Legislation

Vermonters deserve to know what the Clean Heat Standard is, does and will cost

by Rob Roper

The members of the Senate Natural Resources and Energy Committee are tying themselves in intellectual knots over why they don’t need to investigate how much the Clean Heat Standard they’re prepared to put into law will cost Vermonters or how it will work. They are now buying hard into the old line, “we have to pass it to find out what’s in it.”

As Jared Duval of the Energy Action Network and Climate Council said in testimony, “We’ve heard a number of folks say we need to know what the cost of a clean heat credit would be, or what the impact on a gallon of fuel oil will be next year, or the price of a gallon of biodiesel next year…. It is impossible to know the answers to that question until you set up the program (1/19/23).” This was met with bobble-headed agreement from the lawmakers. But this is not just irresponsible government in action, it is largely a straw man argument.

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While, yes, it would be nice to know exactly what the price of a gallon of heating oil would be following passage of the Clean Heat carbon tax and what the cost of a “carbon (tax) credit” will be, Duval is correct we can’t know that number exactly. But we do deserve to know a ballpark figure – and that is an entirely doable exercise. As is coming up with a pretty good estimate of what it will cost taxpayers to run the program.

To that end, here are some questions that can and should be answered prior to passage of a law designed to radically alter the state’s economy, culture, and lifestyle:

1)    What exactly is the revenue generated from the selling of clean heat credits supposed to cover? How much money is selling credits supposed to raise?

We know that the Climate Action Plan (CAP) says that that meeting the thermal sector greenhouse gas emissions reduction mandates will require the weatherization of 120,000 more homes between 2025 and 2030. The estimated average cost per home as discussed by the Climate Council is $10,000. That’s a total estimated cost of $1.2 billion or $240 million per year. We know the plan calls for prioritizing the homes of low- and moderate-income Vermonters, especially in the early stages of implementation, which means much of this activity will require heavy subsidies. Is the selling of credits supposed to cover all that expense? Some? How much?

We know that the CAP calls for installing 169,000 heat pumps by 2030, 137,000 heat pump water heaters, converting 21,000 homes to biofuels, and more. Again, what is the estimated cost of all this activity? The Scott Administration estimates the total cost of this work, including weatherization, will cost over $2 billion. How much of it is expected to be borne by the sale of clean heat credits (ie. people purchasing fossil-based heating fuels), how much from other sources, if any, and what might those be?  

2)    How big a bureaucracy will be necessary to run the Clean Heat Standard, and what will it look like?

We know that the Clean Heat Standard allows anyone to generate clean heat credits by performing actions in one or more of eleven specified categories with other potential categories to be included as new technology allows. We know these multiple hundreds of thousands of uncoordinated, disparate actions performed by thousands if not tens of thousands of individual actors. Each unique credit-generating activity will need to be verified and processed into credit values based on the amount of CO2 reduced by each project. How will this process take place, what level of verification is expected to take place, and how many new state employees and/or contractors will be necessary to perform these duties?

We know S.5 calls for increased duties by the Public Utilities Commission (PUC), the Department of Public Services, and the Agency of Natural Resources. The bill creates a new Technical Advisory Group (TAG), as well as Clean Heat Standard Equity Advisory Group, and the Climate Council is shaking the trees for more money and staff. How many people/employees are we talking about here?

3)    How much will operating the Clean Heat Credit program to cost taxpayers?

We know that the revenue generated from the selling of clean heat credits is designed to never pass through the government’s coffers (this is the loophole politicians think they can use to get away with not calling clean heat credits a “Carbo Tax”). This means, revenue from those credits can’t be used to pay for the state bureaucracy necessary to run the program. Where will that money come from?

We know that the Regional Greenhouse Gas Initiative (RGGI), a regional credit system for large-scale electrical generation often used as an example for the clean heat standard, had an operating budget in 2022 of $3,118,019 according to their website (RGGI website).

