That's how the vast majority of the visible solar and wind projects in Vermont are actually generating renewable energy for other states and meeting the renewable energy standards there — not here. Under the REC method of scorekeeping, Massachusetts, Connecticut and other New England states are using Vermont land and resources to achieve their respective renewable energy goals, instead of pursuing their own projects. The system leaves a lot of Vermonters mistakenly believing their state has been doggedly developing renewable energy and reducing emissions to meet our own legislative policies. “But Vermont does not currently have a leading renewable energy standard that commits to paying the full price of being green,” said Jones. Vermont’s policies are the only ones in New England that allow utilities to use more broadly defined RECs from much older sources and large-scale hydro power (such as Hydro-Quebec), which means demand for those RECs is low and thus inexpensive compared to the wind and solar RECs that Massachusetts and Connecticut buy to count toward their own obligations. Vermont utilities can sell high and buy low and still get away with fulfilling their renewable energy requirements. The irony is that Apple, Google and even Walmart are doing renewable energy in a more transparent and honest manner, the report points out. "In regards to renewable energy leadership, corporate America is often the gold standard,” said Jones. “Whereas utilities like Burlington Electric Department, through REC arbitrage, selling valuable local solar, biomass and wind RECs out of state, play a renewables shell game for the appearance that they are 100 percent renewable.”
Vermont’s Public Utility Commission, in an attempt to address concerns about out-of-state REC sales, altered net-metering rules last year to encourage net-metered customers to give their RECs to their utility by penalizing them a portion of the rate the utility pays them for excess energy created by their system. “Unfortunately, under the new net metering rules, the PUC did not differentiate between people trying to reduce their own and their community’s carbon footprint, and by extension Vermont’s, and the developers stripping the RECs and selling them out of state,” said Jones. “Local carbon reduction is the goal, but with the current punitive REC penalty, most of the net-metering RECs are going to the utility which, ultimately, allows the utility to continue selling RECs from their standard offer and utility projects out of state. “I’m hopeful that they will fix these rules, since the PUC has set up a framework that provides a huge financial incentive to the solar industry to deceive the customer when they transfer the customer’s RECs to the utility. The customer is not truly going solar if the RECs are turned over to the utility, but many customers do not understand that,” he said. Green Mountain Power spokesperson Kristin Carlson addressed this in 2015 after a petition was filed with the Federal Trade Commission alleging that GMP’s marketing was deceptive in regards to this practice, stating: "GMP is proud of its leadership accelerating the adoption of renewables, while keeping costs low for Vermonters by selling RECs, and helping Vermont become a national leader in clean energy. We remain committed to open and clear communications with Vermonters about our energy portfolio and the importance of selling RECs to encourage more local renewable generation while keeping costs low.” GMP stated that the sale of RECs at that time represented about $30 million in value to customers via lower rates. The PUC penalties could discourage projects like the successful 150 kW Boardman Hill Solar Farm in West Rutland — a case study for bringing together community members hoping to reduce their carbon footprints by keeping the RECs associated with the project, financing the project in-state and providing its members with savings on their energy bills. If this project were being put together today, a 6-cent penalty would be deducted per kilowatt generated because the residents involved want to keep and retire the RECs to truly "go green," rather than give them over to their utility.
The PUC public comment period on REC adjustments to rates closes this Thursday, March 15.