Energy

Legislative Wrap: State passes ambitious renewable energy goal

Darren Springer
Darren Springer, deputy commissioner for the Department of Public Service, presented details of a new renewable energy program, known as RESET, to a packed House Natural Resources and Energy Committee during the opening weeks of the legislative session. Photo by John Herrick/VTDigger

At the start of the legislative session, the Shumlin administration presented lawmakers with a fix to what they said was a looming 6 percent statewide increase in the price paid for electricity.

Vermont utilities sell renewable energy credits, or RECs, generated by wind and solar projects, to other out-of-state utilities used to meet renewable energy targets. But because Vermont utilities could count this power toward a state renewable energy goal in 2017, out-of-state utilities have begun to question the value of so-called “double counted” RECs.

The bill, H.40, would resolve that concern, allowing utilities to continue earning about $50 million in revenue from the sale of RECs. The bill repeals Vermont’s current incentive program, known as SPEED, and for the first time sets mandatory renewable energy targets. Double counting would not be allowed. This is similar to energy policies in all other New England states.

It was the risk of a rate increase that helped to build support for the bill through the Senate on the eve of adjournment despite attempts to tack on provisions that would have limited where renewable energy projects could be built. The issue of siting is likely to resurface next year when a summer task force presents proposed legislation at the start of the session.

The renewable energy standard puts the state on a track to continue building renewable energy projects, such as wind, solar and new technologies like manure digesters. This bill requires that 55 percent of a utility’s electricity come from renewables, including large-scale hydro power, by 2017. The target increases the ratio to 75 percent by 2032.

Some of the electricity must come from in-state projects limited in size. The Department of Public Service estimates at least 25 megawatts of new generation must be built in Vermont each year over the life of the program.

The expansion of renewable energy has spurred resistance from municipalities and neighbors who are concerned about where the projects are built. While towns pushed for more of a say in the Section 248 permitting process before the Public Service Board, most environmental advocates say renewable energy is a public good that should not be obstructed by local opposition. Fearing unintended consequences, lawmakers passed a policy putting in place statewide setbacks and local screening for solar projects. Towns will also have automatic party status in the permitting process for solar projects.

The bill also aims to cut greenhouse gas emissions from the heating and transportation sectors. Utilities will be required to reduce customers’ greenhouse gas emissions by offering incentives and on-bill financing for weatherization, heat pumps and other projects.

The bill requires an annual report beginning in 2018 on the impacts of the program on electric rates, including projections 10 years ahead. Utilities can apply for waivers if they prove the requirements would increase electric rates.

Carbon Tax

No action was taken on a carbon tax this year, but a foundation is being set for a full debate in the years ahead.

Just months before the start of the legislative session, advocates announced a campaign to put a price on carbon emissions, the top greenhouse gas responsible for climate change. Lawmakers then began discussion on a controversial policy that they expected would take at least the entire session.

Advocates say putting a price on carbon would cut emissions, grow the economy and generate revenue needed to transition off of fossil fuels. Fuel dealers and industry leaders oppose the tax. Gov. Peter Shumlin prefers a national carbon tax because a state tax, he says, would harm the state’s economy.

Some green businesses testified this year in support of the tax, arguing it would benefit the long-term financial stability of their operations that have been stymied in the past by extreme weather events like Hurricanes Irene or Sandy. One non-partisan consulting firm, Regional Economic Models Inc., found the tax would grow the state’s economy, largely because most of the revenue would be used to reduce other taxes under a tax model proposed by advocates.

But lawmakers are treading lightly on the issue. Fuel dealers are strongly opposed to the tax, arguing it will hit the 4,000 workers in Vermont’s fuel delivery industry, especially in border communities. The proposal by advocates would exempt electricity, but retailers are concerned about energy costs.

Gasoline Wholesalers

Gasoline wholesalers dodged an effort by lawmakers to launch an investigation by the Attorney General’s Office into conspiracies of price fixing in northwestern Vermont.

Gasoline prices are higher in the Burlington area because of the high cost of doing business and low traffic to recoup cost, dealers say. But some lawmakers and the Attorney General’s office have hinted it may be due to lack of competition or illegal price fixing, though they have no evidence to confirm the suspicion.

