A day after GlobalFoundries announced it has moved its headquarters to a site two hours from Burlington, executives from the international semiconductors producer pitched Vermont lawmakers on a plan to make its Essex Junction plant energy-independent.
GlobalFoundries has reached an agreement with Green Mountain Power that would allow the Essex Junction facility to become its own energy utility as early as 2023, according to Gregory Reider, an executive on GlobalFoundries’ technical arm. The plan involves procuring energy on the open market rather than from Green Mountain Power.
The plan offers the company financial breathing room and would lessen the burden on Vermonters’ electricity bills, according to Reider.
“We actually consume more power than the city of Burlington, and we account for approximately 8%” of the state’s electricity loads, he told the Senate Committee on Natural Resources and Energy on Tuesday.
GlobalFoundries makes electric microchips that are used in products such as smartphones and computers. It is Vermont’s largest private-sector employer, with 2,200 employees split between its Essex Junction plant — known as “Fab 9” — and a neighboring company campus in Williston.
The company’s pitch for energy independence at the Essex Junction plant came a day after it announced the relocation of its global headquarters to Malta, New York, 37 miles from the Vermont border.
At Fab 9, executives said the move toward energy independence would cut its operating costs by 50%.
The company would make its own wholesale energy transactions, rather than working through Green Mountain Power. It would then process that energy through its own energy conductors, rather than through those owned by GMP.
The company reached several agreements in recent years with Green Mountain Power to cut its massive electricity rates. The Essex Junction plant’s electricity costs have run about 90% higher than GlobalFoundries’ New York sites, according to Reider. He said the plan for energy independence will involve only the Essex Junction facility, not the neighboring site in Williston.
According to Public Service Commissioner June Tierney, the company’s proposal to run an energy-independent site is without precedent in her time in public office. The plan would be regulated by Title 30, Vermont’s comprehensive regulatory law, Tierney told lawmakers on Tuesday.
GlobalFoundries will have to clear several tests to realize the plan — mainly, whether Green Mountain Power can cut the company out of its service territory under state statute, Tierney said, and whether the plan meets the “public good” test put forth by the law.
While both the power company and GlobalFoundries say the plan would ease Vermonters’ power costs, some lawmakers are raising questions about the public good.
“I think it is of some concern to me that we would consider [nearly] 10% of the load in the state being cut loose from various energy policies,” said Sen. Christopher Bray, D-Addison, the natural resources committee chair.
Green Mountain Power, meanwhile, has filed its own petition with the state’s Public Utility Commission to allow the plan to unfold.
“We’re supporting this collaborative solution to help strengthen GF’s Vermont operations while protecting our other customers from cost impacts,” said Mari McClure, Green Mountain Power’s CEO, in a March press release.
A final determination about whether the plan meets Vermont’s existing laws will rest with the Public Utilities Commission.
The day before Reider pitched lawmakers on the plan, politicians lauded GlobalFoundries’ move to New York state as a huge win for the regional economy.
“It’s a giant step in our goal to enhance Albany’s position as one of the chip fab capitals, not just of America, but of the world,” said U.S. Sen. Chuck Schumer, D-New York, at a press conference Monday.
Correction: The headline has been corrected to clarify how GlobalFoundries would obtain the energy it needs.
