Gov. Shumlin Reveals Plan to Bankroll the Clean Energy Development Fund

by Angela Chagnon

Last week, the legislature considered a bill that would have forced ratepayers to pay an extra 55 cents per month to replace VT Yankee’s share of the Clean Energy Development Fund. Governor Shumlin later announced at his weekly press conference on Wednesday that he had another plan to replace the rate hike, but said that the plan was “not ready for prime time.” As a result of his announcement, the legislature struck down the proposed rate hike, without knowing what the final plan would be.

The Governor finally revealed his plan at a hastily-called press conference held Monday afternoon at the statehouse. He said he “came to this plan” after he received a call from All Earth Renewables, a wind and solar energy systems manufacturer and designer.

One of Shumlin’s largest campaign contributors, David Blittersdorf, is President and CEO of All Earth Renewables.

“Currently, the federal government gives you a dollar cash from the Treasury for tax credits that go to renewable projects,” Shumlin began. “What we’re proposing instead, is that we give a 50 cent cash payment once the project has been completed, for anyone who has been granted a solar tax credit so far.”

The Governor said that in exchange for receiving 50% of what a participant would normally have received, that person or business would get cash immediately instead of a tax credit spread out over five years.

“And that will allow us to free up more dollars, or recycle more dollars directly into the fund to allocate for renewable energy projects,” he concluded.

Calling the plan a “win-win” for ratepayers, businesses, and the Clean Energy Development Fund, Shumlin said that his plan would “free up” 2.7 to 3 million dollars for the fund without raising energy rates 55 cents a month.

The cash payments will be optional for businesses. Secretary of Administration Jeb Spaulding said that the Governor’s plan would enable the money to be available much sooner than the original monthly 55 cent rate hike proposal would have allowed.

When asked how many businesses have agreed to take the option, Shumlin answered, “Based upon our research, we believe that we will get between about 2.7 and 3 million dollars into the fund.”

He said that his plan would bring more money in to the fund than the 55 cent rate hike, which had been expected to bring in about $2.3 million.

“Governor, did I hear you right?” a reporter questioned. “This idea came from, presumably, David Blittersdorf at All Earth?”

“We had a recommendation made by David at All Earth who said ‘I have an idea you might want to look at’,” replied Shumlin. He said that the Secretary of Administration Jeb Spaulding did the “legwork” to ensure that the plan would work.

When asked if the 55 cent surcharge was “off the table”, Shumlin responded with some irritation, “Well, you know, can I just comment a little bit on the revisionist history that I’ve read the last few days on the 55 cent fee?”

He went on to say that the rate hike was not his idea, but was a proposal from the Vermont Public Research Group (VPIRG). Shumlin said he had spoken to Rep. Tony Klein (D-East Montpelier), Chair of the Natural Resources Committee, about his “concern with this form of financing.”

“I’m not saying no to it, I’m saying it should be a last resort to raise electric rates on Vermonters,” remarked Shumlin. He said that he didn’t support raising the rates “unless we absolutely have to.”

Shumlin was asked what kinds of projects the Fund would assist with. “The Clean Energy Development Fund has been integral to building the bridge to renewables at a time when price doesn’t necessarily support that branch,” the Governor answered. “We’ve been at artificially low electric rates nationally.”

He went on to say that his energy plan, which would include renewables and a plan to continue the Clean Energy Development Fund, would come to the public by October 15. Shumlin said that he intended “to propose a high-level nuclear waste surcharge on any Vermont entity that wishes to store high-level nuclear waste in the state of Vermont” by January 2012. Some of the proceeds from this surcharge would be put into the Clean Energy fund.