Energy Systems Framework (Final) -- December 2015

1 • Energy System Transformation•
A Framework for Urban Energy
System Transformation
A Project of the USDN Innovation Fund
December 2015 Final Report

Framework Contents
1. Project Background
P. 4
• Project Phases
• The Big Idea
• Evolution of the Municipal Role
2. Framework Components P. 14
• Establish the Vision
• Understand Your Energy System
• Design Energy System Solutions
• Organize for Transformation
1. Future Directions P. 66
1. Attachments P. 69
• City Profile Summaries
• Background on Energy Supply Systems

City Perspectives on the Challenge
“As cities become more engaged and proactive about energy use and
production within their borders, as Minneapolis has, relying entirely on
utilities to meet City energy goals is not an acceptable condition;
communication must be better, expectations made clearer, interests
more noticeably aligned.
We believe that a city that has engaged in a lengthy and inclusive data-
driven planning process and adopted a strong set of energy goals like
those in the Climate Action Plan needs more control or influence over
energy services, either directly or through a more cooperative,
collaborative relationship with the energy utilities that serve that city, in
order to ensure progress toward those goals.”
(Minneapolis Energy Pathways – A Framework for Local Energy Action,
P. 47)
“It has become increasingly clear that the existing energy system is
undergoing a historic transition. Various innovations and challenges
have begun to shift the local and global energy landscape, including
the expanding use of distributed generation, the increasing frequency
of extreme weather events, and emerging clean technologies that
have the potential to remake our energy system. Efficiency,
conservation, and local generation have begun to undercut utility
revenue and rooftop solar is eroding electricity demand right at the
source.
Harnessing innovation and addressing Boulder’s challenges requires
a flexible approach and an understanding that success takes time.
Here in Boulder, and around the globe, there is a rapidly growing
discussion about the “utility of the future” and the role of end-users.
This energy system transformation has been guiding Boulder’s
activities, including the alignment of the climate commitment and
municipalization.”
(Boulder City Council Work Session Materials on Boulder’s Energy
Future)
“The major challenge in developing a city-wide electricity resource plan is
the fragmented nature of the provision of electricity service in San
Francisco. Currently, the responsibility for purchasing and procuring San
Francisco’s electricity needs is divided between PG&E (75% of total
usage), direct access providers (8%) and the San Francisco Public Utility
Commission’s municipal load (17%).
In order to significantly increase the renewable and GHG-free content of
San Francisco’s electricity supplies, San Francisco and its businesses
and residents must either directly participate in the wholesale energy
market or influence the wholesale procurement choices currently made
by PG&E and other energy service providers.”
(San Francisco 2011 Updated Electricity Resource Plan P. 5)

Project Background

Project Purpose
In January of 2015, the Urban Sustainability Directors Network
(USDN) Innovation Fund approved a $76,000 grant to a coalition of
five member cities to advance a framework on urban energy system
transformation.
The overall purpose of the USDN Energy System Transformation
Framework is to develop a shared vocabulary, understanding and
vision for how municipalities can develop a community-wide energy
planning and management system that supports a transformation of
their energy systems from a fossil fuel base to 100% renewable
energy.
The framework is designed to help USDN members take a leadership
role in this transformation by:
1.Creating a shared language for talking about the transformation of
city energy systems;
2.Clarifying the role that sustainability directors and others in local
government (municipal utilities, finance, transportation, planning,
public works, etc.) can play in facilitating that transformation; and
3.Defining the kinds of analysis and strategy that need to be invested
in to advance the transformation.
The Framework project was staffed by John Cleveland, President of
the Innovation Network for Communities.
Participating Cities
1.Boulder, CO
2.Boston, MA
3.Minneapolis, MN
4.Portland, OR
5.San Francisco, CA
6.Seattle, WA

Project Phases
Phase 1 – City Research And Interviews
Materials from the participating cities were compiled and reviewed and interviews conducted with a
representative or team from each city. (March and April)
Phase 2 – Framework Development and Feedback
Profiles for each city and a draft framework were developed and shared with participating cities. (April-
June)
Phase 3 – Breakthrough Convening
A convening was held July 22-23 in Boulder, CO. Participants in the convening included a combination of
representatives from the participating cities, and national thought leaders who are engaged in energy
systems change. The focus of the meeting was on refining the framework and identifying areas where it
makes sense for cities to collaborate on an on-going basis. (July)
Phase 4 – Final Report
The energy system transformation framework and the results of the convening will be published in a final
report and made available to all USDN members. (Fall, 2015)

The Big Idea
The Energy System Transformation Project Core Hypothesis
The municipal role in energy systems work is evolving from a focus on individual projects and initiatives
primarily targeting greenhouse gas emissions reductions, to a more comprehensive and integrated
approach to energy system planning and management that seeks to accomplish multiple community
benefits simultaneously.
Cities have been drawn into the work of energy systems change primarily driven by their desire to achieve the aggressive
targets for greenhouse gas emissions reductions called for in their climate action plans. This work started with a strong
emphasis on energy efficiency and has evolved to encompass energy demand, energy supply and energy system
resilience. As the breadth and depth of this work has increased, several insights have emerged:
•Reduced greenhouse gas emissions is only one of many community benefits that can come from a comprehensive and
integrated approach to energy systems change. Over time, climate action will become one of the expected outcomes of
the system, and not the core driver of its design.
•The components of energy systems management – demand reduction; supply de-carbonization; and resilience – are
“parts of a whole” and need to be approached in an integrated way, and not as separate programs or initiatives.
•Energy technologies are changing rapidly, and in ways that will increase the importance of place-based design and
management. The configuration and design of distributed generation, renewable energy and demand management
increasingly need to be closely integrated with multiple urban systems and infrastructure designs.
•Most cities lack the technical and human capacity to engage in comprehensive energy systems management. This is not
a function that has historically been thought of as a core municipal function. The responsibility for energy systems
management needs to be clearly identified and the capacity to carry out the functions needs to be developed over time.
•Each city has a very different context, so there is no “one system fits all” approach.

Defining Urban Energy System Transformation
What is Urban Energy System Transformation?
Urban Energy System Transformation is the process of restructuring energy demand and
supply in a municipality to radically reduce the amount of energy consumed, transition
energy supply to fossil fuel-free sources, and make the system resilient to future risks.
There are three basic components of energy systems change work:
•Reduce Energy Demand – reducing the total amount of energy (electricity, thermal, and combustion)
used in key urban systems, including buildings, transportation, industrial, and water/waste management.
•De-Carbonize Energy Supply – restructuring energy supply systems to maximize the percentage of
energy that comes from carbon-free sources.
•Increase Energy System Resilience – designing energy systems so that they are resilient to climate
impacts, including increasing the percentage of distributed energy resources.
These components have to be closely connected with each other (e.g. reducing demand changes the
design of supply systems and visa-versa), and they have to work across all energy sources (electricity,
thermal, transportation).

Climate Goals Have Provided the Initial Motivation
Achieving an “80 percent reduction by 2050” in GHG emissions will
require the near-complete shift away from fossil fuel combustion
(coal, natural gas and petroleum) and replacement with clean energy
sources. This shift will need to be accomplished with all major
current carbon-based fuel uses, including electricity, thermal
combustion and transportation fuels. This will require a fundamental
system transformation (not just physical, but financial, operational
and regulatory) that involves aggressive efficiency measures, fuel
switching, and integrated system redesign. This transformation will
need to take place simultaneously at multiple scales – individual
households/buildings; enterprises and organizations; and
community-wide.
Now is an appropriate time to be having this discussion at the
municipal level. In many places the energy system investment
decisions being made over the next few years will bind communities
to their associated outcomes for decades to come.
The cities engaged in this project are at different stages of strategy
development on this issue. Some have taken aggressive moves to
get control of their energy infrastructure. Others are in the early
stages of doing a “deep dive” to understand their city energy system,
and are just beginning to take stock of what it will require in terms of
demand reduction and de-carbonization to achieve their 80% by
2050 GHG emissions reductions targets. Regardless of the stage of
their work, all the cities will benefit from a more strategic, structured
and shared approach.
Energy System
Transformation Scope
•Energy Sources:
• Electricity
• Heating & Cooling
• Fuels for Mobility
•Energy Strategies:
• Reduce Demand
• De-carbonize Supply
• Increase Resilience
Energy System
Transformation Scales
•Statewide
•Community-wide
•Enterprise-level
•Household & Individual

Energy Is the Largest Single Source of Emissions
As noted earlier, the original motivation for engaging in energy systems change for most cities came
from their GHG emission reduction goals. For the U.S. as a whole, energy accounts for 87% of all GHG
emissions. (Other sources of emissions include agriculture, forestry and other land use; waste; and
industrial processes.) 90% of energy emissions come from electricity or the combustion of fuels for heat
or transportation. The remainder come from fugitive fuel emissions or carbon dioxide transport and
storage. The table below summarizes the percent of total US energy GHG emissions by sector:
Sector Electricity % of US
Energy Emissions
Combustion % of US
Energy Emissions
Sector % of US
Energy Emissions
Residential Buildings 13.6% 5.9% 19.5%
Commercial Buildings 13.2% 3.9% 17.1%
Industrial 10.4% 12.6% 23.0%
Transportation 0.1% 29.9% 30.0%
TOTAL 37.3% 52.3% 89.6%
These percentages will vary by city depending on the types of buildings, fuel sources and electricity
generation sources. Since these are national averages, in cities, the percentages linked to buildings are
often much higher, and to industrial, much lower.
For cities that are pursuing deep de-carbonization strategies, what this means is that the bulk of their
work will be focused on various dimensions of their energy systems.

Energy Management is Emerging as a New Municipal
Function
For cities, work on energy systems is emerging a new municipal
function – community-wide strategic energy planning and
management. Energy is beginning to be seen as a basic municipal
service that cities needs take responsibility for managing, in much
the same way that they do planning for transportation, housing and
other core services.
Energy systems also represents the creation of a new market that is
not yet effectively served by private providers. Currently, the private
service providers to the energy market are highly fragmented, with
participants focusing on narrow dimensions of energy work (e.g. coal
and wind systems; energy efficiency; grid modernization; electric
vehicle systems; etc.). Private players are not yet positioned to play
the large-scale system integration role that is needed. Part of the city
strategy will need to be finding ways to attract private market players
into this niche.
Sustainability professionals are uniquely positioned to facilitate a
strategic approach to energy system transformation that takes the
point of view of the customers of the system – the residents and
businesses that depend on the energy supply. This point of view
encompasses not only the necessary shift in utility business models,
but also the essential integration of energy systems across sectors in
a manner that supports community goals related to health, equity,
economic vitality, environment and quality of life. It allows
communities to consider opportunities to localize the long-term
economic benefits of a decarbonized energy system, instead of
having them accrue solely to utilities and other current energy
providers. It also allows communities to focus on the resilience
advantages of a decentralized energy system.
The Work of Community Wide
Strategic Energy Management
1.Establishing community wide
energy goals and targets
2.Analyzing community energy
systems
3.Developing strategies and plans
to achieve goals
4.Managing implementation and
monitoring progress

The ISO Framework for Energy Management Systems
The global standards organization, ISO,
recently developed a standard for energy
managements systems – ISO 50001. It is
the energy parallel to their quality
standard (ISO 9001) and their
environmental management system
standard (ISO 14001).
The ISO standards are based on a
continuous improvement process
grounded in the Plan-Do-Study-Act cycle
of the quality movement.
While this standard was primarily
developed for enterprise-level application,
Urban Energy Systems Transformation
takes the application of this generic
process to the level of the community as
a whole. This represents, in essence, the
development of a new professional
practice at the municipal level. This
professional practice is early in its
development, and the cities like those
participating in this project are at the
forefront of “field development” for this
professional practice.
(Source: Energy management systems – requirements with guidance for use, British
Standards Institute, 2011)

How the Municipal Role Has Evolved
City energy supply practices have evolved enormously in the last decade. When cities began developing
climate action plans with targets for emissions reductions two decades ago, strategies were very
aspirational in nature and typically organized around relatively low impact demonstration programs. Cities
did not have the staffing, technical knowledge or political leverage to engage in large scale energy
systems change. Over the last two decades, that has changed dramatically.
•More aggressive targets. Cities have set long-term targets with much higher levels of GHG reductions.
All the cities in this project now have a goal of 80% reductions by 2050 or earlier.
•Walking the Talk. Leading edge cities are implementing strategic energy management systems within
municipal government. They are setting energy reduction targets; hiring full time energy management
staff; developing dedicated funding resources; implement enterprise level and building level energy
management software; purchasing renewable power; and rewarding asset managers for performance.
•More sophisticated analysis. Cities are investing in the capacity to deeply understand the technical
details of their energy systems, including developing internal expertise in the operation of electricity and
thermal grids – generation, transmission and distribution – and understanding the structure of those grids
within their municipal boundaries.
•More aggressive policy engagement. Cities are becoming active participants in the energy sector
regulatory process and developing the knowledge and skill sets (often in partnership with outside players)
to intervene in utility rate cases, negotiate with utilities around their energy targets, and engage with
Regional Transmission Organizations on energy supply decisions.
•Making energy systems investments. Increasingly, cities are willing to take on the risk of investing in
and managing energy infrastructure and market mechanisms (utility municipalization; district energy
systems; Community Choice Aggregation; transmission lines; etc.) if that is what they believe is needed to
concretely move them towards their aspired energy future.

