Vermont Legislature SmartTranscripts:

[Sen. Anne Watson (Chair)]: Okay, good morning. This is Southern Natural Resources and Energy. It is Friday, April 24. Happy Friday.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: You do.

[Sen. Anne Watson (Chair)]: And we are starting this morning with H-nine 15, the bottle bill. So we're going invite our legislative council to the chair here and I think it makes sense to look through, basically go chronologically through this, like look through the changes that we've talked about yesterday and then continue on. Okay. Does that Sure. Okay.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: So I did put a little index about the highlighting at the top of the page. Yellow highlighting, which page is one at 27 for the changes you requested yesterday. Highlighting from 27 to 40, is from draft 2.2.

[Unidentified committee member]: And then the gray highlight, you had

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: couple of questions for for Matt, and, I just highlighted them in the gray. So just moving through the changes. The first change is on page five. This is in the handling fee. It's increasing the handling fee for phone legal from 3 and 1 half to 4 and 1 half cents.

[Sen. Anne Watson (Chair)]: Mhmm.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: So now at the bottom of that subsection, it had previously said beginning on 03/01/2029, no Anne and B shall be paid. But because of the floor and the compensation provision, included in the fight, it doesn't didn't really wasn't really correct. So beginning on 03/01/2029, a retailer or person operating her debt consent or shelter reimbursed for beverage containers that are powered by a strategic plan approved by the secretary according to the fair compensation requirements of the plan.

[Unidentified committee member]: And then

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: you will see what's there with the the 4 and a half cents in the plan. And then moving on from there So maybe just a paper. The four and a half seconds, I think this section starts effectively with NAAT. Yes. Yes. Yeah. Okay. On on p seven, there's a technical amendment. Senator Hardy had pointed out yesterday, May, and that was changed on page seven related to the district assigned doctor Scott, I repeat the pickup. Moving on from there.

[Sen. Anne Watson (Chair)]: I'm ready to.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Page nine. By ten and eleven, this is the happening fee for liquor. It involves increased from 3 and half cents to 4 and a half cents. And moving on from there in the page 17, line seven. And this is a question for ANR. This was a question of whether or not, when or if ANR is required to issue their own plan, whether the 10% recycling market development assessment is sufficient as an incentive, disincentive to manufacturers or distributors to the PRO.

[Sen. Anne Watson (Chair)]: I don't do anything further to suggest on that at this moment, but Okay. We'll leave that as a

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: And then on page 19, line seven, this is another question for ANR. This is in our convenience of collection requirement within the stewardship plan. It was, what does unless a waiver is granted by the secretary modify? Is it modifies the ability to have one point of reductions in a population of 7,000 or more, or does it modify the immediate return of deposits? And that was, there were differences of opinions as to what that modified.

[Sen. Anne Watson (Chair)]: Since we're here, can I ask Mr? Chapman for thoughts on this one?

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: So for the record, Matt Chapman, Director of Waste Management Prevention Division. I think it was intended to modify the MPDA program.

[Sen. Seth Bongartz (Member)]: Page 19.

[Sen. Anne Watson (Chair)]: Thank you. And that

[Unidentified committee member]: Okay.

[Sen. Anne Watson (Chair)]: Great. Moving

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: on from there on page 20. This is the fair compensation for the as a part of the stewardship plans. And so I'm just gonna read this subdivision. The plan shall describe that all locations that are deemed beverage containers are fairly compensated for their participation in the selection program, provided that the product storage organization shall pay each location for the beverage containers who are in one half sentence Pertheme's intercollective unless the product stewardship organization negotiates a separate compensation agreement with the location of Pertheme's beverage container. And I do what I almost always do is I interchange product stewardship organization and pursuit to responsibility organization, and I need to change that. I have

[Sen. Anne Watson (Chair)]: So, like, PRO versus Yeah. I have a

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: such in the brand without me.

[Sen. Anne Watson (Chair)]: Can I ask them? So I don't know if we want to do this or if it's too confusing, but remember we talked about those, the like machines that the RV understands, I knew there was letters that went with it, reverse bending machine things, that if there's just one of those that people just suck in, they're unstaffed, whether we would

[Unidentified committee member]: want to do a lower floor or the.

[Sen. Anne Watson (Chair)]: Did they match that point in testimony? You're pretending that you didn't say that, but No. They are not. Well, they're not. That there are different costs. But I don't know. It's too complicated. I just wanna bring it up again.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: I get all this again with respect to the handling fee more generally, the agency has significant concerns about this approach and thinks it fundamentally alters the regulatory design of the program at large. And I have concerns that it's going to undermine the efforts that we're trying to take to modernize and expand the system. I am still processing kind of the language and how it works, but my concern is that you've basically taken away any incentive for the PRO to do any improvements or modernization of the system, and I think at the moment we have very significant concerns as I found this approach.

[Sen. Anne Watson (Chair)]: Well, my question was the sort of like

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: The RBMs? The RBMs have been lower. Yes, they should have a lower rate. Mean, I think, again, I think statutorily setting handling deep rates is something we're not in favor of. Got it.

[Sen. Anne Watson (Chair)]: Okay. This I'm flagging this for more thinking. Let's keep looking up.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Okay. Page 23, in the report from from the PRO that you you wanted the number of redemption centers added or removed from the plan over the preceding year.

[Unidentified committee member]: That

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: takes you to section two, which is where you ended yesterday.

[Sen. Anne Watson (Chair)]: Page 29.

[Unidentified committee member]: Yeah. So

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: we Okay. This is really minor, but would we want to report to this session back to go from we will also say here over that each with

[Sen. Seth Bongartz (Member)]: with or without the. If this happened in line, is it gonna happen to anybody?

[Sen. Anne Watson (Chair)]: Like, something could be removed from the plan, but they hadn't actually closed?

[Sen. Seth Bongartz (Member)]: Well, no. Sorry.

[Unidentified committee member]: You could

[Sen. Seth Bongartz (Member)]: close. Just close. If you I'm not making money on closing. Is it ready to move? That's how

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: it removed. Is that? That would they can no longer be part of So and cover.

[Unidentified committee member]: Yeah.

[Sen. Seth Bongartz (Member)]: Okay. Alright. Okay. On

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: page 29, Section two, you you may recall that yesterday, there is an amendment in the language you reviewed yesterday, 10 b c fifteen twenty three, but that was prior to the PRO plan going so bad. This is when the plan was going into effect, and it changes the language to be consistent with the being the PRO and to also allow for some exceptions to redemption. So the first, the retailer shall not refuse to accept from any person the beverage containers of it's no longer of a kind size and brand sold by the retailer, remember, because now all of the all of the sellers of beverage containers are in the PRO, so it's no longer about what they're what they are selling. You shall not refuse to accept any beverage container. 29 line 15, manufacturer, distributor is being replaced by the producer responsibility organization, So the PRO shall not refuse to pick up from a point of collection included in the suit of the fence. And it's no longer of a concise, bread, etcetera. It's a penny container for a refuse to pay a redemption rate of any from the point of collection. And now page 30, line three, this is adding in an exception for small retailers. So a retailer may refuse to redeem beverage containers if stewardship plans have been approved and implemented, and a retailer building is less than 5,000 square feet. So there is opportunity for redemption elsewhere under the plan, and it's a relatively small retail operation. And then similarly, page 30, line nine through 12, the manufacturer that sells directly to a consumer from a retail location may refuse to redeem if the retail location is less than 5,000 square So beevers that were in the house passed in general, but they were taken out until the PRO is implemented. And that's because once the PRO is implemented, there all are there will be alternatives where there may not be alternatives other

[Sen. Seth Bongartz (Member)]: than ours.

[Sen. Anne Watson (Chair)]: Wait. Was this in the house of Casper?

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: This was in the house

[Sen. Anne Watson (Chair)]: of Bedford. Because

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: you you took it out of

[Sen. Anne Watson (Chair)]: We took it out.

[Unidentified committee member]: We took it

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: out of not took it out. Of general application, right, before the PRO.

[Unidentified committee member]: Okay.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: And this is going in once the PRO is set up, and this section was not in the previous year now.

[Sen. Anne Watson (Chair)]: I see, okay. So it's in the house it was just immediately it would have happened and this is waiting till the PRO would happen. Okay.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: There's one other difference just to note it. The house pass version had the kind type and size sold by the retailer and this basically creates, we call it universal redemption, but it basically anywhere you go where there's a redemption opportunity you can redeem anything, you're not limited to just

[Sen. Anne Watson (Chair)]: the Got it. Goods Okay. And that takes back after the PRO is established. Right,

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: And then there's one other change, that's page 30, minus 13 through 18. This is when the point of redemption for PRO may refuse or shall refuse, actually, is when it's not clean, broken, it's not labeled according to the requirements. It's already been redeemed, so you can't do double counting, and it's not registered with the PRO. So they will not redeem that.

[Sen. Anne Watson (Chair)]: Is it also their language about if we know it's not if there's reasonably no that it wasn't purchased in Vermont or something like that. It was the Seinfeld reference, wasn't that in here? It was in the draft, it's

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: not in the one that's here. Okay. It's in the draft that

[Sen. Seth Bongartz (Member)]: I think I gave Mike. I don't

[Unidentified committee member]: know if he

[Sen. Anne Watson (Chair)]: wanted that one, but I remembered it largely because of the size of the picture. It's not the statue currently.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: It was in the draft I gave to Mike, it didn't come over in the draft. That's before you break it. Oh,

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: okay. I missed the message, sorry.

