Distributed generation gains under new Vermont law

Vermont utilities are now required to buy more than twice the amount of renewable power at fixed prices than they were previously. However, they will to have to acquire increasing amounts of clean power based on the amount of energy they sell, as is the case in most states.

On May 18, Vermont’s Gov. Peter Shumlin (D) signed into law the 2012 Energy Bill. The bill recognizes locational benefits of distributed generation and more than doubles the amount clean local energy that will be brought online through the state’s CLEAN program.

The new law expands Vermont’s statewide CLEAN Program, called the “standard offer,” from 50 MW to 127 MW.  The capacity of any distributed generation facility that provides “sufficient benefits to the operation and management of the electric grid” as a result of its location or other characteristics will not count towards the overall program cap of 127 MW.  California-based the Clean Coalition provided support to Vermont-based clean energy organizations, which it has done for similar and recently enacted programs in Los Angeles and Palo Alto, Calif., and Long Island, N.Y.

“This bill shows a viable pathway for states across the country to procure clean local energy and illuminates the significant locational benefits associated with generating wholesale energy close to where energy is used,” said Craig Lewis, executive director of the Clean Coalition. Power companies are required to pay prices set by the state Public Service Board for power from renewable energy generators. Solar power developers currently can charge the utilities 24 cents per kWh.

The 50 MW in the former standard offer represents about 5% of Vermont’s power demand.

The Vermont Legislature eliminated a previously adopted renewable portfolio standard, which is a step backward from clean energy legislation that has been adopted in 29 other states.