March 23, 2016
Vermont

Irasburg Ridgeline Alliance alleges deceptive marketing of wind energy

IRA Alleges Deceptive Marketing Of Wind Energy | Jennifer Hersey Cleveland | Caledonian Record | March 23, 2016 | www.caledonianrecord.com

The Irasburg Ridgeline Alliance (IRA) has filed a letter of complaint with the Attorney General’s Office alleging that Renewable Energy Vermont (REV), Burlington Electric Department (BED) and Georgia Mountain Community Wind (GMCW) are engaging in deceptive marketing claims.

The IRA letter, which was also sent to the Federal Trade Commission (FTC), alleges that REV, BED, and GMCW are advertising renewable, green energy when in fact they have sold the renewable energy credits (RECs) to out-of-state utilities.

GMCW is owned in part by developer David Blittersdorf, owner and CEO of AllEarth Renewables, who has proposed a two-turbine wind project on Kidder Hill in Irasburg, which IRA was formed to oppose. Its power is sold to BED. BED and GMCW are members of REV, which advertises for its members.

Once electricity hits the grid, it is physically untraceable, so RECs are used as the legal tokens of the electricity’s environmental attributes, according to a document produced by the Attorney General’s Office called “Guidance for Third-Party Solar Projects.”

Once a company has sold the RECs, it can no longer claim that customers are buying green, renewable, or clean energy, according to the FTC and the Attorney General’s guide. It also cannot claim the electricity as a renewable portion of its portfolio.

Green Mountain Power was informed by the FTC in February 2015 that it is not permitted to claim renewable energy after selling RECs, in response to a petition filed by Vermont Law School asking for an investigation into GMP’s allegedly deceptive marketing of its wind energy from the Lowell project.

The same rules apply to all wind- and solar-generating facilities that engage in this deceptive practice, members of IRA argue.

“We believe that all of the corporate entities cited in our complaint have had ample time and warning to learn the Federal Trade Commission guidelines,” said IRA member Dr. Ron Holland. “We are tired of Vermont companies making illegal claims that their energy is renewable when it is not.”

The Attorney General’s guide explains that the product consumers are buying in these cases is actually “null electricity,” defined as “not renewable” and “simply unspecified and undifferentiated power from the electric grid.”

Null power consists of a mix of fossil fuel, nuclear, gas and other “brown” sources of electricity from the regional grid, according to the letter to GMP from FTC Associate Director of the Division of Enforcement James Kohm.

“When GMP sells those RECs to states where coal is used, it puts coal plants on Vermont ledgers,” Holland said during an interview in December.

These companies are making claims that make customers believe they are using renewable energy when the power they are using is actually increasing their carbon footprint, Holland said in December.

Once a project’s RECs have been sold, the producer “has forfeited its right to characterize the power delivered from those facilities as renewable, in any way,” Kohm wrote.

The IRA complaint, which is signed by members Judith Jackson, Michael Sanville, Rebecca Boulanger and Holland, cites examples of how BED, GMCW and REV are misleading customers through alleged misrepresentations.

In Nov. 2015, REV aired an ad on WCAX entitled “Wind for Our Grandchildren,” in which it states that energy from Vermont’s industrial wind powers Vermont homes, the complaint letter states.

A previous REV ad features photos of the Sheffield wind project and describes the power produced by wind as being clean, green and local, the complaint letter states.

A February 2 press release on the BED web site states that GMCW powers the local community with clean energy and provides “enough renewable energy to power more than 5,500 Vermont households.” It further claims that wind power is “an important part of our renewable energy portfolio.”

The IRA complaint questions whether REV’s trade name may in itself be deceptive “because of the makeup of its membership and the promotion of all of these energy projects without discrimination as to those that sold their RECs as opposed to any that haven’t.”

The complaint asks the Attorney General for a declaration that the advertisements are deceptive, for the imposition of financial penalties, and for injunctive relief to keep such practices from continuing.

According to the Attorney General’s guide, violations of the Vermont Consumer Protection Act can result in a fine up to $10,000 per violation.

The guide proposes language that producers may legally use to promote the fact that their facilities generate renewable power while also fully disclosing to customers that they are not buying renewable energy.

The guide firmly suggests that energy producers disclose the sale of RECs in all promotional materials, in contracts and leases, and on the main pages of their web sites, noting that a mention in “frequently asked questions” will not suffice.

No one from the Attorney General’s Office, BED, GMCW, or REV responded to requests for comments for this story Tuesday, although Blittersdorf said he had not seen the complaint yet.