Vermont Gov. Pete Shumlin on Monday unveiled his plan to pay for promoting renewable energy development without relying on a surcharge to customers.
The governor said he wants to use money in the Clean Energy Development Fund to pay for the up-front grants, rather than tax credits.
Twenty-three Vermont renewable energy developers got a total of about $8.5 million in tax credits to be taken over five years. Now, Shumlin said he wants to give them an option: the tax credit or half as much money in the form of an up-front cash payment when their project is up and running.
The governor and Administration Secretary Jeb Spaulding said they expected enough developers would take the up-front cash to save the fund between $2.7 million and $3 million. That’s more than the $2.38 million that would have been raised by a proposed 55-cent electric bill surcharge.
Shumlin said the fund would have sufficient cash “without raising 55 cents a month on Vermonters’ electric bills at a time when Vermonters are hard-pressed to pay their bills and afford $4-a-gallon gas.”
Leigh Seddon, vice president of Alteris Renewables, a solar energy developer that has been working on a project in the southwestern Vermont of Pownal, said his company and its financing partners had welcomed the chance to take payment up front, even if smaller, rather than the tax credit over five years.
“When this proposal came to us from the administration, would you accept $450,000 instead of the $900,000 tax credit so you could get it this year when you want to build the plant, not over five years, the investment people … said that works for us, financially. That works for us to have the cash up front and the certainty, and we will go along with it,” Seddon said.
The scramble to find the right source of money comes as what has been the Clean Energy Development Fund’s main funding source, the Vermont Yankee nuclear plant, is slated to close down next March. Shumlin and lawmakers had been looking for a one-year bridge to get from that funding source to a new one.
The governor said Monday he still hoped to get money for the fund from Vermont Yankee’s owner, New Orleans-based Entergy Corp. Shumlin said he wants lawmakers to pass a new tax on spent nuclear fuel being stored in the state.
Vermont Yankee’s spent fuel storage pool is nearly full and the plant has begun storing some of its spent fuel in concrete cask outside its reactor building in Vernon. Like other nuclear plants around the country, Vermont Yankee has been hard-pressed to find a place to send its highly radioactive waste. The federal government, so far, has not fulfilled a promise, made in a law passed by Congress two decades ago, to take the waste from reactors to a national disposal site.
The electric bill surcharge would have amounted to $6.60 per year and became a hotly debated issue in the Legislature last week. Some lawmakers argued it would be an extra cost ratepayers don’t need; others said it would be regressive, since both rich and poor ratepayers would be charged the same amount.
Shumlin told reporters on Monday the surcharge had been “not my idea,” but Rep. Tony Klein, chairman of the House Natural Resources and Energy Committee, said it did come from the administration, in the person of now former Deputy Commissioner of Public Service Stephen Wark.
Told the governor was saying the idea didn’t come from him, Klein scoffed.
“It didn’t (come from Shumlin) but it came from his Department (of Public Service) and that’s close enough for me,” he said. “It came from the department and they work for him.”
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