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GlobalFoundries revises its utility proposal, but a key legal question remains

A person in a full-body clean suit walks a cart down a hallway.
Kevin Trevellyan
/
VPR
GlobalFoundries has submitted a new proposal to buy electricity directly from the grid, and to comply with state renewable energy requirements. But opponents are questioning the legality of a central part of the company's proposal.

Semiconductor manufacturer GlobalFoundries submitted a revised proposal Friday to buy electricity for its Essex Junction plant directly from the grid, bringing it in line with Vermont’s renewable energy requirements. But the proposal leaves key questions about the plan’s legality unanswered.

The company, which is Vermont’s largest private sector employer and consumes more electricity than the city of Burlington, proposed last March to separate its power supply from Green Mountain Power, in order to buy wholesale electricity at a cheaper rate. Company officials say the move would significantly reduce costs.

More from VPR: Reporter debrief: GlobalFoundries wants to become its own utility. Is that even allowed?

GlobalFoundries had also argued it should be exempt from Vermont’s renewable energy standard, which requires electric utilities to get a percentage of their power from renewable sources. But on Feb. 17, the Public Utility Commission ruled it does not have the legal authority to exempt the company from those requirements. GlobalFoundries now proposes to comply with the renewable energy standards.

More from VPR: Vt. regulators say GlobalFoundries can't form its own utility exempt from renewable energy standards

“We’ll be a self-managed utility, and committed to not only environmental excellence, but continuing to drive the semiconductor market here in Vermont,” said Ken McAvey, the general manager of GlobalFoundries’ Essex Junction plant, known as “fab 9.”

However, the company’s new plan appears to still be at odds with parts of the PUC’s Feb. 17 order. In that order, commissioners say the company’s proposal “would either make GlobalFoundries a public service company—fully subject to all required statutes, such as the Renewable Energy Standard—or an entity that is not currently authorized under Vermont law.” While the company’s new plan would bring it into compliance with some legal requirements for electric utilities, GlobalFoundries continues to seek to be a “self-managed utility,” an entity that is not contemplated under state law.

“GlobalFoundries could become a public service company, like another utility if that’s what it wants to do,” said Chase Whiting, a staff attorney at the Conservation Law Foundation, which opposes GlobalFoundries’ proposal. “If it does that, it needs to be fully subject to all of the required statutes. It can’t just pick and choose which ones it wants to follow and which laws it wants permission to break.”

Conservation Law Foundation has asked the PUC to clarify its Feb. 17 order, as has AllEarth Renewables, another party to the case. David Mullett, AllEarth’s legal counsel, said if GlobalFoundries is allowed to become a self-managed utility, it could have ripple effects.

“You might see ski areas, you might see other entities asking for this kind of thing, and it's very much a sea change with uncertain consequences,” Mullett said.

In an interview with VPR, McAvey said the company has no intention of becoming a public service company.

“We will not be in the business of selling power, we’re not going to be a public utility company,” McAvey said.

As part of its new filing, GlobalFoundries requested the PUC hold hearings on the matter this summer, with a final order by Sept. 1.

Have questions, comments or tips? Send us a message or get in touch with reporter Henry Epp @TheHenryEpp.

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Henry is a reporter covering business, the economy and infrastructure at Vermont Public. He's also co-host of The Frequency, Vermont Public's daily news podcast, along with Anna Van Dine. Henry came to Vermont Public in 2017, and worked as the station's host of All Things Considered until November 2021. Prior to that, he was a reporter and host of Morning Edition at New England Public Media in western Massachusetts. A graduate of Hampshire College in Amherst, Massachusetts, Henry was born and raised in Minneapolis, Minnesota.