Vermont Legislature SmartTranscripts:

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: We are live. It is Senate Finance. We do have four members with us. One is on Zoom, and I've got two more who should be coming through the door momentarily, but we have a quorum. So we are going to start with our first walkthrough on page seven ten. Ellen, you. Where is yours? Ellen Chittenden, Office

[Ellen Chittenden (Office of Legislative Counsel)]: of Legislative Counsel, page seven ten, as passed by the House, is an adulating to defining electricity generating facilities. So, a little bit of context on this. Last year, towards the end of

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: the

[Ellen Chittenden (Office of Legislative Counsel)]: session, an issue was raised about the definition of plant that is in 30 BSA 8,002, which is the definition section used in the renewable energy program chapter. This is a definition specific to renewable energy, not other kinds of energy, just renewable energy.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: And the issue came up, and it is a slightly complicated issue. It is deep in the weeds. I know that natural resources have shown me that they are also very interested in this if we would like to see into them. I said we had to find out what it was first.

[Ellen Chittenden (Office of Legislative Counsel)]: Sure, So so in So, it came up at the end of last session and what ended up happening is that a session law provision was added to Act 38, and it directed the Public Utility Commission to meet with the relevant stakeholders and discuss the issues and gave a few parameters of what they should consider, and then come back with a proposed definition. And they did that. They issued this report in November outlining that they had a couple of meetings with the stakeholders and they have proposed a definition. And that is what is in H710. So, you'll hear from the Public Utility Commission after me, but this definition is used in a few different places, but any time that you define something, especially if there's an incentive attached, whenever you create a threshold or a cap, people may all People tend to look for ways to get around that. And that is sort of the issue here. So, one of the examples that we'll walk through is this definition is used in net metering. Net metering systems receive a higher rate than other solar systems, and so there's a cap on that program. It's 500 kilowatts for most systems, except for schools and municipalities, but 500 kilowatts for a system. So, the issue has come up if two systems are next to each other, largely, that's what we're talking about. Is it one system, or is it two systems and people are trying to avoid There's a couple situations that are discussed in here, and so what is being proposed is a pretty straightforward definition, and then exceptions to that definition. 30 BSA, 8,002, the definition of plant. It is sometimes being referred to as single plant, What we're actually looking at is, is it one plant, or is it multiple plants? Plant means an independent technical facility that generates electricity from renewable energy. We're just talking about renewable energy for this program. Multiple electricity generating facilities, regardless of when each is constructed, shall be considered one plant if the facilities use the same electricity generating technology and are located on the same parcel or contiguous parcels of land. So I'll stop there. So they have defined in this bill, they've included the definitions of what it means to be electricity generating technology. That's pretty straight forward. It meets the method or system used to convert energy from one form

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: into Windmills and solar panels. That's two. Right.

[Ellen Chittenden (Office of Legislative Counsel)]: Including wind, hydro, water, solar, or biomass. Yes. Solar near solar, that's what we're talking about. If it's solar next to wind, that would

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Solar involve next to a hydro.

[Ellen Chittenden (Office of Legislative Counsel)]: But we're looking at we're looking here at things that are the same type of thing built

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: next to you. Well, think the issue is you put up 100 panels this year.

[Ellen Chittenden (Office of Legislative Counsel)]: That's right.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I know. Another two acres, I put up a 100 panels next year. Yep. It is the issue still with net metering. Utilities are required to buy it and it is it frequently sometimes at above market rates. Yes. So it's adding to the cost of electricity. Yeah. And in this committee, we've all you know, if we want to move people to electric, we have to keep the cost affordable. I don't know about present, but I couldn't sell a house with electric heat. Showing more on Saturday. Fifteen years ago. God bless you. Yes. But it was purely on cost, and so It there's a cost differential.

[Unidentified Committee Member (Senate Finance)]: And Yes. Yes. Can a plant be sorry. Sorry. Can a plant be a private home that has They are. Generating Okay. A plant is a private home that's generating If they have solar and wind and it's going back onto the grid, that's considered a plant.

[Ellen Chittenden (Office of Legislative Counsel)]: We're not talking about a home, we're just talking about just the panels largely or the tripod. Okay. But yes. And so the first exception is about personal net metering. So, on page one, eight ten, line 18, so such facilities shall only be considered separate plans if they meet one of the following exceptions. And so, yes, the most obvious situation that would be opposite of what I just described is individual net metering systems. This exception applies on page two if the systems are not located on the same parcel of land, are wired to offset consumption on separate billing meters, and supply different retail customers. So, this bill is setting out that the default definition is if the same technology is adjacent to each other, that is one plant. However, in the neighborhood, if neighbors have solar panels on both of their roofs, that would violate this definition. So, the first exception is being created to say, okay, net metering, as long as they're not on the

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: same parcel and they have separate billing meters for different customers, that those are separate systems and they are considered multiple plants. But if I buy a parcel from Farmer Smith and the one contiguous to it from Farmer Jones, and I put up a 100 solar panels on each thing, those are still separate.

[Ellen Chittenden (Office of Legislative Counsel)]: Those are considered, yes. No, those are considered one plant. One plant. Those are considered one plant, even if there's a difference in time, yes.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Okay. So,

[Ellen Chittenden (Office of Legislative Counsel)]: are two other exceptions that potentially they could meet for that. The next exception is multi owner individual net metering systems on same parcels, and this is for common interest communities. This is an exception if the facilities are located on the same parcel where a common interest community is located, are wired to offset consumption of separate billing meters and supply to the retail customers. Common interest community we're talking about here are HOAs or condos. I was gonna say,

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Murray Hill has Yes. It's a water system. If they put up solar panels in that field above them Mhmm. And along with their own water, they were supplying electricity which was metered and billed to each member of that HOA, that doesn't count. Yeah, that's That

[Ellen Chittenden (Office of Legislative Counsel)]: meets this definition. If it's on the same parcel but it's going to separate meters and separate customers, that's allowed. And the definition of common interest community, in case you're curious, is at the bottom of page two, Is real estate described in declaration with respect to which a person, by virtue of the person's ownership of a unit, is obligated to pay for a share of real estate taxes on insurance premiums, maintenance, improvement of, or services, or other expenses related to common elements, other units, and other real estate that being described in the declaration. This is the definition from the common interest community chapter. We're not necessarily talking about apartment buildings here with rental, we're talking about people who have

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: an ownership interest. They own the condo. Yeah.

