More than $180 million a year in franchise fees, infrastructure relocation savings and undergrounding funds would continue flowing to Denver under a proposed 20-year franchise agreement with Xcel Energy.

It cleared a major City Council hurdle Tuesday, while adding new shareholder-funded bill assistance and requirements for neighborhood-compatible substation design.

The current agreement, in place since 2007, has already saved Denver taxpayers an estimated $3 billion by requiring Xcel to cover the cost of relocating its facilities during city public works projects.

The new deal would continue that obligation at an estimated $150 million annually while also locking in a 3% franchise fee projected at about $34 million next year to the General Fund and dedicating about $10 million a year — 1% of electric gross revenues — for city-directed undergrounding of overhead lines.

Xcel would maintain about 66,000 streetlights and meet performance standards for emergency response, with independent audits every three years.

The companion agreement would require Xcel to contribute a $2.5 million one-time shareholder-funded donation in 2027 for bill payment assistance and $125,000 annually in shareholder funds for income-qualified affordability programs.

It would also allocate at least 1% of each substation construction budget to neighborhood-compatible design improvements, backed by a citywide good-neighbor agreement that incorporates neighborhood input.

An additional $2 million annual carve-out from the franchise fee would support programs such as heat pumps or electric vehicles. Xcel would fund $250,000 a year for Energy Resource Navigators selected through a third-party process.

A city-hosted dashboard would track metrics and spending, with five-year evaluations of the partnership and a community advisory group. City staff said the package establishes a structured process for community-informed pilot projects and secures data access on power flows and gas infrastructure.

The City Council’s Governance Committee, composed of council members, advanced the core franchise agreement and Energy Partnership Agreement.

The measures followed extensive work by a working group convened by the mayor and council president that included community members, two council members, airport representatives and city staff. The working group helped shape key elements of the companion agreement, including the pilot project process, substation design standards and transparency requirements.

Without a new agreement, Denver would lose the contractual franchise fee, Xcel’s relocation obligation, the dedicated undergrounding program, enforceable performance standards and the new assistance and design requirements.

The committee voted to forward the measures to the full Council for consideration ahead of an Aug. 3 referral deadline for the Nov. 3 ballot.