By Guy Page
The state’s statutory requirement to implement the controversial Clean Heat Standard is ended, the Public Utilities Commission declared in a January 30 order.
The Legislature passed the Clean Heat Standard to reduce household heating carbon emissions. It also required a ‘checkback’ progress report. Further work would require an affirmative vote by the Legislature.
The PUC’s January 15 checkback report said the plan is financially untenable. When the Legislature didn’t cast an affirmative vote, the state’s energy regulatory board declared its work on CHS over.
The Vermont Public Utility Commission developed a Clean Heat Standard (CHS) plan under Act 18 of 2023 that would require fossil fuel importers to obtain “clean heat credits” for greenhouse gas reductions from clean heating technologies, fuels, and weatherization, aimed at meeting Vermont’s climate targets.
After extensive public and technical input, the Commission issued proposed rules, technical determinations, and cost-benefit modeling.
Fuel dealers would face new compliance costs that would be passed on to customers. While participants who install measures such as heat pumps or weatherization could see savings, all fossil-fuel users would pay more, making the program regressive. Larger incentives for low-income households would further increase total costs.
For the first 10 years, program-related costs are estimated at about $956 million, adding roughly 8 cents per gallon of heating fuel in 2026, rising to 58 cents per gallon by 2035. The estimated value of greenhouse gas reductions over that period is about $477 million. These figures are highly uncertain, the PUC admitted.
The Commission ultimately concludes the CHS is theoretically workable but not well suited to Vermont, and recommends pursuing alternative approaches that strengthen existing energy-efficiency and clean heating programs instead of creating a complex new regulatory system.
The news was received with relief, and a tinge of caution, on the Facebook page maintained by the Vermont Fuel Dealers Association.
“They will be back but it’s nice to have a little breathing room!!!,” longtime Proctor fuel dealer Judy Taranovich said.
This year, several bills to tax fossil fuels have been introduced. VDC will report on their progress, if any, through committees and floor action.