One bill was intended to help the Attorney General’s office investigate conspiracies of collusion and price fixing among wholesalers and dealers. The bill would have required the reporting of gasoline sales from wholesalers to dealers and that dealers give the Attorney General advance notice of any station purchases in order to keep tabs on consolidation.

The bill was attached to the miscellaneous agriculture bill in the Senate, but in a floor vote, lawmakers determined it was not germane. The Attorney General’s Office says they are willing to speak with anyone who suspects there is price fixing occurring.

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  • Annette Smith

    Congratulations. Vermonters get Hydro-Quebec renewable energy, while Massachusetts and Connecticut get to claim Lowell Wind, Sheffield Wind, Georgia Mountain Wind and Searsburg Wind and all that big solar and a lot of the SunCommon Community Solar Arrays as their renewable energy.

    It’s nothing to be proud of folks. Just another scam, a bait and switch, Vermonters pretending to be “green” when all that is about is money.

    And the carbon tax will be adopted by the same sheep who voted for H.40.

  • Rich Lachapelle

    Feel-good laws passed by the Vermont Legislature dont have a lot of bearing when up against the inviolate Laws of Thermodynamics. This new legislative effort will use up a lot of paper and employ a lot of lawyers, not exactly something that Mother Earth will breath a sigh of relief over.

    • John Greenberg

      ” … when up against the inviolate Laws of Thermodynamics.” Which law or laws does this “feel-good law” violate, in your opinion?

      • Rich Lachapelle

        There is organized opposition to pretty much every form of renewable energy proposed or enacted in Vermont. The Legislature’s pipe dream of 90% renewables by 2050 to include heating and transportation just cannot work with our current standard of living without denuding a lot of ridges and covering many square miles of farmland with those blank, black, south-facing rows of billboards. One of the above posters runs an organization that will try to prevent that from happening. If you want to go back to living an 1820’s existence, lighting your home with whale oil, then you will be just fine. For now, most Vermonters’ comfort, safety and high standard of living depends on using non-renewable petroleum products. No proclamation from Vermont’s Legislature will change that. At least we now are allowed to refer to hydro power as “renewable” even if it comes at the expense of flooding great areas of indigenous lands in Quebec.

        • John Greenberg

          Rich Lachapelle:

          Thanks for your reply, but you didn’t answer my question. What does any of that have to do with the laws of thermodynamics?

          • Rich Lachapelle

            In the broad sense, the First and Second Laws of Thermodynamics define that there can be no perpetual motion machines and that energy is conserved and cannot just spontaneously be generated without the input of some other form of energy. While perhaps the Vermont Legislature has a grasp on this general concept, they
            seem to be in a fantasy land regarding our energy requirements versus what externalities many Vermonters are willing to put up with to make that energy available.
            Like I said, while we enlightened, new-age Vermonters embrace the concepts of clean, renewable energy, we dont want it’s infrastructure anywhere near us. Every common form of practical renewable energy has organized opposition groups fighting it
            from wind turbines, solar arrays in fields, central biomass heating plants and fish advocates arguing for the removal of hydro dams that have been operational for 100 years or more. Meeting the standard of 90% renewable by 2050 for BOTH heating and transportation would require a number of PV arrays and wind turbines that most Vermonters would not tolerate for mostly aesthetic reasons. Some of the reasons for opposing these facilities are a bit fanciful such as when the director of the King George School gave testimony many years back that the sight of distant rotating blades of the proposed Sheffield turbines would cause emotional stress in her students and threatened to close the school if they were built. In summary, the Vermont Legislature’s renewable energy dream would not be tolerated.

          • James Tillingham

            And, in some cases for good reason. A populace that has grown up expecting clear, uncluttered natural vistas will not appreciate thousands of acres of solar panels, or hundreds of miles of ridgelines scarred by windmills. Why do you think the Kennedy family fought so hard against Cape Wind? That is why the wealthy, 0.00001%ers in the Hudson Valley fought so long against the Storm King Mountain project, which was not, as almost everyone thinks, a nuclear plant, but was a pumped storage facility, the only practical means of storing energy from that darling of environmentalist extremists, solar energy.

