Introduced by Representatives Maier of Middlebury, Deen of Westminster, Edwards of Brattleboro, Klein of East Montpelier, Masland of Thetford, McCullough of Williston, Pellett of Chester and Sweaney of Windsor
Subject: Conservation; public service; universal thermal energy efficiency program
Statement of purpose: This bill proposes to establish a universal thermal energy efficiency program, which is to be run by an entity named by the public service board. The program is to be constructed so as to be available eventually to all heated buildings located within the state that are served by the electricity grid. The bill proposes to require the public service board to develop a program which may include loans and other incentives, and in this process to consider an option whereby customers would pay for installed efficiency improvements, through the electric bill, with tariffed charges that are less than the savings that the improvements are estimated to produce. The program is to be developed in conjunction with the office of state treasurer, with the goal being to develop a program acceptable to the treasurer that provides up‑front capitalization for the program from the state pension fund, and which has sufficient assurances that investments from the state pension fund will be assured a market rate of return. The bill proposes that the establishment and administration of the program be financed by a gross receipts tax of 0.05 percent on the retail sale of heating oil and kerosene not used to propel a motor vehicle, propane, and coal, when any of these are sold by sellers receiving more than $10,000.00 annually for the sale of those fuels.
AN ACT RELATING TO ESTABLISHING A UNIVERSAL THERMAL ENERGY EFFICIENCY PROGRAM
It is hereby enacted by the General Assembly of the State of Vermont:
Sec. 1. 30 V.S.A. § 209(g) is added to read:
(g) The public service board, after notice and hearing, shall provide for the development, implementation, and monitoring of a universal heating, cooling, and thermal energy efficiency program by one or more entities appointed by the board for these purposes. Entities appointed under subdivision (d)(2) of this section also may be appointed to fulfill the purposes of this section.
(1) The entity or entities appointed under this section shall propose, develop, solicit, and monitor cost‑effective thermal energy efficiency programs in the state which may include programs that:
(A) Provide financial and technical assistance to improve thermal energy efficiency in the state.
(B) Encourage investment in innovative products, technologies, or services that promote thermal energy efficiency.
(C) Explore collaboration or contracting with private industry to provide thermal energy efficiency services and programs.
(2) Any program created under this section shall:
(A) Be established first as a pilot project in conjunction with one regulated utility designated by the board, but shall be expanded at a pace established by the board so as to be available eventually to all retail electricity consumers located within the state, regardless of the type of fuel used by the heating plant of the consumer and regardless of the income level of the owners or residents.
(B) Include an energy audit which shall result in a list of recommended measures, together with a projection of expected payback periods for alternatives recommended.
(3) The program established under this section may address: efficiencies in building heating and cooling systems; who is to perform the work recommended; what material or products are to be used in the work recommended; the inspection of the work that is financed; the repayment process; and owner responsibilities to repay loans.
(4) The administration of the program shall be funded by a fuel surcharge assessed under 33 V.S.A. § 2504, which shall be paid into a universal thermal energy efficiency fund to be established and administered by an administrator appointed by the board.
(5) The program shall be structured to include loans or other incentives, or loans and other incentives. In developing the program, the public service board shall consider establishing a Pay As You Save (PAYS®) system, which allows customers to pay for cost-effective efficiency improvements over time through a tariffed charge on their electric bill, using savings generated by the improvements, and is hereby authorized to approve PAYS® tariffs.
(6) Any PAYS® tariff established at an electric utility shall be available to customers for the purchase of measures that are cost-effective based on current retail energy costs.
(7) The program shall be developed in conjunction with the office of state treasurer, with the goal being to develop a program acceptable to the treasurer that provides up‑front capitalization for the program from the state pension fund, and which has sufficient assurances that investments from the state pension fund will be assured a market rate of return.
Sec. 2. 33 V.S.A. § 2504 is added to read:
§ 2504. FUEL GROSS RECEIPTS TAX FOR UNIVERSAL
THERMAL ENERGY EFFICIENCY
(a) There is imposed a gross receipts tax of 0.05 percent on the retail sale of the following types of fuel by sellers receiving more than $10,000.00 annually for the sale of such fuels:
(1) heating oil and kerosene not used to propel a motor vehicle;
(2) propane; and
(b) The tax shall be levied upon and collected quarterly from the seller. Fuel sellers may include the following message on their bills to customers:
“The amount of this bill includes a 0.05% gross receipts tax, enacted in 2006, for support of Vermont’s universal thermal energy efficiency program.”
(c) The tax shall be administered by the commissioner of taxes, and all receipts shall be deposited by the commissioner in the universal thermal energy efficiency fund. All provisions of law relating to the collection, administration, and enforcement of the sales and use tax imposed by chapter 233 of Title 32 shall apply to the tax imposed by this chapter.
(d) Unregulated fuel sellers that provide conservation programs that meet the goals of the universal thermal energy efficiency program in a manner approved by the department of public service and which enhance the thermal energy efficiency program’s capacity to serve the state’s retail consumers may be eligible for rebates from the fuel gross receipts tax imposed under this section. To establish rebate eligibility, such a company shall file with the administrator of the fund on or before August 15 of each year a request for approval of rebates based on the company’s activities during the prior fiscal year. The administrator shall make a determination of the amount of rebate for each applicant on or before January 15 of each year, and that amount shall be rebated by the fund administrator under the provisions of this subsection. The fund administrator shall authorize rebates equal to the expenditures undertaken by the unregulated fuel sellers, provided that such expenditures were prudently incurred and cost‑effective, and that they provided thermal energy efficiency services following a comprehensive energy audit and work plan, except in cases where the fuel seller and fund administrator staff jointly conclude that the need for thermal energy efficiency services can be determined without a comprehensive energy audit.
The Vermont General Assembly
115 State Street