Dive Brief:

• A decision by the Colorado Public Utilities Commission (CPUC) has sent the city of Boulder back to the drawing board, potentially to consider building some of its own distribution facilities in a bid to form a municipal utility.
• But as SNL Energy points out, municipalization efforts are only funded at about $1.9 million through 2017 with a $214 million cap on what Boulder can spend acquiring assets from Xcel Energy, meaning the price tag could rise.
• The PUC earlier this month rejected a portion of Boulder's bid to form a municipal utility, finding the city's plan to take over Xcel Energy's infrastructure in unincorporated areas violated the principles of monopoly operation.

Dive Insight:

Boulder's plans to form a municipal utility got a lot more complicated when state regulators last week nixed the city's plan to take over Xcel infrastructure in unincorporated areas. 

“It is clear that the application as submitted infringes upon the exclusive service territory of [Xcel]," Colorado PUC Chairman Joshua Epel said. "When the city submits a subsequent amended application, it must be designed to enable the city to provide service exclusively for the benefit of the citizens of Boulder without running afoul of the doctrine of regulated monopoly.”

But regulators stopped short of dismissing the entire application, instead giving Boulder the chance to amend the plan and find a way to serve residents without Xcel's infrastructure in some areas. While the city has argued Xcel already shares its infrastructure and it's not proposing anything substantially new, they will now have to revise the plan.

That could include building infrastructure, SNL Energy reports. Boulder spokeswoman Sarah Huntley told the news outlet that if it cannot acquire all needed assets then it may have to consider constructing some of its own.

Officials from Xcel and the city have been tight-lipped following the decision, but an Xcel spokeswoman did tell BizWest that Boulder "will now have the opportunity to supplement and correct their plan in this proceeding, but we hope the city leaders will instead be willing to work together with us to help develop a plan for Boulder to achieve the carbon-reduction it had set as its goal for municipalization."