We also know that RGGI is far simpler a program than the Clean Heat Standard as the credits in that program are issued by the single entity, RGGI, not generated by thousands of individuals performing a wide variety of activities that need to be independently verified. Additionally, the “obligated parties” under RGGI are a handful of large-scale electricity producers all based within the region of participating states whose activities are comparatively easy to monitor. There will be over one hundred obligated parties under the Clean Heat Standard ranging from large, regional, national and international fuel providers based outside of Vermont to local, small mom and pop dealers with only a few employees.

We know that once generated clean heat credits, which are a financial instrument, will have to be assigned ownership and a marketplace for buying, selling, tracking ownership, and retiring the credits will have to be established. Who is going to create and run this exchange, and what will this operation require in terms of staffing, technology, and budget?

4)    What is the plan to develop the labor force necessary to complete all of the work necessary to fulfill the obligations of the Clean Heat Standard?

We know that such a labor force does not presently exist. The Energy Action Network estimates that we will need a workforce of at least 5000 skilled workers to meet these obligations, but only 14 percent of that workforce currently resides in Vermont. We know this is a declining industry with many practitioners nearing retirement and there is already a scarcity of such services in the existing market for electricians, plumbers, etc.

Given the local and national labor shortage, what realistic expectations do we have that the other 86 percent will materialize? What will the state do to train Vermonters to do the work and/or lure trained workers from elsewhere? Who will do this work and at what cost to taxpayers?

Testimony before the Senate Natural Resources & Energy Committee indicates that starting wages in the heat pump installation business are in the $20 to $25 an hour range. While these are good wages, they are not exceptionally higher than wages paid in other industries desperate for workers where opportunities exist for employment, yet still those industries struggle to find workers.

What will ramping up demand for such labor do to the cost of this labor a) as it impacts the cost of implementing the Clean Heat Standard, and b) as impacts other businesses and individuals ability to find and afford these services (electricians, plumbers, etc.) for non-Clean Heat Standard projects?

CONCLUSION

Governor Scott vetoed the Clean Heat Standard in 2022 largely because he insisted that questions like these be asked and answered before putting the program into effect. His desire was and is for a two-step process. Step on, the legislature passes a bill which mandates the crafting for a detailed plan for how the Clean Heat Standard would work, what logistics would be necessary to carry it out, what revenues would be necessary to pay for it, and where those revenues would come from  crafted and evaluated. This plan would be presented to the legislature as a second bill. Step 2: The legislature would evaluate the complete plan for a Clean Heat Standard as legislation and vote for it – or not.

This is logical and responsible governance.

Legislative proponents of passing the Clean Heat Standard first and figuring out all these details later ague that it is “irregular” for lawmakers to authorizes agencies to create rules and then have to vote later on those rules. The rules, they argue, can always be amended “on the fly” by the Legislative Committee on Administrative Rules (LCAR) – a body made up of four representative and four senators that, as currently constituted, can be counted on to do absolutely nothing to stop this train wreck from occurring.

This is illogical and irresponsible governance. It may be how things are regularly done (a poor reflection on the way our state is run), but the Clean Heat Standard is not a regular bill by any definition. Its intent is to radically change our entire economy, our way of life, and standard of living. Vermonters deserve to have a clear idea of what it is, how it will work, and what it will cost before it becomes the law of the land.

  • Rob Roper is a freelance writer who has been involved with Vermont politics and policy for over twenty years. Behind the Lines: Rob Roper on Vermont Politics is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

Categories: Legislation

10 replies »

  1. If the legislators were interested in generating a consensus for this proposal these are the types of questions they would be discussion with their constituents. However, as with so much that they do, consensus building is not part of their culture. They intend to RULE us, not convince us. “Hold still…this is good for you…you’re going to like it.”

