(In)Action on Climate and Clean Energy in the 2017 Legislative Session

(In)Action on Climate and Clean Energy in the 2017 Legislative Session

On the heels of the election of a new federal administration hostile to clean energy and action to address global warming, the Vermont Legislature’s limited progress in this arena was tremendously disappointing. Below, find a short summary of most of the energy and climate focused bills considered this session. We note which bills failed to go anywhere, which bills passed and which bills might be taken up next year, the second year of the legislative biennium.

 

SMALL STEPS FORWARD:

H.411: Appliance Efficiency Standards (and Net Metering Change)– PASSED

H.411 ensures that if the Trump Administration or Congress repeals or eliminates federal appliance efficiency standards, those standards will remain in place here in Vermont. With a flurry of attacks on energy efficiency coming out of DC, this bill is an important backstop. These standards are currently common practice and require a minimum level of energy efficiency for many different types of appliances, from refrigerators to heaters. In fact, they save more energy and cut more carbon pollution than all but one other federal program.

 

As passed, H.411 also included a controversial provision related to the new net metering program clarifying that a portion of the new net metering rule applies to existing net metering customers (those commissioned before January 1, 2017). The change clarifies that, after 10 years, customers will no longer be allowed to use net metering credits to pay for various “non bypassable” charges (such as their customer charge, energy efficiency charge, etc.). Many worry that this change sets a risky precedent, potentially enabling regulators to allow utilities to alter the terms for net metering customers over time. After the lengthy and heated debate, however, the PSB’s new rules for net metering are in effect and, of ongoing concern, is how dramatically they alter the landscape of opportunity, particularly for community solar and large net metering customers like municipalities or schools. This reality has triggered significant interest in coming back for some targeted legislative solutions to improve net metering next year for community solar, as well as potential solutions for lower income Vermonters.

 

S.52: Public Service Board and Its Proceedings (and Storage/Standard Offer) – PASSED

S.52 initially came out of a working group on improving citizen access to Public Service Board proceedings. In an effort to make the quasi-judicial process more citizen friendly, S.52 creates a streamlined process for resolving minor complaints about existing energy generators and refines several other aspects of the Board’s practices. It includes a number of provisions such as changing the Public Service Board name to Public Utility Commission to ease current confusion between the Public Service Board and Public Service Department. The bill also directs the Division of Telecommunications within PSD to create a plan by the end of 2017 for how citizens can better access PSB hearings and workshops remotely, and recommendations on how to improve the weight of local voices in PSB proceedings.  Thanks to the leadership of the House Energy and Technology Committee, two other important provisions were added to the bill. One catalyzes a study on how to encourage and expand the implementation of energy storage technologies on the grid, laying the groundwork for advancing storage solutions that are crucial to a more distributed, renewable energy grid in Vermont. The second provision temporarily closes a loophole in the Standard Offer program (which supports the development of mid-sized renewable energy projects) that allowed individual utilities to opt out of paying the costs for that program and, likely, shifting costs of those utilities onto other non-exempt utilities (and their ratepayers).

 

The Commission on Act 250: The Next 50 Years – PASSED

Lawmakers moved a bill that will take a comprehensive look at Vermont’s landmark land use and development law, Act 250, which is nearing its 50-year anniversary. H.424 creates a study commission to review how successful Act 250 has been in protecting our communities and natural resources and how it might be updated to address the challenges and realities of the 21st century. They will examine Act 250 in the context of some the biggest challenges that have transpired since its enactment – including climate change and Vermont’s evolving, more distributed energy grid. The commission is also tasked with answering what – if any – changes are needed to address ongoing challenges with timeliness and predictability in the permitting process. H.424 aims to get in front of the annual push for exemptions and carve-outs that have degraded the full force and intent of the original legislation and instead to take a more holistic approach that better reflects and addresses 21st century realities – like climate change.

 

Enhanced Energy Planning Support (In the Budget Bill) – PASSED

While the budget remains in flux, under threat of a likely gubernatorial veto, it includes a needed $300,000 allocation to regional planning commissions to support their hands-on work with communities in crafting enhanced energy plans under Act 174. The Legislature passed Act 174 last year with the goal of helping communities guide how they want to partner with the state to meet our 90 by 2050 energy goals in ways that work best for them (energy project siting and more…). It’s unlikely that, whatever happens with bigger budgetary issues, this funding is in jeopardy, which is good news for supporting the work of regions and municipalities in more effectively developing their enhanced energy plans.

 

LOST OPPORTUNITY:

90 by 2050 Goal in Statute – FAILED TO MOVE
There were two identical House/Senate bills introduced that would enshrine the state’s 90 by 2050 clean energy goal in statute (S.51 and H.316). Both the Senate Natural Resources & Energy and House Energy and Technology committees took testimony on the bills. The Senate committee took pretty extensive testimony and there was significant support for putting this goal in statute; nearly every utility and several state agencies under Governor Phil Scott ultimately supported it, along with many business leaders, environmental organizations and Vermonters. Unfortunately, these bills failed to move for reasons that remain unclear to many who followed it closely. The bill would have:

  • Helped affirm Vermont’s commitment to a clean, efficient, renewable energy future.
  • Aligned and consolidated several existing efficiency and renewable energy goals under one umbrella.
  • Helped assure that Vermont doesn’t backslide on its job-creating commitment to a clean energy future.
  • Underpinned the important comprehensive energy planning well underway in every region and many towns across the state.
  • Helped send a clear signal to support business innovation that has — and can continue to — grow clean energy jobs, the fastest growing job sector in the state.