[Ellen Chittenden (Office of Legislative Counsel)]: But there's multiple units on one parcel and

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: then One parcel and you share some of the expenses. Yes. And so then, basically, you don't own the roof of the outside walls. Probably, I don't know. So,

[Ellen Chittenden (Office of Legislative Counsel)]: then there's a third exception. There's an exception for co location of facilities other than net metering and for standard offer program facilities. This definition is in chapter 89, the Renewable Energy Programs chapter. I've already mentioned net metering is relevant to this conversation because there's a cap and you get a significant pay bump if you're participating in that program. Same is true of standard offer program. Standard offer, these are contracts that are bid into the state and they receive a stable contracted rate for their electricity for the length of the contract, and those are typically slightly higher than market. There's a cap on the amount of electricity in that program. That's 2.2 megawatts. Then, the other relevant type of facility that also has a sort of a cap is tier three program systems, I'm sorry, tier two program systems. Under the Renewable Energy Standard program, tier two, which utilities are required to have energy that qualifies for tier two, those are systems, again, up five

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: megawatt. It's either two megawatts or five megawatts, I'm pretty Since sure that's not we haven't I remember spending hours in here several years ago, tiers one, two, and three. Yes. And perhaps before we take this up, we could do a one

[Ellen Chittenden (Office of Legislative Counsel)]: right. Zero one You did have to do that last time.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Yes. I think that would be helpful to refresh everyone's memory as because you tend to do a lot of work on it, and then you don't work on it for several years as that plays out, and then it comes back for more work as you find times change. But this all started. There were solar tax credit, federal tax credits, the state tax credits, and the guaranteed return. These were new new technologies, and in order to make the capital investment, they needed a guaranteed return, meaning they needed to know they were going to be able to sell their electricity. And so the state required that utilities buy a certain amount even though it was about market rate. The question, I guess, because this is not dissimilar to what got done for oil and coal in its day. So when people ask me about corporate welfare, I ask if this is what they mean, but it's necessary to get to get the investment in the new technology, which had a common good, and and we did it. The question is at what point does that industry become mature? At what point do you wanna talk about cutting that subsidy off and just saying you've gotta compete in the open market because the utilities were losing money,

[Unidentified Committee Member (Senate Finance)]: and

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: and that gets put back on rate payers. So it's time, and I that is a tax and revenue issue. I'm feeling much more comfortable with this committee keeping this one in large part because that is really a tax and revenue issue. But we will do our briefing before we do anything else. And so I didn't I just started by reading through

[Ellen Chittenden (Office of Legislative Counsel)]: the definition, and there's a little bit left on this page, but the language I'm being struck on page one, previously when two facilities are being built next to each other, the PUC would consider different factors to determine if they were truly separate facilities or if it was someone trying to get under the cap and add more generation. They would look at common infrastructure and if they were going be sharing infrastructure. If they did, there was an assumption that they were actually the same project, just being spread out over time. And one of the issues that was raised is that that requires the utilities, if they want to put multiple projects near each other, if there is a desirable site that no one objects to, it requires them to then put in separate driveways and separate utility poles usually. Which is

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: a big set of transmission lines to get the electricity out. And that may be considered an extra expense and a bit

[Ellen Chittenden (Office of Legislative Counsel)]: of a waste. And so that was one of the reasons that there was interest from the community in being able to cut down on cost and cut down on the amount of land that's being used.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Yeah, okay. That would make common sense.

[Unidentified Committee Member (Senate Finance)]: This might be a question for you, I'm not sure, but can you just summarize, can someone summarize for me, sorry, it's been a long week, what problem is this trying to solve?

[Ellen Chittenden (Office of Legislative Counsel)]: So, think it's part of that. Last year, there was a concern raised that there had been, I think, at least one decision where someone wanted to put in a solar panel project next to a solar panel project that already existed, and a determination was made that they would be considered the same project and therefore violate the rule and not allow them to get the rate they were seeking because they were considered the same project unless they built a separate road and put in separate utility I'm not sure if I got any details of that exact, and also I just want to flag, this has been litigated previously, so this has some controversy behind it, but there's interest, and I think you'll hear from the public witnesses later, about multiple issues when it seemed not intuitive. Correct. That there are sites where multiple projects could be cited, but under the PUC rule, that would not be allowed. So this is trying to

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: make it more clear so there's not this Instimution. Yes. Okay. Last year when we looked at the PUC and siding, it was solar projects, which equally as controversial as felt out, perhaps more so because they take up more space. They're lower, but they also have physical requirements. They couldn't be in my yard because it doesn't get the sun until 03:00 in the afternoon. My neighbor that gets the sun at 03:00 in the morning has solar panels. They're across the street. It's where the shadow is. So they've got to be in certain locations where they get sun, which is talking about sun in Vermont for the last six months is somewhat interesting. I think we'd all like some sun at this point, but so there's space requirements that are technically required, but there's also impact on neighborhoods and so far we have not heard the health concerns, and it's also grand list impacts and highest and best use impacts, so it's a new world and we're finding adjustments as we go forward. We'll see if this is where we need to see. Okay.

[Ellen Chittenden (Office of Legislative Counsel)]: So there's a little bit left, though. There's a bit left. So, on page two, line 10, there's a third exception for co locations of facilities other than net metering standard offer. So, this applies if facilities have separate points of interconnection, If a net metering facility and a standard offer program facility are not site level paying or contiguous parcels, so standard offer and net metering under this proposal's pay

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: The standard offer is you get paid the market value or the standard, this is what we

[Ellen Chittenden (Office of Legislative Counsel)]: pay? Sort of. But your state, the state has established a contract with the facility specifically for a rate. This is saying that net metering and the standard offer offer program cannot be cited on the same parcels. And the statutory cap for the net metering program or the standard offer program is not exceeded on the same or contiguous parcels. So, is you should hear more about this from the PUC, but this is addressing, again, that there are some other types of facilities that would qualify, that we're talking about here, other than net metering or standard offer. There are these tier two projects that would also potentially wanna be cited alongside with it. Is the third exception to this rule. Then, as I mentioned, I started to read through, they've included some definitions that are associated with this. Common interest community for the second exemption. Contiguous here on page three means sharing a boundary with another parcel, or being adjacent to that parcel, and the two parcels are owned by road, recreation path, rail lines, stream, or river. Electricity generating technology, we've already talked about. It's solar and solar, wind and wind. It could also be water and or biomass. Then point of interconnection means the point on the interconnecting utility's existing distribution system, which the facility proposes to connect to. So, yes, a discrete issue in this bill, but

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: a little bit. Penden feeds. Okay. But almost everything in this area is in. Okay. So would you be the one that would can you see? Who would be the best place for us to get tier one, tier two one zero one? I like when they do it since

[Ellen Chittenden (Office of Legislative Counsel)]: they administer it. However, I'd be happy to

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: do it if you need me to.

[Ellen Chittenden (Office of Legislative Counsel)]: Because also tier four and tier five, you haven't even understood.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: That's right. Maybe we will ask the PUC and see how receptive they are, because I know how busy you are and see if they would, a, give us a one zero one on the tiers and

[Ellen Chittenden (Office of Legislative Counsel)]: Of the renewal energy standard.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Renewal energy standard would be a better, I guess, thing for them to give us a one on one on and then comments on this bill. And We'll see if we can get them in. I know Peter Sterling is coming in. Well, we're supposed to have the PUC. Yes, they're not PUC. No, the PUC is now. Okay. Let's see if I can. That's right. Alright. Well, we talk this on now. Are they coming in? I'm not You're supposed to be in this.