The Purpose of the Framework
This Framework emerged out of an desire by leading edge cities to more clearly codify what it means to
engage in the work of “energy systems planning and management” at the municipal level. Because this
is an early stage professional practice area, its functions, standards and methodologies are not well
defined and documented. Each city is inventing their own approach to this work. By coming together to
share what they are doing and evolve it into a more disciplined framework, the cities hope to set the
stage for several decades of work to come.
•Flexible tool. The Framework is intended as a flexible tool to help USDN members think through their
energy system transformation strategies; develop some common language to communicate with
stakeholders; codify leading edge best practices; connect with outside partners who share common
goals; and reduce the barriers to other cities taking on energy system transformation work.
•Not a roadmap. The Framework is not a detailed roadmap for transforming the energy system of any
particular community. The work has to be contextualized in the context of each city’s energy profile,
system design, level of control and power, and community appetite for risk.
•Designed to spawn complementary projects. The Framework is designed to serve as a platform for
additional “deep dive” analysis that is can help cities remove barriers to rapid transformation. There are
already several of these opportunities being developed through Carbon Neutral Cities Alliance
Innovation Fund grants on thermal de-carbonization, a city-based energy “transect”; and district
energy/microgrid strategies.
•Initial practice examples focused on electricity supply. The practice examples in this document are
focused on energy supply issues,(as opposed to energy demand or resilience issues.) More specifically,
most of the detailed examples are is focused on de-carbonization of electricity supply. Future versions
will dive more deeply into thermal and transportation de-carbonization and integrate in examples on
demand reduction and resilience.

Framework Components

Key Components of an Energy System Strategy
1 – Establish the Energy Vision
2 – Understand Your
Energy System
3 – Design Energy
System Solutions
4 – Organize for
Transformation
Reliable Affordable Predictable TransparentClean
Local Control Wealth Creating Innovative Just
Decarbonize
Energy Supply
Reduce Energy
Demand
Increase Energy
Resilience
• Electricity
• Thermal
• Transportation
• Electricity
• Thermal
• Transportation
• Electricity
• Thermal
• Transportation

Framework Components
Component Description
1 – Establish the
Energy Vision
• Create a compelling logic for change
• Articulate the desired outcomes
• Engage key stakeholders in the dialogue
2 – Understand Your
Energy System
• Describe the existing energy system “ecology”
• Map energy demand and supply systems
• Conduct technical analysis to support projects and policy
change
• Build a system for monitoring system performance
3 – Design Energy
System Solutions
• Reduce energy demand
• Decarbonize energy supply
• Increase energy resilience
4 – Organize for
Transformation
• Invest in the staff, resources and other assets that are
needed to take on this work.

Summary Description of the Components
1. Establish the Energy Vision. Cities need to clarify, make public, and develop stakeholder support for
the fact that their sustainability aspirations require an energy system that is eventually close to carbon-
free, and provides a full range of benefits to community residents. Firm commitment to this aspiration,
as well as a clear understanding of its feasibility and the benefits it brings, is essential to achieve the
political will necessary to take on the contentious issues involved in energy system transformation.
This stage typically requires deep stakeholder education and engagement to assure political support
for the transition.
2. Understand Your Energy System. It is not possible to make informed choices about a city’s energy
future if you don’t have deep knowledge about how the current system works. Many of the cities
engaged in this project have done, or are in the process of doing, “deep dives” on their city energy
systems (electricity, natural gas, steam, Combined Heat and Power, renewables, etc.) to understand
the sources of power; transmission and distribution systems and technologies; and how the supply
maps to key components of demand. This analysis requires, by necessity, achieving a deeper level of
technical knowledge of power systems than cities are typically accustomed to developing.
3. Design Energy System Solutions. There are many options for structuring the transition from current
energy systems to carbon-free energy systems that meet multiple community goals. The path for each
city will vary based on current system structures, local resources and other variables. Multiple choices
need to be made about power sources and transmission/distribution that balance concerns of
emissions reductions, cost, cost volatility and reliability.
1. Organize for Transformation. Finally, cities need to build the internal capacity to manage the
implementation their energy systems transformation strategy. This requires both building internal staff
capacity and expertise, and building relationships with external partners.

Local Factors That Influence City Energy Strategies
Local conditions vary significantly from city to city. Energy transformation strategies need to be
designed to take these factors into account. The list below highlights those factors that will drive the
customization of a city’s approach. (See Attachment 1 for more detail on how these factors vary across
the cities involved in this project.)
•The Cost of Energy. The higher the cost of energy, the more there is a market incentive for energy
efficiency, and the more competitive renewable sources are. The cities in this project represent a broad
spectrum of energy costs – from very affordable to very expensive.
•The Aggressiveness of Targets. Different cities have set different targets for energy system de-
carbonization. The aggressiveness and timing of these targets affects the strategies they undertake in
the short and long term. Of particular importance is the timing of strategies that are connected to assets
with long lifecycle. Decisions in the short term (such as investments in new natural gas pipelines; fossil
fuel power plants; or transmission lines) can “lock in” certain patterns of energy use that are then very
difficult to change.
•Existing Power Mix. The carbon intensity of existing power sources will influence the kinds of
strategies that cities undertake. Cities with high levels of renewables in their current power mix will need
less radical strategies to achieve deep de-carbonization than those that are starting from a base that
has a low carbon intensity.
•Legacy Power Systems. The design of historical power systems will influence a range of options for
cities. Factors will include the structure of district energy systems; transmission constraints; and legacy
generation plants. These legacy systems affect the economic and political feasibility of different strategy
options.

Local Factors That Influence City Energy Strategies (cont’d)
• Alignment of State and City Goals. Some cities have set targets for energy system de-
carbonization that are more aggressive than their state targets. This leads these cities to need to act
independent of state policy to achieve their goals. Cities whose targets are aligned with state targets
are more likely to focus their system de-carbonization efforts on advancing and supporting state level
implementation (such as Renewable Portfolio Standards).
• Regulatory Framework. Strategies for de-carbonization are heavily influenced by the nature of the
state regulatory framework for the power sector. Key differences include:
• Whether the power generation sector is regulated or de-regulated.
• The nature of incentives for energy efficiency.
• The nature of incentives for renewables (e.g. Renwable Portfolio Standards, net metering, feed-
in tariffs, Community Solar, etc.)
• The availability of options like Community Choice Aggregation
• Level of Utility Control. There is a fundamental difference between cities that have municipal
utilities and those that don’t. Cities are much more able to influence the carbon intensity of their
municipal systems than the carbon intensity of large Investor-Owned Utilities. IOUs need to be
influenced through legislation and regulatory proceedings controlled by the Public Utility
Commissions and the Federal Energy Regulatory Commission, whereas municipal utilities are
controlled at the local level.
• City Capacity. Finally, a city’s strategy has to take into consideration the staff and funding capacity
the city has to design and implement a strategy. Energy system transformation takes work, and work
costs money. Cities need to have dedicated staff with technical expertise and budgets that can
support detailed technical analysis and participation in regulatory proceedings.

Some Best Practice Principles
• Comprehensive. Energy systems transformation is most effective when it addresses all strategies
(demand reduction; supply de-carbonization and system resilience) and all energy sources (electricity;
heat; mobility) simultaneously, and pays attention to the intersections and synergies between them.
• Integrated. Energy systems transformation work needs to be integrated with other community
planning processes, including broader sustainability frameworks and plans; climate action plans;
comprehensive plans; transportation master plans; etc.
• Multiple Scales. Energy system transformation work is not just about utility scale change. It needs to
address opportunities for change at all scales – individual households; enterprises/organizations; and
community-wide infrastructure.
• Grounded in Customer Requirements. The process of change needs to involve deep stakeholder
and customer engagement and be managed in a way that community members are able to see and
experience direct benefits that add value to the quality of their lives.
• Equitable. The design of the new energy system needs to assure that the needs of disadvantaged
populations and neighborhoods are addressed, and that benefits and costs are equitably distributed.
• Grounded in Scalable Market Economics. Large-scale systems change in energy systems will not
happen if market forces are not aligned with targeted outcomes. Subsidies can advance innovation at
small scales, but cannot support deep market penetration. Systems need to be developed that have
compelling economics for users. The best renewable energy is renewable energy that is cheaper, more
convenient and more reliable than its fossil fuel-based alternative. Capturing full value and pricing
externalities is critical to creating a level economic playing field.

Some Best Practice Principles (cont’d)
• Grounded in Engineering Knowledge. Energy systems – especially electricity grids – are complex
and have very specific requirements for reliable performance. Engagement in energy systems
transformation requires municipalities to develop deep technical knowledge of how systems work so that
their strategies for change are feasible from a technical point of view. (The challenges of balancing a
grid and maintaining required frequency levels with high percentages of intermittent renewables supplies
is a good example of this.)
• Respectful of Control Limitations. There are many aspects of community energy systems over which
municipalities have limited control or influence. The City strategy has to respect these limits and be
grounded in an understanding of a city’s real points of leverage.
• Willing to Exercise Influence. Despite limitations of control, cities need to be willing to exercise their
influence as major energy-consuming customers and articulate their “voice of the customer” in
demanding that energy suppliers align their products and services with their energy vision goals.

1 – Establish the Energy
Vision

Highlights for “Establish the Energy Vision”
• Start with Emissions Reduction Targets. The starting point for most cities in setting their energy
vision is the GHG reduction targets they commit to in their climate action plans.
• Set Specific Energy Targets. Over time, cities find value in creating more detailed targets for the
different components of the energy sector, and articulating a vision of the characteristics that they
want to see in that system over the long term. These targets and goals shape the nature of the
strategies the city seeks to implement.
• Pursue Multiple Benefits. Clean energy (GHG-free power) is core to this vision, but it is not the
only benefit envisioned. Cities see a transformed energy system as also a vehicle for local
economic development; better customer service; more reliable power; more consumer choice;
reduced price volatility; lower energy costs; cleaner air; and improved equity.
• Get Serious About Taking Control. Aggressive targets and a determination to achieve them
leads cities to focus on strategies for getting “more control over their energy futures”. To achieve
this control, cities are willing to be much more forceful and aggressive, and take more risk to
achieve the targets.
• Need to Communicate Complexity Simply to Stakeholders. The details of decarbonizing
energy supply are very complex, from a technical, legal, regulatory and financial point of view. All
cities are struggling to find ways to simplify citizen understanding of the choices and develop
deeper engagement with stakeholders so that the clean energy future constituency is broadened
beyond the “usual suspects.” In specific, this requires framing the vision in language that makes
the multiple benefits clear to residents and taxpayers, and not only framing the transformation from
a climate perspective.

Project City GHG & Energy Goals and Targets
City Emissions
Reduction Targets
Specific Energy Targets
Boulder 80% by 2050
• 50% renewables in year one of municipalization
Boston
25% by 2020
80% by 2050
• 15% of large C/I energy use from co-generation (2020)
• 10 MW of commercial solar (2020)
San Francisco
25% by 2017
40% by 2025
80% by 2050
• GHG free electric system by 2030
• Offer a portfolio of energy resources to residents through
a CCA that is 51% renewable by 2021.
Minneapolis 80% by 2050
• Generate 10% of electricity from local renewable sources
by 2025
Portland
40% by 2030
80% by 2050
• Supply 50% of all energy used in buildings from
renewable sources
• 10% of building energy use supplied by on-site renewable
sources
Seattle
62% by 2030
Carbon Neutral by 2050
• Maintain current carbon neutrality of electricity supply
• 97% reduction in transportation emissions by 2050
• 82% reduction in building emissions by 2050

Typical Targeted Energy System Outcomes
Desired Energy
System Outcome
What It Means
Clean
Reduce carbon emissions and toxic pollutants created by the energy
system.
Reliable
Minimize system downtime from outages and ensure high quality of
the power delivered.
Affordable
Keep rates as low as possible and maintain competitiveness with
market pricing.
Predictable Minimize rate volatility.
Transparent
Consumers can understand their power costs and what drives
changes in them.
Local Control
Give residents greater control over their energy resources and energy
choices
Wealth-Creating
Keep more of the revenue in the local economy instead of exporting it
to outside suppliers and helps drive local economic development,
creating new businesses and jobs.
Innovative
The energy system spawns innovation, intellectual property creation,
and entrepreneurship.
Just
The system promotes “energy equity”, protects vulnerable populations
from undue hardship and promotes energy literacy.

Examples of City Goals and Outcomes (1)
San Francisco 2002 Energy Resource Plan
Goals
•Assure Reliable Power
•Maximize Energy Efficiency
•Develop Renewable Power
•Increase Local Control
•Affordable Electric Bills
•Improve Air Quality
•Support Environmental Justice
•Promote Economic Opportunities
CleanPower San Francisco Goals
•Provide customers with a choice for their
electricity supplies.
•Reduce the City’s reliance on fossil fuels.
•Reduce pollution and greenhouse gas
emissions associated with electricity
generation necessary to serve San
Francisco’s residents and businesses.
•Provide electricity supplies at rates that are
competitive with PG&E service and to
stabilize electricity rates for City residents
and businesses enrolled in the program.
•Increase local control over electricity
supplies.
•Increase local green job opportunities.
Minneapolis Energy Vision Goals
•Reliable and affordable energy services, where all residents
and businesses are supplied with competitive rates, and
disparities in the relative cost of energy services for low-income
households are mitigated.
•Clean energy, where the total carbon emissions and other waste
products have substantially declined, and electricity supply is
nearly carbon-free.
•Provision of essential energy services for all, affordably
meeting the basic needs of residents, without disparity of impacts
or benefits according to race, ethnicity, income, and age.
•An increasing use of local resources within the city, including
renewable energy and efficient district heating. A robust local
supply chain exists in the city for energy efficiency and renewable
energy services, and Minneapolis is a national leader in advanced
energy infrastructure.
•Market integration of efficiency that makes use of transparent
data in economic and purchasing decisions. Residents and
businesses are empowered to save money and reduce their
environmental impact.
•Collaborative progress on planning and investment decisions
by the energy utilities that serve the city. These decisions reflect
and support the City’s climate action, economic development, and
social equity goals.