[Sen. Anne Watson (Chair)]: That means do we monitor I it know you did like it was to prevent somebody from Yeah, true. Mean, it seems good. That feels like somebody's going to try it and go to court and you know what I mean? Like that seems like the kind of thing.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: I mean, why would a redemption center do that?

[Sen. Anne Watson (Chair)]: No, a redemption center would do it, but like a person, a person, you know, do it. I mean, I don't know why they would do it, it's not that much money, but it was, I just remembered it. So much, bring it up. Yeah, yeah, sorry.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: I'll just say that we have had to send letters to municipalities in an adjacent state that doesn't have the bottle bill to tell them to stop collecting cans and shipping them over and redeeming them

[Sen. Anne Watson (Chair)]: in the state of Maryland.

[Sen. Scott Beck (Clerk)]: Oh, okay.

[Sen. Anne Watson (Chair)]: We have had to send letters. Letters were sent. Okay, you should put it back. I agree, let's put it back

[Unidentified committee member]: Okay, I'll put it

[Sen. Anne Watson (Chair)]: back in. Thank you.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Sorry, I missed it.

[Sen. Anne Watson (Chair)]: No worries.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: So you can move on to page 33. And this is the transfers from the water fund. Remember yesterday, you removed the implementation grant for the for the after the donors once you increase the handling fee. And so the question now is, do these amounts, are they should they be correspondingly reduced?

[Sen. Anne Watson (Chair)]: I was was thinking about them as being called, like, the transition grants, but Yeah. Is that the same thing that you're Okay.

[Unidentified committee member]: Just wanna make sure that

[Sen. Anne Watson (Chair)]: that I'm thinking. And so I'm going to look at Mr. Cabin for this. Yes. For this, I should probably go back and look at the previous draft, but do these numbers look right to you in terms of like grants for?

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: No. So basically the transfer authority should be the sum of what the grant programs are in sixty six-eighteen, and since you removed the transition grants, they should be reduced by three and fifty thousand. Support.

[Sen. Anne Watson (Chair)]: Okay, so the FERC bill should just be a million.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: It should be a million, a million, a A million, something.

[Sen. Anne Watson (Chair)]: That's right, because we didn't get to this part.

[Unidentified committee member]: Right, sure.

[Sen. Anne Watson (Chair)]: Right, that's why there's Thank you. Right, right. Okay, So a million, million

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: And then on page 35, we're moving you to section five, the waste management assistance bond.

[Sen. Anne Watson (Chair)]: Before we move on, one of the I have a question from Mr. Chapman on this part. I want to talk more about the other stuff that you raised, so thank you. But for this particular part, because the money is coming temporarily from the Ishites, One hypothesis is that as a result of the PRO, the amount of redemption that happens increases. My main question is like, I'm reading it, we're not making the Clean Water Fund whole relative to the money that we're taking out here. This is money that's coming up. But I'm wondering about, because of this program, or some kind of an increase, would we expect the sheets to grow? Or perhaps because of the program, there will just be less unclaimed bottles and as a result the sheets would shrink. I'm wondering if you have any comments or thoughts on the long term sheets.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: I mean, it's important to understand that sheets are basically waste in the system, right? Like they're unclaimed deposits from people who failed to use the redemption system. The goal is to reduce that number as much as we can and make the system function so that people use it.

[Sen. Anne Watson (Chair)]: Okay. So down over time. So down over time. Okay. Okay. This is good to know. Thank you. Let's keep going.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Okay. So on page 36 in the Waste Management Assistance Fund, this is where the grants are, and this is really to note that the implementation or transition grants for reduction centers were struck. They happen in Subdivision B 12. They're no longer there. And then I just wanted I flagged the gray area in the biofilm implementation grants just so that they're consistent with the genes that you just made in the water pump. And so you answer that question. These are now still consistent, and from there. Great. And then on page 37, the first highlighted language is the repeal of product registration. Once the PRO is set up, all of the beverages that are sold in the state have to be part of the PRO, and they all have to register with the PRO. They all have to be listed on the PRO's website. So that's why you're repealing section fifteen twenty eight you no longer need to have. And then on page 37, I failed to remove Subdivision 12 on line four. Those are the redemption center transition grants that should be removed, and all that's left to repeal would be the producer responsibility implementation grants on October 1. And then you're into the household hazardous products language. This is I mean, I can try to summarize the issue. Mac could probably summarize the issue or Terry could probably summarize the issue. Don't know how to do

[Unidentified committee member]: So I

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: I can do

[Sen. Anne Watson (Chair)]: it. Yeah. Yeah.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: So right now, there's the household hazardous products stewardship program, and it is supposed to be implemented relatively soon. And one of the things about that program is that it's supposed to have one plan for all of the different types of product types that are covered under the household product umbrella. But there are certain manufacturers of certain products that want to implement a stewardship plan, but they want to do it only for their product type or as part of an existing stewardship organization that's already working in other jurisdictions, which is a model that some jurisdictions use. You know, it's just warm up kind of an umbrella for it, then you kind of stick subsidiaries underneath that umbrella for it from the different cities. And so that is what one of these or potentially more than one of these product manufacturers want to do is they want to have the ability to have their own plan for their own product type. Right now, the language says there has to be one plan for all household hazardous products. So what this language does first on page 38 is it pushes out the deadline for the basically, registration of all the product and stewardship organization from July 2026 to 2028. And then on page 39, it effectively allows it moves away from that one registration plan or one collection plan on page 39.7. Instead of there being one collection plan, there would be a collection plan that addresses how covered household products enrolled in that plan meet the requirements. And then you will see on page 40 in section 10 that beginning 07/01/2027, a group of manufacturers may register a new stewardship organization covering a class of household hazardous products and their packages when put together. So not everything is underneath one umbrella, under one plan. There could be separate plans per class, but there can only be one plan per class of products. Mhmm. And that's that's really what that language does. There's some other things about reporting and estimates of cost and how A and R is going to be reimbursed. A and R is going bother what the A and R proposing for reimbursement is what you just saw for reimbursement underneath the bottle bill that they go through the budgeting process and then charge the the PRO, for what you as the general assembly approve to be charged as cost. And then you get to the effective dates. I mean, they they are tiered. The act takes effect 07/01/2026. The UPC label, that's 07/01/2027. Prohibiting sale distribution without participating in the PRO of 07/01/2027. The acceptance of average containers after plan implementation, that's 03/01/2029. The implementation of a plan itself is built into the text of the bill, that's 03/01/2029. And then the capital implementation grants, that takes effect on 07/01/2029. The repeal of that is in the text of the bill, and that's 10/23/2003. And that is the bill. Okay.

[Sen. Anne Watson (Chair)]: Questions of this? Okay. I realize that we were scheduled to go to another bill at this moment, but I do want to take another few minutes anyways to I want to go back to Mr. Chapman, if I can. I just want to recognize that, well, of all, you've put an incredible amount of work into the school already, so super grateful. So I want to hear more from your perspective as to either the problems with this approach or potential fixes or where can we go from here?

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: I wanted to caveat what I'm saying with that I just saw this draft this morning and trying to process the language about how it would affect the overall regulatory design. But my largest set of concerns stem from you have a PRO who is responsible for overall operation and management of the system and making improvements to equipment, making investments in equipment and other sort of aspects of the system and that's an implied responsibility not a direct responsibility. My concern is if there's no opportunity to negotiate a lower handling fee, that there's no incentive to purchase equipment and make the structural improvements to the operation of

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: the potable system that we're looking for.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: And I guess I'll just take one step back. I want to acknowledge like the handling fee hasn't been raised for a long time. If you're looking at existing system and the way the existing systems works without those structural improvements, I think it's reasonable for the committee to make a policy decision to increase the handling fee. I think when you're making massive systemic improvements to the bottle bill, inserting the historic handling fee element creates a set of distortions that I'm worried might disrupt the flow program.

[Sen. Anne Watson (Chair)]: So one possible solution that I want to put out there for discussion is increase the handling fee and then still require some negotiation or agreement. Here we've sort of said that it's more or less optimal because there's this floor. That feels like two pieces. Anyway, I'm trying to find the middle ground, so to speak, but if there's I'm trying to find a path forward that also solves the problem for redemption centers in the short term. Yeah. That's a similar to

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: your statement. Would it would it make sense to

[Sen. Seth Bongartz (Member)]: increase until the PRO goes into effect? So that would be that effectively sunset, so it gets them through this period of time. And then maybe even lab you to set a floor if that's what you

[Sen. Anne Watson (Chair)]: is that we set it at the higher fee and sort of phase it out almost, where it's at four and a half until through the first year of the new plan or something to sort of get people and then get this redemption centers to stay in business to get to the plan, or maybe even the first three years of the plan, you know, till some point. And then after that, there's the negotiation for compensation. And I also just want to ask Matt, you said that it's implied that they're supposed to make improvements to the system, and maybe if that's the reading, we should make it not to live, we should say we have to improve the program.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: So I mean, I think that we've been, So I thought about that and like, and I think that this is, you know, I feel like the insertion of the handling fee, like we're moving away from what I would call traditional EPR principles, it's a much more of a regulatory program. And you're basically asking the agency to start now dictating what technology gets used at what redemption center or something in that vein. Now I'm not sure that we have the expertise to further improve that, right? Like based on sort of like market patterns. There's one area that we've historically frankly done a pretty bad job in doing those sorts of things,

[Unidentified committee member]: which is why

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: again we've sort of, mean it's an assumption, but it's built into the plan and there is a grant program in there that would enable the acquisition equipment to basically make the process easier. And the assumption is that if you can negotiate a handling fee and the parties all agree that that transaction will happen, right? I think my concern is that if you can't negotiate a handwriting fee and there's no benefit to the PRO for ever purchasing any equipment and installing it in any of these redemption centers or increasing the number of redemption centers beyond what we currently have.

