Minneapolis is negotiating agreements with local electric and natural gas utilities that seek more commitment to clean energy, a year after controversial debates over the city starting its own municipal utility.
City leaders are renewing 20-year-old franchise agreements, set to expire in December, that give Xcel Energy and CenterPoint Energy access to public right of way in exchange for millions of dollars in fees.
The new arrangements are expected to be much shorter in duration, accompanied by a separate partnership that would have utilities work with the city to meet its greenhouse gas reduction targets.
Negotiations could be completed as early as in September, though utility and city officials have declined to offer many details.
Council Member Cam Gordon said he expects that the results will fall in line with an environmental consultant’s recommendations in February. Given the restrictions state laws put on what cities can require in franchise agreements, the report advised Minneapolis to pursue additional partnerships with the utilities that would increase their renewable energy sources and energy conservation programs.
“There’s a lot of details to be worked out, but I think we’re going to be poised to at least hit the ground running next year,” Gordon said.
He said that questions remain about how the city and utilities will work together.
Last year, Xcel CEO Ben Fowke threatened to move the company’s headquarters from downtown Minneapolis if the city moved ahead with plans to form its own utility. City officials eventually backed away from their plan.
This week, a spokeswoman for Xcel described meetings with the city as “open and constructive.”
“Xcel Energy is looking forward to an even deeper partnership with the city on a variety of clean energy initiatives,” utility spokeswoman Patti Nystuen said via e-mail. “We have already begun to explore what we can offer in some areas of special interest to the city so that when we and city officials reach agreement on a clean energy partnership, we will be ready to get started.”
Matt Applebaum, the mayor of Boulder, Colo., met with city leaders in July to talk about their progress on forming a municipal utility, which resulted in a legal battle with Xcel.
There is a lot at stake for utility companies in these discussions, said Timothy DenHerder-Thomas, a coordinator for the organization Community Power, who has supported the clean energy partnership.
“The formation of the city’s utility partnership has the potential to set a new precedent of how major utilities work with cities,” DenHerder-Thomas said. “There’s a lot of pressure right now on the utilities to develop an alternate model for how they work with consumers.”