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FTC won’t investigate Green Mountain Power

The Federal Trade Commission won’t open a formal investigation into Green Mountain Power’s marketing of renewable energy, but it is cautioning Vermont’s largest power company to be clear in its communications with the public.

The Environmental and Natural Resources Law Clinic at Vermont Law School had complained to the federal agency in September that GMP was making claims in Vermont about its power coming from renewable sources, when credits for reducing carbon pollution are being sold out of state.

The result, said Kevin Jones, a professor at the law school, is both a higher carbon footprint for Vermont and higher costs for ratepayers.

He took aim at a state program known as SPEED, which allows Vermont utilities to meet in-state goals for building renewable power while selling the pollution reduction credits connected to that power to utilities elsewhere.

“From an environmental and electric rate (perspective), the SPEED program has been a failure,” Jones said.

Green Mountain Power doesn’t see it that way.

“GMP is proud of its leadership accelerating the adoption of renewables, while keeping costs low for Vermonters by selling (renewable energy credits), and helping Vermont become a national leader in clean energy,” company spokeswoman Kristin Carlson said.

She added later that sales of the credits have helped provide the financing to get Vermont’s renewable energy industry off the ground. “By being able to sell (the credits), at least initially, it helps us get cost-effective renewable projects built,” she said.

Darren Springer, deputy commissioner of the state Public Service Department, also said Jones isn’t acknowledging the benefits of the state’s current renewables law.

Jones said the solar projects encouraged under the law are more expensive than other types of power. Springer countered, saying solar is a plentiful bargain when it’s needed most – on hot summer days when wholesale power prices spike. He said more distributed power generation has stemmed the need for costly grid upgrades.

Springer also emphasized the regionwide benefit when southern New England utilities buy Vermont renewable power. Vermont is connected to a New England-wide grid that has become greener overall, he said.

But Jones and other critics have complained for years that Vermont utilities have been touting their development of renewable energy to Vermonters while selling the credits to utilities in Massachusetts and Connecticut.

If an out-of-state utility is buying a credit equal to a ton of carbon reduction, Vermont’s power companies shouldn’t be bragging to their ratepayers about in-state green power generation, Jones and his allies maintain.

In the law school’s petition to the Federal Trade Commission, it accused Green Mountain of deceptive trade practices in several instances, among them the claim that Kingdom Community Wind, a large-scale wind power project in Lowell in northern Vermont, “means clean renewable energy built in Vermont for Vermonters.”

Carlson said that statement was made before the decision to sell the credits out of state and that Green Mountain Power has been scrupulous since then to note in the “power mix” section of its website the sale of the renewable credits.

The Federal Trade Commission made clear that its staff had found that the company can do a better job.

“Although no findings have been made that these claims violate the law, we urge GMP in the future to prevent any confusion by clearly communicating the implications of its REC sales for Vermont customers and REC purchasers,” said a Thursday letter from the Federal Trade Commission to a Green Mountain Power lawyer.