Green Mountain Power presented its plan to the state on Monday for $21 million in energy efficiency improvements for former Central Vermont Public Service customers.
If the Public Service Board approves the proposed annual plan, the company’s Clean Energy and Efficiency Development, or CEED, Fund would pay out $20.9 million over the next four years for residential and business retrofits, farm programs, renewable energy projects, weatherization upgrades and emerging technologies.
The company estimates that the gross societal benefits of these programs would total $53.2 million at the end of 2017.
The creation of the $21 million CEED Fund was a contentious matter in 2012, when GMP’s Canadian parent company Gaz Métro bought CVPS and merged it with GMP — giving the company more than 70 percent of the state’s electric distribution territory.
The debate over those funds originated in a Public Service Board decision made in the early 2000s. In the 1990s, the Rutland-based company and Green Mountain Power purchased electricity from Hydro-Quebec at above-market rates that eventually eroded the value of the two utilities, both of which faced bankruptcy. The board allowed CVPS to increase power rates for consumers in order to salvage the company, but with the stipulation that if CVPS were sold for higher than its book value, the windfall would be shared with CVPS customers who helped bail out the company.
While some legislators and groups, such as the AARP, in the last legislative session demanded that Gaz Metro pay the $21 million windfall back to Central Vermont Public Service customers in cash, the board decided to allow Gaz Metro to put that money in the CEED Fund for energy efficiency investments. The AARP estimated that GMP owed average households $76 each.
Robert Dostis, a spokesperson for Green Mountain Power, said the fund is a better investment for ratepayers than simply handing back money.
“In the end, we’re going to be investing $21 million, but there will be at least $53 million worth of benefits back to customers,” Dostis said. “We all know … that when we invest in efficiency programs, the payoff to customers is significant, and it’s long term.”
In 2012, GMP invested $6 million into the fund for the state’s weatherization program for low-income Vermonters, and in 2013 the utility plans to invest another $4 million. The company estimates that the $10 million investment will net $12 million in overall societal benefits.
GMP proposes investing $1.2 million in electric efficiency programs this year that will be broken into three groups: $1 million for existing businesses to retrofit buildings and upgrade equipment; $50,000 in interest-free loans to public schools for energy upgrades, and about $150,000 for farms to improve technology and install biomass heating systems.
Between 2014 and 2017, Green Mountain Power plans to invest $7.7 million more in similar electric efficiency upgrades. The company estimates that the combined $8.9 million will net about $19 million in benefits.
If the board allows Green Mountain Power to break up its $2 million thermal efficiency program, the utility would invest $1.5 million in 2013 and $500,000 in 2014. Those dollars would go to residential and business energy retrofits, open-air heat pumps and condominium upgrades. The company estimates the $2 million would net $2.4 million in benefits.
In the event that the board would not permit GMP to break up the $2 million over two years, the utility would eliminate the condo initiative, and the company estimates that fewer customers would be helped. GMP representatives say the utility and its partners need the additional year to more effectively implement the programs.
GMP is teaming up with a range of energy organizations, including Efficiency Vermont, Vermont Energy and Climate Action Network, Vermont Fuel Dealers Association and Vermont Energy Investment Corp.
Final comments on the plan are due by the end of next week, and Dostis said the utility hopes to get approval to implement the plan as soon as possible.
“There are tight timelines and we have to demonstrate the savings this year,” he said. “In order to meet those timelines the sooner it gets approved the better.”
