Clean heat ‘carbon tax’ 2.0 has a new name and number

By Rob Roper

Last year H.715, an act relating to the Clean Heat Standard, which would have mandated that fossil-based heating fuel dealers pay a carbon-based “credit” fee for selling their products, was vetoed by Gov. Phil Scott and that veto was sustained by one vote (99-51) in the state House of Representatives. Democrats and Progressives are hoping that newly elected supermajorities in both the House and Senate, along with a new name for what is essentially a carbon tax on home heating fuels, will ensure that that the Clean Heat Standard will become law this year.


S.5 is sponsored by 13 of Vermont’s 30 senators, including Sen. Christopher Bray, D-Addison.

For 2023, the clean heat standard bill has been officially re-christened S.5, an act relating to affordably meeting the mandated greenhouse gas reductions for the thermal sector through electrification, decarbonization, efficiency and weatherization measures. The shortform name is now the brazenly misleading “Affordable Heat Act.”

In a nutshell, how the clean heat standard would operate is that the state will force sellers of home heating oil, propane, natural gas and kerosene to either generate or, in most cases, purchase “clean heat credits” to legally sell their products. The credits operate essentially as a carbon tax (in addition to existing taxes) on fossil-based home heating fuels, the cost of which will be passed along to customers, artificially raising the price to heat homes with those fuels.

Supporters of the clean heat standard argue that the pain of higher costs to heat with fossil fuels created by the credit system is a necessary stick to motivate consumers to switch heat sources, and the revenue raised through the mandatory sale of “clean heat credits” will provide a corresponding and lucrative carrot for those who comply, or more directly to those who facilitate the adoption and installation of non-fossil-fuel heating options.

According to research by the Vermont Climate Council, over 70 percent of all carbon emissions from home, business and industrial heating in Vermont comes from these fossil-based fuels, so the clean heat standard will have an expensive, negative impact on a majority of the state’s residents. Vermonters who have oil, gas, or propane furnaces and/or water heaters, gas stoves, and so on will be the “losers” in the new policy, paying even higher prices to operate these appliances.

The “winners” will be the politically favored “entities” (businesses and government affiliated non-profits) that are allowed and able to generate the “clean heat credits” by weatherizing homes, installing electric heat pumps, etc. (S.5 lists 11 specific measures that will be acceptable for generating credits but leaves the door open for more). Because the fuel dealers have no choice but to buy these credits or face even more severe penalties if they want to stay in business, the clean heat standard creates a government mandated revenue stream of “free money” from fossil fuel users to those politically favored entities.

While the bill would allow a wide variety of businesses and individuals to generate, own and sell credits, it also seeks to designate a “default delivery agent” that would be the authorized go-to entity for fuel dealers to purchase credits. Though not yet designated, conversations in the Vermont Climate Council deliberations indicate strongly that the default delivery agent will be Efficiency Vermont, technically a non-profit organization but funded through the “energy efficiency charge” that appears on Vermonters’ electric bills. Efficiency Vermont would receive another enormous windfall of revenue as a result of being the default delivery agent for the clean heat standard.

It is worth noting that Peter Walke, who served as commissioner of Vermont’s Department of Environmental Conservation in the Scott administration, used that position to advocate strongly within the Vermont Climate Council that Efficiency Vermont be the default agent for the clean heat credit system. Shortly after the Climate Council presented its Climate Action Plan to the Legislature in December 2021, Walke left his post to take the top job of Managing Director of Efficiency Vermont.

The other “winners” will be the new army of government bureaucrats and/or government sub-contractors necessary to run this program.

S.5 states:

Clean heat credits shall be based on the accurate and verifiable lifecycle CO2e emission reductions in Vermont’s thermal sector that result from the delivery of eligible clean heat measures to end-use customer locations into or in Vermont. (1) For clean heat measures that are installed, credits will be created for each year of the expected life of the installed measure. The annual value of the clean heat credits for installed measures in each year shall be equal to the lifecycle CO2e emissions of the fuel use that is avoided in a given year because of the installation of the measure, minus the lifecycle emissions of the fuel that is used instead in that year.” (Emphasis added)

This means that it will be somebody’s — many somebodies’ — job to verify (as well as weed out any fraud) and calculate according to the formula outlined above the clean heat credit values for literally tens of thousands of unique, uncoordinated actions across 11 or more areas of technology/construction, performed by a multitude of individuals, businesses and organizations all across the state. The Climate Action Plan calls for nearly 13,000 weatherization projects alone to occur annually between now and 2030 to meet the greenhouse gas reduction goals set out in the Global Warming Solutions Act.

Once a credit-eligible action has been verified to have taken place and the number of credits created from that action (one credit per ton of greenhouse gas mitigation) has been established, it will be somebody’s — likely many somebodies’ — job to assign a monetary value to each credit, assign ownership of each credit to a particular party, track the sales of each credit to obligated parties over its lifetime, and ensure each credit is “retired” at the end of its life-cycle.

This proposed credit system is often compared to the Regional Greenhouse Gas Initiative (RGGI) “allowance” system. However, RGGI is far simpler than what S.5 is proposing as RGGI has fewer obligated parties and the number of RGGI “allowances” are set and issued from a single central exchange rather that created “in the field” by random acts of hundreds or potentially thousands of entities, and the allowances are auctioned off directly to the obligated parties. Even so, according to the RGGI website, its 2022 operating budget was $3,118,019.00. The cost to operate RGGI is shared among 11 participating states, whereas the total burden of supporting larger and more complicated clean heat standard system would be borne by Vermonters alone.

