Xcel Energy wins legal round over creation of Boulder utility

The Colorado Court of Appeals has ruled that Xcel Energy (NYSE:XEL) can proceed with a legal challenge connected to creation of a municipally-owned utility by the City of Boulder, Colorado.

The state appeals court ruled Sept. 22 that the action by Xcel utility Public Service Company of Colorado was not time-barred. The appeals court vacated an earlier ruling by a Boulder County District Court judge.

The court ruled that certain actions taken toward creation of a public utility for the city were not final, and therefore Xcel was not too late in filing its appeal.

In November 2011, city voted approved a measure that authorized creation of Boulder Light and Power if the City Council could demonstrate its practicality with verification by a third-party independent expert. In November 2013, the voters added another requirement — that a $214m debt limit could not be exceeded in purchasing Xcel Energy’s assets in Boulder.

“Reading the Second Ordinance as a whole, the statements directing further refinement of the plans and deferring creation of the utility for later legislative action show the City intended to make further changes and indicate that this action was not final,” the appeals court said in its decision.

“There remain significant unresolved issues as to the financial viability and reliability of the utility,” the appeals court said.

“For example, based on the “initial modeling” it has completed thus far, the City calculated it could meet the requirements of the First Ordinance by including service to customers outside the Boulder city limits; however, this calculation assumed the inclusion of such customers (contrary to the Public Utility Commission’s prior rulings rejecting the City’s petition to include customers outside the city limits), with no demonstration that the metrics could be met if the utility is limited to Boulder residents,” the appeals court said.

“Because the first ordinance that the city passed was not final, neither is the second one, the appeals court said. “Accordingly, we disagree with the district court that Xcel’s complaint was time barred and, therefore, the district court erred in dismissing the complaint on this basis,” the appeals court held.

Public Service Co. of Colorado v. City of Boulder, Court of Appeals No. 15CA1371.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.