Examples of City Goals and Outcomes (2)
Boulder Energy Future Goals
1.Ensure a stable, safe and reliable energy supply.
• System redundancy, supply quality and load
management
• Fuel source stability
• System reliability
2.Ensure competitive rates, balancing short-term
and long-term interests.
• Rate competitiveness
• Rate transparency and predictability8
• Technology investment and managing price
volatility.
3.Significantly reduce carbon emissions and
pollutants.
• Reduction of GHG emissions
• Reduction of toxic pollutants
4.Provide energy customers with a greater stay
about their energy supply.
• Democratizing local decision-making
• Democratizing local ownership
5.Promote local economic vitality.
• Support for local business innovation
• Economic competitiveness
6.Promote social and environmental justice.
1. Energy equity
2. Impacts to vulnerable populations
3. Energy literacy
Boulder Energy Localization Framework
1.Democratize Energy Decision Making: customers
should have more direct control and involvement in
decisions about their energy, including opportunities to
invest in their long-term energy needs and to have a say
in energy investments made on their behalf.
2.Decentralize Energy Generation and Management:
energy should be generated locally or within the region
to the maximum extent feasible, reducing reliance on
external fuel sources; customers should be able to
manage and reduce their energy use as directly and
effectively as possible; and energy service companies
should be empowered to compete and innovate within a
diverse and robust local energy economy.
3.Decarbonize the Energy Supply: renewable and
clean fuel sources should be maximized as much as
possible, as quickly as possible, minimizing both short‐
and long term environmental impacts and maximizing‐
energy independence over time.

2 – Understand Your Energy
System

Highlights for “Understand Your Energy System”
• Analysis is the Foundation for the Strategy. The energy systems analysis provides the analytical
foundation for a city’s energy system transformation strategy. It creates a level of operating detail
that allows stakeholders to know where the opportunities for improvement are, and what the
consequences of different choices are.
• Happens at Different Levels. Different levels of analysis serve different purposes. At the highest
level is a basic understanding of the regional energy systems the City participates in – the shape of
the Independent System Operator (ISO) or Regional Transmission Operator (RTO) region; utilities
and territories; power sources; transmission and distribution infrastructure; macro load profiles;
regulatory players and roles; etc. As projects become more concrete (e.g. a municipal utility or a
district energy system), the level of fine-grained detail increases rapidly.
• Requires New Expertise. Depending on the level of depth of the analysis, the energy systems
analysis requires high level of technical expertise. Even if this expertise is purchased from outside
sources, city staff still need to be knowledgeable enough to make qualitative and quantitative
judgments about the data. Staff need to understand energy supply, transmission, distribution,
regulation, pricing and maintenance practices.
• Technical Expertise Increases System Leverage. As a city’s knowledge of its energy system
increases, so does its capacity to influence decisions about the future design of that system. It
allows city staff and external partners to intervene more effectively in Public Utility Commission and
ISO/RTO proceedings, and state legislative decision making. It also creates a different level of
credibility with private sector players such as IOUs and renewable energy providers.

Different Levels of Energy System Analysis
There are different levels of energy system analysis that cities can invest in. Each one serves a different
set of purposes. Taken together, they provide a detailed and comprehensive understanding of the energy
system “ecology”.
•Energy System Overview. This level of analysis provides stakeholders with a basic understanding of
how the energy system that the city is embedded in works. It is typically more qualitative than quantitative
in its contents. Some elements can include:
• An overview of the regulatory framework (FERC; ISO/RTO; PUC; state law,; etc.) and how
decisions on energy pricing, transmission and generation are made.
• An overview of energy supply sources (utilities and their service areas; transmission lines; power
generators; power mix; etc.).
• Identification of key opportunities to transform the energy system (which creates the bridge to the
strategy document).
•Citywide Energy Studies. Another type of analysis is what Boston refers to as a “citywide energy study.”
It will typically go to the next level of detail and begin building a more quantitative understanding of the
city’s energy system. This will include detail on: energy loads by building and area; transmission lines, sub
stations and transformers; existing un-regulated generation sources (district energy and CHP); and
potentials for new local generation (renewables; district energy; microgrids; CHP).
•Project-Specific Analysis. Specific projects require an additional level of analytical detail because they
need to support investment decision making on the part of the city and other investors. Examples are
municipalization efforts and district energy projects.
•Policy-Specific Analysis. These are technical analyses that are done to influence specific policy
decisions being made by others. An example would be a proposal for new regional gas pipelines or
transmission lines.

An Example of an Energy System Overview (Minneapolis)
Purpose. The Minneapolis Energy Pathways report is designed to create a framework for choices the
city can make about its energy future. It includes an overview of the city’s energy system, definition of
possible future pathways, and recommendations on which pathways to pursue.
Analysis Components
•Current energy system landscape
• Energy use and services
• Types of utilities
• State regulatory framework
• Federal & regional regulatory
framework
•Local utility franchise agreements
•Potential energy vision pathways
• Enhanced franchise agreements
• City-utility partnerships
• Community Choice Aggregation
• Municipalization
•Future technology, business models and
regulatory frameworks
Types of Data Included
Electricity Market
•Electricity sales by type of utility
•Historical energy prices
•Energy consumption by sector
•Energy prices by sector
Renewable Power & Energy Efficiency
•Carbon intensity of electricity supply
•Local renewable generation
•State Renewable power sources and installed
capacity
•Energy efficiency achievements by type of
utility

An Example of a Citywide Energy Study (Boston)
Purpose. Boston’s citywide energy study is designed to build a quantitative basis for understanding
how much energy the city will demand in the future, and how much of this energy can be generated
locally instead of being imported. It is designed to answer three specific questions:
•How much thermal and electric energy can we locally produce in Boston?
•How could that energy be distributed?
•What are the benefits of producing local energy for our communities and businesses?
Analysis Components
The energy study is being conducted by MIT’s Building
Technology Department and MIT Lincoln Labs. The
analysis components will include:
•An Energy Data Set that is capable of modeling the
energy demands of Boston’s existing and future building
stock.
•A set of scenarios for clean and renewable energy
supply. These scenarios will model the impacts of
deploying different mixes and different levels of local
energy supply, including solar PV, solar thermal, battery
storage, cogeneration, district heating, district cooling
and microgrids. The scenarios will estimate the GHG
emissions and energy system resilience of different
combinations.
•Software to manage incorporation of new building data
and future scenarios.
Report Outputs
•A written summary of Boston’s existing
and future energy demand and how the
local energy supply scenarios will affect
the City’s environmental and resilience
performance.
•Visual representations of the energy
loads throughout the city.
•A summary of the clean and renewable
energy scenarios.

An Example of Municipalization Analysis (Boulder)
Purpose. Boulder’s energy system analysis has been largely focused on determining the feasibility of
establishing a viable municipal utility from the assets of the Investor Owned Utility (Xcel) serving the
city. The analysis generally fell into three phases:
1.Municipalization feasibility studies
2.Municipalization business plans and system modeling
3.Legal analysis to establish the City’s rights to acquire Xcel assets
4.Transition and implementation planning
Analysis Benchmarks
Amendments to the City Charter approved by
voters established very specific performance
parameters the municipal utility needed to
meet before being implemented, including:
•Rates that do not exceed the rates Xcel
charged at the time of acquisition.
•The ability to pay operating and debt
payments of the utility, plus funds equal to
25% of debt payments.
•Power reliability equal to Xcel’s.
•A plan to reduce GHG emissions, reduce
pollutants, and increase renewable energy.
Report Examples
Some of the key reports with links to on-line
documents are listed below.
•Preliminary Municipalization Feasibility Study ,
R.W. Beck 2005)
•Boulder Municipal Utility Feasibility Study ,
Robertson-Bryan, Inc. (2011)
•Boulder Municipal Utility Business Plan ,
Robertson-Bryan, Inc. (2011)
•Independent Expert Findings: Review &
Verification of Modeling of New Electric Utility,
PowerServices, Inc. (2013)
•Review of Updated Model for New Electric Utility ,
PowerServices, Inc. (2013)
•Report of Transition Planning for New Electric
Utility, PowerServices, (2014)

Municipalization Analysis Content
Utility Feasibility Analysis
•Overview of physical assets of
the electricity system
• Distribution
• Utility operations
• Transmission
•Utility goals
• Rate stability
• Carbon reduction
• Reliability
•Financial feasibility
• City load
• Stranded cost
estimate
• Acquisition costs
• Start up costs
• Cash and bonds
• Annual budget
•Energy sources
• Local renewables
• Wholesale purchases
• Wholesale
transmission
•Customer rates
Utility Business Plan
•Utility goals
•Utility structure
•Process for creating the utility
• Planning
• Legal creation
• Resource procurement
•Start up tasks
• City staffing
• Distribution
• Metering
• Scheduling
• Accounting and billing
•Modeling and simulation
• Financial
• Reliability
• Resource mix
• Asset acquisition
• Legal structure
•Legal activities
Utility Transition Plan
•System characteristics and
interconnection plan
•Organizational chart
•Critical milestones
•Scenario analysis and
comparisons
•Utility functions
• Construction,
operations and
maintenance
• Customer service
• Energy services
• Finance & accounting
• Planning &
engineering
• Power supply &
delivery
• Legal/regulatory
• Support services
•Implementation steps
Below is a short summary of the kinds of analysis included in each phase of Boulder’s municipalization
process.

An Example of District Energy Analysis (Seattle)
Purpose. The International District Energy Association (IDEA) is the trade association of district
energy operators. In 2012, IDEA issued a guide to developing district energy projects: Community
Energy, Planning, Development and Delivery. It provides recommendations on the stages of project
development, as well as the analytical data that is needed to make district energy choices. One of the
case studies in this report is the City of Seattle 2011 District Energy Pre-Feasibility Study. It is a good
example of the level of detail needed in this kind of project implementation.
Stages of District Energy Project
Development
1.Objective Setting
2.Data Gathering
3.Project Definition
4.Options Appraisal
5.Feasibility Study
6.Detailed Financial Modeling
7.Detailed Business Modeling
8.Marketing and Business Development
9.Procurement
10.Delivery
Data Required for Analysis
•Development density
• Heat density
• Buildings per foot of distribution
piping to be installed
•Demand loads
• Event loads
• Daily & yearly load profiles
• Anchor loads
• Projected demand growth rates
•Mix of end energy uses
•Age of buildings
•Existing gas and heat networks and electricity
sub-stations
•Existing power plants and power sources
•Transportation infrastructure
•Translation of data into visual representation
(“heat maps”)

Examples of Legal Analysis
Both Boulder and Boston invested substantial resources in understanding and pursuing their legal
rights to pursue changes to their energy systems. In each instance the analysis focused on city rights
relative to the franchise rights of utilities. While each city took a slightly different tact, both examples
are illustrative of the kind of legal analysis that is often needed to support a city’s ability to get control
over its energy future.
Boulder Legal Analysis
A key part of Boulder’s energy system analysis has
included legal analysis and legal action to establish the
conditions under which the City can acquire the Xcel
assets needed to run its utility. Xcel sued the City to
block the asset take over process on multiple
occasions .
The legal issues Boulder invested resources to clarify
included:
•Does Boulder have the right to condemn Xcel assets,
and if so, under what conditions? (Xcel sued based on
the claim that the City failed to meet requirements set
out in the City Charter. There has been no ruling yet on
this lawsuit.)
•Does Boulder need approval for its condemnation plan
from the Public Utility Commission? (Boulder is in the
process of seeking PUC approval.)
•Does Boulder need approval from the Federal Energy
and Regulatory Commission (FERC)? (FERC indicated it
does not need to approve Boulder’s plan.)
Boston Legal Analysis
As part of its regulatory reform strategy, the City
commissioned an analysis of the legal obstacles to
microgrid development in the city by Harvard University.
This report identifies a number of ways in which franchise
right barriers to microgrids can be overcome.
The Harvard report sought to understand whether or not
this franchise language means that utilities have approval
control over microgrids – especially Multi-User Microgrids.
The report found that the franchise clause would not
apply to single owner microgrids, or multi-user microgrids
where each of the users is also an owner of the microgrid
assets, because no transfer of ownership and control of
electricity occurs. In the case of a multi-user microgrid
that operates without joint ownership, the report found
that there is also a possible legal interpretation that would
exempt such an arrangement from being subjected to the
franchise clause.
(Massachusetts Microgrids: Overcoming Legal Obstacles)

3 – Design Energy System
Solutions

Highlights for “Design Energy System Solutions”
• A Practice Field in Early Development. As noted earlier, the domain of comprehensive energy
systems transformation at the municipal level is early in its stage of development. Cities are feeling
their way through the process of understanding where they do and do not have leverage and what
their real options for change are.
• Grounded in City Practice. This section of the framework describes the menu of strategies that
cities can pursue to move their energy systems towards a low-carbon, reliable and wealth-creating
future. This menu is grounded in the practical approaches taken by the cities participating in this
project.
• The Need for Integrated Approaches. Energy systems change requires an integrated approach at
two levels:
• Integration of demand reduction, supply de-carbonization and system reliability strategies
• Integration of strategies across energy sources – electricity, thermal and transportation
Change in each of these domains has economic, legal and technical implications for the other domains.
• The Examples in This Report are Focused Mainly on Electricity Supply. Due to resource
limitations, the strategies documented by the cities participating in this project are focused on de-
carbonization of electricity supply. As a result, detailed implementation information energy demand
activities, thermal and transportation de-carbonization, and system resilience strategies is not
presented. Several future projects of the Carbon Neutral Cities Alliance Innovation Fund are
designed to address these areas. Brief descriptions of those projects are provided at the end of this
report.

