Senator calls Clean Heat Standard a “Rube Goldberg” contraption.

Can’t vote for a bill he can’t explain.

Barring a few loose ends, the Senate Natural Resources & Energy Committee wrapped up taking testimony on S.5, the so-dubbed “Unaffordable Heat Act”, on Tuesday morning in anticipation of passing it out sometime this week.

In a shocking admission, Senator Dick McCormack (D-Windsor) confessed, “Usually at this point in the development of legislation I can picture after the bill passes what’s going to happen. I can envision what the world can be like after this passes. I get it that what we’re essentially doing is directing the PUC (Public Utilities Commission) to put together a kind of a ‘Rube Goldberg.’” And, “I don’t see how this works.”

McCormack apologized to the other four senators on the committee, saying that it was clear to him that they all had a better understanding of the legislation than he did, and that his confusion was his own failing.

McCormack is selling himself short. He is the only one who does understand that this bill is incomprehensible, or at least is the only one being open and honest about his confusion. It is a Rube Goldberg contraption, and he can’t see how it works because it doesn’t work. In fact, it has been the explicit objective of committee chair, Chris Bray (D-Addison), that nobody is able to understand how the Clean Heat Standard will work for fear that if the people are aware of these details, the people will never allow S.5 to become law.

“We’re starting from a point of managing a certain amount of uncertainty,…” Bray warns unruly askers of uncomfortable questions at one point. This is an understatement. “We launch, and then we have a system of monitoring and assessment that lets us help the plan evolve knowing that it’s not going to be a perfect program on day one.” This is a fancy way of saying we’re going to pass this highly flawed piece of junk before anybody can figure out what’s in it. (Including, apparently, Senator McCormack!)

Bray then bemoans, “The anxiety some people feel about specifying everything prior to commencing….” And while it is reasonable to expect some uncertainties when launching any large program, Bray has made sure there are no certainties at all regarding this law.

How much will the Clean Heat Standard cost Vermonters? Bray and his committee refuse to ask. When the Secretary of Natural Resources, Julie Moore, put forward a number ($1.2 billion over four years) Bray sprung into a frenzied attempt to discredit her math. Does he supply his own cost estimates to refute Moore? No. Those will come after the bill is law and Vermonters are stuck with the consequences. No math is allowed.

Senator McCormack shared a bit of solid wisdom with his colleagues: “Never vote for a bill you can’t explain to your constituents.” Hear, hear! So here is a challenge and a litmus test for the senators. If you can’t explain the following, you should not vote for S.5….

1.     Explain the how the “tradeable credit system” that is at the heart of this bill works.

The entire reason behind the bill is to establish a system of  tradable “clean heat credits” that dealers of fossil fuels (“obligated parties”) will have to buy, and others will be able to generate by engaging in greenhouse gas reducing activities such as installing heat pumps and insulating buildings. The incentive to people and businesses across the state to generate, own, and sell these credits is the “market mechanism” that is supposed to make the whole scheme function. But identifying and verifying literally hundreds of thousands of credit-generating actions performed by tens of thousands of actors in obscure places, practically speaking, is bureaucratic quagmire.

Can it logistically even work? The PUC which is tasked with coming up with the operational plan for the Clean Heat Standard doesn’t think so and is asking that the “tradable” credit concept be stripped out of the bill entirely. If the PUC get their wish, what is the purpose of this bill?

2.     Explain who is an “obligated party” (the businesses required to purchase credits).

Defining in the bill who is ultimately responsible for buying clean heat credits is an important detail. The senators still haven’t figured this out. What they want to do – make a dozen or so wholesalers of heating fuels the obligated parties – turns out to be illegal, a violation of the commerce clause of the US Constitution. It turns out not all of the heating fuel wholesalers (the big companies that sell fuel to the small retail dealers, who in turn sell fuel directly to customers) are located in and make their sales within Vermont. Some retail dealers travel outside of Vermont to buy fuel from wholesalers in other states.

Wholesalers that do sell their fuel within Vermont borders can be regulated as obligated parties, but those that make their sales outside of Vermont cannot be.

So now what?

Senator Bray tried to answer this question himself and the results were mind-numbingly obtuse.  (Also, quite funny. HERE’s the video!) He finally gave up trying to untangle what he described as a “potentially wrap around the axle thing”.

Why can’t Bray explain his own bill? Because his committee is faced with two alternatives, and neither is practical, and perhaps not even possible, in application.

One, have some wholesalers, the ones that make sales directly into Vermont, obligated parties, and some retail dealers, those who leave the state to buy their fuels and bring them back into Vermont, obligated parties as well. This is both complicated and unfair as it creates a two-tier system for retail fuel deliverers with some as obligated parties having to buy credits and others not.

Or create an even playing field for retail fuel dealers by making all of them the obligated parties and leaving the wholesalers out of it entirely. The problem with this is there are hundreds of retail fuel deliverers of all shapes and sizes and finding, tracking and regulating them will be a nightmare for whoever gets assigned the task of doing so.

This conundrum isn’t “potentially” wrapped around the axle of S.5, it is firmly wrapped around the axle, and the senators don’t have a solution.

3.     How will the Clean Heat Standard deliver its promised commitment to equity and social justice for low-income Vermonters?

If S.5 becomes law, it will increase the cost of fossil heating fuel significantly for those who still use it. It will also increase the electricity bills for those who transition away from fossil fuel heating systems to electric. The law says it will mitigate the impact of these cost increases, but nowhere does it explain how.

Without a robust economic impact study – which is being assiduously avoided by the committee – we can’t even know what the potential size and scope of a necessary social safety net program will be. We don’t know who will run such a program or where the revenue source to pay for such a program would come from.

These are just a few of the many questions about this bill that remain unanswered or appear to be unanswerable. S.5 will go to the full floor of the Senate in the next week or two. Now is the time to contact your senators and tell them to live up to Senator McCormack’s standard: Explain how all this works – tell us what it will cost us – and if you can’t do that, VOTE NO!

• Rob Roper is a freelance writer with over twenty years experience in Vermont politics and policy.

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In case you missed my interview on The Morning Drive, you can hear the recording here: https://www.wvmtradio.com/show/the-morning-drive/. You may have to scroll down a bit.