To hear its opponents tell it, utility-scale wind in Vermont is a “mad rush” by people “obsessed,” a process driven by the Big Wind money machine and threatening to bulldoze “time-honored Vermont traditions” as well as our ridgelines. In a recent opinion piece, previously dissected in this space, Sen. Joe Benning charged that Vermont’s energy policy is being “driven by greedy, mostly out-of-state corporate developers.”
But when you look at the actual record, you see a far different picture. Vermont has developed its renewable energy policy slowly, carefully, openly, over the course of many years. Virtually all of the relevant legislation passed by lopsided majorities (on voice votes, more often than not) with tripartisan support. The process has been driven, not by big corporations, but by our elected officials. Including Joe Benning himself, as it happens. The process has consistently given preference to small, home- and community-based renewables. In fact, while Vermont has consistently offered financial incentives for small projects, it has never done so for large-scale renewables.
This diary is the first of a two-part series exploring the history of our renewable energy policy, focusing on the legislative record. Part two, coming soon, will look at the regulatory process.
The story begins around the turn of the century. In 1998, the Legislature approved the first net metering program, allowing Vermonters with small renewable power sources (usually solar panels) to sell their excess electricity to their utility. The program was expanded by legislation adopted in 2000 and 2002.
In 2003, lawmakers passed a bill authorizing renewable pricing programs, which allowed consumers to invest in renewable energy projects. It also took the first step toward creation of a Renewable Portfolio Standard (RPS) which would mandate that every utility provide at least a minimum percentage of renewable power. And the bill created an incentive program for small-scale renewable systems in homes and businesses.
Baby steps to be sure, but they illustrate two important facts about Vermont’s path to a renewable energy policy: The process was very deliberate and inclusive, and the programs were designed with individual- and community-scale projects at the forefront.
2005: Lawmakers passed Act 61, the first legislation to establish renewable energy standards, and the SPEED (Sustainably Priced Energy Enterprise Development) program to encourage in-state development of renewable electricity. It also required power providers to add enough renewable sources to fulfill increased demand between 2005 and 2012. The bill passed the Senate on a voice vote, and the House by a 94-35 margin.
The SPEED program has come under attack for allowing utilities to trade renewable-energy credits to other states. This is true, but SPEED was designed to surmount the chicken-or-egg problem with renewables: the upfront investment is relatively large, making renewables uncompetitive at the beginning. Over time, their costs drop dramatically because, well, they’re renewable: no need to keep on buying fuel. SPEED provided a market-based solution to the initial-investment problem by allowing utilities to sell long-term contracts for renewable power. Without SPEED, adoption of renewables in Vermont would have been much, much slower.
The SPEED program is set to expire in 2017. By then, the renewables market will be well established and we should be able to stop selling renewable credits.
Act 61 also required utilities to submit ten-year plans for meeting power transmission needs, with an eye to (whenever possible) limiting new transmission in favor of “nontransmission alternatives” such as locally sourced power. And the Department of Public Service was required to hold hearings on new transmission proposals in each affected community.
Finally, the bill ordered the DPS to create a process involving the public in the development and siting of proposed wind farms.
2006. Without dissent, the Legislature approved Act 168, establishing greenhouse gas reduction goals. They were modest targets, to be sure, but it was another incremental step along the way. The goals were set against the 1990 baseline, and sought a 25% reduction by January 2012, 50% by 2028, and 75% by 2050.
The bill also required creation of a climate change action plan, and mandated that all state agencies consider greenhouse gas emissions in their decision making processes.
Also in 2006, the Legislature took another step in fostering public participation and local energy by adopting Act 208 without dissent. It required creation of a process for engaging the public in power planning issues, and helping communities develop local energy opportunities and climate change action plans.
(And in November 2006, one Robert Hartwell was elected to the State Senate. The record shows that he voted for every piece of renewable energy legislation that passed the Senate from then on — or, at least, he did not cast any “No” votes. That includes all the bills that encouraged wind development.)
2008: By overwhelming margins, the Legislature adopted Act 92, which exempted farm- based energy projects from the Act 250 process. It also set a goal of producing 25% of Vermont’s energy from in-state renewables by the year 2025. And it revised the net metering law, raising the existing cap on non-farm systems to 150 kW.
There were numerous other provisions in the bill, but one I find especially worth noting: Act 92 set a state goal that 20% of total statewide electric retail sales would come from SPEED (renewable) resources by July 2017, when the legislation enacting SPEED is due to expire.