Energy System Solutions Strategy Map
Energy System Solutions
Decarbonize Energy
Supply
Reduce Energy Demand Increase Energy
Resilience
• Electricity
 Increase local clean
energy supply
 Decarbonize imported
power
• Thermal
 Combined Heat & Power
 District Energy
 Heat electrification with
renewables
• Transportation
 Alternative fuel vehicles
 Alternative fuel
infrastructure
• Electricity
 Energy efficiency
portfolio standards
 Improved grid
transmission
 Building energy
efficiency
• Thermal
 Building energy
efficiency
• Transportation
 Mode shift strategies
 Vehicle efficiency
standards
• Electricity
 Distributed generation
 Microgrids
 On-site storage
 Infrastructure hardening
• Thermal
 Distributed generation
 On-site storage
 Infrastructure hardening
• Transportation
 Redesign transportation
infrastructure

Typical Strategies by Energy Source
Energy
Source
Reduce Demand Decarbonize Supply Increase
Resilience
Electricity • Energy Efficiency Portfolio
Standards
• Improve grid transmission
performance
• Building energy efficiency:
 Codes and Standards
 Building Retrofit Programs
 Enterprise Strategic Energy
Mgt
 Building Energy Mgt
Technology
 Information Transparency
 Finance Innovations
• Increase local clean energy
supply
 District energy, micro-grids
and CHP
 Local generation Municipal
Utility
 Clean power purchasing
• Decarbonize imported power
 Renewable Portfolio
Standards
 Retire fossil-fuel plants
 Utility Partnerships
 “Utility of the Future”
• Distributed generation
• Micro-grids
• Infrastructure hardening
Thermal • Building energy efficiency (see
above)
• Combined Heat and Power
• Tri-Generation District Energy
• Heat electrification with
renewables
• On-site generation
• Power storage
Transportation • Mode shift strategies
• Walking
• Biking
• Public Transit
• Vehicle Efficiency standards
• Alternative Vehicle Fuels:
 Electric Vehicles
 Fuel Cells
 BioFuels
• Alternative Fuel Delivery
Infrastructure
• Redesign transportation
infrastructure

Integrating Demand, Supply and Resilience Strategies
“It cannot be emphasized too
strongly that continued and
increased emphasis on energy
efficiency is the least expensive
lever to reduce San Francisco’s
GHG footprint. While accessing the
opportunity is more complex than
building or acquiring generation, is
is well worth the effort and can
dramatically help reduce system
costs.”
(San Francisco 2011 Electricity
Resource Plan, P. 7)
Energy efficiency, supply de-carbonization and resilience
strategies have to be approached in an integrated way. At
early stages of experimentation it may not matter, but as the
strategies approach any kind of scale, they begin to have an
enormous impact on each other. Some examples include:
•Energy efficiency will have a big impact on the design and
sizing of distributed generation systems. An extremely energy
efficient building will be able to get to “net zero” with on-site
renewables, whereas a traditional building won’t. And without
pushing the limit on demand reduction, owners risk
overbuilding systems.
•Supply de-carbonization will require new strategies for
demand management (including remote systems) to manage
increased variability in energy supply. The more efficient
buildings are, the easier it is to do effective demand
management.
•Distributed energy systems have multiple resilience benefits
that need to be factored into the calculation of cost
effectiveness.
•Renewable sources are less vulnerable to “single point failure”
and can be designed into resilience strategies.

A Focus on Electricity
Supply Decarbonization

Typical Energy Supply Decarbonization Strategies
Electricity Thermal Transportation
• Increase local clean energy
supply:
• District energy, micro-grids and
CHP
• Local generation (individuals &
enterprises)
• Municipal Utility
• Clean power purchasing
• Community Choice
Aggregation
• Decarbonize imported
power:
• Renewable Portfolio Standards
• Retire fossil-fuel plants
• Utility Partnerships
• “Utility of the Future”
• Grid Modernization
• Transmission Planning
• Time-Variant Pricing
• New Revenue Models
• Reduced Peak Load
• District heating and
cooling systems:
• Heating conversion to
biofuels
• District heat pumps
• Heat system conversion:
• Air heat pumps
• Geothermal heat pumps
• Deep water cooling
• Alternative fuel vehicles:
• Electric vehicles
• Fuel cells
• Hybrid vehicles
• CNG vehicles
• Biofuels
• Alternative fuel Delivery
Infrastructure :
• EV charging
infrastructure
• Hydrogen infrastructure
The more detailed examples in the next several pages are focused on electricity system de-
carbonization strategies being pursued by project cities.
The examples in this report
are mostly (but not only)
focused here

Electricity Decarbonization – Increase Local Clean Energy Supply
Increase Local Clean Energy Supply
Strategy Details
District Energy,
Microgrids and
CHP
• Conduct detailed analysis of energy demand and map the opportunity for
distributed generation development
• Develop city-owned distributed generation projects
• Create regulatory frameworks that remove barriers to district energy (DE)
development
• Provide technical assistance and regulatory assistance to property owners
Provide financial incentives for DE
• Integrate DE planning into city zoning approval processes for large
developments
• Conduct due diligence on DE project opportunities and aggregate customer
demand to attract private developers into the market
Local Generation • Implement solar programs to help individuals and enterprises develop on-site
generation
• Provide additional net metering or feed-in-tariff incentives to city residents
• Increase municipal utility renewable energy generation or procurement
• Incentivize Combined Heat and Power
• Create a municipal utility
Clean Energy
Purchasing
• Implement Community Choice Aggregation for city residents (if allowed by
state regulation)
• Assist large enterprises in implementing clean energy purchasing through
PPAs and other arrangements

Electricity Decarbonization – Decarbonize Imported Energy
Decarbonize Imported Energy
Strategy Details
State Standards • Increase State Renewable Portfolio Standards
• Increase Net Metering limits
• Close inefficient fossil fuel plants
Utility
Partnerships
• Create local partnerships with utilities on supply de-carbonization
Utility of the
Future
• Grid Modernization
• Smart Grids (Advanced Metering Infrastructure)
• Improved grid performance (Volt/VAR Control)
• Automated Demand Management
• Improved Storage and Frequency Regulation
• Improved Transmission Planning
• Time-Variant Pricing
• New Utility Revenue Models
• Revenue De-Coupling
• Performance-Based Compensation
• Fixed Cost Recovery
• Minimize Stranded Assets
• Reduce Peak Load Requirements

Thermal and Transportation De-carbonization Strategies
Decarbonize Thermal Energy Sources
Strategy Details
District Heating
and Cooling
Systems
• Implement district energy systems that radically increase the efficiency of
fuel use.
• Convert heating systems from fossil fuels to renewable sources of
combustion.
• Implement electricity-powered heat pumps at a district energy scale, and
power them with renewable electricity.
Heat System
Conversion
• Convert household heating systems to electric air or geothermal heat
pumps.
• Use natural sources for cooling, such as deep water district cooling
systems.
Decarbonize Transportation Energy Sources
Strategy Details
Alternative Fuel
Vehicles and
Infrastructure
• Incentivize low or no-carbon fuel vehicle ownership and use
• Implement alternative fuel infrastructures, such as charging stations and
hydrogen stations
• Convert municipal fleets to low carbon fuels
• Convert public transit to low carbon fuels
• Facilitate the use of municipal assets (such as solid waste and wastewater
systems) to produce alternative transportation fuels

How De-carbonization Strategies Influence Each Other
Electricity Thermal Transportation
• The electricity system needs to
be designed to accommodate
electrification of heating and
mobility.
• Depending on the level of
energy efficiency, this will put
large new demands on power
production and transmission.
• Higher proportions of renewable
sources is likely to require more
transmission capability for the
same amount of power. This
new requirement needs to be
factored into grid design and
transmission pricing.
• There are limited large scale
sources of renewable thermal
combustion. Therefore a deep
de-carbonization strategy will
likely over time require the
electrification of heating
systems.
• This additional load has to be
taking into consideration in grid
design.
• The transition to electrification
has to be synchronized with grid
de-carbonization to avoid
unintentional increases in
carbon intensity.
• Both vehicle electrification and
hydrogen production from
renewable sources will put
additional demands on the grid.
• When implemented at scale,
EVs can become part of the grid
energy management. EVs will
be connected to the grid and the
grid will pull and push power
from then as it needs it to
balance loads.
Each primary de-carbonization strategy will influence the other strategies when implemented at scale.
Below are some of the inter-relationships that need to get taken into consideration as cities
development and implement their energy de-carbonization strategies.

Ways Cities Can Influence Electricity Systems
Influencing the multiple players that control electricity systems is a complex undertaking. (See
Attachment 2 for more detail on these players.) Cities are large customers of electricity systems, but
(unless they run their own utility), they have limited control over how the system is designed or
operated. They need to exercise their influence through more indirect means.
Electricity System
Player
How Cities Can Exercise Influence
Utilities
• Create partnerships around implementation of renewable energy and
energy efficiency initiatives.
• Provide input to utility Integrated Resource Plans.
• Provide input to utility grid modernization plans.
• Negotiate new relationships based on franchise agreements.
Generators
• Aggregate renewable energy purchasing power to support the entrance
or expansion of renewable suppliers into the generator pool.
FERC
• There are limited opportunities for municipal engagement on FERC
issues.
ISOs and RTOs
• Participate in ISO/RTO planning and working groups and provide input to
ISO/RTO planning and forecasting documents.
Public Utility
Commissions
• Track and participate in PUC dockets.
• Try to influence who is appointed to PUCs.
• Intervene in utility rate cases.
Legislature
• Lobby for more aggressive Renewable Portfolio Standards and Energy
Efficiency standards.

Lead Electricity Strategies For Project Cities
Electricity Supply Decarbonization
Boston
San Francisco
Boulder, Seattle
Portland
Minneapolis
Increase local clean energy supply:
• District energy, micro-grids and CHP
• Local generation (individuals & enterprises)
• Municipal utility
• Clean power purchasing
• Community Choice Aggregation
Decarbonize imported power:
• Renewable Portfolio Standards
• Retire fossil-fuel plants
• Utility Partnerships
• Utility of the Future

Strategy Example – Municipalization (Boulder)
Strategy Summary. The city of Boulder decided in 2011 to explore the feasibility of establishing a
municipal utility. This decision was based on two conclusions: 1) that it is not possible for the city to
achieve its aggressive GHG reduction goals without an energy supplier willing to partner with the City to
achieve those goals; and 2) that the current electricity supplier (Xcel Energy, an investor-owned utility) was
unwilling to enter into this kind of partnership to pursue deep de-carbonization of the city’s energy supply.
Since 2011, the city has pursued the municipal utility implementation path, including conducting numerous
feasibility studies and analyses; defending its legal rights; filing plans with regulatory authorities; legally
establishing the utility; authorizing funding; and putting in place a transition plan.
Strategy Components
1.Determine that achieving carbon reduction
goals require more direct control over electricity
generation.
2.Get voter authorization to explore
municipalization and establish performance
requirements.
3.Conduct feasibility assessments.
4.Develop a utility business plan.
5.Legally authorize the utility and municipal
funding for acquisition and operation.
6.Pursue legal course of action to condemn &
acquire incumbent utility assets.
7.File necessary regulatory approvals.
8.Develop and implementation plan.
9.Implement the transition strategy.
Results and Current Status
•Boulder determined that it was technically and
financially feasible to launch a new municipal
utility saves ratepayers money, maintains system
reliability and achieves a 50% reduction in
electricity GHG emissions.
•As of July, 2015, the city was in the process of
filing a municipalization plan for approval by the
Colorado PUC.
•There is still a pending Xcel lawsuit against the
city condemnation proceedings, but the City
expects it to be dismissed if the PUC approves
their plan.
•Assuming PUC approval, the current timeline is
for the City to “go live” with the new municipal
utility in January of 2018.

