Cites equity and registration problems
By Paul Bean
The Public Utilities Commission December 6 draft report on the Clean Heat Standard “strongly recommends” the equity and reporting obligations within the CHS are not adopted, seemingly quashing the version as now written.
The PUC says the plan for “enhancing social equity” won’t work on the Clean Heat Standard, the Legislature’s attempt to transition to electrical heat in an effort to reach mandated reductions in carbon emissions.
“The Clean Heat Standard program must be ‘designed and implemented’ to enhance social equity by prioritizing customers with low income, moderate income, those households with the highest energy burdens, residents of manufactured homes, and renter households with tenant-paid energy bills,” said the report.
This will not be possible because the only way to ‘prioritize customers with low income’ would be to subsidize and prioritize their heating costs by “frontloading” the low/moderate income Vermonters into the program, the PUC says:
“The Legislature encouraged the Commission to frontload, to the extent reasonably possible, these equity-targeted credits ‘so that the greatest proportion of clean heat measures reach Vermonters with low income and moderate income in the earlier years’ of the program,” said the report.
The CHS requires the PUC must first focus on low/middle-income Vermonters who cannot afford the implementation of the CHS and they must rely on the willingness of fuel-dealers to help them meet that obligation. The “obligated parties” within the CHS include fuel dealers, and they would be required by law to “obtain and retire” clean heat credits and that can be done by installing electric heat pumps.
“As an example, if an obligated party is assigned to obtain and retire 25 clean heat credits in year on…this amount could be earned by installing two 3.5 ton (42,000 Btu/h) single-family residential air-source ducted heat pump systems (specifically homes in which this would fully displace existing oil heat) and delivering 7,251 gallons of 20% biodiesel sourced from soybean oil. For the installations, while they would generate only a portion of their carbon reductions in year one, those measures would continue to earn credits for the estimated lifetime of the measure”
The biggest flaws lie in Fuel Dealer Registration Data, the PUC says. Some dealers are unregistered and the PUC does not have the resources to go after the unregistered fuel dealers as private enterprises. This under-registration distorts the PUC’s understanding of how much fuel is being imported and sold into Vermont.
Furthermore, many of the fuel dealers that did register reported their information inaccurately. Lastly, in September, the language used within the initial registration asked registrants to “use their best judgement when reporting fuel sold in or into Vermont.” The report clarifies the language was corrected in September, but the original registration caused some registrants to underreport and caused others “would be registrants” to not report at all.
Because of all three of these major flaws, this completely distorts “validity of the data and ultimately the clean heat credit obligations that were based on it.”
Ultimately, if the PUC does not know how much fuel many of the dealers are selling, then it can never appropriately determine how many “carbon credits” they are responsible for, thus how many low-middle income Vermonters they are required to “frontload.”
The legislature must review the Clean Heat Standard in the coming session if it is to proceed into law.