It’s possible this bill could be taken up again next year, though it’s unclear if that will happen.

 

Home Energy Labeling bill – FAILED TO MOVE
S.118 aimed to provide time-of-sale information to home buyers on efficiency services available, including energy labeling. Unfortunately, the bill failed to move this year.

 

VW Settlement Funds – FAILED TO MOVE
This bill, H. 487, asked the Agency of Natural Resources to allocate the $18 million coming to Vermont from Volkswagen as part a settlement for their deception around diesel vehicle emissions. The goal of the bill was to charge ANR with maximizing environmental benefits and issuing an RFP for administration of the funds. After receiving opposition from ANR, the House Energy & Technology committee chose not to vote on it. It remains on the wall in the committee, leaving the door open for potentially shortsighted use of this significant infusion of funds that could be put to good, strategic use to invest in a 21st century transportation and clean energy future.

 

Tax Reform and Climate Action Bills – FAILED TO MOVE

Several bills were introduced this session related to carbon pricing. One bill calls for a study of carbon pricing/cap and trade to reduce GHGs and foster economic benefits (H.394). Four other bills were introduced which aim to put a price on heating and transportation fuels while simultaneously – at an equal amount – reducing taxes elsewhere. Four lead legislative sponsors rolled out separate short-form carbon tax reform proposals to spur much-needed conversations on what carbon pricing could look like for Vermont. They included:

  • “An Act Relating to Replacing Statewide Education Tax Revenue with a Fee on Carbon Dioxide Pollution.” (532 – Rep. Martin LaLonde): This bill proposes to reduce the statewide property tax, while diversifying and stabilizing Vermont’s education financing system.
  • “An Act Relating to Eliminating Vermont’s Sales and Use Tax and Replacing It With a Fee on Corporations.” (533 – Rep. Sarah Copeland-Hanzas). This bill proposes to gradually but completely phase out Vermont’s regressive sales tax and replace it by the same amount with a gradually rising tax on distributors of fossil fuels that emit carbon dioxide pollution.
  • An Act Relating to Making Changes to Help Vermonters and Small Businesses.” (528 – Rep. Johanna Leddy Donovan): Cuts income taxes for every Vermonter and Vermont business and doubles the Earned Income Tax Credit – one of Vermont’s most powerful anti-poverty initiatives that assists over 40,000 low-income families each year.
  • “An Act Relating to Establishing a Carbon Pollution Fee in Vermont.” (531 – Rep. Diana Gonzalez): Implements a fee on carbon pollution fee that is returned via a quarterly dividend check to every Vermonter and Vermont business to help speed the transition to the clean energy future.

 

Each of the short-form bills were sent to the House Ways and Means Committee, with the exception of H.531, which was sent to the House Natural Resources, Fish and Wildlife Committee; the committee with jurisdiction over climate change. House Natural Resources began to take testimony on H.531 late in the session. It’s unclear what action the legislature will take on these bills next year, but the hope is that these common sense tax reform solutions are part of the conversation as the state wrestles with improving our tax code, and/or dealing with federal budget cuts to important Vermont programs. It’s worth noting that other states across the Northeast are also advancing carbon pricing bills, with bills introduced in MA, RI, CT, NY and NH. With leadership and engagement from the coalition of business, low income, environmental, faith and academic leaders – and many local energy committee leaders – the aim is to continue to advance this important policy in the 2018 legislative session. The ultimate goal? Take action on climate change by reducing taxes on the things we want to foster in Vermont – like income, sales and property – and putting a price on the pollution we need to reduce.

 

THE WRONG DIRECTON for a CLEAN ENERGY ECONOMY…

Heating Fuel and Service Workforce Training Pilot Project

While still tied up in the ongoing budgetary debate, a big economic development bill, S.135, is likely to move forward. Among its many provisions is language supporting workforce development in the fuel oil industry. The Vermont Fuel Dealers Association (VFDA) advocated for a pilot program, in partnership with the Department of Labor and career tech centers, to train and attract new employees to work in the fuel oil business, asserting that there is a significant need for new employees in this business sector. Ironically, while the more traditional heating fuel workforce may be in decline, Vermont’s clean energy jobs sector is thriving. In 2016, over 17,000 Vermonters were working in the energy efficiency and renewable energy sector, an increase of nearly 20 percent since 2013. Clean energy now accounts for approximately six percent of the state’s workforce, and Vermont has the most clean energy jobs per capita nationwide.

 

Unfortunately, this fuel oil workforce training pilot program is focused on continuing to bolster a dying industry instead of helping this important segment of our economy (and our communities) evolve into much-needed “energy services providers.” Instead of looking forward and setting this industry up for long-term success, this is a backward looking initiative that contradicts the state’s larger goals of fostering a clean energy economy. The Legislature should, instead, advance a pilot project or program to help Vermont’s fuel dealers get trained and supported in transitioning to more diversified energy service providers.

 

The importance of local leadership – and ongoing, strong state leadership – has never been greater. Far more policy innovation and action is required. That will take political will at the highest levels of state government and relationship building and outreach to legislators to ensure they know where their constituents stand.

 

To get more involved or for more information on these bills or the legislative landscape, contact Vermont Natural Resources Council’s Energy Program Director Johanna Miller. 802-223-2328 ext. 112 or jmiller@vnrc.org.

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