Burlington Free Press
October 20, 2006
John Marshall
At last month's well-attended luncheon hosted by the Vermont Business Roundtable for its members, friends, and legislative guests, presenters spoke knowledgably about Vermont's energy future and supply options: specifically, the challenges and opportunities that we collectively face and the cold, hard, undeniable facts (both good and bad) about the place in which we live.
Expert presenters included electricity suppliers, base load power producers, regulatory officials, efficiency service providers, climate change experts and alternative fuels producers and suppliers who brought their perspectives, data, and suggestions for policy direction.
During a two-hour period in which a great deal of information was shared with the attendees, there were some key, factual statements that emerged that must be understood by all Vermonters, which get to the heart of our dilemma and are unassailable by those who would wish things otherwise.
Specifically, Today, Vermont has very little exposure to price volatility in the electricity marketplace and our rates are, relatively speaking, quite competitive within the region. However, we will be affected by our ability to continue getting clean sources of electricity, and by our ability to increase capacity.
Demand for electricity will increase in the future as our global climate continues to warm (a bad thing) and as economic growth in Vermont and New England expands (a good thing). Also, as northern tier, rural state, Vermont's heavy reliance on transportation vehicles and home heating fuel keeps us at the mercy of the fossil fuel marketplace.
Hydro Quebec (HQ) and Entergy/Vermont Yankee (VY) combine to provide Vermont with over 60 percent of its base load power, 24 hours per day 7 days per week, 365 days a year. Together, they represent safe, reliable and very clean sources of electric power. Renewables (i.e., small hydro, small wind, methane), efficiency and demand side management programs should be our first choice for new energy sources but, cannot realistically be relied upon to fill the enormous gap that would be created if VY's license is not renewed beyond 2012 and the HQ contract is not renewed by 2016.
The Roundtable's position was clearly stated at the outset of the meeting, which supports efficiency measures first and a diversified resource mix that includes HQ, VY and renewables.
Until and unless Vermonters understand that the state's decision-making horizon is extremely limited; understand the economic, energy security, and environmental policy implications of the various resource choices, the tradeoffs that are inherent therein, and are willing to take the politics out of the process, we will face a very volatile, uncertain, and expensive future in a very brief period of time.
JOHN MARSHALL is Managing Partner, Downs Rachlin Martin PLLC and
Director of the Vermont Business Roundtable.
Vermont Yankee has safely provided reliable electricity for more than 30 years. Today, it produces one-third of the states total electricity. The plant is Vermont's most reliable source of in-state electric power and provides vital power to homes, businesses, and health and municipal systems. As a result of the Power Purchase Agreement, Vermont Yankee has saved Vermont customers approximately $111 million and expects the total savings to be $250 million by the end of the agreement.
The further electricity has to travel to reach the end user, the less reliable it becomes. The August 14th blackout of 2003 taught us a valuable lesson because it demonstrated the effects of unreliable power in other parts of the country. Fortunately, Vermont Yankee is the state's hometown power factory, reducing the need to import power from elsewhere. Vermont Yankee produces electricity nearly 100% of the time compared to other forms of energy (such as wind, water and sunlight) that produce electricity at less than 40% of their respective capacities.
