In 2020, citizens of Boulder voted for a new franchise agreement with Xcel Energy, putting an end, for now, to a years-long push for “municipalization”: where the city would split from Xcel to become its own utility. With Boulder controlling its own power grid, the city could have had complete control over where its power came from — or at least that was the idea. With climate models presenting a bleak future unless humanity takes aggressive action, renewable energy would have been the obvious choice.
Now Boulder must work with Xcel, a shareholder-owned utility, to reach its decarbonization and renewable energy goals.
One of Boulder’s core climate targets is to reduce greenhouse gas emissions 70% by 2030, down from a baseline of 2018 levels. As electricity currently accounts for roughly 41% of Boulder’s emissions, part of reaching that 70% reduction means achieving 100% renewable energy by 2030.
Helping the city navigate this partnership with Xcel is a community advisory panel. Made up of 17 members of the community, the panel gives voice to Boulder’s homeowners, businesses, and other groups that might be affected by the partnership. In mid-May, the panel put out a recommendations report, presenting ideas on how the partnership should proceed if it hopes to reach the established climate targets.
Recommendations presented in the report include broad ideas such as “Develop the Roadmap to Zero Emissions Electricity” and “Develop System-level Solutions that Accelerate Grid-Wide Emissions Reduction.” These overarching points are then broken down into more detailed bullet-points while remaining fairly high level.
Though these recommendations align with what experts say is necessary for a city to get to zero emissions, the report, according to two panel members, represents a leisurely reaction to a pressing issue. Because of uncertainty surrounding Xcel’s plans for how to achieve Boulder’s climate targets, the panel maintained a broad view rather than delving into how actions could be implemented, members said. Some aspects of the report also conflict with Xcel’s vision for Boulder’s future.
“Things have moved very slowly,” said Julie Zahniser, a retired speech pathologist and panel member. “Here we are a year and a half after the election and we’re still at general goals. This is very frustrating.”
Zahniser said members don’t yet know exactly how Xcel plans to meet Boulder’s emission reduction goals or how such reductions will be accounted for.
“How are our carbon emissions going to be measured so [Xcel] can show reductions?” Zahniser said.
Wayne Seltzer, a longtime Boulder homeowner and holder of an MIT Electrical Engineering degree, said he wasn’t surprised by the big-picture focus of the city and Xcel when it came to the panel’s input. “We are an advisory panel,” he said. “We’re not a deciding organization. We’re not supposed to be designing the solution. We’re just supposed to be representing the constituents in Boulder.”
And yet, Seltzer also allowed that things had thus far moved slower than he thought they would. “I thought by this time we would have an outline of a roadmap [for how to achieve our goals],” he said.
Explaining Renewable Energy Credits
The clearest divergence between Xcel’s ideas on how to meet Boulder’s climate targets and the panel’s expectations manifested in the conversation around Renewable Energy Credits.
Renewable Energy Credits, or RECs, are like tokens companies receive for producing renewable energy — through wind, solar, or other means. One REC is given for each megawatt-hour that is generated (from a renewable source) and delivered to the electric grid. These RECs can be bought and sold, or allocated to customers of the utility company producing them.
As part of a powerpoint on how Boulder could meet its 100% renewable goal, Xcel showed the panel it could meet Boulder’s clean energy goals utilizing RECs it had on hand. This, both Zahniser and Seltzer said, ignored the motivation behind the city’s decarbonization objectives. In subsequent interviews, city officials agreed.
“When we’re talking about all these RECs, is this new generation or is this paper?” a panel member asked in response to the January 24 presentation at 1:29:38.
“That is existing generation from the system,” the presenter said.
“I think it’s really important for customers to understand that they’re not getting new generation [of renewable energy],” the panel member responded.
To help make sense of RECs, imagine, if you will, two towns served by the same utility company. Let’s also imagine this utility produces half its energy from renewable sources. For some time, both towns in this scenario have energy portfolios that match the utility’s percentage, running on 50% solar energy and 50% coal. But then one town, let’s call it Boulder, decides it wants to be powered by 100% clean energy and demands the aforementioned utility company help them achieve that goal.
Rather than building more solar capacity, the utility company realizes it can simply reallocate all of its clean energy to Boulder, while the other town, that doesn’t care about clean energy, runs on 100% coal. Without changing any of its infrastructure, the utility company is able to meet Boulder’s goal.
In the real world, however, renewable energy isn’t reallocated but rather the credit for that renewable energy is. No matter how many RECs the real Boulder buys, the power coming into our town might still come from a coal plant. It is, more than anything, shuffling numbers on a spreadsheet.
While such an accounting exercise might be satisfactory to businesses wanting to advertise their greenness to environmentally-minded customers, it doesn’t bode well for those who want to reduce overall greenhouse gas emissions.
“If the net is we’re producing exactly the same emissions, then we’ve done nothing to achieve Boulder’s goals,” Seltzer said. “We actually want new renewable sources to be built and put on the grid.”
The Xcel presenter seemed to acknowledge the feeling before anyone addressed it. “This isn’t for every community out there,” he said. “But we believe there are some communities that might have an interest. I’m pretty sure Boulder might not have an interest.”
A different Xcel presenter in the Jan, 29 meeting stated that investing in RECs helps Xcel fund more renewable resources in the future.
In follow-up emails with Boulder Reporting Lab, an Xcel spokesperson said the company did not present RECs as an option for Boulder, but rather showed them as one program used by other communities.
City’s perspective: Moving in the right direction
Carolyn Elam, the City of Boulder’s representative overseeing the panel, voiced agreement with the panel in a conversation with Boulder Reporting Lab. “I think the panel did an amazing job of reflecting how the community thinks about the meaning behind our goals,” she said. “We value far less being able to claim we’re powered 100% by renewable electricity and more about actually affecting global greenhouse gas emissions.”
Elam, however, said that some of the lack of action perceived by panel members was not due to stagnation but rather less-sexy milestones that nonetheless move Boulder in the right direction.
“[Panel members] want to see tangible projects or dollars going into something like a new solar farm,” Elam said. She explained it’s not as satisfying to say, “We worked with our senator and got this bill passed,” even if that bill lays the foundation for future projects.
Elam also said it’s difficult for those invested in combating climate change to accept that not everyone cares. “It’s not just about profit and shareholder interest,” Elam said. “There’s also customer demand. Not all customers served by Xcel have the same desired outcomes that we do.”
Hollie Velasquez Horvath, a regional vice president for Xcel, told Boulder Reporting Lab that Xcel is moving to increase its renewable capacity. As of 2021, according to Xcel’s website, 39% of Xcel’s Colorado power came from carbon-free sources — wind accounted for 33% and solar for 5%.
Horvath said should the company’s most recent electric resource plan be approved (it’s currently in front of the Public Utilities Commission) an additional 3,000 megawatts of renewable energy would be integrated into their system. With their current total capacity at 20,600 megawatts across their eight state territory, the new renewables would add 15% capacity to their system. Or it could replace almost 30% of their fossil fuel portfolio — should they choose to use it that way.
It’s important to note that there are milestones Xcel has to meet to maintain the partnership with Boulder, as well as voluntary exit ramps Boulder could take should it want to move in a different direction.
“We want to bring Xcel along as a partner but we understand there are going to spaces where [Xcel] is beholden to other requirements,” Elam said. “So we need to think about how [Xcel and Boulder] go together as well as where we may need to diverge and tackle things a different way.”