I took my Power in my Hand—
And went against the World—
’Twas not so much as David—had—
But I—was twice as bold—

I aimed by Pebble—but Myself
Was all the one that fell—
Was it Goliath—was too large—
Or was myself—too small?

 

Why would anyone outside Boulder care about the two utility exploration measures 2B & 2C?  Xcel Energy and the groups it funded spent almost a million dollars - easily greater than 10X more than the pro-municipalization groups. In fact, the opposition groups spent more in the last 5 days of the campaign than Citizens for Boulder’s Clean Energy Future spent the entire campaign! Some of the same underlying frustration related to power and privilege expressed by protesters around the world is at play here.  

 

In general, people are fed up with corporations that gamble and expect public bailouts. This may have started with public takeovers of failed Savings & Loans in the 1980s, but the huge failures triggered by Credit Default Swaps involving subprime lending have escalated the feeling worldwide. Every few weeks we seem to hear about another federal loan default.  (As an aside, I was interviewed recently by CBS because Open Range Communications in Greenwood Village defaulted on a $267 million loan awarded by the Bush administration. They wanted to talk to me because I co-founded a small rural internet cooperative for about $13,000 a decade ago.)  

 

While Xcel has not defaulted on any public loans, their monopoly status authorizes them a much-better-than-CD-rate 10.5 percentage return on investment.  And ultimately the public (ratepayers) pay for new infrastructure, often as pass-through riders or accelerated cost recovery. Xcel lobbyists and lawyers exert strong influence over the Colorado Public Utilities Commission (PUC) winning favorable rulings. As one example related to Boulder, the PUC allowed Xcel to recoup most of a tripling of costs to build a smart grid project SmartGridCity - with a possibility of more reimbursement money later.

 

Not to downplay the economics of electric municipalization where proponents claim that Xcel's heavy dependence on coal makes ratepayers vulnerable to rising fuel costs (estimated by Clean Energy Action to be 10% annual coal increases versus Xcel's 2% forecast) and eventual carbon taxes, I believe the real issue is local control over renewable power generation and the speed at which these decisions are made.

 

A few months ago, I got to meet former Colorado Senator Gary Hart at a small backyard gathering of Measure 2B & 2C supporters. To respect his desire to not weigh in publicly on a local election, I am only sharing his thoughtful comments on municipalization now.  

Over the last year, I've been attending PUC workshops and hearings related to Community Solar Gardens (CSGs).  I remember how hopeful I was when Governor Ritter signed the Colorado Solar Gardens Act and State Representative Levy handed me one of his signature pens.  

 

 

The truth is that the Colorado Community Solar Gardens Act was signed into law in June 2010. Yet, almost a year and a half later we still do not have final rules with implementation specifics. Xcel has dragged the Colorado PUC CSG rules into Review, Rehearing, and Reconsideration - the dreaded "Triple R". I believe a Boulder municipal power entity could have implemented CSGs rules faster than the PUC and investor-owned utilities (IOU) like Xcel.

 

Whether or not Boulder's measures lost, this will not take away the value of the municipal power debate. You could argue that the world watches Boulder. But the real story is that people want local control. You can easily call your City Council person, or speak out a town meeting. You and your neighbors can vote officials out. You can't do that with the bureaucratic PUC. More and more, responsible citizen involvement is diminished. Just recently, honored energy activist Leslie Glustrom was barred from her role as citizen watchdog at PUC hearings. As Research Director for Clean Energy Action, Glustrom uncovered years of Xcel rate and cost discrepancies. Others besides myself have commented that the relationship between Xcel and its regulator is too cozy, and we need more consumer protection like this.

 

As a monopoly, Xcel is guaranteed double-digit returns on investment. Even my broker tried to get me to buy Xcel a few years ago but I told Merrill Lynch I didn't want to invest in fossil fuel generation (as Xcel is over 60% coal and almost 27% natural gas); I'm very glad I invested in Apple instead. Transmission line construction (cost plus) is a very profitable opportunity for Xcel as billionaire investor Louis Bacon pointed out last February in a Denver Post editorial.  

 

Distributed power generation at the point of load such as solar panels on roofs minimize the need for transmission lines in contrast with huge centralized power plants. Xcel owns both transmission lines and power plants, so alternatives such as Community Choice Aggregation (CCA) where Boulder could buy clean power from non-Xcel sources without buying Xcel's transmission lines have not been authorized.  

 

I could cite studies where widely distributed generation provides stable power minimizing the need for utility-grade batteries or how more local jobs get created.  But the most interesting concern is how vulnerable transmission lines are to solar flares. Yes, back in 1859 telegraph operators were shocked and pylons threw sparks in an incident known as the Carrington Solar Flare.  And scientists believe the Sun is now heading into a busy period over several years with real possibilities of transmission interruption. 

 

I believe we are on the cusp of readily accessible distributed renewable generation. Every year we find more ingenious and efficient technologies. Over the next generation, even without any subsidies, renewables will be less expensive than fossil fuels.  Local communities who don't wish to tie themselves to decades of coal power will push this change. Even the utilities know that it's not good enough to provide cheap power if externalities (e.g. health costs) get factored in. Creative solutions require boldness, as Dickenson inspires:

 

Was it Goliath—was too large—
Or was myself—too small?