[Ellen Chittenden (Office of Legislative Counsel)]: I already Well, waiting. I'm gonna bring these up.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Yes. Yep. And we we would buy I've advised the gallon if you agree to get back. I'm gonna stay. Okay. And just walk through on nine well, it's more of a committee discussion. I know natural resources would like 09:40, but there's a couple things in there and I'm not going to relinquish it with our report intact, but I wanna make sure that that's what the committee wants to do before we relinquish anything. It seems to be a lot of committees that want our bills this year. Different committees and different bills. Nobody wants the ones that have implied fees, which we've gotten several of. But we could stand at ease here for a couple minutes, like two, and hope that the PVC people show up. Yeah. Would you like to go off live? Let's go. I don't think it's going off live in one minute. Time of year.

[Ellen Chittenden (Office of Legislative Counsel)]: So it's an Easter egg around.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Apparently, there's also a pair of teachers conferences going on. It puts kids out.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Are

[Unidentified participant]: they online?

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: No. No. We're still waiting, but there's they've been about long, long minute. There they are.

[Unidentified participant]: Well, take a minute to sit down.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Okay. That's right. You had to have teacher confidence. We need one more member to come back in the

[Unidentified Committee Member (Senate Finance)]: room so I have more.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I'm having more issues today. So we were going to invite the PUC to come back in that she'd like to do it today. She'll perhaps give us a little walk through of tier one, two, three, four, where that we know just there's new members on this committee, and it has been several years since we've really done anything there. So anything you know, just a really quick refresher would be helpful. Absolutely.

[Unidentified Committee Member (Senate Finance)]: I will let our chair know, and there's another stat protein. Okay. On the renewable energy standard. Would do it, and I will let them know as soon as.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Wait. I've lost another one. Alright. I'm here. You're here, so we're gonna keep going. Now So this is on 07:10.

[Unidentified Committee Member (Senate Finance)]: Introduce yourself to the record. Before I shoot that script, I'm just making sure that my colleague West, who's here, can get the presentation up. That is an all time.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: And after that, Scott and Wesley, are you together? You're you're all here? Alright. We're all here. Whatever works, you can come up together. If you have separate testimony, just let us know.

[Unidentified participant]: Yeah. Thought I thought I'd come up about halfway through when

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: it's Okay. My

[Unidentified Committee Member (Senate Finance)]: works. Honorary representatives. Okay. Thank you so much, Senator Cummings, and for the committee to have us here. My name is Steph Hoffman.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: I'm the General Counsel at the PUC, and with me is Staff Attorney Leslie Skidmore. We're here to present H7-ten, which covers the definition of plant, changes to the definition of plant in 30 ESA Section 8,002, its definition 18. We also filed with the committee a recommendation on some language regarding a decommissioning fund proposal that we hope to prepare an introduction today for you to walk through that concept. In 2025, Act 38 passed. That act required the PUC to prepare a recommendation to the committees of jurisdiction regarding the definition of plants that had been discussed during that legislative session with various interested parties. We were required to engage those set of interested parties in the process of getting to a definition, a recommended definition. It gave us three things we had to consider in that process. The first is land use benefits of co locating energy generation facilities, ensuring comprehensive review of co located facilities, and potential ratepayer impacts. Those considerations were discussed in detail in the recommendation that we presented to the committee. This is a little bit more detail in the process that we engaged in as a result of Act 38. We convened proceedings at the Commission, much like the court would, we opened a case essentially. We opened that proceeding last June after the conclusion of the legislative session, and we did two things in that proceeding from the very beginning. We sought input on the definition of the word plant as defined in 8002, and we also put out proposed statutory language regarding the establishment of a decommissioning fund. We paired these two things together because the stakeholders, the interested parties

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: It's a decommissioning for these plants. Yes, for renewable generation. Committee traditionally decommissioning fund was Vermont Yankee. This is not the same decommission.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: No, and Wes will explain a little bit that the requirement for us to ensure decommissioning happens comes from Section two forty eight(five), where there are requirements regarding the Commission's involvement and making rules around how decommissioning will be insured for each of those projects. In our proceeding itself, we engaged in a written comment period. There were two rounds of written comments provided in July and September. In September, at the conclusion of those written comments, we issued a conceptual plan for the decommissioning part of the proposal. We held two workshops at the September, one on the definition of plant and one on the decommissioning proposal. Then we provided a final opportunity for comment on the definition of plant that is part of our recommendation to the committees. When we went through this process, we tried to think about these two issues together simply because the interested parties are all the same. We have a renewable development community, we have state agencies that appear in our proceedings, we have different interest groups that get involved in these proceedings, and so that process was hand in hand for both of these topics. Sorry to interrupt. So, the decommissioning is of solar and wind plants? What is that? I'm sorry, I'm not understanding the decommissioning piece. Yes, and we'll go into more detail about this at the second part of this presentation. But yes, it's renewable energy generation facilities and energy storage facilities, both of which have no decommissioning obligation. At the end of the project's useful life, that's either take that project down or put it to another useful purpose, basically. The useful life is usually, we know. There's a range. Originally, was conceived in this probably twenty five to thirty five years in that range. Useful life is actually typically defined by the economic viability of the project to continue operating. Thank you. That's really helpful. Absolutely. After this process concluded, we prepared our recommendations and submitted them to the committees of jurisdiction for your review, and then we've been to several of them to talk about our recommendation. So, just to explain where we're coming from before where we've landed now for consideration of the committees in age seven, 10. The current definition of plan is on the screen here, and it has essentially two components. It asks whether the facilities that are proposed or existing are the same project and if they use common equipment and infrastructure. Then at the end of that definition, explains that common ownership, continuity and time of construction, and proximity are all relevant to determining the same project component of that test. Because many of these terms are not defined and because there are concepts that are not exactly fine line and the sand divides them, we have had a lot of litigation around these issues and whether two or more facilities are the same facility matters for several renewable energy generation project programs, namely net metering, standard offer, and the qualification under 8,005 for the renewable energy standard maximum of five megawatts to qualify those facilities for renewable energy credits that are Tier two credits. All three of those programs have capacity caps. You can't exceed those caps to be in those programs. This definition is used in our cases to decide whether what's being proposed can be compensated at those rates for those programs or can receive Renewable Energy Standard Tier two designation. As part of our process, we were looking at the three factors given to us in Act 38, as well as many of the concerns that have arisen in our proceedings over the course of the last seven to ten years where this has become more and more of an issue as more and more renewable energy generation becomes co located or is attempted to be co located. We developed a new standard that does the following things. It sets as a baseline that if a project, more than one project, is on a facility, so it's on a parcel or a contiguous parcel, and uses the same electricity generating source, meaning solar and solar, wind and wind, hydro and hydro, then it cannot be on the site together and not be considered a single facility. That's the dividing line. It's parcel or contiguous parcel plus same generating technology. That's the baseline standard. There are three exceptions to that baseline standard. The first is for individual residential net metering. We don't want two neighbors to not be able to put solar on their roof as individual residential customers of a utility and have residential size net metering because this definition says contiguous parcels would be ineligible, so we have an exception for that. The second exception is multi owner individual residential net metering or common interest communities. Think duplexes, triplexes, quadplexes, some forms of group housing. When you have those arrangements,

