This commentary is by Jonathan Dowds, deputy director of Renewable Energy Vermont.
Vermont has a plan to combat climate change — accelerate our transition to electric vehicles, switch our heating and cooling systems to electric heat pumps, and power it all with electricity that is increasingly green and renewable.
There is a lot to like about the plan. Iin addition to protecting the environment, EVs and heat pumps will save most Vermonters money in the long run.
But the plan rests on a foundation made of paper because Vermont’s most consequential energy policy — our Renewable Energy Standard or “RES” — papers over our region's fossil use and does not move the needle when it comes to making our region’s power supply greener and more renewable.
The RES requires utilities to get 75% of their electricity from renewable sources by 2032 but this topline requirement is ineffective when it comes to increasing renewable generation and combating climate change. Vermont’s Department of Public Service has confirmed as much, stating that it has only a limited impact on regional renewable development.
Our RES — unlike similar laws throughout the Northeast — requires utilities to get only a small fraction of their electricity from new renewables. As a result, utilities meet their overall renewable energy obligation by retiring renewable energy credits from older hydroelectric facilities.
The problem is that none of these hydro facilities are generating more electricity because we passed the RES. And if the hydro facilities do not generate any more electricity because we passed the RES, then the natural gas plants located throughout New England do not generate any less. While, legally speaking, Vermont’s electricity may have become more renewable, the region’s overall renewable generation and carbon emissions have not changed much at all.
To be clear, it’s not the utilities that are at fault here. By using old hydro credits to meet the renewable requirement, they are following the letter of the law while keeping their costs as low as they can. If they opted to spend more on renewable credits that have a real impact on regional carbon emissions, they would likely face pushback from the Public Utility Commission.
Utilities are incentivized to sell the credits from the new Vermont projects that do reduce emissions to Connecticut, Massachusetts and Rhode Island and to replace them with credits from older hydro projects that do not. The system is working, but it is a bad system.
The good news is two components of the RES are making a difference for renewables and the climate.
The first is a requirement that utilities get 10% of their electricity from new in-state renewable energy, such as net-metered solar on rooftops. Because this requirement actually increases the amount of renewable electricity on the grid, it does displace fossil fuel generation and reduce emissions.
The second is a requirement for utilities to help customers reduce their fossil fuel use, typically achieved by incentivizing heat pumps and electric vehicles. Again, because these technologies are more efficient than their fossil fuel counterparts, the switch reduces overall greenhouse gas emissions.
The problem is that these requirements are just too small to match the moment.
The decision to use old renewables to satisfy the overall renewable energy target was not an accident. It was a strategic decision made in 2015 to keep costs low. But it was a mistake, albeit one made with good intentions.
It’s clearer than ever that the overall renewable energy target provides only the illusion that we are doing our part on climate. Now we know. It is time to update that RES so it provides a solid foundation for climate action.
This summer, Rhode Island updated its standard to get to 100% renewable electricity and Vermont should do the same. While we raise our overall target, we need to make sure that as much of this electricity as possible is coming from new renewables rather than simply taking credit for existing generation.
Doubling or tripling the requirement for new, in-state renewable generation would be good policy too. It’s a way for us to take responsibility for the impact of our energy usage (Vermont is currently 49th in the share of the electricity it uses that is generated in-state) rather exporting these impacts to vulnerable communities elsewhere.
Since the cost of wind, solar, and storage have all declined dramatically and the Inflation Reduction Act will cover 30% to 50% of the cost of renewable energy projects, there is no excuse not to invest in real energy transformation with real climate benefits. It’s time to meet the moment.