City staff brief board on Xcel Energy franchise, opt-out window and undergrounding costs

City climate staff on March 5 told the Environmental Advisory Board that Boulder’s 20‑year franchise with Xcel Energy remains on track to reduce grid emissions but that the city will use the first five‑year anniversary to evaluate the partnership and give Council options, including an opt‑out.

Carol Neland, senior manager for energy systems in the Department of Climate Initiatives, said the franchise—approved after the 2020 vote to pause municipalization—includes performance milestones for grid emissions and a five‑year review point the city can use to notify Xcel if it intends to end the franchise. “These milestones present a great opportunity for us to pause and reflect on what were the goals of our partnership and how have we been doing,” Neland said.

The nut graf: council will hold a study session on March 13 to review progress and decide whether to ask voters or act itself on continuing the arrangement. Staff framed the March meeting as an update and a chance to collect questions from council and the broader community before any formal decision.

City staff summarized three separate legal documents that shape the relationship with Xcel: the standard 20‑year franchise that governs use of public rights‑of‑way; a settlement agreement that preserved elements of the municipalization work suspended in 2020; and a partnership agreement that lays out shared goals, an advisory panel, and a set of implementation tactics. Jonathan, director of Climate Initiatives, said those three documents together give Boulder options and influence but do not create direct regulatory penalties for missed interim milestones.

On emissions, staff said Xcel’s most recent filing—the company’s “just transition solicitation” for replacement resources as coal plants retire—forecasts system‑wide emissions reductions that could exceed the statutory 80% reduction (relative to a 2005 baseline). Neland said Xcel has forecast grid‑wide emissions reductions above 90% if the company implements its plan as proposed. “They’re forecasting to do even better than what they presented to city council, by 2031,” she said.

Board members pressed staff on reliability and wildfire mitigation, two issues staff expect to be central to the March 13 conversation. Neland and Jonathan outlined ongoing investments Xcel plans for vegetation management, pole and wire replacement, and targeted undergrounding tied to transportation projects. The franchise reserves up to 1% of annual revenues collected from Boulder for community‑directed undergrounding; staff said that fund has been used on four major projects: North Broadway, Nineteenth Street (part of a multiuse path), East Arapahoe (from Foothills toward the golf course), and Chautauqua. Neland said the four projects total roughly $16 million.

Staff cautioned that fully undergrounding the city’s remaining overhead system would be far more expensive. “To get closer to fully underground…that’s roughly a potentially billion‑dollar undertaking,” Neland said, adding that the city and Xcel are pursuing strategic investments and process changes to prioritize higher‑risk sections of the grid.

Vegetation management was raised repeatedly as a reliability concern. Staff said Xcel’s wildfire mitigation plan includes vegetation funding and that the company has planned “hundreds of millions” for vegetation management over the next few years; staff also acknowledged ongoing coordination challenges on private land and resource constraints that slow trimming and clearance work.

Board members also asked about distributed resources and storage. Staff said Xcel and Boulder are exploring battery pilots, virtual power plants and microgrids as part of longer‑term resilience planning, but no single technology is a near‑term silver bullet. Staff said the city will file testimony with the Public Utilities Commission on wildfire mitigation and undergrounding priorities.

Why it matters: the franchise and related agreements define how Boulder engages with its regulated utility for the next 20 years and create a formal five‑year decision point that could lead to ballot action or other council measures. Staff framed the March 13 council study session as a fact‑finding and community‑listening opportunity, not a vote.

The city’s next decision points on the franchise will include both the city council discussion on March 13 and additional opt‑out opportunities tied to emissions milestones and five‑year anniversaries in future years.