A majority of the crowd that turned out for Thursday’s public hearing on whether Minneapolis should form its own utility appeared to oppose the idea, raising questions about how the city could afford it and acquire the expertise for such a complicated project.
Supporters described the upcoming expiration of franchise agreements with Xcel Energy and CenterPoint Energy as a key opportunity to push for cleaner, more reliable energy and hold the utility companies accountable, stressing that it is a debate the city needs to have.
“I’m here today not because I think Xcel or CenterPoint or whoever is doing a terrible job, I’m saying we need to do better,” said Emma Wright of the environmental coalition Minneapolis Energy Options.
And after suggesting last week that Xcel would not keep its headquarters in Minneapolis if the city took over distribution of electric service, Xcel CEO Ben Fowke said Thursday he doubts Minneapolis will make the switch.
“We have been a partner for 100 years,” he told investment analysts in a conference call. “I suspect we’ll be a partner in Minneapolis for another 100 years.”
Thursday’s public hearing about whether Minneapolis should jettison those companies in favor of creating its own utility attracted opinions from energy executives, small businessmen, environmental activists, and ordinary citizens during 3½ hours in the City Council chambers.
The Committee of the Whole, which heard Thursday’s comments, will decide Aug. 15 on whether to add the question to the November ballot. Such a referendum would give voters a chance to authorize Minneapolis to create its own utility but would not bind city officials if they ultimately chose another alternative.
The focus of the discussion was mostly on Xcel. CenterPoint recently reached an understanding with Minneapolis Energy Options, which had pushed for the city to consider possibilities beyond simply renewing the franchise agreements to collaborate on energy goals.
Xcel: Costs ‘staggering’
Xcel employees showed up wearing red stickers that said, “Don’t mess with success,” and executives were the first members of the public to speak.
Laura McCarten, Xcel’s regional vice president, said the cost to purchase the company’s assets “would be staggering,” and the city would also be responsible for billing, new construction, restoring power, and more.
“Instead of reinventing the wheel at a very high price for businesses, let’s work together as we have in the past,” she said.
More than 60 people signed up to speak, and a diverse array of people stepped up to oppose the measure, many of them regular citizens unaffiliated with Minneapolis Energy Options or the utilities. They included a North Side woman who described herself as a pinny-pencher and said Xcel’s rates were already low. She said the city can’t even control its slumlords and other problems.
“In Minneapolis, we have great ideas but never have the money to fund them,” another resident told the council.
Among the other opponents were unions representing Xcel and CenterPoint workers, Minneapolis DFL Chairman Dan McConnell (also a union leader for construction and trade workers), who said the city doesn’t have the expertise or money for the project, and mayoral candidate Dan Cohen. He noted that Moody’s had downgraded the city’s credit rating in part because it has an above-average load of debt, and questioned how Minneapolis could take on more.
Lower costs for small business?
While business organizations from the Minneapolis Regional Chamber of Commerce to the Downtown Council spoke against the measure, council members heard another view from Mill City Music president John Kolstad that exploring the creation of a municipal utility could help small businesses like his.
He said if he was going to renew a contract he would first explore all his options, and “it would be irresponsible to renew this franchise agreement without the review … called for by this ballot.”
Louis Alemayehu, of the Environmental Justice Advocates of Minnesota, said he hears people talking about Xcel Energy like residents work for them. “And the reality is, we need to begin behaving like they work for us and ask for what we need, and if they can provide that and work with us then we should continue,” he said. “If they don’t want to, we should find another means.”
In remarks to the analysts, Fowkes said the utility looks forward to working with those in the community who want more clean energy supplied to Minneapolis customers, in a reference to Minneapolis Energy Options.
“I think at the end of the day, we are going to sit down, work with the city, and I think everybody recognizes the cost and risk, the enormous cost for Minneapolis, to go forward with something like that,” he said in the conference call about its quarterly financial results.
Fowke said Xcel is ahead of many of the city’s renewable energy goals, saying the company will achieve a 30 percent reduction in greenhouse gas emissions by 2020.