A threat to Xcel

The city should consider a public energy utility but can’t rush the discussion.

Daily Editorial Board

Minneapolis began public hearings Aug. 1 to consider whether the city should leave Xcel Energy and form its own gas and electric utilities.

At the hearing, volunteers from Minneapolis Energy Options demanded cleaner energy options sooner rather than later. Though the Minnesota Daily Editorial Board agreed with MEO’s push for studying other energy options in April, the discussion should go deeper.

Xcel has been the American Wind Power Association’s top energy provider for the past nine years, with about 12 percent of its energy coming from wind power. Xcel has pledged to bring that up to about 16 percent by 2020. Xcel continually implements energy alternatives, even if it may lag behind some municipal utilities, like Seattle’s City Light.

Another obstacle for a public utility is the money. Laura McCarten, regional vice president of Northern States Power, said in a letter to Minneapolis residents that buying Xcel property could cost the city billions. The utility’s headquarters is located on Nicollet Mall and has about 2,000 employees in downtown alone. A city utility plan would be a huge undertaking that needs to be examined realistically.

A $250,000 study on meeting Minneapolis’ renewable energy goals will come out in February next year. A November referendum without these facts would be premature and could risk the city’s leverage with Xcel if it fails.

Under state law, the city would not be able to establish municipal ownership without voter approval and could be constrained in negotiation authority. However, before any referendum, Minneapolis should be wary of becoming like Boulder, Colo., which is now fighting with Xcel over customers and risks losing support of residents in the early stages of the municipalization process.

Locking Minneapolis into another 20-year contract without knowing our options is irresponsible. Like CenterPoint Energy, Xcel must come to the table to have direct conversation with residents if it wishes to continue to represent the city’s energy goals.