Boulder Municipalization Timeline
Year Milestones
2005 • City begins researching power supply options and funds a “Preliminary Municipalization Feasibility Study”.
2010 • Xcel franchise expires and the city decides not to renew it.
• Boulder voters approve a utility occupation tax to replace the franchise fee.
2011 • City Council approves Boulder Energy Future purpose, framework and goals.
• Voters pass a ballot measure to fund ($1.9 million per year) the evaluation of a municipal utility, and establish charter
requirements for the utility.
• Municipal utility feasibility plan and business plan commissioned and completed.
• First Community Guide to Boulder’s Energy Future and municipalization strategy is published.
• Energy localization study commissioned.
2013 • Detailed analysis and modeling conducted to determine if a municipal utility could meet the Charter requirements.
• City projections are validated by a third party independent review.
• City Council authorizes the filing of condemnation to acquire Xcel assets if negotiations fail.
• The Boulder-Xcel Task Force is launched and issues its report.
• Xcel and the city decide to terminate discussions because of a lack of agreement.
• Voters approve a ballot measure to authorize city bonding to purchase Xcel assets.
• Voters defeat a ballot measure sponsored by Xcel that would prevent municipalization.
• The Colorado Public Utility Commission issues a ruling that requires CPUC approval before Boulder moves ahead on
municipalization.
2014 • City Council forms a utility in the charter.
• A detailed transition plan for establishment of the utility is developed and approved by City Council.
• Voters approve a ballot measure allowing the City Council to hold private executive sessions to discuss legal advice for
creation of a local utility.
• City files a condemnation petition in Boulder District Court.
• Xcel files suit to block the City condemnation petition.
• FERC affirms Boulder’s right to move forward with condemnation without needing FERC approval.
2015 • City petition for condemnation is dismissed, based on a decision that the city needs to get CPUC approval first.
• Boulder files a proposal for municipalization with the PUC.
• Staff begin work on a broader Energy System Transformation Blueprint.

The “Utility of the Future” Concept
One of the opportunities in the Boulder experiment with
municipalization is to model the transformation of the
utility business model at the local level. The terms
“utility of the future” or “21st
Century utility” are used to
denote emerging shifts in the traditional centralized
fossil-fuel based utility model that are being driven by
de-carbonization mandates, new energy technologies,
and the rapid reduction in the cost of renewable energy.
Many of the energy systems change strategies that
cities are pursuing are grounded in the same principles
that are driving the “utility of the future” dialogue. (See
side box.)
Three of the cities participating in this project (San
Francisco, Minneapolis and Boston) are in states that
are leading the regulatory reform movement to support
the utility of the future. As part of their energy systems
change work, cities have the opportunity to be active
participants in this regulatory reform process.
Utility of the Future Characteristics
•Customer-focused. Flexible, customer-service oriented, and
able to provide customized energy solutions.
•Energy as a service. Offers a new business model that
provides energy as a service and is able to adjust to a
decreasing demand, rather than relying on increasing electricity
sales and building more generation plants as the path to
profitability.
•Adaptable. Adaptable to new information and new
expectations without unsustainable investments in
nonrenewable resources or inefficient regulatory practices.
•Reliable. Able to provide high reliability to reduce customers’
costs.
•Clean. Committed to securing increasingly clean power, while
offering customers enhanced opportunities to manage their
energy and save money.
•Innovative. Agile and competitive, while promoting local
innovation and engaging local industry and institutional leaders
in partnerships that will further enhance service.
•Distributed. Increasing percentages of power supply come
from distributed energy resources, and the grid is able to
integrate these power sources without interruption.
•Smart. The system uses two-way communication technology
to community between power users and power suppliers,
enabling multiple innovations, including Real Time Pricing,
Demand Management, voltage regulation, and remote
metering and fault detection.
•Resilient. Able to withstand future climate impacts without
disruption.

Strategy Example – District Energy & Microgrids (Boston)
Strategy Summary. Boston’s vision for transforming its energy system is embedded in it 2014 Climate
Action Plan. The strategy focuses on three approaches – 1) advocating for continued strong state policies
on energy efficiency and renewable energy; 2) creating a structured partnership with utilities; and 3)
advancing district energy and microgrids. A core strategy is increasing the amount of energy supply
(thermal and electrical) that comes from district energy and microgrids by expanding the district energy
business model out from single owner campus structures to more multi-user microgrids (MUMs).
Strategy Components
1.Conduct a citywide energy study to understand
energy demand by asset class and identify the
areas of the city that are suitable for potential
district energy and microgrid development.
2.Identify and address any legal barriers to
district energy development, including utility
franchise agreements.
3.Develop business models for Multi-User
Microgrids (MUMs) and implement pilot projects
to test those models.
4.Integrate microgrids and district energy
requirements into the city development planning
process.
5.Develop a formal community wide energy
planning function for the City.
Results and Current Status
Boston is completing a citywide energy study that
establishes the analytical framework for identifying
opportunities for distributed generation; articulating
and defining the benefits; formalizing the
community-wide energy planning function;
integrating district energy into the City’s
development planning; and removing regulatory
barriers.
The City is also in the process of developing a pilot
microgrid project for an area of the city (the Marine
Industrial zone) that has significant property
controlled by the city. The pilot project will
demonstrate the feasibility of Multi-User Microgrids
implemented in partnership with the existing
distribution utility.

Background on District Energy and Microgrids
• A district energy system is a version of distributed energy that consists of a network of underground pipes
carrying hot water, steam, or chilled water from a central plant to the buildings using the service.
• A microgrid is a localized grouping of electricity generation, energy storage, and loads that has a single point of
connection to the traditional macrogrid that allows it to disconnect and function autonomously from the macrogrid.
• A tri-generation microgrid combines district energy and microgrids and provides heating, cooling and electricity
for a group of buildings and can support mission-critical loads when the surrounding electric grid fails.
• A Multi-User Microgrid (MUM) is a microgrid where there is more than one entity that uses the services (in
contrast to the more traditional microgrids and district energy systems on single owner campus environments
where the system serves a hospital, university, company or other large organization.)
Potential Benefits of Microgrids
•Significant improvements in the efficiency with which
fuel is converted to heat and power. (Separate electricity
generation will have a typical efficiency rating of around
45%, whereas a combined heat and power system can
be more than 80% efficient.)
•Ability to plan whole-building energy efficiency
measures in conjunction with the microgrid
implementation in order to properly size the system.
•Lower total energy costs.
•Reduced capital costs and operations and maintenance
costs for building owners.
•Improved system resilience and reliability.
How Cities Can Integrate Microgrids into
Development Planning
•Identify areas of the City that are likely to be able to
economically support microgrids.
•Use zoning codes to incentivize microgrid development:
• “District energy-ready” development
requirements
• District energy “zones” that require new
development to connect to existing systems
•Conduct pre-project development and due diligence
functions to attract private system developers.
•Provide regulatory and financial incentive for microgrids
and district energy.

National Microgrid Initiatives
Geography Initiatives
New York • 2010 NYSERDA report on microgrids: “Microgrids: An Assessment of the Value,
Opportunities and Barriers to Deployment in New York State”
• The New York Public Service Commission “Reforming Energy Vision” process identified
barriers to microgrid development, including a lack of clear legal identity and potential
franchise conflicts
• Recommended a statutory definition of a microgrid; incentives for financing; and
accelerated technology deployment
Connecticut • 2013 microgrid financing projects (Round I: $18 million; Round II: $15 million)
Minnesota • 2013 report: “Minnesota Microgrids: Barriers, Opportunities and Pathways Toward
Energy Assurance”
• Recommends microgrids be included in utility system planning; pilot projects support by
incentives and financing; and interconnection and performance standards be addressed
Massachusetts • 2014 report by the Mass Clean Energy Center: “Microgrids: Benefits, Models, Barriers
and Suggested Policy Initiatives for the Commonwealth of Massachusetts”
• Recommends a microgrid challenge; emphasis on microgrids that reduce GHGs; and
integrating microgrids in utility grid planning and emergency planning
Maryland • 2014 State report: “Resiliency Through Microgrids Task Force Report”
• Recommends cost recovery of “public purpose microgrids” through ratepayer
assessments
Federal • Multiple federal microgrid R&D initiatives across the country
• USDOE funding for technology development and performance awards
Source: MassCEC Presentation, “Update on Microgrid Market and Policy Development”, 2015

Strategy Example – Utility Partnerships (Minneapolis)
Strategy Summary. In 2014, the city of Minneapolis developed a “Minneapolis Energy Vision” and a
“Minneapolis Energy System Pathways” report to guide implementation of that vision. The Pathways report
explored four different possible strategies for moving toward the vision of an almost carbon free electricity
supply by 2040: 1) enhanced utility franchise agreements; 2) city-utility partnerships; 3) Community Choice
Aggregation; and 4) a municipal utility. The city chose to pursue options #1 and #2 simultaneously. The
City used its franchise agreement renewal process to structure a partnership with its gas and electricity
utilities, which it refers to as the “Minneapolis Clean Energy Partnership.”
Strategy Components
1.Use the Minneapolis Energy Vision to establish
long-term energy de-carbonization goals.
2.Use the Energy Systems Pathways report to
layout a full menu of strategy options.
3.Use the franchise agreement renewal process
to bring the utilities to the table.
4.Sign MOUs with both utilities committing the
parties to joint action in support of the City’s 2040
Energy Vision.
5.Establish a Board of Directors and by laws for
the Partnership.
6.Establish and Energy Vision Advisory
Committee.
7.Develop a joint work plan.
Clean Energy Partnership Goals
“The Minneapolis Clean Energy Partnership (“CEP”
or “Partnership”) is a new approach that brings
together the City of Minneapolis in a unique way
with Xcel Energy and CenterPoint Energy, its
electric and gas utilities, to help the City reach its
Climate Action goals and Energy Vision for 2040
goals. The CEP is a collaborative leadership
framework through which the City and utilities will
study, prioritize, plan, coordinate, implement,
market, track, and report progress on clean energy
activities in the city.” (Partnership 2015 Work Plan)

Clean Energy Partnership 2015-2016 Work Plan Elements
Clean Energy Partnership Goals
•Increase energy efficiency
•Increase renewable energy
•Develop strong City-Utility Collaboration
•Advance equity and other environmental benefits
Strategies
•Community and stakeholder engagement
•Data and information
•Policy levers
1-4 Unit Residential
•Map participation in utility
programs to identify
underserved areas
•Develop a community
engagement strategy
•Develop an on-bill
repayment option
•Develop city policies to
drive energy efficiency and
renewables in 1-4 unit
dwellings
Multi-family
underserved areas
•Develop a community
engagement strategy for
multi-family
•Develop city policies to
drive energy efficiency
and renewables in multi-
family dwellings
Small Commercial
underserved areas
•Monitor implementation
of small business
programs in the Lake
Street corridor
Large Commercial
underserved areas
•Identify buildings with the
best potential to increase
benchmarking scores
•Develop a tool for whole
building data in multi-
metered buildings
•Develop a recognition or
challenge program
•Provide TA workshops to
owners and managers
City Enterprise
•Begin rollout of LED
streetlights citywide
•Identify options for new
city fleet fueling
infrastructure
•Support city resident
access to Community
Solar Gardening options
•Continue city-utility
collaboration on city
distribution infrastructure
and planning

Strategy Example – Community Choice Aggregation (SF)
Strategy Summary. Beginning in 2002, the City of San Francisco initiated a deliberate process of taking
control of its energy future with the issuance of its first Electricity Resource Plan (ERP). The ERP set
broad and aggressive goals for creating a clean power system for the city. In 2008 the Board of
Supervisors endorsed the goal of a greenhouse gas free electricity system by 2030 and directed the City
to update the ERP to reflect this goal. A core strategy in the 2011 ERP is the implementation of a
Community Choice Aggregation program called CleanPowerSF, which will provide all San Francisco
residents the choice of procuring carbon-free power at competitive rates.
Strategy Components
1.The 2008 Council resolution sets a goal of a
GHG-free electricity system by 2030.
2.The 2011 Electricity Resource Plan
recommends 21 different strategies for achieving
this goal.
3.Community Choice Aggregation (CCA)
emerges as one of the highest impact short term
opportunities.
4.The City commissions a 2014 study to
recommend options for CCA implementation.
5.The study recommends that the San Francisco
Public Utility Commission (SFPUC) serves as the
implementation organization for the CCA
program.
CleanPowerSF Implementation Timelines
•May 12, 2015: Present proposed not-to-exceed rates to
San Francisco Public Utility Commission (SFPUC)
•June 23: Seek SFPUC approval to file updated CCA
implementation plan
•June 30: Receive Board of Supervisors’ and Mayor’s
approval for power contracting legislation
•Aug 3: Issue request for offers for program’s electric
resource supplies
•July-August: Approval to execute back office and
customer care contract
•Sept. 29: Approval to execute Phase 1 supply
contract(s)
•Oct. 27: Present final rates to SFPUC
•Late November: Commence pre-enrollment notification
process
•Jan. 26, 2016: Phase 1 program launch

Background on Community Choice Aggregation
Community Choice Aggregation, (CCA) is a policy which allows cities and counties to aggregate the
buying power of individual customers in order to secure alternative energy supply contracts on a
community-wide basis. (It is also known as "Municipal Aggregation" and "Community Aggregation”.)
CCA's are de facto public utilities of a new form that aggregate regional energy demand and negotiate
with competitive suppliers and developers, rather than the traditional utility business model based on
monopolizing energy supply. Consumers are allowed to “opt out” of the program and be served by the
traditional power supplier. In some communities, consumers are automatically enrolled unless they opt
out. In others, consumers have to “opt in” to participate.
There are currently six states that allow Community Choice Aggregation – Massachusetts, Ohio,
California, New Jersey, Rhode Island and Illinois. In 2014, it was estimated that CCA served close to 5%
of American consumers in over 1300 municipalities.
Municipal energy aggregation can be an effective tool for cities and towns to aggressively expand both
the availability and the adoption of renewable energy. It offers communities the opportunity to make
large-scale change without locking in constituents who may not agree with that change. CCA strategies
can advance municipal clean energy goals in several ways:
•A city or town can make increased use of renewables the default for everyone
•They can integrate local renewables into the supply by purchasing renewable energy credits from local
suppliers
•They can use the aggregation to support the development of new sources of renewable energy. (As an
example, the San Francisco strategy recommends consideration of a number of new local renewable
energy projects as potential suppliers to the CCA.)

