Hallquist: Legislators need deeper understanding of renewable energy credits

Editor’s note: This op-ed is by David Hallquist, CEO of Vermont Electric Cooperative.

As CEO of Vermont Electric Cooperative, I am concerned that the Vermont Legislature is heading down a road to create mandates for renewable power adoption without understanding the physics of the power grid and while ignoring the market realities.

Those who understand the operation of the electric grid know that high levels of intermittent resources, such as wind and solar, have serious negative impacts in terms of reliability. The grid has been designed to use spinning generators that help to maintain stability. As generation increases or decreases rapidly, the inertia of these spinning generators helps to keep things stable. Wind-powered generators do not have that inertia. When the wind drops, the blades stop. Solar generators have no moving parts, so when a cloud passes, the generation stops immediately as well.

Recognizing the seriousness of the situation, U.S. Department of Energy has placed a top priority on solving this problem. At the present time, a cost-effective solution does not exist to enable high levels of penetration of intermittent sources of energy.

In terms of cost, natural gas is so inexpensive right now that no other source comes close in terms of cost and economics. While I fully appreciate the importance of moving to a renewable portfolio, the economics of natural gas prices will prevent this shift from happening, regardless of what legislative mandates are issued. Current proposals would have utilities purchasing renewable energy credits (RECs) if they are unable to meet the renewable portfolio goals established by the state of Vermont. In the end, this will not move our state forward to adopt higher levels of renewable energy, and it will add to the cost burden of the end ratepayer.

This is because we can purchase natural gas-fired electricity for less than four cents per kilowatt-hour today. If RECs are purchased by utilities, this may add about three cents for a total cost of seven cents per kilowatt-hour. By way of comparison, the cheapest form of renewable power comes from industrial wind on ridge lines, at about 10 cents. To meet the current legislative proposal given current market conditions, utilities will simply buy power from gas-fired sources and RECs from other states like Connecticut or Massachusetts instead of more expensive in-state renewable energy. While this may make Connecticut or Massachusetts richer, it does not achieve the legislative goal of encouraging development of renewable energy in Vermont.

If Vermont Electric Cooperative had been subject to the new, proposed rules and legislation a few years ago, it is unlikely that we would have chosen to support the construction of the Kingdom Community Wind project. Instead, the purchase of RECs in combination with non-renewable market power would have been less costly option to fill our power supply portfolio while meeting state renewable requirements.

The bottom line is that the current thinking in the Legislature in terms of a renewable portfolio standard is flawed. Physics and economic reality will prevail. Before creating a more serious problem, legislators should wait until next year so that this issue can get the higher level of research and attention it requires. Right now our electricity portfolio is only 4 percent of the carbon footprint in Vermont. Vermont legislators do not need to rush this.

VTDigger is underwritten by:


About Commentaries publishes 12 to 18 commentaries a week from a broad range of community sources. All commentaries must include the author’s first and last name, town of residence and a brief biography, including affiliations with political parties, lobbying or special interest groups. Authors are limited to one commentary published per month from February through May; the rest of the year, the limit is two per month, space permitting. The minimum length is 400 words, and the maximum is 850 words. We require commenters to cite sources for quotations and on a case-by-case basis we ask writers to back up assertions. We do not have the resources to fact check commentaries and reserve the right to reject opinions for matters of taste and inaccuracy. We do not publish commentaries that are endorsements of political candidates. Commentaries are voices from the community and do not represent VTDigger in any way. Please send your commentary to Cate Chant, [email protected]

Email: [email protected]

Send us your thoughts

VTDigger is now accepting letters to the editor. For information about our guidelines, and access to the letter form, please click here.


Recent Stories

Thanks for reporting an error with the story, "Hallquist: Legislators need deeper understanding of renewable energy ..."