Shumlin’s inaugural address focuses on energy, environment

“We know that everything we hold precious is under threat from climate change and pollution,” he said.

Lake Champlain

He said the state is losing the battle on water quality. Lake Champlain, he said, “drives tourism and supports our economy even as it cries out for us to do more to stop dumping pollutants that are destroying it.”

But runoff from farms, roads and developed areas has for years polluted the lake. Now, federal regulators are requiring the state to cut phosphorus loading into the lake by more than 30 percent in order to comply with the Clean Water Act. If the state fails to address the issue, regulators say they will cut funding to the state and issue stricter regulations on wastewater treatment plants – a situation Shumlin said will cost the state more.

The Environmental Protection Agency is asking the state to allocate money for the cleanup before it approves the state’s plan, which still fails to meet required pollution targets, EPA officials say. To pay for the plan, the Shumlin administration is proposing a tax on fertilizer and a commercial development fee.

In May, Shumlin was hesitant to invest state money in Lake Champlain. Now, he said his capital budget includes $6.75 million for projects and technical assistance; $3.75 million for stormwater management projects; $1.4 million for agricultural projects designed to prevent pollution; and $3.2 million to reduce runoff from roads.

Shumlin said the fertilizer tax and the development fee will raise an additional $5 million per year. Keurig Green Mountain has committed $5 million in a private donations over a five-year period to a new Clean Water Fund, and Shumlin is soliciting more private money to support cleanup.

“I need your support to ensure that the state of Vermont does its part, and I look forward to working with you this session to launch a new era of clean water in Vermont. This will be part of our collective legacy if we can get it right, and the time to act is now,” he said.

Chris Kilian, vice president and director of the Conservation Law Foundation, said it appears that improving the lake’s water quality is now a priority.

“But, as always, the devil is in the details. Actions speak louder than words,” Kilian said.

CLF filed a petition calling on the Agency of Agriculture to require farms to adopt mandatory pollution control measures – such as cover cropping and livestock exclusion – in the Missisquoi Bay basin. But the Agriculture Secretary Chuck Ross rejected the petitions, and CLF is appealing in environmental court.

Shumlin said he will consider removing tax breaks for farmers whose land is in current use – a program that provides an incentive to keep land undeveloped – if farmers violate water quality regulations. He said the agency will target resources and increase enforcement in sections on the watershed most prone to causing pollution runoff.

“I will ask you to help me hold those farms that have not been doing the right thing more accountable by adding teeth to our current use program,” Shumlin said. “Similar to the way we treat foresters, farmers who are not following the required practices that prevent pollution should not enjoy the property tax reduction of current use until they do the work required of them.”

On Thursday Ross said under the proposal farmers who follow the rules will continue to benefit from the current use program, but “when they don’t we’re going to be saying your current use is abated. It’s going to be restricted until you follow the rules and regulations of the state.”

The Agency of Agriculture does not have estimates on how many farmers would be affected, or how much money they could lose in current use tax breaks. Ross said the agency is still figuring out how to pursue enforcement, but he said the state will likely use a mechanism now in place for the forestry component of current use.

House Minority Leader Rep. Don Turner, R-Milton, supported Shumlin’s intent to clean up the lake, but opposed his plan for how to pay for it. He said money within the existing budget could be better used before adding taxes and fees.

“We are not interested in raising taxes, raising fees for new revenue streams at this point,” he said.

Turner said he was not prepared to support the governor’s proposal to use the changes in current use to pay for the cleanup.

“I think that we know that current use is a very popular program, and it is a very expensive program. But if we want open land in Vermont its been one of those tools that has worked really well,” he said.

Renewable Portfolio Standard

The administration is proposing a new renewable energy program that will require utilities to purchase renewable power, such as wind and solar. The state’s current program is voluntary.

“If we work together to enact this legislation, it will mark our single biggest step so far toward reaching our climate and renewable energy goals. Jobs, energy savings and emissions reductions make this program a true win for our economy and our environment,” Shumlin said.

He said the the new program will add “hundreds of megawatts of new community-scale, locally generated clean energy to our portfolio,” create “1,000 additional jobs,” save electric customers “hundreds of millions of dollars on energy bills,” and reduce “greenhouse gas emissions by approximately 15 million metric tons through 2032.”

The program will be much like other energy policies known as renewable portfolio standards. But the state’s program will go further. In order to comply with state requirements, utilities can do more than just sell renewable electricity.

The proposal allows utilities to also receive credit by offering customers thermal efficiency services, such as heat pumps, or investing in electric vehicle technology, such as vehicle charging infrastructure, according to state officials. (The heating and transportation sectors account for more than 80 percent of the state’s carbon emissions.)

Darren Springer, deputy commissioner of the Vermont Public Service Department, is working on the proposal.

“The goal is to be as broad as possible,” he said. “And utilities have wide flexibility to implement it in terms of what they see best for their customers.”

The department has found the state’s current renewable energy program, known as SPEED, will not achieve the state’s renewable energy goals. But it has provided developers with incentives to build windmills and solar farms in Vermont because of the price certainty it offers through long term power contracts.

Andrew Savage, a strategist with the solar manufacturer AllEarth Renewables, said the SPEED program provided a market opportunity for renewable energy businesses.

“Now we need to look to the next generation and that’s going to yield even more savings for Vermonters and ratepayers, and at the same time, get even more renewable energy deployed,” he said. “[SPEED] laid the groundwork for where we are today and now the industry is poised with the technology that we have and the know-how that we have to deliver on ambitious goals.”

The governor’s speech did not address where energy projects should be built, an issue that is causing some towns to place restrictions on where solar farms and windmills can be located.

Brian Shupe, executive director of the Vermont Natural Resources Council, supported the points made by Shumlin, but said the state needs to balance its renewable energy goals with good land use practice.

“Some places should be off limits. Some areas aren’t suitable for any type of development,” Shupe said.

Savage said there will be creative deployment of renewable energy projects around the state, which include installing solar panels on areas that are already developed – parking lots, rooftops and areas under agricultural production.

Shumlin said the state has the “foundation” to move forward on the new energy policy. He compared the state’s renewable energy industry to the economic boom created by the ski industry.

There are 15,000 jobs in the clean energy industry in Vermont – the majority of which work in energy efficiency – according to a June 2014 report commissioned by the state. There are 1,500 jobs in the solar industry, according to the report, and Vermont has ranked first in the nation in per capita solar jobs.

Part of this growth was due to the state’s net metering law, which allows residents and businesses to generate their own electricity and receive a credit toward their bill from the state’s utilities.

Shumlin pointed to SunCommon, a solar developer and financier based in Waterbury, as a business that is making solar “more accessible” to residents.

Under the net-metering program, SunCommon offers homeowners solar installations that can be financed for the same price as a utility bill, depending on the size of the house and project, according to Graham Fisk, solar home adviser at SunCommon.