[Sen. Anne Watson (Chair)]: Except that they're required to do it. That's the thing that I don't understand is like

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: They're required to have, so there's a convenience standard and that convenience standard lays out what the minimum number of facilities there are and they're required to make the best use of existing facilities. You know, like most of our APR programs, they rely on a planning process to basically establish the collection network as opposed to the agency frankly coming in and sort of micromanage that process. This just sort of like, again, this was all designed with sort of a set of assumptions in place on how you would use the ability of people to work with one another to sort of encourage the type of things that we want. I'm still processing, Well, we've got a

[Sen. Anne Watson (Chair)]: feel like, you know, based on the testimony that we've heard in this room is that the first step has to be, we need to make the redemption centers that currently exist financially viable enough, so that they are going to stay in business until we, you know, until and continuing to when we have a PRO. And then we also, secondarily, and as importantly, have to build trust between the redemption centers and the people in the field and this new entity that's going to be running the PRO. And what I've heard with good reason, that trust doesn't exist yet. So if we can find a way to have a ramp to both provide financial stability and build trust, I think that's going to set the program up for more success. You don't need to I will say that at this point, I'm sure a lot of people have thoughts about the bill that we're looking at, the conversation you just had, and I want to hear all of it and welcome all of it. Well, you know, at the end of the day, everyone may not be happy, but like, let's see if we can figure out what we need to figure out what we're going to do. And so would love to, and I know you're just reacting to seeing it this morning. So would love to talk some more and would love to talk some more. Know, like, there's a lot of people that I would like to include in the in that conversation. So in any case

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Do you draft next week?

[Sen. Anne Watson (Chair)]: Yes. It looks like based on the conversation we've had, the number of changes is relatively small. But we do have some, like are we sticking with this policy as it looks like here? Are we changing? And that's a bigger discussion, I see will not show up in the next job and that's okay. But we've got on the We've scheduled some time for this for

[Unidentified committee member]: tonight's speech. Which the

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: good thing about this conversation is we all have the same goal. Everybody's making that thing up in the same boat. So it's just trying to figure out what

[Sen. Anne Watson (Chair)]: What's the best path? I appreciate that. That feels pretty true. Okay, thank you. You're welcome. Okay, so with that, we are going to transition to page seven eighteen and Mr. Locke from Pearson Zee, Vermont. How building energy codes. If he's there, are you there? He's there. He's there.

[Peter Walke, Managing Director, Efficiency Vermont]: I'm here. I'm here.

[Sen. Anne Watson (Chair)]: Yeah. And I actually need one second myself to transition. Welcome. You for thank you for being here. Thanks for your flexibility after we did not take this up yesterday.

[Peter Walke, Managing Director, Efficiency Vermont]: I'm happy to come at the pleasure of the committee. So my testimony will, I think will be blessedly short and maybe get you back on schedule.

[Sen. Anne Watson (Chair)]: Okay. All right. We'll go right ahead.

[Peter Walke, Managing Director, Efficiency Vermont]: Sure. For the record, Peter Walt Hack, managing director of Efficiency Vermont. I'm here to talk about h seven one one eight, which we provided testimony on the in the house side and house energy digital infrastructure. Changes were made at that point to the bill, which made us more sort

[Sen. Scott Beck (Clerk)]: of

[Unidentified committee member]: comfortable with the bill.

[Peter Walke, Managing Director, Efficiency Vermont]: The bottom line is you're looking at, we're talking primarily about municipal code enforcement opportunities From a functional perspective, I would much rather see code enforced at the state level. Most municipalities do not have the capacity to take that on. This is more of an opt in approach. But that does create continue to create a bit of a patchwork quilt of implementation of different programs across the state. And that's not great for folks operating in different spaces from our perspective. But overall, if a municipality, you know, doesn't have the capacity or doesn't want to opt in, they're not going to. So I don't think this does much anything. There's also, it was supposed to be funded through the general fund and as is normal, that money was stripped out in order to, you know, consolidate all that information in the budget. I do think that's gonna be challenging to move forward without any funding component to it. But overall, I'm relatively agnostic other than to say I would much rather see and much rather have you consider having the state actually enforce the laws it has on the books.

[Sen. Anne Watson (Chair)]: Thank you. Think that I mean, ultimately that would be my preference as well. I feel like that is something that is going to have to happen in the future rather than in this draft, of course. But it it makes me wonder about, or the municipal, I'm sort of spitballing here a little bit, but it makes me wonder if with the municipal enforcement piece that we build in some clause that's like up and until the state takes over enforcement, right? And just to automatically say that like, this is true as long as the state is not doing it. So I imagine we would have to repeal that anyway if the state ever did take over. Like if we move forward with this language, we'd have to

[Peter Walke, Managing Director, Efficiency Vermont]: The other thing I wasn't aware of on the house side, I know they had scheduled the Vermont League of Cities and Towns to come in to add their perspective. I don't know if that's happened, in your committee. I haven't been paying close attention to it, but I do think, that would be an interesting perspective to see if there is interest at that level because they would be the ones to provide most insight there.

[Sen. Anne Watson (Chair)]: Mhmm. Where specifically in the dollar we talked about? Oh, sorry. Yeah. No. So spell No worries. Page 14, section 10, slides eighteen and nineteen. There's, oh, then- Oh, I see. Yeah, and then again, on page 15, minus twenty and twenty one, just the municipal enforcement. But I do have one other, unless there's more that you needed to, that you wanted to say, have one other question for you. Are

[Peter Walke, Managing Director, Efficiency Vermont]: you That's sufficient for me.

[Sen. Anne Watson (Chair)]: Okay, great. The other question that I have is really about section seven, which is about the There are these modules that have to be included on energy codes for a number of types of, I guess it's not just section seven, it's also section So, the bone home section's professional. Yeah. So, one concern that we had heard was that, you know, example, people assigned to this, OPRs particularly, was not in a position to review the education modules with any level of expertise and wondered if that would be something that Efficiency Vermont could potentially do in terms of like looking over, like reviewing modules and consider recommendations to update them as necessary, Things like energy codes and how that affects energy, airflow, moisture management, dynamics, and the integrated system, but in the building as an integrated system. And I realized maybe this is, If you want to get back to us on that, that's fine. But I just wanted to put that out there as like, we were thinking of you in that capacity.

[Peter Walke, Managing Director, Efficiency Vermont]: Understood. I think we're we could play a role in that process to some extent, but the reality that shouldn't exist directly with us because we're not the only one with that expertise. And I could see, you know, that the drafters of the code being the one who are going through and providing that, you know, so it's a public service department code. They could they could have support from folks. See mister Coda sitting in the room from the sort of installers of, of these, things provide some input as well. We could provide some input on overall building science, but it's the code writers that ought to make sure that the code enforcement in education modules are appropriate.

[Sen. Anne Watson (Chair)]: So there might be, there potentially could be a couple of different entities that would, that could bring expertise to that.

[Peter Walke, Managing Director, Efficiency Vermont]: I would say that there's a difference between being accountable and participating, right? I think the code writers could be accountable for that work and the folks who have been involved in helping them develop that code or, you know, working through the working group that already exists, which might be the way to do it could provide that level of technical expertise in an advisory role. That might be the way to think about it. Don't think you should create a a new separate structure for that if the if the tools already exist.

[Sen. Scott Beck (Clerk)]: Okay.

[Sen. Anne Watson (Chair)]: Okay. Any other questions for Esther Wong, Bongartz? I think that's it. Thank you so much.

[Peter Walke, Managing Director, Efficiency Vermont]: Happy to help and happy to get you a little bit back on track.

[Sen. Anne Watson (Chair)]: Alright. Thank you. Have a good day.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Take care.

[Sen. Anne Watson (Chair)]: Okay, so our next topic is, we're going back to data centers, but not until ten. So we've got a little time, we're gonna take a break until ten. Okay, are, so the National Resources and Energy coming back from a break and we are moving to H727 about data centers. The last time we were talking about this bill, Mr. Edgemond Walsh was interrupted by a fire alarm. So we're going to let you continue on on the the map that you wrote. I think you're mid sentence. So something about principles.