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: it would

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: preclude individual utility customers from each having that metering at their house, again, at a residential scale because they're living in housing that accommodates more than one family. So, this is a multi owner, and mind you, owner. So, renters, it would be a different situation, but multi owner arrangements where they would want to be able to do residential size net metering. What about 20 units, condo units, in the same development? Is that Is that an exception? That would be as long as it meets the definition of a common interest community, which condominium units are considered a common interest community. You have to keep in mind that facilities, plants still have to meet the Section two forty eight criteria. This is just a screening mechanism to determine whether they're eligible as separate facilities to go forward with separate applications, Whether they actually meet all the criteria under Section two forty eight to be permitted, given a certificate of public good is a separate inquiry that is apart from the screening. The third exception is for more than one renewable energy program facility on a parcel or contiguous parcel. This is the most complicated of the exceptions, and we did some rewriting of it that you see in 07/10, and I'm going to show some examples of this. But this is to ensure that no individual incentive program is exceeding its capacity cap. So, don't want more than 500 kilowatts generation capacity on a site for net metering, same parcel, contiguous parcel, same for a standard offer program. You don't want more than 2.2 megawatts for the capacity cap, and you don't want more than five megawatts in res Tier two, except for the Res Tier 2s can be if they have different points of interconnection. I'll explain that when we show you examples. We also provided some definitions that would be added to the end of the definition section or in the alphabetical place they belong of common interest community, the word contiguous, electricity generation technology, and point of interconnection. This is the text of exception C, and it says that the exception is for colocation of facilities other than that metering program or standard offer program facilities, and applies if they have separate points of interconnection. So, you're allowed to have more than one renewable energy generation facility on a parcel or contiguous parcels, so long as essentially you're not exceeding the capacity cast for the program's net metering standard offer, and you're not putting net metering standard offer on the same site or contiguous sites?

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I think of that net metering, standard offer, just refresher. That's the utilities buy at market rate, essentially?

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: Yes, the standard offer program involves an RFP process that the commission instigates where projects bid in and are selected based on their cost per generation amount, so per kilowatt hour generated, and utilities are required to purchase a certain amount of power through the standard offer program. The last RFP met the overall capacity cap of the program that happened two years However, there is some capacity that hasn't yet been built in that program.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Is

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: an illustration, rudimentary I admit, to try to illustrate the point. Each of these rectangular boxes, imagine, a parcel or could represent contiguous parcels. It's not important which one, but just within the geographic bounds that would constitute a single facility under the standard definition provided. These show three different things that under the new definition can be cited, but under the current definition of plan, could not. So A shows when you have 500 kW of net metering on a site. Again, I'll use site as a simplistic term, but that could mean contiguous parcels. Plus a five megawatt PPA, which would be the tier two projects we're talking about. And the way that a PPA arrangement works is a direct contract with the utility itself between the merchant generator who's developing that facility and the utility. So they negotiate a market dispense for that contract. And that's how those tier two projects come down. In example B, you have essentially the same but with standard offer swapped out for net metering to show again, could have a five megawatt Res Tier two project on that site with standard offer. In Example C, you can see there, you'd have two five megawatt PPA projects and they would just have to have separate points of interconnection. But all of these facilities would, for engineering reasons, have separate points of interconnection because you cannot connect to the grid at the same point, although it's, of course, useful in some rare circumstances. That's not how most projects come before us. What still can be done under this new definition, and we did this because we believe that the policy rationales for these heightened incentives in net metering and in standard offer dictate that there are capacity caps for a reason. You don't want more than 500 kW of metering. You don't want more than 2.2 megawatts of standard offer because those programs give higher compensation for these types of projects and dispersed renewable energy generation under those programs was part of the legislative goal of developing those incentives. And so, the definition is used to screen out still exceeding either one of those caps. So, you cannot have net metering standard offer on the same site. Similarly, you can't have more than 500 kW of net metering or more than 2.2 megawatts of a standard offer program. And it encourages that distributed generation under both of these programs. And it essentially prohibits any citing that would violate the letter and spirit of those statutory caps. My portion of the presentation on the definition of plants, done, unless anyone has any follow on questions. I'm gonna turn it over to Wes and he's gonna talk more about the decommissioning fund concept that

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: we submitted, a letter to the committee.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: Thanks, Steph. I'd to thank the chair and thanks to the committee for having us. As Steph already described, we chose to couple the single plan.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Need you to introduce yourself to the record. Okay,