Strategy Examples – State Policy (Portland)
Strategy Summary. Portland is a low cost energy state with a relatively mild climate. The City has set
aggressive GHG reduction goals and a target for 50% renewable power by 2030 for the city as a whole.
The 2015 Climate Action Plan articulates seven strategies around energy supply issues. Because it is not
pursuing a municipalization strategy (the City made an unsuccessful attempt to purchase its largest
electric utility in 2005 but has not pursued municipalization since then), the City is strongly focused on
advancing renewable energy supply strategies at the State level by engagement with the Legislature, the
Public Utility Commission, and the utilities themselves.
Energy Supply Strategy Components
•Electricity Supply – Collaborate with utilities
and regulators to reduce the carbon content of
the electricity supply by 3% per year.
•Installed Solar – Add 15 MW of installed solar
capacity.
•Community Solar – Advocate for a community
solar policy in the state.
•Renewable Energy Policy – Participate in
statewide policy discussions to expand renewable
energy markets.
•Biogas – Support local and regional biogas
resources.
•District Systems – Expand low-carbon district
heating and cooling systems.
•Fossil Fuel Exports – Establish a fossil fuel
export policy.
Primary Targets for State Policy Reform
•Virtual net metering. State law does not
currently require utilities to offer virtual net
metering. This limits community solar
implementation options.
•State renewable tax credits. State tax credits for
renewable energy (previously a 35% Business
Energy Tax Credit) expired three years ago.
•Connecting State climate goals to utility policy.
The State has a long-term GHG reduction goal of
75% by 2050. The “Roadmap to 2050” document
that describes potential strategies for achieving this
goal has not been formally adopted by the
Legislature or integrated into state utility policy.

Strategy Example – Municipal Utility De-carbonization
Supported by Building Energy Use Reductions (Seattle)
Strategy Summary. Seattle has the good fortune of having a municipal utility (Seattle City Light) that is
already carbon neutral and powered by hydro power. Seattle City Light has is committed to meeting all
future load growth through a combination of conservation and additional renewables. Making good on this
commitment will require deep reductions in building energy use. A significant strategy in the new Climate
Action Plan is focused on achieving an 82% reduction in building energy use by 2050.
Building Energy Use Data for Reduction Strategies
In order to determine what type of policy mandates will be needed over what time frame to achieve deep
building energy use reductions, the City needs to build a detailed baseline of current and projected energy
use by building type. This analysis is including:
•Existing and Forecast Population. A projection of current and future building growth by sector, based
on population and economic projections.
•Existing Energy Use and GHG Intensity. Base year energy use and GHG intensity data by building
type for commercial and multifamily buildings; vintage, fuel splits, and major end-uses.
•Forecast Energy Use and GHG Intensity. Projected changes in building energy use over time based on
the anticipated impacts of code changes, of cutting edge engineering practice, and of increased efficiency
in mechanical equipment, lighting, hot water and appliances.
•Energy Use and GHG Targets. Additional energy use and GHG reductions that will be required to meet
the City’s 82% GHG reduction goal by 2050.

Lessons Learned from Electricity De-Carbonization Work
• Bold goals and a bold vision enable bold action. A clear articulation of the long-term energy de-
carbonization goals, and endorsement of those goals by the political infrastructure, helps drive an
aggressive systems change agenda. As an example, the Boulder strategy was motivated by the
realization that they couldn’t achieve their GHG reduction goals without an electricity supplier partner who
shared those goals. The seriousness with which they took this GHG target commitment informed the
scale of action they were willing to consider.
• Cities have limited direct leverage over utility strategy. Most cities cannot directly influence the
business strategies of their natural gas and electricity utilities when it comes to energy supply de-
carbonization. So the strategies need to be more indirect in nature – voluntary partnerships; engagement
in visioning processes; engagement in regulatory proceedings; lobbying for changes in state legislation;
etc.
• Franchise agreements provide some City leverage. Renewal of city franchise agreements are a useful
tool for incentivizing city-utility partnerships. They are one of the few direct economic leverage points that
cities have with utilities. In both Minneapolis and Boulder, they provided the starting point for change.
Cities should be strategic about how they use renewal opportunities to advance their clean energy goals.
• Control over some local electricity supply is a powerful advantage. San Francisco’s municipal utility
provides power to the city municipal operations and selected large users, accounting for 17% of total city
electricity supplies. SFPUC’s supply is 100% renewable and comes from three hydroelectric power plants
that SFPUC owns and operates with the City’s Hetchy Hetchy reservoir system. The availability of this
power supply source under city control gives the city some options it wouldn’t have without it, including
further greening of municipal energy sources, and the ability to manage a complex program like the city
CCA initiative. Likewise, Seattle has a 100% renewable energy municipal utility, meaning it can focus its
full attention on reducing energy demand and decarbonizing the transportation and thermal sectors.

Lessons Learned (cont’d)
• The feasibility of municipalization is highly dependent on local conditions. Municipalization is
definitely not for everyone. Minneapolis looked closely at municipalization and decided it was likely far
too expensive and complicated to be feasible. The Boulder strategy depended on a number of
localized legal, regulatory and infrastructure conditions:
• The city is a home rule city, so it has the legal authority to exercise eminent domain over assets
necessary to achieve priority public outcomes.
• Boulder is surrounded by rural areas, so the physical configuration of of the electricity system
reduced the complexity of “carving out” transmission and distribution assets without disrupting
other players.
• Stranded asset costs that the City would be required to reimburse Xcel for (in addition to the
value of the assets it condemns) are projected to be relatively low.
• The size of the utility is small enough that it is feasible for the city to manage its acquisition.
• Local politics favor a municipalization strategy.
• Municipalization requires a high level of technical expertise and a significant
feasibility/analysis budget. Boulder has invested several million dollars in technical studies,
modeling analysis and legal services to support the municipalization strategy. In the process, it
established a city staff unit in charge of the work, and developed a cadre of staff with expertise in all
the aspects of utility operations.
• Where it is legal, Community Choice Aggregation can be a significant tool for energy supply
de-carbonization. San Francisco’s CCA initiative allows it to participate in renewable energy markets
in ways that would be impossible if the city were entirely dependent on imported IOU electricity. It can
negotiate directly with renewable suppliers, as well as develop its own renewable projects to supply
the CCA program.

Lessons Learned (cont’d)
• The technical, economic and administrative requirements of a large city CCA initiative are
substantial. It took San Francisco considerably longer than it planned to get its CCA program off
the ground, both because of difficulty finding competitive renewable energy suppliers, and the
administrative complexity of program management. The first CleanPowerSF implementation plan
was developed in 2007, but the program will be launching in 2016. The city’s ability to use its
SFPUC’s “back office” services for the program has been an important ingredient to feasibility.
• Virtually all city strategies require deep system understanding. All cities have invested
resources in some type of technical analysis of their energy systems.
• Keeping stakeholders engaged is critical. As with any high risk public enterprise, it is critical to
engage key stakeholders so that are informed and supportive of the strategy. Boulder invested
many resources in community outreach and education, including running three successful ballot
proposals related to the municipal utility. Other cities engaged stakeholders through community
forums, planning processes and technical workshops.
• Aggressive action by one city can help others. Minneapolis has the same electricity IOU as
Boulder. Several participants in Minneapolis observed that Xcel was eager to avoid the outcome
they arrived at in Boulder, so were more willing to enter into a collaborative relationship with the city
of Minneapolis.
• Cities need to get engaged in regulatory and policy proceedings. Cities wishing to influence
their clean energy future need to pursue multiple strategies simultaneously. In addition to working
locally with their utilities, they need to be actively engaged in regulatory proceedings at the PUC
level and pushing state policy makers to set the context for a long-term carbon-free energy system.
Engaging in regulatory proceedings requires development of new knowledge of the process and
immersion in often arcane utility regulation details.

4 – Organize for
Transformation

Energy Systems Change Requires Organizational Capacity
Each of the cities participating in this project have had to develop new organizational capacity to support
their energy systems change strategies. Each city has taken a slightly different approach to this
challenge.
City Organizational Capacity to Support Energy Systems Change
Boulder • To support its muncipalization effort, Boulder established a new position of Energy Strategy and
Electric Utility Development with a full time Executive Director.
• The office reports directly to the City Manager. Responsibilities include development of long
term energy strategies for the city, and leadership to develop Boulder Light and Power as a new
publicly owned electric utility.
• In addition, energy system work is supported by several staff out of the Department of
Community Planning and Sustainability.
Boston • Boston energy strategies are managed by Brad Swing, Director of Energy Policy and Programs.
• To support its municipal energy work, the City created a new Municipal Energy Unit with two full
time staff.
• The Renew Boston initiative is staffed by a full time embedded utility executive who is located in
City Hall.
• In addition, a new position of Ecodistrict Energy Fellow was established in the city development
organization, (the Boston Redevelopment Authority) to manage the citywide energy plan and
district energy/microgrid development.
Minneapolis • The Minneapolis energy system work has been managed with existing staff out of the City
Sustainability Office.
Portland • The Portland energy system work has been managed with existing staff out of the City Bureau
of Planning and Sustainability.
San Francisco • San Francisco’s energy systems work is jointly led by staff of the Department of Environment
and the San Francisco Public Utility Commission (SFPUC), which manages the city’s water and
electric utilities. The Electricity Resource Plans were developed by the SFPUC.

Future Directions

Opportunities for Future Framework Development
Component Opportunities for Further Development
1 – Establish the
Energy Vision
• Development of common definitions of community benefit from energy systems
change.
• Development of some common metrics for measuring success.
• Best practice sharing on stakeholder engagement strategies.
2 – Understand
Your Energy
System
• Development of a tighter taxonomy of the types of analysis.
• Development of detail on the specific analytical components that should be involved
in the process.
• Exploration of technology platforms and systems that can help with energy systems
analysis.
• Best practice sharing on examples of energy system analysis reports.
• Development of common RFP language for procuring energy system analysis
services.
3 – Design Energy
System Solutions
• Deeper dive into additional dimensions of electricity de-carbonization (utility of the
future; intervening in regulatory proceedings; state-level de-carbonization strategy).
• Additional detail on thermal de-carbonization strategies.
• Additional detail on microgrids and district energy.
• Detail on integration of electricity, thermal and transportation de-carbonization.
• A framework for energy system resilience.
4 – Organize for
Transformation
• Organizational designs for energy systems work at the municipal level.
• Job descriptions for energy system change professionals.
• Strategies for funding energy systems transformation work.
• Strategic alliances with outside partners.

Boulder Convening Next Steps Ideas
The July convening in Boulder generated a large number of ideas for next steps to advance municipal
energy systems transformation work. These included:
1.Finalize the Framework
– Distribute to USDN membership
– Develop communications document for external stakeholders
2.Build an On-Going City Network Focused on Energy System Transformation
– Network for Urban Energy System Transformation (NUEST)
– Formal, multi-year collaboration
– Staffed by a knowledgeable NGO or other party
– Uses cities as applied R&D hubs for energy system transformation
3.Create Additional Knowledge Products
– Urban Energy System Architecture
– AC to DC Conversion Opportunities (done)
– State Policy Agenda
– Energy System Security Framework
– Storage Technology Impact Analysis
– Detailed Framework for Transportation De-carbonization
– Energy Systems and Equity Framework
– How to Deal With Stranded Assets

Related USDN and CNCA Projects
There are several projects being funded by the USDN Innovation Fund and the Carbon Neutral Cities Alliance (CNCA)
Innovation Fund that can add additional detail and depth to the Framework.
•Microgrids Report. The cities of Boston, Cambridge MA, Northampton MA, Somerville, MA, and Washington DC are
completing a USDN-funded project focused on best practices for the technology transfer of campus scale energy
systems into districts of privately owned buildings in neighborhoods and downtown. Key to this work is the exploration of
business models which are applicable to both Investor Owned Utilities, Municipal Utilities, and Cooperative Utilities. The
report will be completed this summer.
•Thermal De-carbonization. The cities of Boulder and Seattle received a grant from the CNCA Innovation Fund to
develop advanced methodologies for inventorying thermal energy uses; assessing the viability of low carbon energy
system substitution options; developing replacement strategies based on equipment lifecycles; and identifying issues and
barriers to scaling the practice. The project is scheduled to be completed in the summer of 2016.
•Energy Systems Analysis. The cities of Boulder, Minneapolis and Seattle are leading a CNCA-funded project to
develop a more sophisticated methodology for conducting an initial analysis of the different types of energy systems
within their boundaries. This approach utilizes a variation of the urban transect methodology to create a set of
development profiles that capture the majority of land use use/development patterns within each city. These profiles will
then be subject to an in-depth energy systems analysis that will establish both an initial baseline of existing energy
systems, and a set of scenarios for transitioning to a low carbon energy system. The project is scheduled to be
completed in the summer of 2016.
•Next Generation District Heating. London is leading a CNCA-funded project to explore the development of “4th
generation” district heating networks. These are heating networks that operate at lower temperatures, which enables a
more cost effective transition to future low-carbon heat from local renewable, environmental and waste heat sources. It
evolves heat networks into a flexible, future-proofed infrastructure that is capable of playing an active role in a smart
energy system, the integration of heat and power, and in addressing the challenge of heat supply to more energy efficient
buildings. The project is scheduled to be completed in the summer of 2016.

