Vermont energy regulators are poised to allow the state’s only natural gas utility to buy methane from a giant New York State landfill despite criticism that the deal will do little to help the state to meet climate goals.
Public Utilities Commission staff has recommended approval of a 15-year contract for Vermont Gas Systems to purchase “renewable” natural gas from the Seneca Meadows landfill in Waterloo, a regional town. in the Finger Lakes.
The Canadian-owned utility that serves 56,000 customers in northwestern Vermont says the contract will help reduce its carbon footprint by replacing much of the fossil-fuel natural gas it sells with methane. which is generated from the decomposition of waste. Methane is a powerful greenhouse gas, so capturing it before it escapes from landfills and burning it instead of fossil fuels such as natural gas is considered an important strategy to reduce emissions.
But critics have slammed the deal as an elaborate and confusing form of “greenwashing” that is unlikely to reduce emissions and carries significant financial risks for ratepayers.
“This is not renewable energy,” Catherine Bock said Seven Days. “This is the continuation of the use of gas.”
He is a retired naturopath and climate activist from Burlington who led the challenge to the contract. He submitted PUC filings and checked with Vermont gas officials who testified.
Critics like him note that little, if any, of the landfill gas, or biogas, physically makes it to Vermont customers via a leaky, circuitous, 1,000-mile route from New York State. west to Ohio, then turns northeast to. Ontario and Québec before crossing into Vermont. Instead, they claim that what Vermont Gas is actually buying is “renewable properties” of landfill gas in an effort to burnish the company’s environmental record and meet Global Warming emission reduction requirements. Solutions Act.
Those qualities can be “attached” to fossil gas from western Canada that is sold to people as “renewable,” potentially misleading customers, wrote Rep. Jim Masland (D-Thetford), in a scathing letter to the commission. These attributes are “abstractions” that do more than perpetuate the “false belief that [Vermont Gas] is an environmentally responsible player,” wrote Masland.
Renewable energy credit systems are intended to support new forms of renewable energy, Masland wrote. “What [Vermont Gas] the proposal does nothing to stimulate new renewable energy,” Masland wrote. Several other lawmakers signed the letter. Legislators rarely participate in PUC deliberations.
Such doubt is legitimate, but not significant enough to override the possible benefit from the contract, found Daniel Burke, a hearing officer for the PUC. After a nearly four-month investigation, Burke filed a proposed decision Wednesday recommending the commission approve the contract. The full commission, which is expected to rule in early November, has rarely deviated from the proposed decisions.
Critics make good points, Burke found, but it’s “premature to foreclose [Vermont Gas’] joining a new market that has the potential to satisfy Vermont’s broader energy policy.
The contract was with a company called Archaea Energy, which was recently bought by British energy giant BP. it will initially provide Vermont Gas with enough gas to meet about 4 percent of current peak demand, rising to 13 percent by 2030.
It’s unclear how much the deal could raise prices. Adding all the landfill gas to Vermont’s supply could raise rates by 3.6 percent, but the company doesn’t have to use all the gas itself. It can decide each year how much of the gas it wants to use or resell as truck fuel.
That would give the utility the “flexibility to meaningfully address how key business practices contribute to greenhouse gas emissions,” Burke wrote.
If the contract is well managed and overseen by regulators, it could provide a cost-effective way to help Vermont Gas meet its climate goals, Burke found.
The case is closely watched and unusual for several reasons.
This is the largest contract the PUC has ever considered. Gas supply deals do not require the approval of regulators unless they are for five years or more than 10 percent of the company’s peak demand.
The Seneca Meadows contract is for 14.5 years with an optional 5-year extension. Vermont Gas officials say the contract represents an important part of their long-term strategy to reduce emissions.
The case is also unique because 130 public comments were submitted, almost all from opponents of the contract.
Vermont Gas officials have repeatedly emphasized that the contract is just one part of an overall strategy to reduce emissions. Others include aggressive weatherization of buildings, installation of electric heating equipment such as cold-climate heat pumps, and exploration of other heating sources, such as geothermal and “green hydrogen” projects.
These efforts will reduce demand for the company’s core product, but company officials insist they need to add renewable gas to the mix from sources inside and outside of Vermont.
One high-profile source in the state is a large digester at the Goodrich farm in Salisbury that produces methane from cow waste and food scraps.
But Tom Murray, the utility’s vice president of decarbonization technology, says the company needs to look beyond limited sources to tap the region’s renewable gas supplies, too.
“Vermont is a small state,” he testified in September, “and we have many challenges to meet our energy goals if we only look within our borders.”
Company officials had no comment on the proposed decision.
Annette Smith, executive director of Vermonters for a Clean Environment, said her biggest concern about the deal is selling renewable energy “virtues.”
The company is looking for ways to make money in two ways. One is to sell assets in other industries, such as transportation markets, if that is the most profitable.
Another is to earn credits under the future Clean Heat Standard if the company can demonstrate that buying gas can lower the carbon intensity of its current supply. Landfill gas tends to have 26 to 43 percent lower emissions than fossil-fuel gas.
“This is where the big money is to be made, so VGS is foaming at the mouth to get this contract,” Smith said.
