Minneapolis appears to back off municipal utility proposal

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It appears the city of Minneapolis is backing off a proposal to pursue a municipal utility – for now, MPR reports.

Backers of the proposal have said the city might be able to distribute energy more cheaply than for-profit companies. And supporters suggest that a city-operated utility could more aggressively pursue renewable energy.

By law, Xcel has exclusive rights to sell electricity in Minneapolis, and the only other option for the city would be the creation of a municipal utility. The concept has many critics, who question the city's ability to manage such a complex enterprise.

Still, the city council had been planning to put a question on the November ballot, seeking a public vote on whether the city should pursue a municipal utility.

In an effort to halt that, Xcel writes in a letter to Mayor R.T. Rybak that the company will explore new energy commitments with the city, KSTP reports.

In a response letter, Rybak says he supports holding off for now:

"I appreciate the important commitments that Xcel has made in your letter. I believe, and I think that my colleagues on the City Council believe, that we should not preempt the conversations that come next by putting a question about municipalization on the ballot three months from now."

On Twitter, Rybak clarifies that there was no "deal" with Xcel:

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