Encore CEO discusses Vermont plans as new Renewable Energy Standard expected to become law

While some suspect Gov. Phill Scott will veto House Bill (HB) 289, which set’s Vermont on a path to 100 percent renewables by 2035, the bill is still expected to be finalized as it cleared both House and Senate with a legislative majority large enough to override an executive veto.

Gov. Scott’s opposition of the bill is due to its fiscal impact, estimated to be around USD 1bn, which he believes will trickle down to Vermont residents. Despite the opposition, the bill is still expected to be finalized next month during a veto override session.

In the meantime, Encore Renewable Energy is actively developing projects across the state—an estimated 75 MW of solar, mainly MUSH and C&I projects, and 80 MW of battery energy storage projects.

“It's been in discussion for years--how we could increase the Renewable Energy Standard (RES) both with respect to the overall portfolio and looking to move toward 100 percent renewable energy by 2035,” said Chad Farrell, Encore Founder and co-CEO, in an interview with NPM.

“Most importantly, this will allow a good bit of that energy supply to come from within Vermont State borders, speaking to energy security, job creation and additional supply at the distribution level,” Farrell added.

While the bill is aimed at accelerating renewable energy development in the state by requiring utilities to increase their renewable procurement, it does not specify how they intend to do so, such as establishing a community solar program or addressing specific plans for funding or program creation. However, Farrell is optimistic the bill will drive C&I and storage incentives to the state.

The bill has three main components. The first addresses energy usage with existing renewable projects.

“The lion's share of that will happen within the service territory of our only investor-owned utility in Vermont—Green Mountain Power,” Farrell said.

The second creates new in-state renewables and requirements for a few municipal utilities which will create new generation opportunities to address additional load coming down the pike—increasing it from 20 MW a year to upwards of 80 MW.

The third allows Vermont utilities to procure renewable energy from elsewhere within the ISO-New England grid to distribute within the state. This will allow them to look at offshore wind projects, as developers are currently only allowed to construct onshore wind.

“We hope that we can get back to delivering some wind projects,” Farrell said. “That’s not necessarily Encore’s business model, but there are plenty of other good reputable wind developers out there that I think would be interested if we were able to deliver more onshore wind within the state of Vermont.”

Compromise

One of the compromises of the bill during the legislative sessions was the removal of a virtual net-metering program known as the Standard Offer Program. The program was already “significantly curtailed” by the Vermont Public Utility Commission, who put restraints on the types of sites eligible and curtailments on the total quantity of net-metering credits allowed per customer, according to Farrell.

There was also a 500 kW per project cap, which prevented developers from achieving greater cost efficiency for the ultimate price per kWh that is paid for production, which is ultimately achieved through larger scale projects.

“In the view of a number of the proponents for this legislation, that program was really kind of in a state of serious decline anyway,” Farrell said. “It was a great policy for the industry 10-or-12 years ago.”

The most recent iteration of that program was a reverse auction mechanism, which has also sunsetted.

“It does speak to the notion that in subsequent sessions, there will be procurement programs introduced, discussed, debated and ultimately passed into law,” Farrell said.

Farrell is optimistic that the new RES will eventually lead to further legislation that could help expedite an abnormally long siting and permitting process in the state.

The state has a robust state level certificate of public good process, Farrell explained. A quasi-judicial process overseen under legal processes by experts for risk factors, which addresses mainly environmental, aesthetic, and archaeological considerations.

The original RES was enacted in 2015 targeting 75 percent renewables by 2032.

*This story was originally published exclusively for NPM subscribers last month.

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