One of the biggest climate bills of the session is headed for Gov. Phil Scott’s desk. The governor has promised to veto the bill, but supporters are hoping to override his veto.
Senate lawmakers voted 20 to 10 Thursday to give final approval to the Affordable Heat Act. The climate bill aims to reduce greenhouse gas emissions from heating buildings, the second-largest source of climate warming pollution in Vermont.
The policy has been mired in controversy this session, with many Republicans and some Democrats expressing concern that it will raise the cost of fossil fuel heat and that some small fuel dealers in the state — particularly those that sell propane — will struggle to comply.
Proponents of the bill say it will create a revenue stream to help lower and moderate income Vermont households get access to things like cold climate heat pumps, home weatherization and advanced wood heat.
Many environmental advocates in the state point to data that shows these options are more cost-stable than volatile fossil fuels in the long term, though they require substantial upfront costs.
The bill directs the Public Utility Commission to design a credit-based marketplace that companies that import fossil heating fuels into the state for sale will have to participate in.
“The implication here is that this is something that is on a fast track, it's going to go regardless of what happens."Sen. Randy Brock, Republican from Franklin County
Companies would be required to retire a certain number of clean heat credits every year, based on how much pollution the fossil fuel they sell creates.
They can earn those credits by paying a statewide entity to do things like weatherizing buildings, or installing cold climate heat pumps, among other things. Helping people switch to biofuels or natural gas derived from manure and food waste will also count, but generate fewer credits.
Companies can also apply to do the work themselves. If regulated businesses fail to comply, they pay a fine – though notably the House added a provision that allows the PUC to waive that fine if a company can prove it made a good faith effort to comply and was not able to do so.
Many environmental groups support the bill, including Vermont Natural Resources Council, VPIRG and Vermont Conservation Voters, as well as the Sierra Club.
Credits will be awarded based on the emissions a project saves, factoring in the full lifecycle of a fuel – from how it’s made and refined, to how it’s transported and ultimately what gets emitted when it’s used in Vermont. The bill’s proponents say this will favor solutions like home weatherization over options like biofuels, by requiring that clean heat credits come from less carbon intensive heat options over time.
But a coalition that includes 350VT, Vermonters for a Clean Environment, Standing Trees and Gedakina, among other groups, has called for changes to the bill . They want the policy to exclude biofuels and pellet stoves as ways to earn credits altogether. And they’ve called for a provision that would require suppliers of renewable natural gas to demonstrate that using that gas results in a net reduction of methane emissions. They’ve also called for lawmakers to take steps to reduce Vermont’s dependence on biomass for electricity.
The PUC is required to submit proposed rules to lawmakers by January 2025, following two separate reports analyzing how the program would affect fuel prices and Vermont’s economy. The first report is due to lawmakers in February 2024.
Lawmakers and Gov. Scott have long been at odds over how the final program should be approved. Much of the debate in the Senate Thursday was over process, rather than the policy or even climate change.
“Nothing moves forward without the specific enactment of the full General Assembly. I have been assured by legal counsel ‘enactment’ means we have to pass a law."Sen. Jane Kitchel, Democrat from Caledonia County
Some lawmakers rejected the bill over concerns that it doesn't specifically call for the 2025 Legislature to approve new regulations before they go into place. That is the core of Gov. Scott’s opposition, too.
“The implication here is that this is something that is on a fast track, it's going to go regardless of what happens,” said Franklin County Sen. Randy Brock, “that the check-back and any legislative involvement in this is purely periphery and not being taken seriously."
But Caledonia County Sen. Jane Kitchel said she has been assured that full legislative approval will be required in the future.
“Nothing moves forward without the specific enactment of the full General Assembly,” Kitchel said. “I have been assured by legal counsel ‘enactment’ means we have to pass a law."
The bill goes next to Gov. Scott’s desk.
Have questions, comments or tips?Send us a message or get in touch with reporter Abagael Giles @AbagaelGiles.
