Dive Brief:
- The Vermont House of Representatives has overwhelmingly passed a bill that establishes renewable requirements for the state’s electric utilities and obligates them to use renewables and energy efficiency to reduce Vermont’s fossil fuel use.
- The bill requires utilities to obtain 50% of their electricity from renewables by 2017 and 75% by 2032.
- The bill will also allow utilities to sell RECs into regional electricity markets. Without the change, Vermont electricity rates would go up an estimated 6%, according to VTDigger.
Dive Insight:
Opponents of the new bill and specifically Tier 3 — its fossil fuels reduction component — argue it will increase the cost of electricity for ratepayers. A Vermont Department of Public Service study found that eliminating Tier 3 would reduce energy savings by $275 million and increase rates by 4%.
The bill requires Vermont regulators to determine exactly what qualifies as a reduction in fossil fuel. Utilities can invest in renewables or subsidize energy efficiency retrofits, according to the bill.
The bill is also expected to reduce Vermonters’ use of oil, propane and gasoline. Opponents say that will increase demand for electricity and drive rates up. Governor Peter Shumlin’s office and bill supporters say ratepayers' savings on fossil fuel expenditures will create net savings.
One amendment fight was over whether to allow utilities to rate base capital investments in fossil fuel reductions, which will be permissible under the current bill. Another fight that proposed to remove Tier 3 was defeated.
An amendment dictating renewables siting was also defeated. Vermont has seen increasing battles between residents and renewables developers over siting issues, while public support for wind projects fell from 2013’s 66% to 50% in 2014.
The bill heads to Vermont’s Senate. If it passes, it will then go to the governor's desk, where his signature would turn the bill into state law.