Attachment 1:
City Profile Summaries

City Profiles Overviews
These materials provide a very abbreviated overview of some of the work that project cities are doing
on energy system transformation:
•There are additional more detailed Word documents with background on each city.
•While it is understood that energy system transformation work requires a comprehensive approach
to energy demand, supply and resilience, these materials highlight the work that the participating
cities have been doing on energy supply. So they are not a comprehensive view and will need to be
enhanced over time.
•In addition, there is a brief summary of the contextual energy system factors that are relevant to
each city, including:
• Population
• Type of utility regulatory scheme
• Energy costs
• Total energy consumption
• Main utility suppliers
• Renewable energy incentives
• Current electricity supply profiles
•City strategies are evolving quickly so some aspects of these overviews are likely to be out of date
by the time you read them. Please check with the cities before citing the materials.

Context Difference Across Project Cities
Context Boulder Boston Minneapolis Portland San
Francisco
Seattle
Population 103,000 655,800 382,500 583,700 852,000 640,000
Electricity
Costs
Medium High Medium Low High Low
Utility
Market
Regulation
Regulated Deregulated Regulated Regulated
Partially
Regulated
Regulated
CCA Not Allowed Allowed Not Allowed
Not
Allowed
Allowed Not Allowed
IOU
Renewable
Portfolio
Standards
30% by
2020
15% by
2020
30% by 2020
25% by
2025
33% by
2020
15% by
2020
Net
Metering
Yes Yes Yes Yes Yes Yes

Electricity Supply Profiles Across Project Cities
Context Boulder Boston Minneapolis Portland San
Francisco
Seattle
Coal 57% 5% 36% 43% 8% 1%
Natural Gas 31% 44% 13% 24% 39% 0%
Nuclear 0% 34% 28% 0% 22% 4%
Renewables 12% 17% 24% 31% 14% 93%
Other 0% 1% 0% 0% 1% 2%
Source: Various City Documents; figures are rounded in several cases

Electricity Prices Across Cities
Source: EIA
The chart below shows the average retail price of electricity across the six states represented by the
cities in this project.

Energy Goals and Targets for Project Cities
City Emissions
Reduction Targets
Specific Energy Targets
Boulder 80% by 2050
• 50% renewables in year one of municipalization
Boston
25% by 2020
80% by 2050
• 15% of large C/I energy use from co-generation (2020)
• 10 MW of commercial solar (2020)
San Francisco
25% by 2017
40% by 2025
80% by 2050
• GHG free electric system by 2030
• Offer a portfolio of energy resources to residents through
a CCA that is 51% renewable by 2021.
Minneapolis 80% by 2050
• Generate 10% of electricity from local renewable sources
by 2025
Portland
40% by 2030
80% by 2050
• Supply 50% of all energy used in buildings from
renewable sources
• 10% of building energy use supplied by on-site renewable
sources
Seattle
62% by 2030
Carbon Neutral by 2050
• Maintain current carbon neutrality of electricity supply
• 97% reduction in transportation emissions by 2050
• 82% reduction in building emissions by 2050

Boulder Energy Supply Context
Context Description
Population • 103,000
Utility
Regulation
• Regulated utility market
• Community Choice Aggregation is not allowed
• Consumers cannot choose their own suppliers
Energy Costs • Mid-range
• 11.7¢ per kWh average for residential (EIA 2013 data)
Energy
Suppliers
• Electricity -- Xcel (IOU)
• Gas -- Excel
Renewable
Power
Incentives
• RPS for IOUs – 30% by 2020
• Net metering is allowed
• Community Solar Gardens allowed up to 2 MW
Electricity
Supply Profile
• 57% --Coal
• 31% -- Natural Gas
• 10% -- Wind
• 1.5% -- Hydro
• 0.5% -- Solar

Boulder Energy Supply Strategy Summary
“Boulder’s Energy Future” establishes the framework for the city’s energy system transformation work.
Energy Future Principles
1.Democratize Energy Decision Making: customers
should have more direct control and involvement in
decisions about their energy, including opportunities to
invest in their long-term energy needs and to have a
say in energy investments made on their behalf.
1.Decentralize Energy Generation and Management:
energy should be generated locally or within the
region to the maximum extent feasible, reducing
reliance on external fuel sources; customers should be
able to manage and reduce their energy use as
directly and effectively as possible; and energy service
companies should be empowered to compete and
innovate within a diverse and robust local energy
economy.
1.Decarbonize the Energy Supply: renewable and
clean fuel sources should be maximized as much as
possible, as quickly as possible, minimizing both short‐
and long term environmental impacts and maximizing‐
energy independence over time.
Energy Future Goals and Objectives
1.Ensure a stable, safe and reliable energy supply.
• System redundancy, supply quality and load
management
• Fuel source stability
• System reliability
2.Ensure competitive rates, balancing short-term
and long-term interests.
• Rate competitiveness
• Rate transparency and predictability8
• Technology investment and managing price
volatility.
3.Significantly reduce carbon emissions and
pollutants.
• Reduction of GHG emissions
• Reduction of toxic pollutants
4.Provide energy customers with a greater stay
about their energy supply.
• Democratizing local decision-making
• Democratizing local ownership
5.Promote local economic vitality.
• Support for local business innovation
• Economic competitiveness
6.Promote social and environmental justice.
1. Energy equity
2. Impacts to vulnerable populations
3. Energy literacy

Boston Energy Supply Context
Context Description
Utility
Regulation
• De-regulated utility market. Utilities do not generate power but have
exclusive franchise rights for distribution
• Community Choice Aggregation is allowed
• Consumers can choose their own electricity suppliers
Energy Costs • High
• 22.5¢ per kWh average for residential (BLS 2015 data)
Energy
Suppliers
• Electricity -- Eversource (IOU)
• Gas – National Grid (IOU)
• Downtown steam system managed by Veolia North America
Renewable
Power
Incentives
• RPS for IOUs – 15% by 2020; 1% per year increase after 2020
• Virtual net metering is allowed with the same utility service area
Electricity
Supply Profile
44% -- Natural Gas
34% -- Nuclear
9% -- Renewables
8% -- Hydro
5% -- Coal
1% -- Oil

Boston Energy Supply Strategy Summary

Minneapolis Energy Supply Context
Context Description
Utility Regulation • Regulated utility market. Utilities do not generate power but have exclusive
franchise rights for distribution
• Consumers can choose their own electricity suppliers
Energy Costs • Mid-range
Energy Suppliers • Electricity -- Xcel (IOU)
• Gas – CenterPoint (IOU)
• Downtown steam and chilled water system managed by NRG Thermal
Renewable
Power Incentives
• Excel – 30% by 2020; plus 1.5% from solar
• Net metering is allowed, up to 1 MW
• Xcel is required to offer community solar; other utilities can be are not required
Electricity Supply
Profile
36% -- Coal
27.5% -- Nuclear
13% -- Wind
13% -- Natural gas
8% -- Hydro
3% -- Biomass
0.5% -- Other

Minneapolis Energy Supply Strategy Summary
2040 Energy Vision Principles
1.Reliable and affordable energy services, where all
residents and businesses are supplied with competitive
rates, and disparities in the relative cost of energy
services for low-income households are mitigated.
2.Clean energy, where the total carbon emissions and
other waste products have substantially declined, and
electricity supply is nearly carbon-free.
3.Provision of essential energy services for all,
affordably meeting the basic needs of residents, without
disparity of impacts or benefits according to race,
ethnicity, income, and age.
4.An increasing use of local resources within the city,
including renewable energy and efficient district heating.
A robust local supply chain exists in the city for energy
efficiency and renewable energy services, and
Minneapolis is a national leader in advanced energy
infrastructure.
5.Market integration of efficiency that makes use of
transparent data in economic and purchasing decisions.
Residents and businesses are empowered to save money
and reduce their environmental impact.
6.Collaborative progress on planning and investment
decisions by the energy utilities that serve the city. These
decisions reflect and support the City’s climate action,
economic development, and social equity goals.
Minneapolis Energy Pathways
The city’s Energy Pathways report recommended
four pathways for analysis:
•Pathway 1: Enhanced Franchise Agreement.
Either a single franchise agreement that includes a
broader set of goals, or a traditional franchise
agreement with a separate agreement that
addresses those goals.
•Pathway 2: City-Utility Partnerships. Formal City-
utility coordinating entity focused on setting and
tracking local goals. Not a partnership in any legal
sense, but an entity in which the City and utilities
agree to act as willing partners to achieve shared
goals.
•Pathway 3: Community Choice Aggregation. City
contracts directly for energy supply.
•Pathway 4: Municipal Utility. City owns and
operates independent utility.
The City chose Pathways #1 and #2 for immediate
implementation.

Portland Energy Supply Context
Context Description
Utility Regulation • Portland is regulated utility market. Utilities own generation sources and
are regulated by the Public Utility Commission.
• Community Choice Aggregation is not allowed in Oregon.
Energy Costs • Low
Energy Suppliers Portland is served by three Investor-Owned Utilities (IOUs):
•Portland General Electric (serves 75% of the city; Portland is about a third of
its total market)
•Pacific Power (serves 25% of the city; owned by Pacificorp, a large seven-
state utility company)
•NW Natural (Oregon’s largest natural gas utility)
Renewable Power
Incentives
• Net metering is allowed, up to2 MW for commercial; 25kW for residential
• Virtual net metering is not required of utilities; no Community Solar option
Electricity Supply
Profile
43% -- Coal
25% -- Hydro
24% -- Natural Gas
6% -- Wind
2% -- Other

Portland Energy Supply Strategy Summary

San Francisco Energy Supply Context
Context Description
Utility Regulation • Partly regulated utility market. Some IOUs still own generation sources through
legacy agreements.
• Community Choice Aggregation is allowed
Energy Costs • High
• 22.2¢ per kWh average for residential (BLS 2015 data)
Energy Suppliers • PG&E (IOU) serves 75% of electricity demand, plus natural gas
• The San Francisco Public Utility Commission (SFPUC) Power Enterprise
division serves municipal electricity requirements, supplying 17% of SF usage
• 8% of electricity demand is served by independent Energy Service Providers
Renewable
Power Incentives
• Net metering is allowed, up to 1 MW
Electricity Supply
Profile
PG&E:
39% -- Natural Gas
22% -- Nuclear
16% -- Hydro
14% -- Renewables
8% -- Coal
1% -- Other
SFPUC:
100% -- Hydro

San Francisco Energy Supply Strategy Summary
Strategy 1 – Empowering San Francisco
Citizens and Businesses to Reduce GHG
Emissions
•Energy Efficiency. Improve and expand
energy efficiency programs in San
Francisco.
•Behind the Meter. Promote the
development of behind-the-meter resources.
•Technology Innovation. Develop San
Francisco as a “Green Test Bed” to promote
and encourage the deployment of new
energy technologies.
•Building codes. Improve building codes
and standards to promote energy efficiency.
•Distributed Generation. Advance and
support Community Scale Energy Systems.
•Storage. Promote back-up storage
deployment as an alternative to the existing
use of diesel and natural gas-powered back-
up generation.
•Community Choice Aggregation.
Implement Community Choice Aggregation
consistent with guidance from the Board of
Supervisors and the San Francisco Local
Agency Formation Commission (LAFCo).
Strategy 2 – Increase the Renewable and GHG-Free Content of
San Francisco’s Electricity Supplies
1.Transmission. Evaluate and develop new City-owned transmission
projects to increase the delivery of Hetch Hetchy and renewable
power to San Francisco.
2.Green Power Option. Develop an optional “green pricing” option
allowing San Francisco customers to voluntarily commit to purchase
electric energy from zero-GHG energy sources.
3.Regulatory Engagement. Participate in regulatory proceedings to
encourage state and federal policies to promote the use of GHG
reduction strategies and encourage the development of CCA.
Strategy 3 – Continuing and Expanding SFPUC Electric Service
to Guarantee Reliable, Reasonably Priced and Environmentally
Sensitive Service
1.SFPUC Rate Reform. Develop a rate structure for the SFPUC that
reflects its cost-of-service.
2.Increased Municipal Load. Increase the use of municipal load
supplied by electric energy from Hetch Hetchy to displace fossil-fuel
use.
3.Interconnection Agreement. Renegotiate the Interconnection
Agreement (IA) with PG&E that governs the transmission and
distribution of Hetch Hetchy energy to San Francisco that expires in
June 2015.
4.EJ Policies. Continue to implement the SFPUC’s recently adopted
Environmental Justice and Community Benefits policies.
Source: 2011 Electricity Resource Plan, SFPUC