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: got it. I'm Wes Skidmore, and I'm a staff attorney with the Public Utility Commission. So Steph noted that we chose to accompany the single plan process with process related to sort of looking into our current decommissioning of primarily solar generation facilities process and look at if there were any other potential solutions there. And really what we're talking about here is the potential creation of a decommissioning fund to ensure that the end of the useful life of solar projects and battery projects, that those sites are able to be decommissioned, so removal of all metal and components for the technical processes, as well as restored to their original condition. So that's what we mean by decommissioning. And as Seth noted, that would occur typically at the end of the useful life of a project, so twenty five to thirty five years. With modern solar panels, it might be longer. So I'm gonna start just with a little bit of background, and the main background concerns a statute that we see at the commission very regularly, that's two forty eight. Essentially, Section two forty eight is the statutory standard we apply to applications for certificates of public good, which is essentially what we call permits for developers to build energy generation sites or storage sites. Subsection A5 of two forty eight requires that the commission adopt rules to ensure, quote, that facilities are removed once they are no longer in service. And in response to that requirement, we promulgated a rule, rule 5.9, commission rule 5.9 in 2017 to carry out that statutory requirement, and that rule really has two aims. Number one, to require a certificate of public good recipients to establish a plan and commit to decommissioning those facilities at the end of their useful life, and requirement number two is to establish that as a developer they have sufficient financial assurances to support that decommissioning when it needs to occur. I wanna note here, very important, the rule really applies, we're talking about privately developed solar and energy storage installations, not utility owned sites, and we're only talking about generation or storage sites that are greater than 500 kilowatts in size. So we're talking much more here about the large 20 megawatt solar arrays in Vermont rather than the small scale net metering facilities. In fact, those are not subject to this requirement at all. We have a requirement that net metered solar arrays decommission, but the owners of those sites are not required to go through the same rigorous process that a large scale developer is. That's a lot of scrap.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Yeah.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: What does this process actually look like right now for a solar developer? Developers are required to first obtain an estimate for decommissioning and site restoration costs as part of their process in front of us seeking a CPG. They have to obtain, maintain, and update a financial instrument covering the estimate they arrive at's cost for the life of that facility from an A rated financial institution, so essentially very reputable banks. They have to file that instrument with us. We keep paper copies, and they have to provide periodic updates to accommodate inflation, and typically we require those updates to happen every three years, so they always report every three years that incrementally increases the total estimate. And then the last requirement is they have to eventually decommission their site at the end of its useful life, at which point we as the commission would release any claim we have to the financial instrument they provided us with. Now in practice, all the solar arrays in Vermont are many years away still from needing a decommission, but obviously we're bound by the statutes right now regardless of whether those panels are ready to come down. And there are a lot of terms I'm throwing out here. I'm not gonna go in and define all of them, but if you have any questions about terms I'm using, please feel free to ask. So what are the challenges with the current system, and why are we coming before you to advocate for a change? We think there are challenges from both the side of the PUC and from the developer side. From the PUC side, what we see is fundamentally, you know, we've been tasked to ensure decommissioning by statute, but we otherwise have no regulatory interaction with those developers once we've given them their CPG, once we've given them their permit, unlike, for example, a utility company, which we interact with Green Non Power on a regular basis. So we don't regulate these merchant generators, what we call them, in the same way that we regulate monopoly utilities, and importantly, we do not currently have statutory authorization to actually meet our obligation at the end of the useful life of these facilities when they actually will have decommission expectations. And so what do I mean by that? Well, it's an administrative constraint. Effectively, if we needed to call on one of these paper documents from a bank and say, you know, here, bank, we have a document, we're owed XYZ dollar amount of money, we have to meet this obligation, we don't have anywhere we can deposit that money, and of course this is years down the line, but if we actually were needed to decommission a site and restore the site, we don't have the ability to access funds needed. We have a paper document that gives us a right to access those funds, but that's different than actually having the money in an account somewhere. Another administrative constraint we've identified is really the significant workload on the PUC that this process entails currently. As I mentioned, there's a triennial, three years, requirement that these instruments be updated for inflation. That requires engagement with formal commission processes. That requires assigning a staff member. That requires the staff member to review documents. Oftentimes, we see these financial instruments from the banks follow a template. The bank template might not be the same template as our template, and they're, you know, essentially then is a back and forth with the developer attorney in the middle, and this could happen twelve years after the solar panels have all been put up. They're still required to come back before us, and we're still required to engage in this sort of intensive review of those documents. Another constraint we've identified is that it might be very difficult for us to legally enforce these instruments, remember, these pieces of paper from a bank, in the event we actually had to, even if we had a valid claim. We have concerns that it would require litigation. We have concerns that the banks might

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: not

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: be as willing to comply as they are willing to provide that piece of paper when it actually comes to it. And remember that the claims we would have to make would not be with the people who develop or own these solar projects or battery projects. We would have to go make a claim against a large financial institution. The second point on the slide is substantial noncompliance. Really, that's quite simple. Over the last year and a half, the Commission engaged in an audit of overdue compliance for cases that have been before us, and we found that 60 to 65% of facilities that were required to maintain these financial instruments with us were out of compliance. So that could either mean the instrument wasn't updated, that could mean that the instrument had never been filed after the draft was filed with us, it could mean that the instrument filed with us most recently was deficient in various ways, and so on. And this noncompliance really demonstrates a regulated entity constraint.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: So I understand, they come in, you say, you get a piece of paper from the bank. Does that piece of paper say x amount of dollars have been deposited in this account? Okay, and

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: this It typically works that way, but not always.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: And they are supposed to put every three years, there should be an updated assessment of what it's going to cost to and they're supposed to put extra money in. But you were finding that a, you get a letter from the bank saying you can access this money in twenty years if you need it, but there's never any money put in it or there might be money put in it originally, but then the follow-up money or not enough follow-up money is going in, and it's going to take a substantial amount of effort and probably court action to do this, and none of this is even dealing with if somebody goes bankrupt and is gone, in which case the state of Vermont is sitting on this mess. And okay, because, yeah, twenty years from now, we could all be on hydrogen or something. Okay. Well, can I ask

[Unidentified Committee Member (Senate Finance)]: a question? Is there are there any penalties for noncompliance?

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: We have the discretion to issue penalties for noncompliance. I believe, and Steph can correct me if I'm wrong, we found such substantial noncompliance that we wanted to at least offer a grace period to allow developers to come back into compliance, and that grace period is wrapped up or close to wrapping up, and to the extent that some developers still haven't filed the proper documentation with us, that's an avenue we could explore. Do have you anything to add on that point, so?

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: I would just say the noncompliance was a huge red flag for us that there's a problem with the methodology, right? The system itself, submitting letters of credit, escrow agreements, bond agreements, some of which are money in advance, some of which are just a promise, right? They're promissory notes. I go bankrupt. Right, and if you haven't been paying for your promissory note, essentially because you've absconded, then that note is meaningless anyway. So the system itself, we believe, is flawed based on the state of art.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: And I'm assuming it is taking you a lot of time and money. I understand that some of these developers are from overseas, which I'm sure makes things even more difficult or challenging. Okay, and the bottom line is where this might not be as toxic as nuclear waste, There's a lot of it that will have to be disposed of somewhere. And so it is in our best interest to make sure, but and in the most efficient way possible because you have limited staffing at times.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: Yeah, think that's spot on. We have an obligation to make sure that these solar sites are decommissioned and restored one day, but we certainly don't have the staff to actually go out in the field and do that work, and we don't currently have the ability to deposit the money in that account and pay contractors to do that work. So we're sort of stuck in terms of what action we could actually take if we needed to decommission right now, and we have some time. That's one advantage we have, is we have some time before these facilities do reach the end of their useful They

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: make it easier for them to pay in because the payment is spread over time, unless they don't. Okay.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: So the last item on this slide really is just there's significant amount, as you've identified, of liability and uncertainty, and that would really be liability that the state is faced with. That would be the liability of communities having decaying infrastructure in their midst. So what have we proposed? Well, short, we've proposed a fund model. This would generally have the attributes you see on the screen. We're thinking there would be an upfront contribution. We think the fund would be managed by the commission with collaboration from state treasury. We think the fund would have the opportunity to grow over time based on some sort of reasonable conservative interest rate. The fund would have a huge advantage in the sense that it would be available for us to call upon regardless of the status of those developer entities, bankruptcy notwithstanding the money's gonna be in an account. The fund and interest borne on that fund could cover the costs the commission incurs to administer it, and the fund could account for for overruns. The specifics of establishing the fund as we envision it would be developed over the course of a commission rule making. So these are general attributes and we would fine tune that in a rule making.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: This would be an investment fund probably in the treasurer's office.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: That's right. We think it would be a special fund.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: Okay. There's Treasure.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: There are similar examples that ANR uses that are effectively cleanup funds for hazardous To clean

