Clean Heat Standard Bill Clears a Key Vote in Vermont House

A bill that aims to fight climate change by helping people heat their homes and businesses with cleaner fuels passed a key hurdle in the Statehouse on Thursday despite sharp criticism from Republicans.

The House of Representatives followed the Senate’s lead and voted to create a clean heat standard requiring the state’s heating oil, propane and natural gas dealers to reduce the greenhouse gas emissions from the fossil fuels they sell.

The closely watched bill, a version of which Gov. Phil Scott vetoed last year, passed by a 98-46 vote after hours of debate. That’s two votes shy of the 100 needed to override another veto, but supporters expressed confidence those votes could be rounded up if needed.

“It’s a good day for climate action and young people and future generations,” Johanna Miller, the Energy & Climate Program director of the Vermont Natural Resources Council, said.

Matt Cota, managing director of the Vermont Fuel Dealers Association and the chief critic of S.5. said it was “extremely difficult” to envision a scenario where Scott could now block the bill from becoming law.

He and his members are now turning their attention to making sure that fuel dealers “get a fair shake” in the Public Utility Commission process that will determine the program structure and vital details that could make or break some dealers.

“The real work begins outside of this building in July,” he said.

The bill would require fuel dealers to decrease the amount of fossil fuel they sell over time or find ways to offset emissions from those fuels. They could supply lower-carbon fuels, such as biofuels, or help customers install electric heat pumps and pellet stoves.

They could also reduce the demand for fuel by weatherizing homes so less energy is needed. Doing so would earn them “clean heat credits” that could be bought and sold in a marketplace not unlike the carbon credits used in cap-and-trade systems.

Dealers who do nothing would face increasingly stiff “noncompliance payments” that would be used to fund clean heat projects, many of which would be focused on low- to moderate-income residents.

Exactly how those payments would be calculated would be determined during an 18-month process before the Public Utility Commission that is certain to be both complex and contentious.

The House debate was both of those and more, lasting several hours on Thursday and triggering multiple efforts by Republicans to derail or modify the bill.

Rep. Laura Sibilia (I-Dover) stressed that the bill contained a key “check back” provision that required another legislature in 2025 to approve the details of the program assembled by regulators. That’s something Scott has repeatedly called for, but he has said the language is still insufficient.

Sibilia pushed back on opponents’ core claim that the bill would harm lower-income residents. They’re already struggling the most with higher fossil fuel costs, and the goal of the bill is to get more people off such polluting, volatile-cost fuels, she said.

“If we don’t help Vermonters try to stay in front of or apace with this energy transition, it is our most vulnerable who will suffer and be left behind with more and more costs and less and less choices,” she said.

Regulators would need to have the program in place by June 1, 2025.

Passing a clean heat standard was identified by the Vermont Climate Council as the policy most able to help the state reach its aggressive 2030 greenhouse gas emission-reduction requirements.

The state needs to achieve a 40 percent reduction in emissions by 2030 and 80 percent by 2050, as required by the 2020 Global Warming Solutions Act. Heating is responsible for about a third of the state’s emissions, second only to transportation.
The council’s 2021 Climate Action Plan estimated that the clean heat policy could get the state 34 percent of the way toward that reduction target.

The two other major policy measures proposed in the climate plan are viewed as important but less effective. Last year’s adoption of a California-car emissions rule is expected to account for 14 percent of the needed reductions by 2030. The rule aims to encourage more people to drive electric vehicles and would prohibit the sale of new internal combustion vehicles after 2035.

The other recommended strategy was to join with 13 other states to form a regional transportation accord that would cap greenhouse gas emissions from transportation. The Transportation & Climate Initiative would have helped the state meet 10 percent of its 2030 goal. Scott has chosen not to join the effort, which has stalled.

That has left many lawmakers and climate activists viewing the clean heat standard as the state’s best chance to meet its rapidly approaching climate goals.

But Republicans railed against the bill as misguided and said it would fail to do enough to protect residents from future fuel price increases.

Rep. Jim Harrison (R-Town of Chittenden) sought to cap the possible increases. He cited testimony from Julie Moore, secretary of the Agency of Natural Resources, that heating fuels could increase by 70 cents per gallon by 2030 due to the program.

He has heard from many constituents, and that possibility “scares the heck out of them,” he said.

The bill already contained language that allowed the Public Utility Commission to adjust the program to prevent “undue financial impacts” on customers. Harrison sought additional language to instruct regulators to act if fuel costs rose more than 20 cents above the average New England price.

“We offer this amendment in the spirt of assuring our constituents that their worst fears won’t be realized,” Harrison said.

Asked about her estimate, Moore said it was based on the best information currently available. Passing such a consequential bill without at least a good-faith attempt to calculate its costs was “unfair and a disservice to Vermonters,” she said.

Sibilia acknowledged that Vermonters have some anxiety over the bill but suggested that this was due to “false information that has been pushed out there irresponsibly.”

A similar program in Oregon regulating transportation fuels has been shown to have only increased fossil fuel prices in that state by six cents a gallon, she noted.

“We’re not expecting the kind of prices that have been floated out there, scaring Vermonters,” she said.

In two years, lawmakers will be in a far better position to make changes to the program rules if warranted, she said.

Rep. Mark Higley (R-Lowell) also offered an amendment to change the Global Warming Solutions Act to remove the ability of citizens to sue if the state doesn’t meet its required reductions.

“For us to be boxed into a corner with no way out, is not, in my mind, a way to do business and represent our constituents,” Higley said. His measure also failed.

The tension in the chamber during the lengthy debate was palpable. When Harrison observed that there seemed to him to be “no interest whatsoever in a cap” by the members of the House Committee on Environment and Energy that considered his amendment, Rep. Carol Ode (D-Burlington) interrupted and suggested that Harrison might be “impugning the motive” of the committee.

Speaker Jill Krowinski (D-Burlington) held a conference at the dais and decided that Harrison hadn’t violated House decorum rules but had gone “right up to the line.”

The bill sets aside $1.7 million for the development of the program. This includes $825,000 for additional staff at the Department of Public Service and $900,000 for staff at the Public Utility Commission.

“Climate action is a complex problem, and sometimes complex problems require complex solutions,” said Rep. Kathleen James (D-Manchester). 

Got something to say?

Send a letter to the editor and we'll publish your feedback in print!