[Unidentified committee member]: I was. I'm not sure

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: if I remember the exact

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: word I was on, but

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: I think we can manage.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Let me go ahead and share my screen. If you're ready

[Sen. Anne Watson (Chair)]: We're live.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Great. For the record, Ben and Julie Walsh with the Vermont Public Interest Research Group here again on page seven twenty seven. I will spend eighty five seconds on the slides that I come through yesterday just to refresh your memory, and then we can get into the meat of what I was hoping to discuss yesterday. Alright. So data center are massive. They use some of them more electricity than everyone and everything in the state of Vermont. The landscape is changing very, very rapidly, and I have some other examples of how true that is. But, you know, a very large data center from a decade ago is now a non event representative center, and nobody knows exactly how fast the industry is growing, but it's growing fast. Combine all those things from our perspective, oh and I should say, you know, we've seen really significant impacts in other parts of this country. Think arguably places that don't have protections for repairs as strong as Vermont, but still you combine all these things, and from our perspective taking a precautionary approach, a better safe than sorry approach, that really puts in place redundant safeguards to make sure if there are any sort of chinks in the armor in Vermont's laws and regulations that have backstops. And so the three kind of core principles or categories of things that we're thinking about are protecting the wrongs, right, barriers, grid, which are distinct but very interrelated, keeping new climate pollution due to data centers listed as possible, recognizing if you are building something that is going to use electricity that was not used the day before it was turned on, that inherently will increase greenhouse gas pollution unless you are bringing online a commensurate amount of renewables or doing something else to reduce carbon pollution by the same, and ensuring that the legislature has so even though there's a legislature, legislature, the regulatory structures we have in place to come out and the public generally that there's strong oversight and transparency. A couple of the things I wanted to say just to set the table and then I want to get into some of the issues that other places are seeing with data centers and then at a high level some potential solutions. They don't have specific language that I'm bringing though if the committee's interested in any of the ideas that we're talking about, we certainly can in fairly short order bring language. One, I want be clear that we agree with the idea that there is potentially some benefit to Vermonter's about a data center being excited here, and I say that fully aware that many of my friends, DFIRG members, other organizations in this state probably don't want to hear that, but we fully understand the benefits, the potential benefits to the grid and to repairs the whole of electrification. If you have more EVs on the road and more heat pumps, you are managing that load smartly and not increasing peak while you're getting more kilowatt hours sold, you're spreading out the same fixed cost over more kilowatt hours and just simple math says that reduces rates or at least reduces the upward pressure on rates that we're seeing from other places, and if you think that's true for EVs and heat pumps, basic physics and economics dictate that it is also true from other loads if you are managing them smartly. If you're not managing them smartly, really bad things can happen from a rate standpoint, but there are potential benefits there. I just want to be very clear that you can have benefits from a rate standpoint and still be horrible in other ways, right? Like that doesn't mean that this is an unmitigated good if it's managed smartly, it still could have very significant water or toxics and climate impacts, but from a strict rate payer and affordability standpoint, if managed smartly it can be a benefit. And then also I want to be clear that as a general matter, not in any way shape or form pretending like I really understand the regulatory framework in all 50 states. Vermont has a more protected regulatory structure than some or many other places in The United States. Chose a few decades ago not to deregulate, so we just have more in that space than a lot of other places that are more deregulated. Okay, so getting into some of the specific issues, and this is not any thoughts of Liz by any stretch, and it is also only in the energy and climate space, not talking about water and toxins and all the

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: other things you heard about from Jared and

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: John yesterday. Issue number one, what are we solving? What are we trying to do here? What's the point

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: of this from our perspective?

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: The incredible, the superior load. So one thing that has happened in other places is data centers have gone online and then have either and have infrastructure build out to meet that load, that projection projected load, and then either one, they have pulled out quickly for whatever reason, leaving other repairs with stranded costs, or two, they have operated in a way that doesn't meet expectations, and so things like demand charges, like you heard about 100,000,000 power a couple of days ago, that would be occurring on a monthly basis based on their peak demand might come in, like their revenue might come in substantially under projections. And so there are things that other states have done to protect against this, like having minimum contract lengths, exit fees if they break a contract early, protections in terms of financial instruments up front that can then be called on if they try to break the terms of the contracts, or minimum demand targets on a monthly basis regardless of what their actual demand is based on whatever the projections they put out on. So again, there's ways to deal with this, but this is the sort of thing that has happened. So this is going to be a recurring theme throughout this idea of like things are moving very fast. As I was doing research to really bring the specific examples that I was going to bring to you today, it was shot even you're telling me, you're reading about this every day, it's kind of shocking how many examples I was finding that were from like this month. So this article in the middle here, Sudden Data Center Loss, a little off of product, NERD, that's the North American oh my goodness, energy regulator God, Virginia Reliability Corporation, I'm sorry. They skipped the A in American, threw me off. This is nerd is something that you heard about from here on Power the other day. They're really looking at the reliability of the grid as a whole, and they have issued an alert because they had customer initiated they saw customer initiated load reductions, which is to say, like, data center operators basically going, yeah, we're just not gonna operate right now, to a full, like, gigawatt, which is, again, like, the month and hour peak load just dropping off the system overnight. And so that's potentially manageable, also potentially causes really significant issues, and so they're looking at that.

[Sen. Anne Watson (Chair)]: But can I ask you about that? So that was, if I'm understanding correctly, that was not a case of they went out of business, they just said we're not operating for these hours.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Yes. I can pass along this specific article and then I believe there's an underlying filing inert which I should say I have not done a deep dive on, so I couldn't give you all of the details. But yeah, and some of this is to be expected, data centers have on an annual basis on average used close to the full amount of electricity they could based on their capacity, more than most other customers. So if they were operating twenty four seven all year round, they would be at 100% of what's called a load factor, and like on average they're about eight each. So they're using almost all the electricity they could in, but depending on the data center you're talking about, there are instances where sign in to sign in they basically disappear as a load, and the utilities can manage for that. So that would be like if you have a data center that's training AI and the training cycle ends, it just they're done, it just turns off and then probably turns back on not too long later, but that needs to be managed for. And it can be, the utilities know how to deal with that, but this as I understand it was a little bit different where it was not the sort of expected cycling but something more concerning. The other thing I wanted to mention on this point is this sort of ageing a contract early. So it's important to remember that data centers, you hear data center and most people think AI, and that is most of it, certainly mostly growth, but it also is things like crypto mining and things that are sort of more speculative. And so there's an example Washington State where a crypto mining operation went bankrupt, and at $700,000 you could argue not a lot of money, but it's an example of the sort of thing that can happen when you're having a large load that can disappear directly.

[Sen. Anne Watson (Chair)]: That's a crypto mining thing. When I read that, I thought it was like real life.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Like, go on and go.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Mining is a term for what they're doing. It's pretty silly, but that is what it's called. Mining, it does literally say mining operation in that quote,

[Sen. Anne Watson (Chair)]: doesn't it? It does. Yeah. And you're

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: like, what are you telling me about like

[Sen. Anne Watson (Chair)]: Are they drilling for something? Well, I thought, you know, you're saying massive amounts of electricity for somehow No. Mine.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: It's nothing. Data center to, like, Okay. Yeah. Next. One result I'm for. Number two that I wanted to bring to you is the idea of quote unquote backup generation that is in fact used to avoid some of the regulations and interconnection etc, that would typically be required. So this is an example, there are two data centers in Tennessee that XAI, that's Elon Musk's AI company, constructed and basically brought in a bunch of 18 wheelers with jet engines on the back that operate as backup generators, fired them all up, and turned the data center on. They were not operating as backup, they were just using generators that were intended to be backode as their power source. They were sued, they eventually did go through the appropriate interconnection process, and that was Colossus one, this is Colossus two, that's literally the name of the data center, they did it again. They brought in a couple dozen of these massive, I should note very loud and very polluting, backup generators used them as a primary source and they were sued last week.

[Sen. Anne Watson (Chair)]: Are they gas power generators? Yes. So

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: there are a number of concerns here. One from a pollution standpoint is this one data center in Memphis would increase the NOx pollution in the state of Vermont by about

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: 200,000 basis,

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: and it obviously would one site, so the local air pollution concerns could be really significant. Now obviously we have PUC and CPG procedures and all the rest, but we're talking about an industry whose motto is literally move paths and break things. Like that's not euphemism that we came up with, that is that was part of now that Meta, that Facebook was operating on for most of a decade, and officially it's been removed now, but certainly is kind of the attitude of a lot of these companies. And so I don't think we can count on and this is if there's one takeaway from my testimony, It is, I don't think we can count on the current regulatory framework, even a very good one, to fully be protective when we're talking about an industry that just approaches things very differently and has more money than God to do what they want. And very frankly this is a, you know, shoot first gets you later attitude, right? Like that's exactly what's happening. And again, to the point of this is moving very fast, were sued about this last week. And I was not looking for, like, examples from April 2026. This is just the best stuff that was coming up as examples for this. So, yeah, notes are written here. It just is how fast things are moving. The last thing I wanted to note here We have

[Sen. Anne Watson (Chair)]: a question.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Oh, yeah.

[Sen. Scott Beck (Clerk)]: So, you know, regardless of the problems with the with the grid and the energy issues, what does this do to, like, bandwidth for for WiFi? How does it affect servers for companies that are trying to operate when people are trying to get data? Is that anything that's relative to this?

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: It's a really good question, it certainly crossed my mind, it's not something I've looked into. I would assume that just like you need well certainly you would need a lot of fiber to data into and out of a data center. I'm not an expert in that area, but I would assume that it would be similar to the electric space where in order to serve a data center, certainly a large one, you would need to build out that infrastructure as well. But

[Sen. Scott Beck (Clerk)]: Just bandwidth is probably about it. So can you give me some kind of idea why one would be built? What was the purpose of

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: There's a few reasons. I mean, as I understand it, the House took testimony from the Department of Navy Greenland Power on sort of what they've heard in terms of inquiries. I think there was an article in Franklin County about there was an article. In Franklin County there was one that there was some sort of preliminary discussions, nothing happened. But it certainly is something that is more real than I think a lot of us assumed six months to a year ago. The simplest description I have for why when I come to Vermont, especially given we have higher than average electric rates, We've been coming down in terms of like ranking on the national average because our growth rate in electricity rates is lower than a lot of places, but still higher than average. A lot of the gas sites from their perspective are being taken, you know, if you look at places like Northern Virginia, that's very welcoming to data centers, there's more and more resistance, electric rates are going up in other places, So when you look at a place like Vermont, which as much as might not feel that way to Vermont, it's probably a relatively cheap way compared to many places. And we do have transmission capacity, in particular the Southeastern part of the city because of Ramadan going offline. So yeah, I don't think anyone knows when anyone's coming here,

[Unidentified committee member]: it does really feel like

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: a matter of time more than anything, the more I look at the landscape nationally.

