Editor’s note: This commentary is by Richard Faesy, a principal and co-founder of the Hinesburg-based Energy Futures Group.
[T]hree-quarters of Vermont’s greenhouse gas emissions come from just two sources: driving our cars and trucks and heating our homes and businesses.
That’s likely no surprise to residents of this rural state, with its nascent public transit, and winters that can get a bit chilly. However, Vermont is also a state that understands our future relies on reducing fossil fuel consumption.
We’ve set ourselves the lofty, but clear-eyed, goal of getting 90 percent of our power from renewable sources by 2050.
It used to be that Vermont’s energy programs were focused on saving electricity. That made sense when we were mostly burning fossil fuels to produce our electricity, but today we’re getting cleaner kilowatts from hydro, wind and solar.
Leveraging those cleaner kilowatts is the key insight behind a component of Vermont’s Statewide Total Energy Program (STEP), known as Tier 3. It’s a crucial element of the statewide plan because it directly addresses the 75 percent of emissions coming from transportation and heating.
Though it won’t get us to 90 percent renewables by 2050 on its own, and we must continue to push forward in other areas, Tier 3 will play a growing role in helping us achieve that goal.
In our recent study, the Energy Futures Group found that, in 2018, Tier 3 will account for 7 percent of Vermont’s energy savings goals. That figure will grow to more than one-third, or 34 percent, by 2032.
So, how does Tier 3 work? The program asks utilities to help their customers use less fossil fuels by offering them incentives to adopt technologies that use electricity instead of fossil fuel – such as cold climate heat pumps, heat pump water heaters and electric vehicles.
Not only will this program account for one-third of Vermont’s energy savings goals, the electrification efforts alone will save people money, and it’s likely to reduce electric rates too.
That’s because when their customers convert from fossil fuels to electric alternatives, utilities will be able to sell more electricity, thereby spreading their fixed costs – think poles, wires and trucks – over larger total sales.
We estimate that Tier 3 upgrades in 2018 alone will save Vermont $7 million over their lifetime, and the state will save more than $300 million from upgrades put in place over the next 15 years.
Big picture, Tier 3 is creating a virtuous cycle where individuals and businesses are incentivized to use more efficient, cost-saving electric tech, while burning less fossil fuels and bringing down the cost of the electricity that’s powering them.
Already, Tier 3 has helped a family-owned lumber mill in Bristol find a lower-cost alternative to its diesel generator; allowed a sugaring operation in Jay to jettison 8,000 gallons of propane annually through electrification; and helped families across the state finance heating improvements to old homes.
The Burlington Electric Department is using Tier 3 to help Green Mountain Transit acquire new electric buses, add electric bikes to Burlington’s bike share program and increase the number of electric vehicle charging stations in the city.
Green Mountain Power partnered with Freedom Nissan in South Burlington to give people $10,000 off the all electric Nissan LEAF, which drove sales of more than 150 LEAFs in just four months.
These success stories, and the potential of Tier 3 to produce even more savings – while further reducing fossil fuel consumption in the areas where Vermonters use them most – illustrate why policymakers should protect and, ideally, expand the program in the years to come.