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: up fund. So

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: as Steph noted earlier, we did receive some input from interested parties coupling this proceeding with the single plan proceeding. But we we really think that more input is needed, and we think there would also need to be a consultation process with outside experts for the establishment of the fund. And we've heard from several institutions, some within Vermont, that would have interest in offering time in some capacity, but we would need to to undertake an RFP process and engage consultants to to sort of do that complex actuarial or accounting work needed to actually set this up. In the proceeding we conducted over the course of the last year, we received limited feedback on our decommissioning proposal, and we're providing with this presentation, I believe it was emailed to the committee yesterday or the day before, all comments that included feedback on the decommissioning proposal that we received over the past year in that case. Feedback to the extent we received it did center around that contribution amount from the developer. There was a lot of interest in that topic specifically, as well as interest about potential return of funds. And we've proposed some statutory language the committee has been provided and that language does, as I noted, contemplate further process to refine this idea. And I just wanna reiterate that the goals of this shift really are to minimize regulatory engagement, right size costs and financial assurances, and really ensure that the state of Vermont is not burdened by dormant or abandoned infrastructure. I have a opportunity for questions and

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: comments here. What happens to the money that was supposed to be or may or may not be in those bank accounts? The money that's supposed to have gone in, which sometimes hasn't gone in, I'm assuming that there will have to be some pay in for existing solar arrays that probably have to be pretty individualized.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: We think that the process we don't see a path for us to demand that facilities that are already built and already have their permits, like, that they have to opt into this fund. In effect, we have instruments for those places, and it is our job under the status quo to pursue them to make sure those instruments are properly maintained. With that said, we think there's a real opportunity here for substantial cost savings even for the developers that already have projects built. That's mainly because every three years right now, they're required to interact and pay fees with a bank or a different financial institution. They're required to retain an attorney. They're required to file those updated instruments with the commission. Sometimes, if not always, they're required to put additional money aside due to inflation. And a big, source of uncertainty for developers is there could be deficiencies in their filings that would cause us to reject them, and we do. We have to because we have to ensure decommissioning, and that doubles the costs because then they have to go back to the bank. They have to they have to, you know, use their attorneys for even more billable time and so on. So we're thinking back of the envelope math, every three years, developers under the status quo may be on the hook for something like 3 to $4,000 as things currently stand, just to get their filings updated with us right now. And we believe that there's a very doable path to creating a fund that requires contributions amount contribution amounts that still make that fund attractive for existing projects because of the cost savings. Okay.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: When I'm just thinking of municipal employees join state pension fund. There is a block payment to make up for the fact that you haven't been paying into the fund for x number of years, and then you get into that regular payment cycle. That might be a system because it sounds like some of these developers have been doing the right thing and they've been putting money in the bank and some of them have or maybe not or maybe not as much money. It's costing them to file with you. It's costing you to look at them. So in the long run, this would be one payment upfront, which would then be an an investment fund, like a pension fund. So you'd do it and be done with it. Or maybe if you had to pay it when you were looking at a lot of capital expenses, pay it over time, but okay.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: So as I noted previously, we really think it would be best to have a proceeding to refine all those points.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: Okay.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: But in our minds, from where we stand right now, an upfront contribution is one viable path that makes sense. We don't feel that we have the expertise to come to you with a dollar. That's why we think we need further process, and we need to retain experts. But the upfront contribution model is we think one strong approach. We think there's another benefit to that approach, which is these developers do have to engage with us, the regulator, when they want the permit to fill the project. Right. So to the extent we do have engagement with them, it's really at that point. Yeah. So for all new projects, there's a very clear path to requesting an upfront fee. It's our view that the economics of this fund would also, as I said, make it attractive even for older projects.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: So what does this build do? Because it sounds like you're not quite ready for prime time to put all the particulars in the law. Does this just allow you to set up? What does this bill allow you to do at this point?

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: This bill does really two main things. One, it allows us to retain consultants

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: for economic purposes generally. Does that include money?

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: What do you mean, for banking? For

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: consultants, because if it does, it's going on the wall across the hall. It does it, okay.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: So the second thing it does is it creates a fund and instructs the commission to open a proceeding to refine the details of that fund with engagement from the developer community, other interested parties. It allows us the authority to build back to that fund the costs of a consultant, so that's where we would come up with their paychecks, and it would give us the ability, once that fund is created, to draw upon it if needed for decommissioning at the end of the useful life of these facilities.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: What else could you draw upon it for?

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: It's limited to the purposes of decommissioning. Not an attempt create a slush fund. It's pretty restrictive and not waived. Because

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: we're asking developers to pay into it. Right. In return, when they're ready to shut the thing down or it's dilapidated and needs to be shut down, they're not going to be hit with a big upfront cost at a time that their revenues have stopped coming in. Will have paid in over time. And if this is an invested fund, hopefully they will be making a lot more than they will just with money sitting in a bank account.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: Can I clarify one point about that? This fund is not it's built for the delinquency. It's not built as an insurance mechanism to fund all decommissioning that has to happen. So projects still will maintain their obligation. And just to clarify, there are plenty of developers who Yes, this is for delinquency situations. So the status quo, if everyone's doing what they're supposed to is at the end of the useful life of a project, that owner will either convert the project to a new useful purpose or take it down to the standards that are required by the certificate of public good, and they pay for that. They have other mechanisms What in their

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: bank. What they're they're putting putting in in the the bank is money in case they walk away from it.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: Yes. In the status quo, that is what they're doing.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: And you're saying rather than put the money in the bank, you're going to have them pay into an investment account which will give you some backup money in case they don't fulfill their obligation to decommission at the end.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: Yes. Or they haven't properly anticipated the total cost, I. E. A cost overrun occurs. It is an insurance fund against delinquencies, much like a car insurance fund is an insurance fund against accidents. And so this fund is not to fund all future decommissioning. And so, it'd be built right sized for that purpose because we don't actually want to be in the business of decommissioning sites. We don't want to retain excavator. Only in the circumstance where the state is holding that obligation because of delinquency will we be tasked

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: with that. I mean, I'm thinking to the developer, it would be easier to pay x annually and have it invested. So when they come to decommissioning, their money's there.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: But they don't have mechanisms for that in the private marketplace, is that our understanding? Okay. We need this money from our perspective for the reasons that 02/1985 says we need the money, which is it is on the commission to ensure decommissioning. Okay. For both all This is your insurance backup. Instead of working through those third party financial entities as the intermediary of the funds, the state holds it, the state has access to it.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: There is no question. And they won't have to come in and update every three years.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: So cost savings, mutual benefit, and wind is the goal.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: So they will pay you upfront, you're gonna invest it, you're gonna have your delinquency fund that won't be every three years dealing with the bank.