  • Jackie Folsom

    I wish somebody could explain to me how electric cars – being promoted everywhere – are going to help with the infrastructure of the roads. Currently they run on the same roads but because of less gasoline use, are they really getting a “free ride” on the highways? I know there aren’t many now, but is somebody thinking about a tax on them? Thanks

    • Glenn Thompson

      Oregon is experimenting with a mileage tax. Probably a bad idea since it would discourage the purchase of electric cars and put all vehicles on equal footing when it comes to taxation!

      http://economics.about.com/od/taxesandeconomicgrowth/a/mileage_tax.htm

    • Rich Lachapelle

      Electric cars, for most parts of the country will essentially be powered by coal or natural gas. Instead of having a tailpipe on the car spewing carbon dioxide, there will be a large smokestack located on the fossil-fuel burning powerplant that fed it’s batteries electrons. Until we get the bulk of our electricity from renewable sources or nuclear plants, transportation will continue to be a major source of atmospheric carbon. It may make some people feel good about themselves to take money out of the Koch Brothers’ pockets by not burning gasoline. For some, like many members of the Vermont Legislature, this is all that really matters and constitutes “doing the right thing”.

  • This is an embarrassing outcome. After being cited for double counting RECs, VT bureaucrats teamed up with GMP and Burlington Electric, to claim the state had no renewable energy policy so therefore no double count.

    Connecticut believed them and agreed — no double count. Cleared of any wrongdoing, these same bureaucrats cried to the legislature that the utilities would lose $50 million in revenues because of a double count. (Have I lost you yet?)

    They knew exactly what they were doing. They lied their way through to the vote. And now they will live with an unmanageable law for which no one has accounted for the administrative costs. Just glad I don’t live in Vermont.

  • Rob Pforzheimer

    VT, like Maine will be a wind turbine plantation to fulfill CT & MA renewable energy mandates.

    The sale of REC’s are supposedly going to save VT’ers from a 6% rate increase? Have the sheep in the legislature and their puppet masters considered what will happen when the REC market inevitably crashes. Years ago Washington Electric Coop (WEC) requested a rate increase because the price of REC’s from the Coventry landfill generation dropped.

    Does anyone really believe this farce is going to avert climate change?

    • James Tillingham

      Probably minor impact on climate change. Wider use of nuclear energy would have a bigger effect. But in either case, what we save in this country will likely be cancelled out by expanded use of carbon fuels in other countries. But that is not a reason to give up. There are plenty of other reasons to reduce the use of coal, oil, and natural gas in steam electric plants. Coal, in particular, has issues with sulfur. The others, while lower in sulfur, have problems with CO2, CO, NOx, and PAHs. Biomass is a loser on the PAH problem.

  • Willem Post

    All,

    Here are some interesting facts regarding Vermont “making a difference” regarding climate change.

    Last night there was a rainfall of about 0.5 inch, over an area of about 10 by 10 miles, lasting about 30 minutes.

    The area equals about 100 square miles, equals 64,000 acres, equals 259 million ft2.

    The volume of water was 10.8 million ft3 with a weight of 673.75 million lb.

    Condensing a lb of water vapor releases about 1,000 Btu

    Heat released in 30 minutes was about 673.75 billion Btu, or at a rate of about 1347.5 billion Btu/hr.

    The maximum heat input of the Montpelier Heating Plant is 0.04021 billion Btu/hr.

    The heat released of the rainfall is equivalent to 33,511 Montpelier Heating Plants operating at full capacity.

    Vermont’s primary energy consumption in a year is about 145 trillion Btu, per DPS, or a rate of 0.01655 trillion Btu/hr

    It would take 80.4 hours of Vermont’s primary energy to equal a 1-hr rainfall. If there had been wind, the energy of the event would have been much greater.

    Montpelier RE aficionados are dreaming fantasies if they think RE laws are making a difference regarding climate change.

    It should be clear, Vermont’s RE set up has nothing to do with affecting climate change, but mostly serves to chase as much subsidies as possible to artificially, and expensively, grow RE businesses that produce high-cost energy, and to provide talking points to get re-elected.