    • If you check out Act 60 re: redistribution of funding for schools @ late 90’s, it’s another good example of socialist BS and the bullying tactics; to rush through legislation; with no community input or oversight. FYI: Vermont used to have a Council of Censors; that acted as watchdogs in situations like these. Unfortunately, the US government was broke @ post-Civil War and took the bait (money) from the central bank in England. As a result, the US became a corporate entity. In 1870, the Council of Censors was abolished and by 1913 the Vermont Constitution was set aside and replaced with a document created by corrupt public officials.

  2. This whole climates movement started with grass root organizations, initiated, funded, and organized by trained brain washers, supplied by the RE Industries. That’s why VT Yankee is gone. That’s why windmills and solar fields are here. That’s why there is GWSA, Clean Heat Standard, threats to take away propane stoves, and end ICE vehicles. The RE Industries contribute large sums of $ to the Democrats’ coffers. The Right needs to fight fire with fire. There have been a lot of good articles in the Vermont Daily Chronicle but unless someone goes toe to toe with the left and the RE Industries, it’s just preaching to the choir. People like Warren Buffett are heavily invested in fossil fuels. They don’t want to see those investments decline due to GWSA or any other climate schemes. Them and the oil industry should be enlisted to fund grass root movements against the RE Industries and their political cohorts. To help publicly expose their schemes. Extreme weather and climate change are here. But what is being proposed by the left will not stop them, only ruin Vermont’s economy. In fact, it won’t stop climate change on a national scale. But, a successful campaign, one that is LOGICALLY planned and executed would also set a model for the country to see, reason on and maybe copy. California and Colorado own no patents on CO2 reduction. The general public needs to hear the truth about the future of Vermont’s economy and the impact of current legislation on their lives. They need an alternate plan.

  3. The Davos crowd has decided. Have they not made it clear to us peasants? Now, go to your rented pod, eat your bugs, watch and read their propaganda, take the untested, unknown medicine they made, and do not travel outside the perimeter they establish. Any disobedience will trigger elimination through the chip they strategically placed in your body.

  4. If I can put words into the mouths of the demo/prog supporters of this proposal, and their standard response also applies to every other social assistance program and social equity promotion scheme they are pushing: “the question is not..can we afford to do it, but can we afford NOT to do it?”…
    It’s not the legislature’s money, but they sure are generous with it.

  5. To get a general sense of the cost of the Clean Heat Standard, one only needs to look at what has occurred in other western nations that have applied and legalized similar draconian regulations in their countries; dor example the UK, Australia. How did that work out for the average citizen? I guess the democrats like the idea of impoverishment for many more people in this state. How blind does one need to be to see that when one has no viable energy alternative to replace fossil fuels, it is most prudent not to discard them for that which is much more expensive and intermittent.
    ( current battery technology is extremely toxic to the environment, and more importantly to the people employed/enslaved in the mines where the necessary minerals and metals are extracted ). But one must also question the rational: it is all based on a theoretical belief that gases such as carbon, nitrogen, methane are responsible for climate change. This is not settled science, but this is more akin to scientism. Climate is an extremely complex system based on many other factors such as planetary alignments ( gravitational and magnetic forces ), solar activities, the periodic changes in the elliptical to round transitions of our orbit, the tilt of earth in its axis ( changes in preception) and many other factors. The reductionist thinking which states only that certain gases ( at first it was only carbon, which is a fairly minor gas at 0.039 percent composition of the atmosphere, now extended to other gases such as nitrogen ) over simplifies the climate equation. History objectively demonstrates that the climate is cyclical: there are warming periods and cooling periods and these are largely independent of our activities. Do I think we should continue with extractive processes for energy? No, I don’t and not because of the religion of climate change. My concern is more the damage we do to the environment that is beyond the capability for nature to correct it. Every element that is a proposed solution is essentially not unlimited unless it can be recreated from the process that originally used it to create the energy we desire, and without requiring a net loss in energy, and at an affordable cost. That is a difficult problem to solve. However one must think of the economic cost to everyone on transitioning to more environmentally friendly resources. ( solar and wind are in the total production and use cycle not the environmentally friendly solutions they are so often touted to be).