[Wes (Wesley) Skidmore (Staff Attorney, Vermont Public Utility Commission)]: And just to clarify one other point, right now, if you were to build, let's say, a five megawatt solar array, you may be looking at a situation where you find A rated bank, and you put aside $150,000 maybe $200,000 this is one way they provide these assurances, in an account and that money is frozen. The bank then, because they have that money in an account, signs a document that they provide to us, and that's what we can call upon if the developer twenty years, thirty years, forty years down the line doesn't decommission the site. On top of that frozen sum of money, the developer also has to pay costs associated with renewing that instrument every three years. What we're thinking, and again, we don't have hard numbers because we need to retain experts to come up with those numbers and give us a formula, we're thinking a dramatically lower amount of money would be contributed to this fund Because in in all reality, we don't view there being a possibility of the vast majority or even a majority of these projects at all needing to be decommissioned. We think there are some serious incentives for developers to decommission their sites, and we anticipate a low level of delinquency. And so really, we're not looking for hundreds of thousands of dollars in terms of contributions. We think there's a low, low number that can be that all parties can agree on that allows the developers to disengage with that regulatory process over the life of their project.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: But the fact is we haven't it's like a nuclear plant. We haven't decommissioned any, so we won't know till we get there how much I mean, yeah, what's the penalty for not decommissioning to just declare bankruptcy, disband, and walk away, go out of business.

[Unidentified participant]: And I can see that

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I mean, I could see if you want if you're gonna decommission this plant and you've got five more, you're gonna wanna stay on the state's good graces. But we don't have any experience on which because we never decommissioned things. I think the only thing we decommissioned is Vermont Yankee, and that was a little different. Right. As far as we know, these aren't toxic. We may find out they're old PFOAs or something in them is toxic. Your

[Unidentified participant]: point is well taken that Vermont has a relatively young solar and battery market. In some of the Southwestern states where that market is a bit more mature, there has been some decommission occur, and my understanding is in the vast majority of cases out in the Southwest, there's a huge incentive to re handle the site.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I would assume so, as long as solar is what we're doing or but technology is changing very rapidly, then there is the potential that, like, coal, the market decreases significantly. So this need to think through all eventualities.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: And I will add the status quo is that the estimation process occurs now. Like, how we're getting to these estimates is part of the status quo. And so that variable doesn't shift with the new fund model. It is part of both. You're right. We absolutely need to understand that eventual number. Yeah. There are also other financial incentives associated with the site itself, not just the infrastructure speed, solar, solar forever, because of points of interconnection, because of upgrades to infrastructure, because of tax depreciation benefits to stay with the project until it is fully either taken down or repaneled repurposed. Not everyone is going to operate within those constraints. You're absolutely correct. That's why we're saying we think delinquency is a very small subset of the potential here in this marketplace. This is very akin to what the current directive is, and in fact, puts a lot more behind that directive. Right It now it just says like a

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: superior program.

[Steph Hoffman (General Counsel, Vermont Public Utility Commission)]: Yes, and we think so too, but we also recognize that there's still some unknowns and that's hard to pin down. But right now we have a sentence in A5 that says we must ensure decommission in and other go about that, make rules, problem made rules. And We think that looking at this from a different angle with a different regulatory sort of pension throughout an extension of that pension over thirty, forty years helps us get the assurance faster, being the state of Vermont, and ensures that projects can properly plan economically, understand the contribution from the get go, not over a long time horizon, etc. When you have mutual benefit of regulator and regulated entity in that respect, the results tend to be better than the results we're seeing with this That's what I mean by circling that red flag when you have significant non compliance. Probably the system isn't working properly and it's not effective at total flow. It's regulator and regulator.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Yeah, you're not a bill collection agent.

[Unidentified Committee Member (Senate Finance)]: No, we aren't good at that. We're also not good at restoring soil horizons and removing the panels, and those are all made to Yes, plant exactly.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Okay. Committee. Questions? Thank you. Thank you. Okay.

[Unidentified participant]: Thanks a lot.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: We've got ten minutes. Peter is here, and I have a feeling I'm not gonna leave this committee later to talk about Nine Okay. Yeah. What is it? 09:40. 09:40. There it is. I'm I'm looking at the committee. No. I think I'll

[Unidentified Committee Member (Senate Finance)]: Well, I'll stay a little longer, but I have to go soon. Okay.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: I mean, you guys can stay. Yeah. Thank you.

[Ellen Chittenden (Office of Legislative Counsel)]: Are you anticipating a long discussion? I think potentially you're trying to

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: make a decision. I'm trying to make a decision as humans at which point. Or do we at all would like push 09:40 to natural resources? So I think we wanna So very brief discussion.

[Ellen Chittenden (Office of Legislative Counsel)]: It might not be a long discussion, I'm sorry.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Oh, okay.

[Ellen Chittenden (Office of Legislative Counsel)]: But I don't know that.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Judging by the amount of discussion right now, I wouldn't say we're gonna have a Okay. Long Peter, come on 09:40. Do

[Unidentified participant]: you want to do that? Or, Ellen, are you staying for 07:10?

[Unidentified Committee Member (Senate Finance)]: I can stay, yes.

[Unidentified participant]: I was gonna say,

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: if we just turn

[Unidentified participant]: by 09:40 real quick, we're not on

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: the We thought we were going to get in between. I've only got five minutes before Peter's schedule. If Ellen's I'm sorry. Take him stay. Okay. This is the second day we've had Ellen on calls. Last week, I think we had her on every day. It's a long. So

[Unidentified Committee Member (Senate Finance)]: you do Alright. That's good. Not that that, Corey? While we're waiting for Peter. Oh, I think it's okay. So let it go to Natural Resources.

[Unidentified participant]: So is that the question we're kind of posing? Do we want Natural to take a peek at it?

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Do we want to relinquish the bill This to one they can do recommendations on, but I think this is more squarely in our domain. The other one is a lot of energy planning in it. There's a couple with some deadline or something we

[Ellen Chittenden (Office of Legislative Counsel)]: So it's only three things. It's the it's the use of thermal funds by BED Yes. For their their thermal and transportation programs. It's the energy plan updating the regional planning statutes to address the energy planning. And then the repeal of the telecommunications advisory board that hasn't met since

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: 2001. That was the one that we needed to do. Yes. Yep. 2021. Sorry. Alright. Thought it was. So Should it start off then?

[Unidentified participant]: Let them let natural We

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: We have the

[Unidentified participant]: You do?