Seattle Energy Supply Context
Context Description
Utility
Regulation
• Regulated utility market
Energy Costs • Low
• 7.8¢ per kWh average for residential
Energy
Suppliers
• Electricity -- Municipal Utility (Seattle City Light)
• Gas – Puget Sound Energy (IOU)
• Enwave Seattle operates a private district steam utility in the
downtown
Renewable
Power
Incentives
Electricity
Supply Profile
• 1.7% --Coal
• 4.5% -- Nuclear
• 0% -- Natural Gas
• 3.4% -- Wind
• 89% -- Hydro
• 0% -- Solar
• 1.5% -- Other

Seattle Energy Supply Strategy Summary
Seattle is served by a municipal utility (Seattle City Light) that has achieved carbon neutrality and is
committed to meeting all future load growth through a combination of conservation and new
renewables. As a result, Seattle does not face many of the electricity supply de-carbonization
challenges that the other project cities do. Instead, the Seattle strategy is focused on:
•Deep reductions in building energy use, so that more building energy supply can be served by
carbon-free electricity rather than thermal sources.
•Deep reductions in transportation vehicle miles traveled
•Deep reductions in the GHG emissions per mile in Seattle vehicles
Key Transportation Strategies
Increase Transportation Choices:
•Funding
•Transportation infrastructure and services
•Transportation demand management
•Vehicle fuels and technologies
Complete Communities
Economic Signals:
•Road pricing
•Parking management
Key Building Energy Strategies
Information
•Smart meters
•Energy benchmarking
•Home energy information
Incentives and Assistance
•Utility incentives
•Streamlined permitting
•Financing
Performance Requirements
•Energy code improvements
•Efficiency standards
Energy Supply
•Clean energy
•District energy

Attachment 2:
Background on Urban
Energy Supply Systems

Energy Supply Systems
There are three main energy supply systems – electricity; heating and cooling; and transportation.
Each of them have different fuel sources, system elements and players in the system.
Electricity
Fuel Sources:
Fossil Fuels
•Coal
•Natural gas
•Petroleum
•Propane/LNG
Renewables
•Nuclear
•Biofuel
•Biomass
•Hydropower
•Hydrogen
•Solar
•Wind
System Elements:
Power Sources
•Power Plants
•Dams
•Solar/Wind Farms
•CHP
The Grid
•Transmission
•Distribution
•Microgrids
Economic Actors
•Generators
•Utilities
•FERC
•RTOs
•PUCs
•Consumers
Thermal
Fuel Sources:
•Natural gas
•Propane
•Diesel fuel
•Biofuel
•Biomass
•Geothermal
System Elements:
•Combined heat
and power
•Distribution
•Pipelines
•Storage tanks
•Delivery trucks
Economic actors
•Extraction
•Refining
•Pipelines
•Local distributors
•Consumers
Transportation
Fuel Sources:
•Petroleum
•Electricity
•Fuel cells
System Elements:
•Cars
•Trucks (light/heavy
duty)
•Commercial Rail
•Airplane
•Water transport
•Public
transportation
Economic actors
•Equipment OEMs
and suppliers
•Government
infrastructure
investors
•Regulators
•Consumers

Electricity Supply Systems
The electricity supply sector is extremely complicated from multiple levels – its technical design; levels of
control and authority; pricing; and business models. Cities that seek to change the electricity supply
system have to understand how this system works, where the levers for change are, and how they can
influence those levers. Because it is so important to system redesign, this section of the framework
provides a brief overview of the main components of electricity supply systems and how they vary across
the country.
In the early days of electricity, most electricity utilities were “vertically integrated.” This meant that every
geographical area in the country had only one electricity utility, and that utility fulfilled all three roles in
the electricity grid:
•Generation – owning the power plants that burned coal or oil or some other fuel to make electricity;
•Transmission – Owning and operating the high voltage (often 500-, 345- or 230-kilovolt) lines that do
the long-distance transmission of electricity from where it was made to where it was used; and
•Distribution – Owning and operating the lower voltage (usually 120- or 240-volt) lines and local
transformers responsible for actually distributing electricity to end-use customers (like individual homes
or businesses).
Starting in the 1990s, many states passed laws that broke up these three separate functions and gave
these separate functions to different companies. This process was called “de-regulation.” In de-
regulated markets, the “electricity company” is really just a “transmission and distribution” company
(T&D). The T&D utility performs the last two functions described above and owns the large transmission
lines that are found in utility rights of way as well as the wires and poles in your neighborhood that bring
the electricity to homes and businesses.

Key Players in Electricity Supply Systems (1)
Utilities. In traditionally regulated markets, utilities provide generation, transmission and distribution
services in a vertically integrated fashion. They are granted monopolies on their service areas and in
return submit to regulation by Public Utility Commissions. In de-regulated markets, the utilities do not
own generation and only provide transmission and distribution services. Power is provided by private
generator companies.
There are two basic types of utilities in the U.S.:
•Investor Owned Utilities (IOUs). These are private, for-profit corporations that provide a combination
of generation, transmission and distribution services. About 75% of the population is served by IOUs.
•Consumer Owned Utilities (COUs). These are utilities that are controlled by the customers in one
fashion or another. They include municipal utilities, electricity cooperatives and Public Utility Districts.
About 25% of the population is served by COUs.
Generators. Generators create electricity supply. In regulated markets, utilities own and operate
generation plants. In de-regulated markets, power is sold into wholesale markets by independent
generation companies. The ISO determines which generators are allowed to sell into the wholesale
market. Many large energy consumers (such as universities and hospitals) generate much of their
own power through on-site systems such as Combined Heat and Power or District Energy systems.
Federal Energy Regulatory Commission (FERC). FERC was created under the Federal Power Act,
and it oversees interstate wholesale markets and transmission systems. Many aspects of energy
sales between states and regions, and the development of transmission lines across state borders
require FERC approval.

Independent System Operators (ISOs) and Regional Transmission Organizations (RTOs). ISOs
and RTOs are similar voluntary organizations that plan, operate, dispatch a and provide open-access
transmission services under a single tariff. ISOs and RTOs exist to meet FERC reliability and access
requirements. Their purpose is to foster competitive neutrality in wholesale electricity markets and
reliability in regional systems. In 1996, FERC issued what it called Order 888, which encouraged the
creation of ISOs to run and oversee electricity wholesale markets. There are now several ISOs in the
country, including ISO New England, New York ISO (NYISO), California ISO (CAISO), and Midwest ISO
(MISO). PJM Interconnection LLC is the ISO for all or parts of 13 states that originally included New
Jersey, Pennsylvania, and Maryland. Some parts of the country are served by RTOs, and some by ISOs.
Some are served by neither.
The overall purpose of ISOs and RTOs is to “keep the lights on” – meaning make sure the grid is
designed and managed in a way that keeps it from failing. They perform three basic functions:
•Operation of the grid in real time. The balance between power supply and power consumption needs to
be managed on a minute by minute and second by second basis. Any imbalance can lead to a system
“crash”. The ISO/RTO tells which generators to run at what level of capacity to assure balance in the
system.
•Management of the market for wholesale electricity. The ISO/RTO runs short term (“day ahead”) and
long-term (“forward capacity”) markets that set the price of wholesale electricity on an hour by hour basis
that ultimately drives the retail cost of power.
•Planning for the future of the grid and electricity markets. The ISO/RTO plans for how much generation
and transmission capacity it will need in the future to assure smooth operation of the grid. This translates
into processes for authorizing additional transmission lines and additional power generators.

Public Utility Commissions. Regulation of IOUs is carried out by state-level Public Utility Commissions
(PUCs). In return for granting them monopolies on various aspects of their markets, states limit how
much the monopolies are allowed to charge. It is the PUCs that make this determination. Most state
commissions consist of 3-5 appointed or elected commissioners and a professional staff. The
commissions typically carry out the following functions:
•Determining the utility revenue requirements;
•Allocating costs (revenue burdens) among customer classes;
•Designing price structures and price levels that will collect the allowed revenues, while providing
appropriate price signals to customers;
•Setting service quality standards and consumer protection requirements;
•Overseeing the financial responsibilities of the utility, including reviewing and approving utility capital
investments and long-term planning; and
•Serving as the arbiter of disputes between consumers and the utility*
Public Utility Commissions work through a number of vehicles, including:
•Rate cases that set returns on investment and other economic conditions that determine how much
revenue the utilities can collect and what they charge their customers.
•Rulings on issues of law or policy (typically managed through a series of “dockets”)
•Approval of plans and utility documents, such as Integrated Resource Plans that serve as planning tools
for the electricity system
PUCs are important players in implementing Renewable Portfolio Standards, Energy Efficiency programs
and other legislative mandates for power systems.
*Source: “Electricity Regulation in the US: A Guide”, Regulatory Assistance Project, 2011

Thermal Energy Systems
A significant municipal source of carbon emissions are energy uses for heating and cooling buildings.
The primary technologies used to provide these thermal management services vary significantly, both by
geographic region and by scale of buildings. However, in many regions—particularly colder climates--the
predominant energy source for heating operations is natural gas (including propane) or heating oil. For
commercial and industrial operations, gas may also be used to provide cooling. Thermal uses (space
heating, water heating, ventilation, and cooling) account for 69% of energy uses for residential
structures, and 50% for commercial structures. Achieving deep emissions reduction and a successful
transition off fossil fuels requires a comprehensive replacement of these oil and gas thermal energy
systems.
There are a number of additional factors that make replacement of natural gas and related fossil fuels a
high priority.
•First, the proportion of overall emissions could actually be significantly higher if new research on the
climate impacts of natural gas development and use result in significant increases in the assessed
climate impacts of natural gas.
•Second, the proportion of emissions associated with natural gas in municipal inventories is also likely to
grow quickly as efforts to decarbonizes electricity sources and transportation achieve reductions in those
sector. Without viable strategies to replace these thermal energy sources, communities will continue to
face challenging tradeoffs between meeting these essential living needs, and the expansion of oil and
gas development to address these needs.
•Finally, the high probability of increasing temperatures and the associated cooling load demands will
potentially lead to a significant expansion of gas use where it is being used to run commercial and
industrial cooling systems.

Transportation Energy Systems
Nationally, mobility systems account for approximately 30% of total U.S. emissions. Most city strategies
related to transportation are focused on reducing Vehicle Miles Traveled through different forms of
“mode shift” – including public transportation, car sharing, on-demand transportation, biking and walking.
However, to get to deep de-carbonization goals, cities will also need to find ways to influence or drive the
de-carbonization of mobility fuel sources. The two main strategies that are focused on this goal include
increased vehicle efficiency and fuel switching.
•Efficiency. Increased vehicle efficiency (miles per gallon) is primarily driven at the national level
through CAFE (Corporate Average Fuel Economy) standards. Cities have minimal leverage at on fuel
efficiency standards.
•Fuel Switching. Cities can exercise considerable influence over the implementation of alternative fuel
infrastructures and alternative fuel markets. They can:
• Incentivize low or no-carbon fuel vehicle ownership and use
• Implement alternative fuel infrastructures, such as charging stations and hydrogen stations
• Convert municipal fleets to low carbon fuels
• Convert public transit to low carbon fuels
• Facilitate the use of municipal assets (such as solid waste and wastewater systems) to
produce alternative transportation fuels

Useful Energy Supply System Resources
Source Title Description
Regulatory
Assistance Project
Electricity Regulation in
the U.S.: A Guide
This 120 page PDF document provides an excellent overview
to utility regulatory models in the U.S., including descriptions
of how they vary from state to state and region to region.
Peter Fox-Penner
Smart Power: Climate
Change, The Smart
Grid, and the Future of
Electric Utilities
Fox-Penner’s book provides a layperson’s introduction to the
history of utility regulation and de-regulation, and lays out
scenarios for future business models for the utility industry. It
is especially useful for understanding the quirky and often
illogical patchwork of regulatory jurisdictions in the utility
sector, and how things got to be this way.
Boston Green
Ribbon
Commission
A Guide to Electricity
Markets, Systems and
Policy in Massachusetts
This Guide was written for the Commission by the
Conservation Law Foundation (CLF). CLF is one of the most
utility-savvy NGOs in the country and participates extensively
in the ISO-New England regulatory process. It is an excellent
description of the often arcane process of setting electricity
prices and managing wholesale electricity markets, written in
an open and accessible style.
Advanced Energy
Economy
Towards a 21st
Century
Electricity System in
California
AEE has been a national leader in facilitating dialogue on the
transformation of the utility business model. This white paper
is a joint AEE-utility industry effort to develop common
principles for managing this transition in California.
Bentham Paulos
Empowered: A Tale of
Three Cities Taking
Charge of Their Energy
Future
Ben Paulos’ short book (44 pages) provides an overview of
the efforts of Boulder, CO, Minneapolis, MN, and Madison, WI
to get control of their energy futures.

Project Contact Information
Project Manager:
Brett KenCairn, Senior Planner
Community Planning and Sustainability
City of Boulder
kencairnb@bouldercolorado.gov,
303-441-3272
Project Consultant:
John Cleveland, President
Innovation Network for Communities
john@in4c.net
616-240-9751

Energy Systems Framework (Final) -- December 2015

More Related Content

What's hot (20)

Viewers also liked (11)

Similar to Energy Systems Framework (Final) -- December 2015 (20)

Energy Systems Framework (Final) -- December 2015