Op-Ed: Energy Bill Puts Vermont on the Right Track

Op-Ed: Energy Bill Puts Vermont on the Right Track

By Representative Margaret Cheney – April 2009

As printed recently in the Burlington Free Press

We can be sure of two things: Vermonters want more locally generated renewable energy, and Vermont’s economic future will be brighter with the new jobs that a vibrant energy industry will create. The Vermont Legislature’s 2009 energy bill is a firm step toward achieving these goals.

Above all, this is an economic development bill that invests in our future.  It will:

•    Create new in-state jobs, quickly. One solar businessman estimates that it will bring 15-20 jobs per MW of installation per year – jobs in engineering, manufacturing, distribution, and installation.

•    Jump-start the development of renewable energy. Department of Public Service polling shows that 89% of Vermonters want more renewable energy as part of their electric mix.

•    Spur community-scale generation of electricity, such as farm methane projects and commercial solar installations, within reasonable and stable cost parameters.

•    Provide certainty to developers of renewable energy, so they can access financing and use sure-footed projections in deciding whether to build their project.

How will we do all this? We ask the Public Service Board to create a “standard offer” for community-sized renewable energy projects. This would give small developers a fixed-rate, 20-year contract for the clean electricity they produce. This clear contract price would reflect the real cost of installing the project, according to energy type.

Some people have raised valid questions about the cost to electric ratepayers. To address these concerns, the proposed law includes strict limits to minimize any cost increases. Protections include a cap on the size of eligible projects and a cap on the total amount of power that can qualify, to an eventual statewide aggregate of 50 megawatts.   The bill also requires regulators to base prices on real-world costs for different types of energy – not guesses about future energy markets, which was the mistake the federal government made in the 1970s in the so-called PURPA law. Every two years, regulators will re-set the contract prices for new developers, reflecting lower costs as renewable technology evolves.

More than 40 countries and municipalities have instituted this pricing mechanism for renewable energy. Also called “feed-in tariff,” it has proven to deliver more green energy more quickly and more fairly than other market incentives. It creates jobs and gets capital flowing.

Among other important provisions, the bill also expedites the delivery of $21 million in federal energy stimulus money through our Clean Energy Development Fund, an existing program with a long list of Vermont projects that are ready to go. These range from new renewable energy projects like the Monument Farms anaerobic digester in Weybridge to new systems on old buildings, such as solar power for Camel’s Hump Middle School in Richmond. In addition, the bill aligns our building codes with federal standards so we can receive other stimulus dollars for energy conservation. And it includes a pilot program that will help our biggest industrial consumers of electricity, such as IBM, invest in their own energy-saving measures.

President Obama is challenging the nation to double our renewable energy production. Vermont has been a leader in the green field, through our creation of Efficiency Vermont and the Clean Energy Development Fund, and the time is right for us to reclaim that lead. Local generation, local jobs, and the development of local companies, home-grown in Vermont, are good for the state. I am confident that this legislation presents another set of practical steps on the path to a more secure energy future.