• Douglas has made some progress on energy initiative
    October 12,2008

    Energy is a big issue in this fall's election, as it has been in Vermont over this past biennium. Competing claims are flying. Democrats and Progressives decry what they call Gov. James Douglas' lack of vision on energy, dubbing him "Governor Does-less." Yet there's so much news of various happenings on the state energy front, that one reporter recently wondered whether all the activity was concentrated to this fall to help Douglas in the election. How much of this activity is hype, and how much is real?

    I decided to look at one of the biggest bones of contention between the Legislature and Douglas, the omnibus energy bill, H.520. The Legislature passed it last year, Douglas vetoed it, and the Legislature was called back into a special session last summer, to override this and another veto.

    Both veto attempts failed, so the two sides went at it again this year, and finally produced a bill. Senate President Pro Tem Peter Shumlin characterizes the law, Act 92, as "watered down at every turn" to make it palatable to Douglas.There was much in the original bill that Douglas said he liked, though he opposed the creation of an all-fuels efficiency utility, which could bring about savings for all heating fuels in the way that Efficiency Vermont helps homeowners and businesses lower their electric bills. Douglas didn't like the concept, and he particularly didn't like funding mechanism: a windfall profits tax on Vermont Yankee.

    In his veto message, Douglas made a commitment to implement many of the provisions in the bill that he favored. He tapped Richard Smith, deputy commissioner of the Department of Public Service, to head the process.

    How has the administration fared? I met with Smith last week, and he walked me through what's been done in the areas where Douglas promised to act. I then concentrated on the areas that I thought were most crucial to Vermont's energy future and checked up on many of them. Here's what I found.

    The overall goal is that renewable energy comprise 25 percent of all energy consumed in Vermont by 2025, according to both H.520 and Act 92. (Lt. Gov. Brian Dubie has repeatedly noted the strong feelings of participants in a statewide energy gathering two years ago that the "25 x '25" goal is too modest, but that's a subject for another column.) Douglas agreed to move forward with 25 x '25, and he has done so. Last January, a consultant to the Department of Public Service issued a preliminary report on goals. The Department of Forest and Parks plus the Agency of Agriculture have also reported on the capacity of farm and forests to meet Vermont's energy needs, according to Smith.

    Liquid fuels, like heating oil, gasoline, diesel, and liquid propane, are where Vermonters' pocketbooks are being hit hardest now, yet neither H.520 nor Act 92 have much language about them. The all-fuels efficiency utility, funded by Act 92 at a lower level than in H.520, was the most significant measure relating to liquid fuels. In his veto message, Douglas did not offer to so much as study an all-fuels efficiency utility.

    Biodiesel can be a renewable, in-state source of liquid fuel. The authors of H.520 wanted the state to increase use of biodiesel in state buildings and vehicles, and they wanted recommendations on how to do this. Douglas pledged the administration to come up with those recommendations, and Smith says the initial analysis is completed. (The study is also mandated by Act 92.) Potential warrantee issues and additional costs were the two main issues raised in the initial analysis.

    Transportation runs almost 100 percent on liquid fuels, mostly gasoline and diesel. H.520 called for the state to figure out ways to attract people to more efficient transportation, like carpools, van pools and buses. The Agency of Transportation told Smith that a study they were doing for the Governor's Commission on Climate Change fit the bill, and that study came out in June.

    I asked Brian Shupe, who works on transportation and land use issues for the Vermont Natural Resources Council, to comment on the study. He likes a lot of its suggestions, but he's puzzled that the administration doesn't follow them. The report recommends a gas guzzler tax, which he said the governor beat back when the Legislature proposed it.

    The report recommends more rail and bicycle facilities, but the budget decisions of the Agency of Transportation don't reflect that, Shupe said. He also said that the report's recommendation to use Act 250 to contain traffic and sprawl don't reflect the actions of the Natural Resource Board. As an example, Shupe pointed to a shopping center in Rutland town that received an Act 250 permit. He said the NRB could have been denied on traffic criteria, and added, "They're making decisions that run counter to their state goals here."

    Wind energy is an area where Douglas is strongly at odds with Vermonters. Ninety percent of Vermonters polled by the administration said they favor wind farms visible from their homes, yet Douglas has categorically voiced his opposition to utility-scale wind.

