Turning to Vermont Yankee to Pay for Energy Efficiency

Commentary printed on May 24, 2007 in Times Argus

 Faced with the steeply rising electric rates of the 1990s, the Vermont Legislature established an energy efficiency utility. Its mission is to assist Vermont businesses and individuals to reduce their electric bills by helping them use electricity more efficiently. It has been so successful that it has become internationally recognized. This utility is funded through a charge on electric bills. The average homeowner has generally received a rebate on energy efficient light bulbs and appliances. However, businesses, the chief users of electricity, have received hundreds of thousands of dollars in services and savings

Faced with today's steeply rising fuel oil prices, the Legislature is attempting to expand the responsibility of the efficiency utility to all fuels, so that average Vermonters can share the benefits long enjoyed by Vermont businesses. Vermont cannot control the cost of oil, but we can help people use less of it.

The issue is how to pay for these programs. The original bill placed a gross receipt tax on fuel oil dealers. Such a charge would undoubtedly be passed on to consumers in the form of slightly higher fuel prices. At a time when many people are struggling to pay their fuel bills, even a slight increase was unacceptable. The bill passed out of the Senate without a funding source and was sent to the House.

Without funding, the program would have a limited effect, so the search continued for an appropriate source.

Potential energy-related revenue sources were researched by outside professionals. During that investigation, several facts came to light. The first was that Vermont Yankee, like the large oil companies, has received millions of dollars in unanticipated revenues due to high oil prices and changes in governmental policy. That discovery led to the proposal of a windfall profits tax on these unanticipated revenues. I believe this is the notorious "Shumlin Tax" of journalistic repute. However, that is not the tax that passed the Legislature.

A second piece of information that research brought to light is that Vermont Yankee is paying almost $2 million dollars less in property taxes than it did 10 years ago. That fact raises a question of fundamental fairness. Who else in the state of Vermont is paying less property tax now than they did 10 years ago.

Like wind and solar power, Vermont Yankee is a low carbon emitting energy source. A separate section of the bill creates a method of assessing property taxes on commercial wind and solar energy. Because we wish to encourage the development of these renewable energy resources, it is a discounted rate. The Legislature decided that the fairest thing to do was to tax Vermont Yankee at this discounted rate. This is not a new tax. Vermont Yankee is simply having its property taxes assessed in the same manner as other utilities in its class.

The ever increasing cost of fossil fuels is hurting everyone. Hard working people are having a difficult time putting gas in their cars and heating their homes. It is a time for everyone to bear their fair share of the burden.

Sen. Ann Cummings is a Washington County Democrat.