[Unidentified committee member]: Last

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: quick point on this, and then I've got a couple more slides on problems, and then I'll get to broad thoughts and solutions. Yeah, so you heard a lot about them on scale, that sort of concept of like what could potentially be studied here at the data center, and one thing I wanted to point out here is, I don't want to say this could definitely happen in Vermont's regulatory account, but I certainly could imagine the data center trying to pull this off and I'm not confident that it would be impossible. Know, you're hearing non power come in here and say, well, sort of seems like 200 megawatts is the upper limit on all we could imagine being sited here,

[Unidentified committee member]: I don't

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: really know that there's anything from stopping the company from saying we're going to put a thousand megawatts of backup generators on-site, we're going need to connect for 200, we're going to assume that a lot of our generators are going break periodically because we're operating them in a way that they're not supposed to, and that's a real thing, like they do overbuild because they know they're going to break these generators, and they have a 500 megawatt data center that's operating at 200 in terms of what's actually the grid's accuracy, because they're just generating a lot of their own electricity from fossil generators or something. So I don't know that's going to happen, but it does not seem outside of possibility. Okay, this one's going be quicker. This is not a specific thing that other states have run into, but it concern is we have. We have in Vermont something like 200 megawatts of what's called Cabernet, the Vermont grid. The difference between our peak usage in a given year and what we could theoretically have flowing through Vermont's poles and wires at that same time. So what I'm showing you here is a report from Velco, the long range transmission plan from 2024. So bottom right, historical five year average peak, right about nine fifty megawatts, and that's not annual usage, that's like the most electricity ever flowing through the wires in Vermont at a single moment in time, I think might be a fifteen minute increment. All time peak is the bottom left, which is close to 1,100, so that was about twenty years ago and you'd have to ask Velco what they feel like the precise current maximum peak would be without reliability concerns, and it's probably not that exact number. But just to give you a sense, it's like 900 to 1,100, that's where we're getting that 200ish gap. And then the two on the top are continued growth on the left, which is just sort of like continued projected growth, assuming nothing really changes about the trajectory we're on, and the right is based on, I believe, primarily accelerated electrification, heating and transportation. And so the bottom line for this slide is we have a little bit of suburban grid and we're planning on using all of it in the next five to ten years for the things we already know we wanted to, like get EVs and heat pumps deployed. And so the concern is, and the reason I'm bringing this to you, is if the data center gets here in the next few years, you could protect ratepayers and still absorb most of the headroom on the Motts Grove. And then after that construction, we really wouldn't have a lot of access room for the things we're already doing, like you need something constant on the bill, and then you have to build the grid out, add constant on repairs to do those other things. And so we think the bill should be strengthened in ways that would tell the utilities and the PUC, when it comes to this contract, you need to do everything you possibly can to reduce the peak the increase in peak the data centers bring. We brought language in the house that basically said having no increase in peak, and we're told that's essentially a moratorium on these things, and so that is not precisely what we're advocating for now, but we do think there's some decent language in the bill to begin with. As passed the House, it is better than most other statutes in the country, but that's more a reflection on most other state laws in the country are just not very good on this yet because it's moving so fast. And it could be strengthened. Last but not least, at least from our perspective, on carbon pollution. I don't have precise numbers, but I can say that as a general matter, the speed with which data centers are growing, the degree to which they're relying on fossil fuels to fuel their growth, they are undoing to a significant degree the progress we've made in this country on carbon pollution. Also, so this is moving fast, this is a report that came on Wednesday of this week. Compared to 2022, this is, I should say, Frontier Group Environment America. You as heard, we're not directly affiliated, it's a separate organization, but we share our names sort of bachelor. Long story short, you can read the whole quote, but coal plants are being used more now than they were a few years ago. The only reason that would be true is if our electricity was growing, only reason our electricity is growing is because of data centers. So we're using coal plants more than we were because it is in the growth, and the timeline for which we're actually gonna be retiring those flow plans is pushed out by decades because of

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: the spread. So the the real concern, I don't know if I'm gonna this in.

[Sen. Anne Watson (Chair)]: You got a question coming here?

[Sen. Scott Beck (Clerk)]: Yeah. No. I'm just a curiosity question because I know you probably aren't the right person to ask about. You know, we know that we've got grid enough to accept the demands for the next decade. What are we doing to to anticipate growth beyond

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: there? Mhmm.

[Sen. Scott Beck (Clerk)]: You know, because I know there are a lot of solar projects that could come online and some utilities said, well, we we really can't accept it there right now. So is there is there something some big plan state that that increase the capacity?

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: I can hear from on that as a transmission planner. Certainly, the utilities could speak to it as well. But, yeah, I mean, the the report that I reported from here is literally called the long range transmission plan. So yes is the short answer, but you're right. I'm not the person who's trying to give you the details on some of it.

[Sen. Scott Beck (Clerk)]: I'll pick them in Saint Bernard. Yeah.

[Sen. Anne Watson (Chair)]: It's a good question. Yeah.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: No. That's absolutely right. It's a good point. So not great from a department standpoint. I should say this this is about all international reporting from sorry Vermont. In New England, you really wouldn't be talking about gas or anything more than coal because coal really hasn't retired in this region already, but still not fantastic in the

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: amount of money since that's been

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: And lastly, I don't know.

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: Right? Like, I

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: don't think anyone else does either. If we were having this conversation five years ago, well we weren't. We weren't having this conversation two years ago, which again, like this is moving very fast. I don't think anyone can say with real confidence exactly what issues we might be dealing with in a few years on data centers, certainly not five or ten years from now, and again that just speaks to this

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: sort of precautionary principle approach.

[Sen. Scott Beck (Clerk)]: Just real quick, so you're in the hot seat, so Yeah. You know, as we anticipate increase, you know, what are we doing about geothermal? Although, I figured.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Yeah.

[Sen. Scott Beck (Clerk)]: I mean, do we have enough water to produce enough hydrogen to generate electricity that needs cleaner?

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Yeah. So there's a few really interesting technologies that are sort of coming down the pipe, and there's a lot of questions about exactly how quickly they're gonna come and, like, what problems we might not be anticipating with them. So you're talking about mined hydrogen, that's one that I'm certainly keeping an eye on. I do understand it has some climate impacts if the hydrogen exceeds and it's a very, very small molecule, so it is hard to not have some extinction. I'm not an expert on that, but that's my rough understanding. That being said, unlike traditional fuel cells where you're using a

[Unidentified committee member]: lot of

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: electricity to create hydrogen in the first place and it's basically energy storage that's not terribly efficient. If you can mine hydrogen and then use it to run a power plant, that potentially has a lot of benefits. Not saying it'd be very supportive, you need to do more research on it, but it's definitely something to keep an eye on. Geothermal, there's a couple of really exciting advanced technologies on that. As I understand it, the current generation of them would struggle in Vermont because of our bedrock, but there are some other ones that are not based on drilling, based on advanced lasers, and I think that's right, or maybe plasma, anyway, that may be able to deal with those issues. And infusion is the other one, which is one of those things that, like, are sort of like, we're gonna get people to Mars. Like, it's gonna be twenty years from now. It's it's been twenty years from now So it's forever. Yes. Right. Like, as long as I've been alive and probably a lot longer than I need. That being said, there are there's a company that is saying they are gonna have a commercial fusion generator online in Virginia within the next couple years. I believe you wanna see it, but it's also

[Sen. Anne Watson (Chair)]: so you

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: can watch this space.

[Sen. Anne Watson (Chair)]: Data centers in Virginia to make.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Probably why they're saying Yeah. I don't know. But Yeah. Mean, there's a lot of demand for life history that in is in Virginia. Okay. I know you have other witnesses, so I wanna just get to a few quick thoughts on, like, what to do about all this and then wrap unless you have other questions. So, again, high level thoughts. One, there are a number of places that the language in the bill well, again, I I wanna have a say, like, do you think the house best build is relatively strong? Vermont, if you didn't do anything to it, passed it, probably better. But there are also a number of places in the bill that could really be tightened up. One, I think probably the best example of this is there's language in the bill and there's a few places where this exists that say mitigate this or that. So there's one piece of language on page two that says mitigate the risk of other ratepayer classes paying unwarranted costs. Mitigate means rid of juice. It doesn't mean prevent. And so what the contract language currently is saying is reduce, but don't get rid of the possibility of other ratepayers paying the market costs. With that, it is inherently accepting the idea that other ratepayers can pay more of the costs. Now I absolutely don't think that was the intent of the house. I don't think that's what anyone's goal is going to be. That's not what the PC's goal is going be, that's not what the utility's goal is going to be, but the plain language reading of the bill says mitigate, don't limit. And literally it's unwarranted, not even warranty costs, unwarranted costs. And there's a number of other places where that sort of mitigate but don't eliminate. It doesn't say but don't eliminate, that's obviously the inference, but I think it's a correct one, exists throughout the bill. And so there's a number of other places that are a little bit less obvious where language could be tightened up to make it really protective. You know, you may hear from others that they don't really need to do that, like current law kind covers us. But again, I don't want to assume that we're infallible and are completely correct that we're covered by current law. So the second one is climate pollution, relies on the current renewable energy standard. Obviously we're strong supporters of the current renewable energy standard, know, versus passage in 2024, but in real terms from a physics standpoint what it requires is by 2035, 40% of the electricity in Vermont is coming from new renewables. The other 60% is coming from any old renewable, and we all know that that would come from RECs from old renewable sources. There's almost a philosophical debate about RECs and like the value of them as an accounting measure to say, well you don't have greenhouse gas pollutions because we bought this thing. I don't want get into that. What I want to emphasize is from a strict physics standpoint, if you build a thing that uses electricity that didn't exist before, you're increasing the amount of electricity that's being used. There is no way around the math of unless you are also generating more renewable electricity, you are increasing carbon. Right? Like that is just the way the math works. And so what we asked the House for and what we've been asking you for is a requirement that all of the electricity from these semi data center comes from newly built renewables, basically looking at the new renewable tier of renewable energy standard as a sort of defining a new way of defining that, and that allows for renewables back to 2010, but the way the regional market works, any use of those renewables would drive the construction of new renewables.

