Energy & Environment

Neighbors say Vermont Gas failed to meet energy efficiency promises in pipeline case

Nathan Palmer of Monkton in 2014, standing where a natural gas pipeline was later buried on his farm. Photo by John Herrick/VTDigger

For almost a decade, Jane and Nathan Palmer have been fighting a Vermont Gas Systems pipeline that runs along their Monkton farm. Now, the neighbors are alleging that Vermont Gas has failed to honor its promise to invest in energy efficiency in the region — a claim that company CEO Neale Lunderville calls “frivolous.”

When the pipeline was built in 2017, Vermont Gas said it would lead to $200 million in savings for ratepayers, based on the lower cost of switching from oil to gas.

The Palmers were skeptical of that claim from the beginning. They knew that the price of oil and gas could fluctuate. They argued that fossil fuels were bad for the environment. But in negotiations over the project, the number stuck. When the state greenlighted the project, it included a goal of investing a portion of the projected $200 million in savings in energy efficiency.

The Palmers say Vermont Gas hasn’t invested that money. Last Friday, they filed a motion to intervene in a hearing about the utility’s financial plan, which is called an Integrated Resource Plan. That proposal makes no mention of the $200 million investment, which the Palmers say is problematic.

“We’re trying to hold their feet to the fire to the promises they made,” said Jane Palmer.

Lunderville, however, says the company never promised to itself invest the money. And, according to a 2018 order by the state’s Public Utility Commission, Vermont Gas fulfilled its legal requirements by establishing a program that helped Addison County customers invest their savings in energy efficiency.

The pipeline is within 300 feet of the Palmers’ house. They’ve been vigilant since plans to build the pipeline first surfaced nearly a decade ago. And, the couple says, they’re already on guard because the utility didn’t build the pipeline the way it said it would.

State officials recently issued an order citing deficiencies in the pipeline’s installation; it wasn’t buried at the required depth and Vermont Gas failed to have a licensed professional engineer sign off on the project. The state started investigating the project after neighbors, including the Palmers, filed a complaint.

Now, “it’s always on our mind,” said Nathan Palmer. He worries about safety. “You go to bed at night, you wonder: Is this the night that something could happen?”

According to Lunderville, Vermont Gas “strongly affirms that the pipeline was designed, engineered, constructed and is operated safely — and we stand by our long record of safety.”

In the latest legal action, the Palmers argue that the utility’s plan for the future should include the energy efficiency measures promised in the past. 

“If they guarantee that they’re going to put $200 million into energy efficiency, then they need to put $200 million into energy efficiency,” said Nate Palmer. “That should’ve started years ago.”

The Palmers say the state shouldn’t accept the plan in its current form. Currently, according to attorney James Dumont, who represents the Palmers, the plan is “silent about the $200 million obligation.”

But Vermont Gas is adamant that it has met the state’s requirement for the $200 million investment — and that Dumont’s argument has no legs to stand on.  

“It is predicated on a meritless claim, and it is designed to create headlines, not drive at the facts,” Lunderville said of Dumont’s argument, adding that the Public Utility Commission had already addressed the matter and signed off on the company’s approach.

The company created an energy efficiency program for Addison County that was approved in 2018. That program has served 350 customers so far, according to Lunderville.  

“One goal of this program shall be to invest the projected $200 million savings into energy efficiency transitions that will facilitate, rather than frustrate, achieving the 90% renewable energy goal by 2050,” according to the certificate the state issued to Vermont Gas in 2018.

The certificate establishes that Vermont Gas is responsible for “ensuring that the investment of VGS ratepayers in the Project results in not only reliability and greater availability of natural gas to new customers but also greater energy efficiency (and reduced greenhouse gas emissions) for new and existing customers.”

Lunderville said it was always clear that ratepayers would be the ones to pay for energy efficiency, not the utility.

The Public Utility Commission now has two weeks to determine whether the Palmers will be granted intervenor status in the upcoming hearing. That would allow them to call witnesses and raise issues on the record.

Disclosure: Vermont Gas Systems CEO Neale Lunderville is a board member of the Vermont Journalism Trust, which operates VTDigger.

Clarification: This story has been edited to make clear that the Public Utility Commission previously ruled that Vermont Gas Systems met its energy efficiency obligations.

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Amanda Gokee

About Amanda

Amanda is a graduate of Harvard University, where she majored in romance language and literature, with a secondary focus on global health. She grew up in Vermont and is working on a master’s degree in liberal studies at Dartmouth with a concentration in creative writing.

Email: [email protected]

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