2009: The Vermont Energy Act of 2009 (Act 45), which did a whole lot of stuff. Most notably, it amended the SPEED program by ordering the Public Service Board to issue “standard offer” prices for renewable energy plants in Vermont. This encouraged development of renewable power by establishing default prices that allow renewable-power developers to recover their costs plus a decent rate of return. The standard offer applies only two projects 2.2 megawatts or smaller; it’s another way in which Vermont’s renewables policy has been tilted toward small, local projects. (Vermont does not offer, and has never offered, financial incentives for large renewable energy projects.)
Of all the bills in this list, Act 45 was the only one that failed to attract broad tripartisan support. The House approved it 88-44, and the Senate passed it by 16-10. The bulk of the “No” votes came from Republicans; Governor Jim Douglas allowed the bill to become law without his signature. He believed that the state already had sufficient incentives for renewables, and he was concerned that the bill might raise electricity prices.
Act 45 also allowed “appropriate” wind turbine development on state lands. This was not, apparently, a source of controversy at the time.
Another section of the bill created self-managed energy efficiency programs for large industrial ratepayers. Those companies were required to invest in efficiency, verify energy savings, and report their results annually to the state.
There was also a section that barred local governments from adopting any laws or ordinances forbidding the use of solar panels, clotheslines, or other small renewable energy projects.
2010: On voice votes, the House and Senate adopted Act 159, which established simplified procedures for permitting of small renewable energy projects and connecting them to the power grid. It also corrected a problem with the market for farm methane plants, by bringing older plants into the “standard offer” program.
Act 159 also ordered the Public Service Board to write a report by October 2011 on the potential development of an RPS (Renewable Portfolio Standard) program to replace, or to be added to, the SPEED program. Critics of SPEED have called for a switch to RPS, which would require electric retailers to maintain a minimum quantity of renewable power in their own portfolios, rather than selling the credits outside the state.
Another provision transfers jurisdiction over appeals of renewable-energy permits from the environmental court to the Public Service Board. It also requires the PSB to abide by the processes and precedents of the environmental court.
November 2010: Prominent anti-wind Senators Peter Galbraith and Joe Benning are elected. During the ensuing biennium, neither will vote against three major pieces of energy legislation. One of the three established much tougher targets for renewable energy generation in Vermont — targets that would be almost impossible to meet without some adoption of utility-scale wind.
Which brings us to Act 47, The Vermont Energy Act of 2011. It expanded the net metering program, allowing for the connection of more small and individual systems. There were numerous other provisions, most of them relatively minor.
Two energy bills were adopted in 2012, both on voice votes.
Act 125 again expanded the net metering program with an eye toward home solar systems. It also ordered the Department of Public Service to report on the net metering program and recommend ways to expand it.
Act 170, the Vermont Energy Act of 2012, set new goals for adoption of renewable energy: 55% of each utility’s energy should come from renewable sources by 2017, and 75% by 2032. The Act also amended the state’s renewable energy goals to encourage distributed generation and a diversity in size and technology, fostering a broader base of renewable energy sources. It expanded the standard offer program, allowing favorable rates for renewable energy projects.
The Act also mandates biennial reports from the Public Service Board on the SPEED and standard offer programs, which should include comparison of Vermont’s electric rates with those of nearby states. The Act had included establishment of RPS’s (renewable portfolio standards), but the Senate stripped out that requirement near the end of the session. Instead, the bill mandated further study of RPS.
And the Act requires the Department of Public Service to report on progress toward the DPS’ recommended goal that by 2050, 90% of all energy consumed in Vermont be renewable energy. This includes not only electricity, but also heating and transportation.
And among its many other provisions, it enacted a smart-metering program and allowed customers to opt out of the program without penalty.
Conclusion. Vermont’s progress on expanding renewables and fighting climate change hasn’t always done the right thing. I would argue that it’s been too slow and too timid, given the magnitude of the threat we face. But when reviewing the legislative record, it’s clear that the process has been deliberate and inclusive, and that it has favored small-scale generation and discouraged long-distance transmission.
A review of Vermont’s recent regulatory history reveals the same thing: a long, exhaustive consideration of all the issues that has encouraged the participation of all concerned parties. Not a perfect process, but definitely not the “mad rush” depicted in anti-wind rhetoric. I’ll post a diary on that regulatory history in the near future.