[Sen. Anne Watson (Chair)]: Where is that in the bill?

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: It is not in the bill. The bill does not talk about any of this at all because this was a burden of the bill that said, you have to follow the rest, the renew money system. They took that out because it's the law and they have to follow, right? So, like, you don't need to say you need to follow the law to scale. And that puts Vermont in a better position in most places, but it still leaves, right now, 70 75% coming from something other than new renewables, and even by 2035, 60% will be coming from something other than new renewables. So requiring all of the power coming from new renewables would be a way a way of getting the carbon pollution from a newly constructed data center close to zero. Not zero, this construction cost, then all the rest, but close to zero. It's not the only way, but it's the most out.

[Sen. Anne Watson (Chair)]: But just to senator Hardy's question, I'm imagining that if we were going to include something like that, it could be in the section on large load the large load service equity contract, which is starts on page two.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Yes, and that's where we suggested it in the house. We have language that we submitted to House Energy and I can get to you as well. Since I'm probably not agreeing to Terry, I'll just very briefly say on that language, what we were asking for was 100% new renewables, but not oh, 100% new renewables that is over and above the renewable energy standard, so we're not simply saying the data center needs to get a bunch of new renewables, but then everyone else gets less, because that's actually not solving the carbon pollution problem if it's, like, moving the economy around. Basically. But we actually didn't ask for a set amount of, you know, state renewables, and that's because If you build a 20 megawatt data center and had a 100% in state requirement, you need 100 megawatts of solar overnight. Currently we're building about 50 megawatts a year, and so that could really blow up the in state renewables market, mean, right from a building in state renewables standpoint, but it would inherently make it harder for other Vermonters, facilities, etc. To purchase and deploy new renewables in the city because the demand was spiked so quick even with a very small data center. And so what we suggested was 100% renewables in the region and need to work with the utility to figure out how to get as much as possible in on campus, on-site literally in the top of billion to none, and that there would need to be some requirement for instant renewables that increase over time, but giving the piece some utility flexibility to figure out what makes sense.

[Sen. Anne Watson (Chair)]: And yes, if you suggested this in the House and they didn't fight?

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: There was interest in the, I believe, accurate description of the way that played out. Sheriff's interest on the committee, but they did not feel they had the time to really gut it, and so they took all the renewables language out, relying on renewable energy standard, recognizing that that would

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: be a helpful outcome. Okay.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: But they just so this is something that we're not gonna have time for, and we were clear with

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: them that we would be talking to you all. Yeah. Lastly,

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: I already mentioned this. It's starting to align with it around protecting grid capacity. There's two pieces there. One, I think just directionally the language could be stronger, saying reduce to the greatest extent possible the increase in peak, something like that. Two, part of that language in the bill currently is the sort of tools in the toolbox, demand side management, load shedding, which is basically the utility saying, hey, you need to turn off right now, distribute energy resources, but you can add additional tools that utilize to make sure that utilities and the PUC could require them to do certain things in that contract if they didn't want to. I think if they're not in the list, then there's some risk that the data center operator would say you can maybe do that. So those in

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: the toolbox could go in the the list as well.

[Sen. Anne Watson (Chair)]: In this list on page four?

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: No. No. I I know. Yeah. I was trying to keep out of the weeds in in this test.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Oh, then

[Sen. Anne Watson (Chair)]: know that I, like, he didn't Well,

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: so do I.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: It's the problem.

[Sen. Anne Watson (Chair)]: If if you

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Yeah. Can send that

[Brian Redmond, Director, Drinking Water & Groundwater Division (VT DEC)]: to you.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: I can

[Sen. Anne Watson (Chair)]: submit to that. For sure.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: That'd be good. Large load after every project is the language that uses the phrase demand side management. So if you're if you're seeing demand side management here in the right place.

[Sen. Scott Beck (Clerk)]: Do we have?

[Sen. Anne Watson (Chair)]: I haven't looked. We have friends, Christian.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: I emailed it. Yes.

[Sen. Anne Watson (Chair)]: It was on yesterday. Oh,

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: okay. Okay. And We should keep Yeah.

[Sen. Anne Watson (Chair)]: Yeah. Thank you.

[Ben Edgerly Walsh, Vermont Public Interest Research Group (VPIRG)]: Principals. Professional principal. Thank you so Alright.

[Sen. Anne Watson (Chair)]: Thank you.

[Unidentified committee member]: Sorry. They took

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: longer than this. No

[Sen. Anne Watson (Chair)]: worries. It's important stuff. Too much love. Too Too much love. Too thank you. Alright, we're going to move now. Don't know if you all want to come out together or one at a time or who would like to go first? It's all about the Okay, sure. Welcome.

[Unidentified committee member]: Great move to be led. Well, morning everyone. My name is Billy Costa. I'm the director of planning policy for the Vermont Agency of United Resources and I'm joined by Kevin Burton, director of the Watershed Management Division of Medicine. It's nice to be here.

[Sen. Anne Watson (Chair)]: Thank you, thank you for being here.

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: So we're here to speak on page seven twenty seven. Just give me a moment, we're gonna get my screen sharing going. I have some brief prepared comments and then we are going to talk about some revisions to the bill we recommend and then taking questions you have. Great, so first off, I wanna thank the legislature for your attention to this important topic. The agency is aware of the proliferation of data centers across the country and the energy demands and natural resources paths that are associated with them. Vermont, Mr. Ben just indicated, Vermont is in much better shape than many other jurisdictions to manage this impacts. We have a robust existing body of state environmental regulations, largely administered by our agency, but with the addition of comprehensive oversight through Act two fifteen. When I testified in the house, in the house energy committee on this bill, I recommended the bill be amended to add a specific Act two fifty trigger for data centers. There's some question that some gaps existed in Act two fifty's framework and that some data centers might go forward in locations that wouldn't trigger Act two fifty. The house agreed with that recommendation. They made the change and that's in the virtual. So with that change, the agency contends that the current framework state environmental laws, our agency's existing technical regulations paired with broad comprehensive review provided through Act two fifty is sufficient to address the anticipated range of impacts associated with data centers. That said, we appreciate many of our monitors and our new legislators, security advocates are concerned with data centers and especially their potential to pass on service and grounds. H727 currently includes several provisions related to water and PFAS that we'd like to focus on now. Our primary concern with the current drought is that it creates unnecessary and redundant requirements specific for data centers to address potential natural resource impacts that are already covered in SABL. These provisions begin on page nine, which are absolutely helpful. I'll just scroll to the right screen. Okay, so starting at the top of page nine, subsea requires that a data center obtain a groundwater withdrawal permit even if the data center doesn't trigger the existing jurisdictional requirements under state law. So right now, anything that withdraws more than 57,600 gallons of groundwater a day needs to obtain a permit from our agency. What this section says is that even if a data center draws less than 57,000 gallons, they still need to get this done. That doesn't apply to any other form of land use or development in the state. And it's unclear. And this law has been in place for a number of years. We've seen no issues with withdrawals less than that trigger. So it's just unclear why we would ask this form of manuals to obtain a permit from us that no other land use at the same level of the water. It's also become clear of your testimony that it's very unlikely that any data center would withdraw below that. It's almost inevitable that a data center is gonna use more than 57,000 gallons a day. So we should strike this provision and simply require it follow consistency. Provision D does something similar. It requires that data centers obtain a surface water withdrawal permit. And then it requires that in issuing that permit,

[Unidentified committee member]: the

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: agency sees withdrawals under drought conditions. We believe that data centers drawing surface waters would already trigger the need for this permit under existing statute and the existing statute already has provisions related to limiting withdrawals during drought conditions. So these concerns are clearly and explicitly addressed in state law. There's nothing additional needed in this bill to address them. To be very clear about that, section E1 in the bill states that all applicable permits from our agency are required for those. We're suggesting adding including but not limited to make clear that there may be more permits that are enumerated in this list would be necessary. And as we see, it calls out explicitly, there'll potential need for surface water withdrawal permit, groundwater withdrawal permit. And we added the potential need for a state threatened endangered species tatings permit because we've heard from advocates the concern that some of the industry work could implicate those species. So we believe with that clear statement that reinforces the fact that there are many existing laws in place that would address the concern of mutual raise and the proceeding C and D promotions. Moving on, the bill also currently requires that our agency conduct quasi section four zero one review of a broad range of water quality impacts. There's a lot of legal and administrative reasons why that doesn't make sense. So we've been talking with Derek Carpenter and John Grogan and her group and advocating for the provision for some time now to their credit. They've been working in good faith with us to try to find a good solution. So I have to change share of the document. Here we go. So I believe just yesterday, Mr. Carpenter and Mr. Brogdon proposed some alternative language too. So the existing provision of E2 is above and their proposed language is below and that language is similar to the affliction taken for groundwater withdrawal. So basically any surface withdrawal in excess of 300,000 gallons a day would require this permit and that permit should address a range of concerns, water quality, aquatic biota, threatened and endangered species, things like habitat, etcetera. For the same reason I articulated earlier, while we appreciate this, we just don't think it's necessary. If you look at the existing groundwater withdrawal, excuse me, surface water withdrawal framework in state law, so this is what's currently in statute. This is that surface water withdrawal permit section. It requires that the permit address efficient use and conservation of water, that withdrawals comply with the Vermont water quality standards, that it establishes limitations on low flow or drought conditions. So there's a whole range of very prescription criteria that's an existing law that we believe more than adequately addresses the concern being prograised by advocates. So instead of creating these additional duplicative requirements in this bill, let's just rest with the laws that are currently in the books. Moreover, this new surface water withdrawal permit is not in place yet. We're just about to launch the rule making process I believe this summer where all those prescriptive statutes will be turned into a rule in how we administer the program. That will be a public process. We will have a stakeholder engagement process. They're gonna answer that rulemaking. The rule will come to LCAR. So all these concerns raised around surface water withdrawals will be addressed in that rule. All the advocates can participate in that conversation. Question, so the statute that you just had on the screen,