    • Germany’s current energy issues are a harbinger for Vermont. Coal is becoming the fuel required to supply Germany’s electric power needs. https://www.npr.org/2022/09/27/1124448463/germany-coal-energy-crisis
      We may not have any coal-burning power plants, but we may need to purchase coal and gas fired power in the immediate future to make up for the vagaries in “renewables”.
      And this will not be the first time Vermont’s legislative decisions have caused Vermont residents increased cost, with little or no intended benefit.
      The climate evangelists in and lobbying our legislature may believe that good will come of the economic disaster they determine necessary, but even if Vermont produced no man-made carbon, China’s increased energy use (Coal mined in 2022
      in China was 4.496 billion tons) absolutely negates any impact Vermont’s elite wishes for.

  6. And, how about data that shows the impact the law will have on reduction in carbon emissions (increase or decrease?), and also what impact it will have on other kinds of social / environmental indicators…for example, where will the equipment and materials come from, what will they cost, what labor will be used for mine and/or manufacture the materials, at what cost? And…..sustainability…i.e. what are the lifespans / life cycles of the equipment involved (solar panels, heat pumps, appliances, etc.) and how will materials be either recycled or safely disposed of and at what costs? And….what will the impact be on commerce and business (somewhat addressed above) and at what cost?

  7. If the idiot crowd would stop buying electric vehicles and solar panels all this would go away. If you are buying an EV in Vermont you are an idiot. Ever heard of “Range Anxiety”, battery depletion from cold weather, EV battery fires, children used as slaves to mine dangerous cobalt and Lithium and more. If you must wrap yourself in virtue, find something else to impress your cult members. Please explain how buying an EV will help the planet when more electricity will have to be generated by burning wood, gas or oil at another location to get power to your vehicle. And how much electricity is your solar panel producing as it’s completely covered with snow? I’ve said this numerous times, we are living in the idiot apocalypse. Just because you can afford an EV does not mean you are smart or caring. It means you have to show others how wonderful you are to feel good about yourself and that makes you an idiot.

  8. As Vermont’s legislators continue to gaslight the public on their carbon tax schemes-
    by any name- the goal is the same. Wealth redistribution on a statewide scale.
    Perhaps we need to be enlightened by these sage saviors of Vermont’s natural resources- and the legislature can in fact provide us with the data, documentation and facts they have used to formulate their opinions. I’m not talking about algore or john kerry abstract facts, alluding to “settled science” I dont want to hear from bill mckibben nor david bittersdorf nor any other climate evangelist. I’m not interested in emotional rhetoric, nor tirades about future generations being crippled with unbreathable air. Just the facts, please- and some facts about current energy usage say from Germany. Facts about the limitations of Li-ion batteries and their production. Facts that will allow such environmental geniuses as christopher bray and mark macdonald to explain to us why this is a positive step for the environment and Vermont’s residents. Perhaps, Mary McLure, CEO of GMP could explain to the legislature and us mere ratepayers the cost of upgrading the transmission and distribution system for Vermont’s electric grid to accommodate the diktats Vermont’s legislature deems necessary. While she’s at it, what the expected energy consumption is for a miraculous mini-split HVAC system, at 10 degrees F, to
    heat your residence.
    ms. krowinski and mr. baruth had ought to be able to produce evidence that a foreign power, such as China has not become involved with manipulation of facts and spending billions to create this crisis to alter US Energy policy.
    We have been force-fed but one side of the “global warming” story for decades- with the name of the crisis changing every few years and the doomsday predictions pass by without effect.
    Like it or not, our politicians are influenced mostly by money. Campaign contributions, lobbyist pressure and dollars, paid for by unknown and obscure donors. To allow our legislators to control all energy consumption in Vermont is a bridge too far. These supposed guardians of democracy and public interest seem to have neither in mind as they plunge Vermont down a rabbit hole to comply with unproven theory.

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