating the distribution system as close to the actual city borders would be too expensive.*** (And therefore preclude the formation of the utility in accordance with Charter metrics.)

IF ONE HAD READ THE PUC STAFF'S ARGUMENT, ONE WOULD FIND THAT SEPARATING ALONG THE MUNICIPAL BORDERS IS ACTUALLY WHAT PUC STAFF SUGGESTED, WHICH MAKES A LOT OF SENSE. Back to the concept of "a legitimate purpose." Condemning grid facilities in an area representing 39 square miles outside of city borders because the city cannot AFFORD to complete the separation as close as feasible along the city borders....because this would be too EXPENSIVE.....is not a "legitimate purpose."

In fact---very importantly---if the approach taken in the original separation plan filing were to be allowed, it would set a precedent that could wreak havoc for multiple entities all around the state when it comes to generation resource planning.

As a retired attorney, I'm sure Mr. Wardwell can appreciate the power of precedent. And the PUC likely does not wish to open up a can of worms for the entire state. I suggest that Mr. Wardwell, or anyone else for that matter, read up on a utility model called "Community Choice Aggregation" which is very close to two of the city's suggested paths.....and normally this takes a change in state statutes to actualize. Please do. (Not the best model in my view, but that's another story.)

As I've said before in this blog, I believe the PUC was not given any realistic or complete separation plan from an engineering standpoint.

"None."

---Karey

(OK, I have to say it: the city, here, reminds me of a guy trying every pickup line in the book....!)

I don't relish saying this, but it's really hard for me to to see this as anything but an *embarrassment* for the city. My guess is that the PUC was expecting an actual **engineering study** from the get-go so they could evaluate it....none of which the 'new options' represent. Further, the city's first new option is basically Community Choice Aggregation (CCA), and as such is remarkably similar to its first presentation (which was like "reverse" Community Choice Aggregation). This usually requires a change in state law to actualize....and carries with it *all the same potential problems embodied in the city's first suggestion,* except this time in reverse.

All the while, it's difficult to fathom that Xcel is *gaining* any empathy---or respect---for Boulder. To say the least.

Sigh.

---Karey

Thanks for writing this, Bob. I've heard it said that Boulder's best "deal" (Plan B, as you call it) was years ago....if there was any "leverage" on Xcel, well, it's vanishing fast.

However, I think the focus on mutual benefit is where things should go from here. Xcel is fully aware that the electric industry is changing, and they have done a great--in fact pioneering, in many ways---job of expanding renewable energy in the state. This doesn't meant that there isn't more for them to do, though.....and they know it. Boulder would best be served by a cooperative, humble tone, if not full all-out acknowledgement that the path they've taken is like taking a wrong turn on a forest road....first it gets rockier, then overgrown and hard to navigate, then it either dwindles out or reaches a dead end. Hopefully the city will see that this is the type of path they've taken, and turn back with an outstretched hand.

I'm not holding my breath for this.....though as the old song goes, "But I can dream, can't I?"

---Karey

With the substantial (7,000 plus) number of customers the city wants Xcel to wheel energy to over the proposed newly-municipal distribution system (in an area of 39 square miles), what Boulder is proposing is essentially "reverse Community Choice Aggregation" ("CCA") for which there is no precedent in Colorado, and which is normally enacted through the legislative process.

CCA (whether "reverse" or not), comes with its own set of challenges and issues, especially as as Distributed Energy Resources ("DER") become more the norm rather than the exception, as is happening in the transforming electric utility industry. In California, where CCA has been enacted through legislation, I have been advocating recently that new legal entities should form to address these problems, problems which could represent reliability issues in a DER "world."

The best, most expedient and effective outcome for the city, which truly carries great potential for trying out new models and demonstration projects, would be to form a Local Government Partnership-type arrangement where Xcel and Boulder might collaboratively help move the state forward, and bypass the CCA-like arrangement altogether, particularly because CCA, which by necessity comes with a complex set of agreements and arrangements through legislative mandates (usually), is not on the legal landscape at all in Colorado. Nor is it ideal, as it is.

I sure hope for a good outcome---for both the city and Xcel. There is a deepening sense of wasted time and effort in all this....the market is driving change at an incredibly fact pace and Colorado needs to keep up. I think Boulder could play an important role---let's hope the sides stop "fighting" soon.

---Karey

You mean other than lawsuits brought by environmental orgs for non-compliance? ; )

Here is a pp from the EPA's "Regulatory Impact Analysis" ( from link: http://www.epa.gov/airquality/cpp/cpp-final-rule-... ) :
"Under CAA section 111(d), a state must submit its plan to the EPA for approval, and the EPA must approve the state plan if it is “satisfactory.” If a state does not submit a plan, or if the EPA does not approve a state’s plan, then the EPA must establish a plan for that state. Once a state receives the EPA’s approval of its plan, the provisions in the plan become federally enforceable ***against the entity responsible for noncompliance,*** in the same manner as the provisions of an approved State Implementation Plan (SIP) under the Act." [emphasis added]

Also, here is an interesting article from earlier this year which analyzes what could take place if states ignore the rule: http://www.brookings.edu/blogs/planetpolicy/posts...

Hope this helps....

---Karey

I think the Clean Power Plan is great, and strikes a balance well. One thing....it may be time for Colorado's many "muni" utilities to be required more renewable energy that the dismally low 10% they are required to achieve now (in contrast Xcel is already at 21 or 22% and is required to have 30%).

In fact, if the muni utilities' requirements were to be raised, it would be interesting to see if citizens in those cities would "rebel" at all (as has been the case in some of the rural electric territories, which have a 20% renewable supply requirement). If so, it would demonstrate how unlikely that others munis around the state would follow in the footsteps of Boulder's higher clean energy goals, however admirable.

Anyway, I believe Xcel can and will rise to the challenge of deeper decarbonization than currently required, and hopefully will serve as a leader to other coal-dependent utilities. Even better if Boulder ends up working *with* (not against) Xcel on demonstration projects, down the road.

---Karey

I certainly commend Boulder for its climate goals. However, breaking up the distribution system (the "grid") into myriad hundreds or thousands of little municipal utilities with minds of their own (how many cities are there in the U. S.?) is just *not* the way to make real progress, regionally.

---Karey

I was a client of Paul's in the real estate law area from the late 1990's--2000's. He was a joy to work with and I learned a lot from him. That he did so very much community service--more than I had been aware of---comes at no surprise...it's clearly a testament to his kind nature shining forth. Even though I had not had need for his law services for many years, I choke up, realizing he is gone (and at such a young age!). He was a beautiful person....so warm and engaging.

My best wishes to him on his journey onward, and to his loved ones in adjusting to this great loss.

---Karey

....the irony of what he is saying is apparently lost on you unfortunately....regardless...it is clear to many of us that the muni proposition is a failing path including aspects of its separation plan and so common sense and cooperation should prevail all around the table at some point for the true benefit of the public.