Proposed Renewable Portfolio Standards will cost Vermonters money and jobs

Open Letter

Dear Governor Shumlin, Speaker Smith, and Senate President Pro Tem Campbell:

As organizations representing employers and employees across Vermont, we are writing to express our concerns about proposals to increase renewable energy mandates on Vermont utilities through Renewable Portfolio Standards (RPS) and related mechanisms.

These proposals have been advanced in the name of reducing greenhouse gas emissions and promoting the renewable energy sectors in Vermont’s economy. However, we are concerned that these otherwise positive goals do not justify the costs entailed for Vermont employers and their employees and that these goals can be more cost effectively pursued.

Electricity costs, reliability, and quality are critical concerns for employers, especially high value employers who tend to be energy intensive. Average electric costs in Vermont for commercial and inustrial customers have run 30% to 40% higher than the average in the other lower 48 states against which we compete for jobs, investment, and markets. Our rates are already increasing owing to factors including existing renewable energy mandates, the loss of Vermont Yankee power contracts, and looming regional reliability projects. Additional rate increases owing to new renewable energy mandates, particularly those that focus on smaller scale, less cost-effective and reliable generators would exacerbate these increases.

Vermont already has one of the cleanest electric portfolios in the country, and more dependence on renewable energy than other states with an RPS are seeking to reach. Vermont utilities have pointed to existing regulatory requirements and market expectations to support the conclusion that Vermont’s dependence on renewable energy is unlikely to decline in any meaningful way going forward, even if no further renewable mandates are enacted.

Even as we continue to emerge from the recent recession, Vermont employers and their employees continue to face serious challenges. To commit to a twenty-year policy that would lock us into even higher electric rates is not in the best interest of Vermont companies and working Vermonters and their families.

Vermont can promote our renewable energy sector through other economic development policies that could in fact benefit Vermont companies more broadly, and we can have a more cost-effective impact on our greenhouse gas emissions by looking to sources outside our electric portfolio.

If you believe that we should still move forward on any new renewable energy mandates in the face of these concerns, we respectfully ask that you first clearly explain to Vermonters:

  • What do you feel would be an acceptable increase in rates and risk to reliability for Vermont’s commercial and industrial customers resulting from new regulations?
  • What do you feel would be an acceptable reduction in jobs, wages and benefits, and capital investment for companies that would face increased electric rates or concerns about reliable electric transmission?

We appreciate your consideration of these concerns. We look forward to working with you on these and related matters.

Sincerely,

Associated General Contractors of Vermont

Associated Industries of Vermont

Barre Granite Association

Central Vermont Economic Development Corporation

Champlain Water District

Franklin County Industrial Corporation

Greater Burlington Industrial Corporation

Green Mountain Economic Development Corporation

Green Mountain Dairy Farmers Cooperative Federation

Home Builders & Remodelers Association of Vermont

International Brotherhood of Electrical Workers Local 300

Lake Champlain Regional Chamber of Commerce

Lamoille Economic Development Corporation

National Federation of Independent Business/VT

Rutland Economic Development Corporation

Vermont Business Roundtable

Vermont Energy Partnership

Vermont Farm Bureau

Vermont Fuel Dealers Association

Vermont Grocers’ Association

Vermont Ski Areas Association

Vermont Truck and Bus Association

Vermont Vehicle & Automotive Distributors Association