    The Legislature removed a bureaucratic obstacle to the wind business by directing the Public Service Board to write new rules for permitting wind-measuring stations. Before investing in large-scale wind projects, wind developers want to know how much wind a site has. They install a small anemometer, perched on a slender mast at a similar height to where a wind turbine might be sited. Under current rules, the measuring station goes through a permitting process similar to that for a full-size, electricity-generating turbine with 90-foot blades.

    Douglas' veto blocked the board from re-writing the rules. He did ask the Agency of Natural Resources to review their practices. Smith reports that the ANR will no longer require bird and bat studies for the measuring towers.

    In this year's Act 92, the board is instructed to create a simple application form for the measuring stations, and they are required to issue a decision within five months of the application. Rule making for the new procedures was delayed a year by the veto. According to Susan Hudson at the Board, it has not yet begun.

    A major goal for the Legislature was to create a predictable and attractive tax environment for wind developers. Negotiations led to a generation tax of 0.3 cents per kilowatt-hour, phased in over several years, with the facilities exempt from local property tax. (Difficulties in appraising electrical generation facilities can cost towns and business owners big bucks in lawsuits.) Douglas' veto delayed the arrival of the attractive tax environment for wind, though he pledged to use the rest of 2007 to develop generation tax level recommendations. This year, Act 92 institutes the generation tax at the same level H. 520 set it last year, without the phase-in period.

    Advocates of small-scale, in-state hydroelectric power say it can provide significant additional generating capacity. The permitting process blocks small-scale hydro, however. At the federal level, a 5 kW hydro plant requires a similar set of permits to a new Hoover Dam, and the cost can run into hundreds of thousands of dollars.

    The state of Maine has found a way to take on some of the federal permitting and simplify their own process, so the cost for a permit runs only in the thousands of dollars. The streamlining makes a lot more projects viable.

    Douglas committed the ANR and Department of Public Service to facilitate permitting of small-scale hydro and recommend new permitting procedures. Smith says that Natural Resource Board workshops, mandated by Act 92, are addressing those issues.

    One of the participants in the workshops is Middlebury physician Anders Holm. Holm has resuscitated the 19th century utility, Middlebury Electric Company, to generate power from Middlebury Falls on Otter Creek. Holm says that he hasn't seen any evidence that the administration is making the permit process easier. "It remains an amorphous, difficult-to-predict process," he commented.

    Middlebury Electric is not looking for a rubber stamp, Holm emphasizes, just a clear set of criteria. He gave the ANR a template from Maine that would establish clear criteria, but his sense is that ANR prefers the "amorphous" process that gives them "unlimited power" to stop or support projects.

    Holm says that hydro advocates and the administration seem to have reached a stalemate in the workshops, and he's not sure another one will be held. Douglas, who campaigned for governor in 2002 on the issue of permit reform, does not appear to be delivering for small hydro.

    Both climate change and peak oil call for a rapid transition to using less energy overall and much more renewable energy. There are a lot of job opportunities in the transition, but jobs require training and standards for that training. Douglas, who also has campaigned with the slogan "Jim = Jobs," pledged to implement two workforce development sections from the bill he vetoed, and he seems to have done so.

    H.520 created a category of accreditation called "solar system specialist," that would allow people to be licensed to install and maintain solar systems without having to master other skills that they didn't intend to use. Smith and Andrew Perchlik, executive director of Renewable Energy Vermont, met with the State's Plumbing Board last year, and they agreed on a way to meet this need without legislative creation of a new specialty. REV agreed to submit a curriculum for the Plumbing Board to approve.

    Douglas also committed his Department of Labor to write a workforce development plan for green building, energy efficiency and renewable energy, as H.520 would have mandated. Smith says he has met with Labor Commissioner Patricia Moulton Powden to develop the plan, and they are working with Vermont Technical College and Efficiency Vermont on the efficiency aspect.

    What does it all add up to? As far as I can tell, for the most significant parts of H.520 Douglas said he would implement, he did well in producing studies with the right sort of goals. The areas where he achieved the most significant concrete results were related to job training. In the other areas, developers are frustrated, jobs are not being created, and Vermont is left with less in-state, renewable power than we'd otherwise have.

    Note: Reporting and analysis by Thomas Weiss, found at http://vtpeakoil.net/community/folder.php?id=15, informed my analysis.

    Carl Etnier, director of Peak Oil Awareness, blogs at vtcommons.org/blog and hosts radio shows on WGDR, 91.1 FM Plainfield and WDEV 96.1 FM/550 AM, Waterbury. He can be reached at EnergyMattersVermont(at)yahoo.com.


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