[Sen. Anne Watson (Chair)]: it had an, you know, 07/01/2026 at the top, is that what you're talking about in your case rules for? So if your rules are not in place yet, and as

[Sen. Scott Beck (Clerk)]: we

[Sen. Anne Watson (Chair)]: just heard, all this is moving super fast. If there was a data center proposed this summer before you got the rules in place, wouldn't that mean that the rules wouldn't apply to them because the rules don't exist

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: yet? I believe that's true, but the current provisions point back to the rule of Well, what's in the bill points to the rule of law. Whatever's in there now would still be deficient for that same reason.

[Sen. Anne Watson (Chair)]: Oh, I see. I mean, I think that, you know, I hear you on the sort of redundancy of some of these things, but I think that, you know, lots of the testimony we've gotten has been, we want it redundant because we're worried that they're going to try to skirt around current things. If your rules are not in place, that's concerning to hear. And I understand they're not in place because they haven't, you haven't been required to do them yet. So I get it, it's not a criticism, but it is just a sort of reason to bootstrap this with more requirements. So there's not any loopholes that these extremely well funded organizations might try to slip through?

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: My response to that is we do have that through the Act two fifty suite of environmental criteria address many of the same issues that these permits would cover and in fact are broader and get out of all the interstitial spaces between the permit. So even if these rules for surface water withdrawal are not currently in fact, In fact, we believe that the active cooking process likely has sufficient oversight to address. Likely. I look, I can admit to that. That's how we've been managing surface water withdrawal so far, but yeah, I will. The other reality is that this bill is probably not gonna pass until, may not be effective until July, either I have to look at the effective date. So you should, if that's an imminent concern, you should certainly look at the effective dates because you'd want it effective with the passable amount in July. It's on the path of

[Sen. Anne Watson (Chair)]: the effective date, but even still, I mean, the rules will not be in effect. Your new rules will not be in effect until they go through the whole process with LCAR, etcetera. Do you want to speak to

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: the whole time line of that at all? I

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: can, we anticipate that the Rivers program within Marjan will probably aim to go through ICAR mid summer I would say with stakeholder engagement in the fall that's the preliminary timeline. The draft rules are already being put together so we're pretty close. So I think it will be a great opportunity for everybody that's interested in surface water withdrawals to engage.

[Sen. Anne Watson (Chair)]: Well, we heard yesterday that they were likely not going to be available until 2027. So just thinking about that gap

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: of the year. So fair point, what I would encourage then is perhaps if you do want to have additional restrictions related to service model withdrawals in this bill, we have them sunset upon that rule of knowledge.

[Sen. Anne Watson (Chair)]: And another

[Sen. Scott Beck (Clerk)]: comment here? I'm just, I think it's the process that's important, we go through this, but we don't even know if a data center is gonna be here. Because Vermont had a need for what a data center would provide, we should have our own here. And if if you did have a need for it, is there a possibility we could get it from my home state to have it? Know, I think and, you know, you guys are trying to be proactive and get out in front of a potential problem, which is great. But sometimes, blue making takes too long in the state. You know, we we we pass the water two years later, still what they don't know. Yeah. So I'm just I'm just trying to figure out another one that we really have a problem. If if we have we're gonna have a data center we want, we really have a need for them here. If not, why doesn't anybody wanna book them?

[Sen. Anne Watson (Chair)]: I feel like the answer to that is it's a big answer. Yeah. But I don't think anybody here is, it's not like they're proposing to put one here. It's sort of beyond our control in a lot of ways. There could be a company that wants to put one here, and if we don't have the appropriate laws and rules in place, then we could be in a situation.

[Sen. Seth Bongartz (Member)]: That's good.

[Sen. Scott Beck (Clerk)]: We've got mechanism in place. And the way he said, well, bad thing, acting 51, well, it's actually proven over the years to be very low. And, you know, we just need to make sure that the right things trigger it.

[Sen. Anne Watson (Chair)]: Yeah. Yeah. Yeah.

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: So yeah.

[Sen. Scott Beck (Clerk)]: So so we're it's a work in progress. Right? And I understand we gotta conserve the water and particularly in trying to go. I don't know if we got a really big problem. If not, what are we trying to solve?

[Sen. Anne Watson (Chair)]: Trying to make sure we don't have to be have a problem at one of these big big big spots to you know? Okay.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: And then it looks like solar. Right? They fill our fields with data centers and all the

[Matt Chapman, Director, Waste Management & Prevention Division (VT ANR)]: data goes out of state. Exactly.

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: Our environment is impacted by it.

[Sen. Scott Beck (Clerk)]: I just want to give you all the thing.

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: Just to kind of recap, think on the groundwater withdrawal piece, we have an existing law in place, the existing triggers we believe are appropriate. We don't think there's a need for that provision. On the surface water withdrawal, we will soon have this law in place we think is comprehensive and adequate. I appreciate there is this temporal gap. So, you know, welcome you to try to fill that if you think that's necessary, but we ask that ultimately when that rule is in place, that that is what is used to address its impacts. And then the last piece you want to sue is a section of the bill that requires a monitoring plan for key fouls if there's surface water discharges. We don't oppose that concept, but what we're suggesting is that it be addressed as part of the Act two fifty process. Currently it's just a standalone requirement that falls to our agency. It's not tied to any permit program and there's no fees associated with it. It's just kind of an obligation that's being placed on us out of context. Since we know these will all require an Act 50 permit, and since Act two fifty has a history of requiring monitoring plans and things of that nature in their permits, we think the best approach to address this is to have, is our applicants provide this plan to Act two fifty, have Act two fifty receive comments from our agencies on those plans. And we're suggesting here that venture commissions be directed to seek those comments or responses this language and then have the monitoring of PFAS discharges managed through the active Yes, go ahead. That seems

[Sen. Seth Bongartz (Member)]: like we're in the comments from the agency. And because the district commissions don't have expertise in this. And I think that's the issue with the with trying to get at with the service and the border withdrawals as well and permit the agency for the expertise lies. So I think the concern about this section and comments If the agency is one of the expertise, the agency should be just positive thing. Not a construction, but produce departments and then. And because of the last one, but these are ways that is he's making it so you have some circumstances. I'm just not sure we're really connecting the FTC agency to this whole process the way it should. Sure,

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: so a few responses there. First, the term comments is kind of the typical, that's what it's called, the things that we submit to Acting fifty District Commissions. They're called comments on the document. So that's just a term of art. We are required in the statute to provide evidence of recommendations to the commission to provide that technical assistance. So there is an obligation there. You could certainly change that word to something more meaningful, like technical analysis, whatever you think would be appropriate to convey the weight of the input of your suggestions necessary. I will also add that this provision that's currently drafted is not tied to a permit. So we're not issuing No, it's not

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: covered by those regulations. So that helps mixing the two.

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: Right, right. And then on the commission's capacity, I would be remiss not to point out that for a number of years now, our agency and the administration has been kind of gaining the change to Act of 50 to provide more professional expertise for major cases that have members of the land use to be more civil district commissions to provide that expertise and capacity on complicated cases for this exact reason. And we've been repeatedly told that's been monitored if necessary. So this is the system we have. Okay, this is a system we have in return on scientists.

[Sen. Scott Beck (Clerk)]: Yes,

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: and we work really closely with them and we participate in these cases all the time. A good example of how this partnership works is the Double Diamond Interchange project in Colchester. This was a very large B TRANS project where there was all these crossing interstate and state highway lanes being developed. There was a concern from the community and others related to chloride pollution associated with road maintenance in that project. That is, at that time, was not a Plumable Battery Agency regulated, but the issue was addressed in the Act two fifty process and the Act two fifty permit has conditions related to chloride pollution. Our experts participated in that process. We provided lots of science and other information as we always do in 1950. I can also point out that we don't issue permits beyond the takings permit for wildlife habitat and right area protection. We realize that work throughout February, we regularly provide technical assistance, expertise, and district commissions to navigate those complicated issues. So this is a model that we think has worked that could work for this purpose and we're just suggesting this is because of better leave.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: I do think that, Billy did mention that it wouldn't be tied to what the PFAS piece was tied to simply ANR as opposed to Act two fifty. We don't have a permit for that. So having that wire within Act

[Billy Coster, Director of Policy and Planning (VT Agency of Natural Resources)]: two fifty really makes it an enforceable model treatment.

