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Removing barriers to expanding renewable-energy generation in Vermont

Please note: This article has been updated. The new version is at

www.greenenergytimes.org/2017/12/15/removing-barriers-to-expanding-renewable-energy-generation-in-vermont-2/

By Rick Wackernagel and Laura Mistretta

To avoid the worst effects of global warming, we need to transform our energy system, replacing fossil fuels used in producing electricity, heating and transportation with renewable energy. In 2011, Vermont made getting 90% of our energy from renewable sources a goal. This will require a substantial expansion of our electrical system. Our renewable-electricity-generation system has not been expanding fast enough to reach that goal, however.

In 2015, Vermont used about 5.5 billion kilowatt-hours (kWh) of electricity 1. About 2.5 billion kWh came from renewable sources – hydroelectric dams, wood, wind turbines, methane digesters and photovoltaic solar panels 2. We will need to replace the 3 billion kWh of fossil-derived electricity and, to substitute electricity for fossil fuels used in heating and transportation, we would need to add another 8 billion kWh 1,3.

Vermont’s Comprehensive Energy Plan 2 plots three possible paths to 90% renewability in 2050. It requires expansion of our current 550 megawatts (MW) of in-state renewable generating capacity by 1,000 to 1,700 MW 2,4. To finish by 2050, we need to be adding 26 to 46 MW of generating capacity each year. In 2011 and 2012 we added about 120 MW 5. From 2013 to 2015, however, we averaged about 11 MW per year. This pace will not get us to our goal.

One of the barriers to expanding renewable generation capacity is local resistance, for example to wind projects in Swanton 6 and solar projects in Bennington 7. The reasons for resistance vary and include aesthetics, health, tourism impacts, environmental impacts, and the relative influence of communities and developers in permitting processes. Many of these could be called dissatisfaction with the current distribution of costs and benefits from producing renewable energy. Could we structure development of generation capacity, so host communities would capture more of the economic benefits – e.g., cheaper electricity and jobs? Could these communities have more input into decisions, so new systems meet local goals, such as resilience in the face of extreme weather events? And how can we equitably share these benefits so that, regardless of income, property ownership or political access, all who call Vermont home stand to gain?

Act 174 already gives towns more voice in renewable-generation siting decisions. It should be allowed to continue. However, it’s impact on distribution of cost and benefit is limited. We need to address distribution directly. Creative minds will come up with many ways to improve the distribution. We offer four to start the conversation.

  • Deepen the engagement of communities by creating pathways for local ownership. Allowing partial local ownership has been an effective strategy in Germany and Denmark for accelerating expansion of renewable generation. Denmark now requires developers to allow local residents to provide 20% of the investment in large projects 8. Research shows this shared ownership has reduced local pushback 9.
  • Replace policies that restrict the ability of individuals and communities to benefit from renewable energy. Limits on the size of net-metered generation systems keep them at uneconomical sizes. Economies of scale in electricity generation are substantial 10. Allowing community members to be co-owners of utility-scale systems will reduce the cost of power for all Vermonters, as well as providing a better return on investment than they currently can receive. Community solar should refer to ownership structure, not size of generation system.
  • Think creatively about alternative ways to compensate host-community residents for the costs they bear. Different people will find different methods of compensation attractive. Having a menu of acceptable methods will allow negotiations to proceed more quickly. Power producers already make lease payments and pay property taxes. They also could make other payments to neighbors and communities. Residents of host communities could receive discounted prices for electricity or get credits on their bills. The prices or credits could depend on the kind and size of generation system, and the degree to which the community is self-sufficient in electricity.
  • Develop policies and incentives that benefit Vermont’s most vulnerable. The Vermont Solar Market Pathways report found huge potential benefits for low-income households from community solar projects with interest rate buy downs or on-bill financing to reduce barriers to participation 11.

Institutional changes that allow more equitable distribution of costs and benefits of renewable energy will help open the bottleneck preventing us from producing the renewable energy we need.

Rick Wackernagel is a member of the Energy Committee of the Sierra Club Vermont Chapter.

Laura Mistretta is a member of Rights and Democracy VT, co-leading its Jobs, Justice, Climate campaign.

Sources

1. U.S. Energy Information Administration. 2017. State Energy Data System (SEDS): 2016 updates by energy source.

https://www.eia.gov/state/seds/sep_update/use_all_phy_update.csv

2. VT Department of Public Service. 2016. 2016 Vermont Comprehensive Energy Plan.

https://outside.vermont.gov/sov/webservices/Shared%20Documents/2016CEP_Final.pdf

3. Wackernagel, Rick. 2017. Impact of electrification on tax revenues, Excel worksheet based on energy use data from State Energy Data System at U.S. Energy Information Administration.

Data at https://www.eia.gov/state/seds/seds-data-fuel.php?sid=US#DataFiles

Spreadsheet at https://drive.google.com/open?id=1d5eqTWBGGxQU5mpULvPh_veVHv-VBk5J

4. Vermont Public Service Department. 2014. Total energy study: Final report on a total energy approach to meeting the state’s greenhouse gas and renewable energy goals.

http://publicservice.vermont.gov/publications-resources/publications/total_energy_study

5. U.S. Energy Information Administration. 2016. Electric Power Annual, Existing capacity by energy source, by producer, by state back to 2000 (annual data from the EIA-860).

https://www.eia.gov/electricity/data/state/existcapacity_annual.xls

6. Freese, Alicia. 27 November 2017. Developers withdraw Swanton wind project proposal. Seven Days. https://www.sevendaysvt.com/OffMessage/archives/2017/11/27/developers-withdraw-swanton-wind-project-proposal

7. Therrien, Jim. 27 November 2017. Bennington energy plan moves ahead despite developer’s warning. VTDigger.org.

https://vtdigger.org/2017/11/27/bennington-energy-plan-moves-ahead-despite-developers-warnings/#.Wh1tB1WnG70

8. Ramsay Dunning. 1 December 2014. Citizens need a legally enforced right to invest in renewable energy.

https://www.thenews.coop/92109/sector/citizens-need-a-legally-enforced-right-to-invest-in-renewable-energy/

9. Warren, Charles R. and Malcolm McFayden. 2010. Does community ownership affect public attitudes to wind energy? A case study from south-west Scotland. Land Use Policy (27:2).

http://www.sciencedirect.com/science/article/pii/S0264837709000039

10. Lazard. 2017. Lazard’s levelized cost of energy analysis – Version 11.0.

https://www.lazard.com/perspective/levelized-cost-of-energy-2017/

11. Hill, David et al. 2016. Vermont Solar Market Pathways.

http://solarmarketpathways.org/wp-content/uploads/2017/07/vermont-solar-market-pathways-combined-report.pdf

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