Journalists Debrief: Vermont Lawmakers Evaluate Historic Regulations on Fossil Fuel Companies

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Right now, Vermont lawmakers are weighing a policy that would make major changes to how Vermonters heat their homes and businesses. The idea is to create a clean heat standard that would slowly change the current fossil fuel market to reduce emissions – without crushing small businesses along the way.

The state’s climate action plan makes it clear: The legislature must pass a bill that gets the ball rolling this session.

VPR’s Anna Van Dine and Henry Epp discussed the details with VPR’s climate and environment reporter Abagael Giles. Their conversation below has been edited and condensed for clarity.

Anna Van Dine: First of all, what is a clean heat standard and how would it work?

Abagael Giles: Fundamentally, the clean heat standard is a regulatory tool that would slowly push companies to the top of Vermont’s fossil fuel supply chain – think Vermont Gas, but also companies that wholesale heating oil, propane or kerosene to your local fuel. dealer — to slowly reduce the greenhouse gas emissions produced by their products over time.

In many cases, we cannot make these fuels cleaner. They are what they are. Thus, the State of Vermont would create a market where companies could buy and sell what are called “clean heat credits”.

“CHS is the most significant government regulation for the distribution of heating fuels ever contemplated in Vermont history.”

– Matt Cota, president of the Vermont Fuel Dealers Association

And each year, these fossil fuel companies would be required to earn or buy credits at a rate proportional to the amount of fossil heat they sell.

Year after year, wholesalers will have to earn more and more credits.

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The hope is that this will move them away from selling fossil fuels as a business model, but also create a growing market for more efficient heating options.

Henry Epp: And how would fuel wholesalers get those credits?

Companies would create credits by doing things or paying other people to do things that reduce home heating emissions.

The bill mentions, as an example, the insulation of houses and the installation here of heat pumps for cold climates or high-efficiency pellet stoves. But it also calls for the supply of renewable natural gas and biofuels which, depending on their origin, are not always low carbon. Note: there is some debate around these options from climate activists.

Currently, lawmakers are considering requiring that one-third of the credits companies earn each year come from projects that serve low-income households, those with incomes at or below 185% of the poverty line. federal.

Anna Van Dine: Wow, I mean, we’re asking these companies to completely change what they’re doing, right? Why?

Heating buildings accounts for about 35% of our emissions as a state. Vermont has one of the oldest housing stocks in the country – and it’s often poorly insulated. Additionally, nearly two-thirds of households in the state have low and moderate incomes. And switching heat sources or weatherization is expensive, even if you save money in the long run.

Energy Action Network, Courtesy

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Emissions from the heating of government buildings constitute the second largest pool. At about 34% of global emissions, they are a key part of what Vermont needs to reduce to meet its climate goals.

“You know, these are things that someone with savings or good credit can invest in, and it’s a smart economic move for them,” said Jared Duval, member of the Climate Council and executive director of Energy. ActionNetwork.

“But people who don’t have savings, or who live paycheck to paycheck, or who have bad credit, those are the people that I think – as a board member – we have to make sure they get higher incentives.”

To meet the state’s climate goals, we need to help these homes produce fewer emissions. To do this, proponents of this solution say we need to create a market that makes fuel switching profitable and attractive.

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Henry Epp: What do the people and companies who will be regulated under this policy think?

Vermont Gas says it supports a “well designed program.” , among others.

The Vermont Fuel Dealers Association isn’t sure yet. Both say they want to see market stability. They know change is coming and would rather know now which market they can adapt to in the long term, rather than see a hodgepodge of outright bans in the years to come.

“…People who don’t have savings, or who live paycheck to paycheck, or who have bad credit, those are the people I think – as a board member – we need to make sure they get higher incentives.

– Jared Duval, Climate Advisor

Some fuel dealers have been around so long that this isn’t the first home heating transition they’ve been involved with. But they want lawmakers to know it won’t be easy for them.

“CHS is the most significant government regulation for the distribution of heating fuels ever contemplated in Vermont history,” said Vermont Fuel Dealers Association President Matt Cota.

Notably, Vermont Gas and fuel dealers recognize the role their products play in contributing to climate change. So I think there’s support for a standard that doesn’t raise prices terribly for their customers. Finally, the cost is not yet known.

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But it’s also important to note that electric utilities have been required to reduce emissions for several years – and it has worked. So, in a way, we are now in a place, without this policy, where some of the fuels that contribute the most to our emissions as a state are the least regulated.

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Tony Talbot

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Associated press kit

A fuel dealer delivers propane to a house in Barre. As proposed, the policy would not regulate small home fuel dealers, which provide heating oil and propane to the 74% of Vermont households that still rely on fossil fuel heat.

Anna Van Dine: Have other states done something similar, or would Vermont be the first?

Vermont would be the first state in the nation to regulate all fossil fuel-based home heating fuels.

In 2021, Colorado adopted a clean heat standard that applies only to natural gas. California, Washington, and Oregon have low-carbon fuel standards that apply to transportation fuels, and so far the results are promising.

But yes, Vermont would be the first.

“…Without clear legislative direction this session, it will be very difficult to meet the demands of 2030.”

– Julie Moore, Secretary of Natural Resources

Anna Van Dine: What happens if it doesn’t? What is the probability of advancing this session?

Without a clean heat standard passing this session, early modeling shows we simply won’t be able to comply with the Global Warming Solutions Act. We cannot finance our solution to this problem of reducing heating emissions with public money.

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“And without clear legislative direction, it will be extremely difficult to meet those requirements,” Natural Resources Secretary and climate adviser Julie Moore told lawmakers. “And I would go even further and say that without clear legislative direction this session, it will be very difficult to meet the demands of 2030.”

The bill is still at the House Energy and Technology Committee.

Find the agendas and meetings of the supervisory committees here.

If passed, it goes to the Public Utilities Commission to work out the details. The bill provides for the deployment of the program in 2024.

Now: it is too early to know if this will move forward. The governor has yet to weigh in, but he was against joining a regional market that would have done something similar for gasoline and diesel. What if it doesn’t? Another option is money orders. And Moore warned lawmakers: These are tougher and less fair.

Do you have questions, comments or advice? Send us a message or contact the journalist Abagael Giles @AbagaelGiles.

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