[Sen. Anne Watson (Chair)]: Okay, right, thank you. Any other questions from me? Okay, all right, well thank you so much. Take care. Thank you. Okay, we've been going here for a little while. I guess we did have an rage. Oh, it's not this needed. Well, let's just take a three minute break. Okay. And we'll Okay, well we have a forum, so I'll tell you. So just to frame this up, we're switching topics. Is the season of rapidly changing Well, 01/8928, the reason it's listed as 09/28 is because I was thinking about adding some language that we have seen before from 02/24, from S224. The last from the past, there is, I am not going to be able to get it quickly here. I would have done that sooner. I sent it to Brian. I know I have it here. 02/24. There's language I attached it now from I dragged him. Okay. I'm not going be, oh, hiatus, huzzah. There's language from 02/24, towards the end, that was about fishing tournaments, which seemed to me that we had some broad agreement about, and wondering about bringing it back and putting it in 09/28. And with that in mind, I wanted to hear from what you, Daisy, about thoughts on that language. If you had your druthers, what would you want to see changed? Uh-oh.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: Good morning. Good morning. For the

[Brian Redmond, Director, Drinking Water & Groundwater Division (VT DEC)]: record, Brian Redman, the director of the drinking water and groundwater protection division in GDC. And also joining me today is Ken Smith, general counsel for the Wildlife Department. Thanks for the opportunity to come in and testify. So we were involved prior to the crossover working on some language that effectively required consultation between the departments related to fishing tournaments on inland lake that are serving public water systems. And the language, the existing language went on further to allow us to require fishing tournaments, fishing permits issued to include conditions, requirements, limits, and prohibitions. There was some concern expressed during the last round of testimony I participated in about timeliness of review and having each of these individual permit applications reviewed individually and having that consultation occur on an individual basis. A team within my group that would be doing this work is doing not to diminish the importance of this work, but also doing a lot of very other important work and actually frankly, having trouble meeting some of our existing obligations. So capacity is a concern. And I know for fish and wildlife, the timeliness of that review is a concern. So I've worked with fish and wildlife department, Hannah and her team to provide some replacement language that we can provide at the committees desire. Essentially what it would do is require consultation. So require consultation between Fish and Wildlife Department and DEC. We would develop some best management practices and the best management practice framework for allowing permits to occur on the Zimmerman water bodies, and then require that information to go into the application that the Department of Fish and Wildlife administers for these permits. So essentially shifting this framework to the front end versus an individual review of each application. We feel that that would address some of the timeless issues as well as some of path to the concerns that I have on my existing team. Great,

[Sen. Anne Watson (Chair)]: Super. And you can send us this language? You can. Okay. So we don't have it right at this moment, but it's something we can look at. Nice time. Okay. Thoughts or questions for Mr. Redmond about this coming? We don't have the language, it's hard to cover. Okay. We'll take a look at another point. Just really briefly, as we look at a new draft of 09/28, well, could perhaps perhaps we should look at it before we include it. Another possibility is that we can include it and we can always just take it out. And you're happy to clean them. Easier to strike out than to add, so. Okay. Okay. Questions, okay? I'm sure. Okay, Senator Beck? Yeah, I'm sure. Okay, great. Thank you so much, really appreciate it. I think that's it on that. So now we're going move on to the last topic for today, the H740. Now we did, this is about the greenhouse gas registry and inventory. I think it's fine. And we don't have Ellen, but I think I can more or less walk through this new draft that I asked her to put together. So I wanted to tell you about what's in this new draft, and then I want to have a discussion about where we want to go with this. First being on page two, just really briefly looking at some geographic information about data of fossil fuel sales. And the last phrase is, or the smallest geographic level practicable. And I wanted to make sure that that also does not mean that we just want everybody's address. We also want to protect individual identities of consumers. So that's why that's there. I'm not sure if that rule making section's new. That might be one that we should ask Ellen about, but yeah, maybe to make rule making about this. The money that is here, this appropriations section does exist in the budget. That's just so that the appropriations committee could take this out, but it's also in this bill as well. So that's, and there's a position that goes along with that and to check to make sure that like, is it appropriate for us to include this inheritance was? When I say they, I mean, appropriations books. And then section four is in response to comments that we heard from Secretary Moore about the possibility of using the data that's collected to reverse harmonize the data that's collected by the tax department so that if it's possible to only collect the data once, that we could potentially do that if tax is able to use the data that is collected by ANR. So that is what, at least the intention of that section is. And then we get to another section here. Now, because this is creating a fuel dealer registry, greenhouse gas inventory. We do have a fuel dealer registry already on the books, which is not effectual at the moment, in connection with the clean heat standard, seems to me logical if we're going to create a fuel cell registry, which by the way is not connected into the clean heat standard. I think it could be helpful for a number of different purposes, especially including measuring the effectiveness of policies that's useful as we heard before, for enhanced energy plans or energy chapters and municipal plans, it just seems logical to repeal the unused language that is in the Clean Heat standard. So that is what section five does. Okay. So this as a draft, I am interested in folks' thoughts, reactions, comments on this. Something else that I think could be on the table here is, do we want to repeal? If we're repealing part of the, you know, if we're repealing this registry that came into being as part of the Clean Heat Standard, Affordable Heat Act, do we want to, because we are not doing the Clean does it make sense to repeal all of that? You could think of it as housekeeping in terms of like, we're not doing it, so we're just cleaning it up. You could all, and I guess I would say together with that, that the goals of helping people get off expensive, price volatile fossil fuels, 100% afforded is of high value to me, especially since we're seeing those prices for fossil fuels spike so significantly right now. So would love to figure out a system to get us there. Don't know that the clean heat standard is the right tool. It certainly was not the right tool this year, especially as the Public Utility Commission recommended not moving forward with it. But I think this data is going to be helpful. So having said all of that, it's a lot of freehandle, I'm curious for your thoughts, reactions, comments,

[Unidentified committee member]: inputs.

[Sen. Anne Watson (Chair)]: Do you want to manage? Yeah, I do. Okay. In

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: section three, is that $300,000 a debt in

[Sen. Anne Watson (Chair)]: the budget? It is in the budget. Time to digest is okay.

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: And I think it's the 300,000 with fund the physician and

[Sen. Seth Bongartz (Member)]: team plus. Yeah.

[Sen. Anne Watson (Chair)]: Plus standing at the registry. It's not a registry though. I mean, think that's important. Oh, so I think it's not. It's just data collection. Yes. Yeah. I think it's really important. Reporting mechanism. Yeah. It's not a registry. Yeah. Yeah. We could think about that again. It's just collecting. Yeah, it's just data. That's a good point. Yes, go ahead. Think also on that paragraph at the top of page two that says, Protect identities, individual identities of consumers. I think I recall that there was also a concern about protecting, I don't know exactly what it's called, but some of these businesses that we're gonna be collecting information, that would be submitting data are pretty small. It is, yeah, the sort of like protecting business. Don't know. Alan can probably come up with language that does that, but just making sure that we're not like, revealing proprietary business information or something like that. Yeah. But it's more like Yep. There's a way to follow-up data. Yeah. Because we don't, to just talk about it, we don't care, like, who is selling it. Right, like, that's not being important. Yes. Where and what. Yep. That was my understanding anyway. Okay. Yes, go ahead.

[Sen. Scott Beck (Clerk)]: They use your words also, they're already doing their points at that department. If there was some way you could make that a long report, they

[Unidentified committee member]: want to weigh

[Sen. Anne Watson (Chair)]: in And weigh in that is the intention with Section four, to try to get to that. Because I'm totally hearing about that. The reverse ferminization. Yeah. The secretary has called it. That's the-

[Unidentified committee member]: the great word.

[Sen. Anne Watson (Chair)]: Yeah, yeah. I never heard that great before. Yeah. But that's the intention of getting it back. But we're running out of time. So I'm going to ask folks to say, would you, details aside, there's maybe some details, but in concept, is this something that you could get behind? Or if not, what would you need?

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: I'm struggling with it right now, what I knew about it.

[Sen. Anne Watson (Chair)]: Okay. What if it included a repeal of the entire Cleaning Heat Standard?

[Michael O’Grady, Legislative Counsel (VT Office of Legislative Counsel)]: I don't know if this was

[Sen. Scott Beck (Clerk)]: already billed.

[Sen. Anne Watson (Chair)]: Well, this repeals the fuel dealer

[Unidentified committee member]: registry. Well, I have to think about that. What can I

[Sen. Anne Watson (Chair)]: it, if this is already in the budget, does this appropriation and position have to be in the bill as well? That is a good question. I don't know if it has to be, but I was asked by appropriations to include it in this. Other thoughts? Senator Hardy? Yeah, I mean, I could just react to that. Exactly. Is entirely fair. So what I'm anticipating we would do is we would, we'll bring, take this up again next week and we'll, now that you have it, now that you've seen it, this is a place to start. Happy to have more conversation about this, but we'll go from there. Okay, all right. Now I do know, well, we're going to take more testimony. I did see a couple of hands go up, but there's more time for testimony next week, and we're about to have the bell ring. And just as a heads up for next week, it is going to be a little bit of a wild ride because we have a lot of different things to do. Oh yes, thank you. We are going to meet on Monday virtually, one

[Sen. Scott Beck (Clerk)]: to

[Sen. Anne Watson (Chair)]: three. Getting witnesses lined up for that, because we are losing time next week due to early florum. So that is where we're at. That's where we're at. There'll be a lot of different topics next week. So here we go. Right. So with that, any thoughts folks want to leave with?