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: We have the bill.

[Unidentified participant]: Oh, I know.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: But We have the bill. The secretary of the senate in his wisdom said it to us. I don't know if it would automatically go to them unless we will link with it. I was told the yield would automatically come, but that's under rule 31 because it hits the revenues of the state. So I think we have to ask to be relieved with our record intact and be sent to them, and then they can work on it. So we'll get this in next week. I think we can take care of those three sections pretty quickly and or the week after it may actually end up being up. Talk to Charlotte and see if we can get that in. Okay. That's easy. Easy peasy. Love it. Okay.

[Unidentified participant]: Thanks, Emma.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I I I started really need to keep paying this on the impact bill, folks. We're gonna be busy. Okay. Peter, come on. You know the drill.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: I do. Hi. I'm a peep my nightmare is trying to do computers out in public. Do you need

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: to put

[Unidentified Committee Member (Senate Finance)]: Put it on my job, Will.

[Unidentified participant]: We got a

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: We got a But right

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: now, maybe it'll last. Charlotte, do you

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: see Oh, there you are now.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Yeah. Thank try to do a screen check. Peter Sterling, executive director of Renewal Energy Law. Thank you so much for taking a few minutes. I was gonna

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: touch your

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: time today to hear me walk through the benefits of single plant. Let me just see if I can share this test for you. Can you make me a co host? Yeah, you should. I've got a couple slides that I think just illustrate what I'm saying. I only need a couple minutes.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I think we're losing everybody's attention spans.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Okay. Here we go.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: No. No. You can do that. I would say if you only have a couple slides, that will work very well. Good.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Okay, do you see me, or is

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: that Yeah, this is your cohost.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Oh, here it is, Cher, yeah, okay, here we go.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: He does. Right, Okay. The

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: current single plant law limits solar development on good sites, and you can see the picture on the right there, there's a 2.3 megawatt solar array out of a gravel pit in a Hardwick, and that's in the green there and in the red there is another, I don't know, 15 or 20 acres that's behind it, that is much more difficult to access because of the current restriction. I think we would all agree that we're going to build solar, putting it on an old gravel pit is a good place, and we should be taking down the barriers for putting solar where there's an already host solar, it's close to existing load, where the infrastructure's already there, which makes it all cheaper, and you can take already disturbed sites. The background on single plant is it only really applies to solar projects under five megawatts that are on the same or adjacent parcels. It was enacted in 2009 to stop the artificial partitioning of other projects like net metering and standard offer, and it generally prevents the colocation of solar where it could be beneficial to rate payers. But with the end of off-site net metering and standard offer going away, single plant rulings just add time, uncertainty costs to meeting Vermont's renewable energy goals without any benefits to ratepayers. And importantly, towns have begun to move forward with enhanced state energy planning and are trying to cluster solar development and single plant rulings from the state of Vermont or the Public Utility Commission limit a town's ability to put solar where they think it's appropriate.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Okay. You just said standard offers going away.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Well, yeah, I mean, there's no more

[Unidentified Committee Member (Senate Finance)]: There's no

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: There's really no more

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Standard offers.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: No more bins being put out there. Okay. The legislature, well, Senate Natural when we discussed it last year, and they in the house energy community neither seemed to have any interest in reauthorizing a new round or standard offer bidding. So for all intents and purposes, there's a couple of megawatts left that'll be big, but it really isn't in a consequential way.

[Ellen Chittenden (Office of Legislative Counsel)]: Okay.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Here is an example of how amending single plant will benefit ratepayers and others and natural resources. You can see there are two solar arrays. There's one on the left, existing solar array, and one on the right is proposed solar array. While the single plant rule was in effect, this green access really, the developer would have to build a brand new access road at a cost of $50,000 to access the new solar array because single plant ruling prevented the sharing of things like roads. Now they can just utilize that green road there. You don't have to build the roads, you don't have to build new power lines along the road, which saves about $10,000 every 100 feet. So when you get rid of single plant rulings, developers are allowed to build solar more affordably because they don't have to build things like new roads and put up new poles and wires on these existing sites. I think that's very beneficial to everyone without causing any harm to anyone. A second example, and this is a less good drawing, but those four blocks down there are four houses, and they all want to have their own net meter have a net metering, And the PUC initially called that a single plane, even though they were like 300 feet apart at times. And that just eventually got permitted, but it caused many months of delays, which adds to the cost. Bottom line is even for homeowners, if you are limiting, not eliminate, but limit the single plant moving, are allowed to be able to put solar up more affordably, not just for the big ones in the fields and stuff, but for homeowners as well. Again, without any adverse impact on ratepayers, and I would also argue that we continue, while pushing some more solar together, you are limiting the impact on natural resources. I think I wasn't here for the PUCs proposal, but I'm guessing they gave you a map like this. I wasn't sure what they had, but just as another way of looking at what the single Under this law, what single plant would apply to. So two large power purchase agreements, you can see. A standard offer project, you can do a colocation and you could put in a large solar array, one to five megawatt next to a net metering. This is what it will impact. And again, I just want to really be clear for those of you who want to get in the weeds, colocation of net metering arrays and standard offer arrays are still subject to these single plant balloons, meaning there is no real potential for a rate payer impact by gaming the system. And I think oh, that was the end of my old computer. And I think that was my last yes. The only slide he missed was this beautiful aerial picture of a solar array with the word question sign. So you need to represent it. Know?

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: It's these solar pictures of

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: You've seen plenty of solar pictures. Of the array. So the the end of the day, moving forward, the eight seven ten would allow for the greater co location of solar to benefit ratepayers, benefit natural resources, and have no impact on ratepayers by allowing for projects to be artificially partitioned to gain advantage of nonviolent.

[Unidentified Committee Member (Senate Finance)]: Is there anyone I'm sorry. Is there anyone arguing against this proposal? Okay. Because it seems like it's a bit of

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: a fog mess. Allison was. So Yes.

[Unidentified Committee Member (Senate Finance)]: But she's not available.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: I mean, I know she's been very involved with

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: some reciting. I will say, and I'm not gonna speak for the Public Utility Commission. Were here. They they did a big public process over the summer and fall, and, you know, other entities like the Leader of Cities and Towns and the Farm Bureau and all these other people who have tough interests in this, and no one spoke out against it. Okay. I mean, it's a solid proposal.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: Okay. Then we will do some work on this because it does have potential for rate impacts and clean out the cost impacts.

[Peter Sterling (Executive Director, Renewable Energy advocacy group)]: Thank you for your time on a Friday.

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: We've been here. My goal was to get them out early at 03:30. Woah. But since Look at that. Thirty today weekend. The whole

[Unidentified Committee Member (Senate Finance)]: three

[Sen. Ann Cummings (Chair, Senate Finance Committee)]: times It's probably why there's so many school classes in here today. Would you