Of course, the major cost of this clean heat standard proposal is not the operating expense but rather the cost of the credits themselves. Though advocates have been careful to avoid any substantive discussion of what the cost of a credit might be, if the expectation is that the credit sales will be the primary revenue source for subsidizing the thermal sector programs necessary to meet the greenhouse gas reduction benchmarks in the Global Warming Solutions Act, the total annual cost of clean heat credits will more than likely exceed $100 million annually. Some 13,000 home weatherization projects estimated at an average of $10,000 per project is $130,000,000 alone. No other revenue source to pay for these projects has been identified or discussed.

S.5 is sponsored by 13 of Vermont’s 30 senators: Christopher Bray (D-Addison), Senate President Pro Tem Philip Baruth (D-Chittenden), Brian Campion (D-Bennington), Senate Majority Leader Alison Clarkson (D-Windsor), Ann Cummings (D-Washington), Martine Gulick (D-Chittenden-C), Ruth Hardy (D-Addison), Mark MacDonald (D-Orange), Dick McCormack (D-Windsor), Andy Perchlik (D/P-Washington), Kesha Ram Hinsdale (D-Chittenden), Anne Watson (D-Washington) and Becca White (D-Windsor).

The Senate committee of jurisdiction for S.5, which will radically restructure Vermont’s economy, will be Natural Resources & Energy (though that name may change), chaired by Sen. Bray, whose legislative bio boasts a degree in zoology from UVM and a master’s degree in English. Other members of the committee are Sen. Dick McCormack, a folk musician from Bethel, Sen. Mark MacDonald, an 80-year-old retired teacher who recently suffered a stroke, and two new senators, Becca White, a cashier at the Upper Valley Food Coop in White River Junction, and Anne Watson, the former mayor of Montpelier and a high school math and physics teacher.

Rob Roper is a freelance writer who has been involved with Vermont politics and policy for over 20 years. © Copyright True North Reports 2023. All rights reserved.

Image courtesy of TNR

19 thoughts on “Clean heat ‘carbon tax’ 2.0 has a new name and number

  1. To convert my house it would cost approximately $100K now, I had an estimate to convert to HP pre-Covid and it was about $70K (also have a guest house) – I don’t have that kind of money. And if I can’t afford that how on earth do they think anyone in VT can afford it – how many people are rural here, I would say what 70% of the state.
    Is the issue to kill the people of VT – cause they would be freezing them to death in the winter here.
    And does anyone know, would you be able to contract with a NH oil/propane dealer to fill your tanks, one that does not have any operations in VT, without this carbon credit situation? Please respond in comment as I really would like to know. I have no money to use to convert from heating oil and propane to HP. Does anyone else, except the wealthy elderly who seem to be the majority of people moving into this socialist hellhole of a state?

  2. This is so disgusting. It’s based on a huge lie, that carbon dioxide has more than a tiny “greenhouse effect” no matter how much is in the atmosphere.
    It’s practically the mother of all lies. The greenhouse effect is tiny, and does NOT increase with more ppm’s in the air. It’s about 0.04% of the atmosphere, and is essential to life. It is at a historic low now, and we need MORE CO2, not less!
    Here’s a great, fact-filled, authoritative website on the subject, the CO2 Coalition.
    Not all “scientists” agree with this hoax, but too many don’t want to know, or are chicken to stand out and get attacked for telling the truth. Shame on them.

    • “Not all “scientists” agree with this hoax, but too many don’t want to know, or are chicken to stand out ”

      You forgot the biggest reason that they follow the lie… The grant money. They should be excommunicated from the scientific community for perpetrating the lie and not allowing peer review and conflicting studies which is what science is.

  3. NOTHING has ever come out of the Montpeculiar house of fascist that was ever AFFORDABLE, who in heck do they think their kidding? Just like their brethren commies in commiefornia they only strive to add more and more cost to the right to live here. They should all be shot like Ethan and the boys would have surely done…

  4. If they really wanted people to switch heating sources, they would give people a 100% tax credit for switching. Of course that would diminish the power of the commies in Mount Stupid, and that is what this is all about.

    • Time to switch back to wood heat….or move to a better run state. Freedom is becoming scarce in Vermont. And, Electric is not cheaper….heat pumps are not efficient once it gets down to zero degrees. Looks like the elites are looking down their noses at the working class which is STILL the backbone of this state. Thoroughly disgusted.

      • but wait – with the last bill from last year that was vetoed they are planning on figuring out a way to tax wood sellers too.

  5. The semi autonomous nature of America’s individual states permits them to compete with one another for businesses and for citizen population by endeavoring to provide the most attractive combination of taxes and services, i.e. being well and efficiently managed by a responsive legislature. That provides a very foundational form of democracy, a shoe-leather democracy which we see being exercised as population shifts away from states not rationally attuned to businesses or to the people. Some states are gaining population (and Congressional representation); some are losing the first and consequently the second. In theory, it would lead states on the decline to copy the management of the more successful ones, but we often see this thwarted by the ideologic dogmatism of political leaders. Their states lose people to more attractively managed states. It’s why I moved south.

    • In theory this works, but not in all instances, such as when you are married and your spouse refus s to leave a state like Vermont or for people caring for elderly parents.

    • We’re NOT a democracy. America is a Constitutional Republic. Democracy is mob rule; playing in the sandbox with bullies.

  6. Here is the preamble of the S.5:

    “Statement of purpose of bill as introduced: This bill proposes to establish the
    Clean Heat Standard to reduce Vermont’s greenhouse gas emissions from the
    thermal sector.”

    Right up front they lie. Nothing about “affordable”. Fool me once ….

  7. Sen. Chris Bray is Vermont’s carbon tax poster boy. He doesn’t show much concern about Vermont businesses or the many low-income residents who will be burdened by this “feel good” tax. If Bray was so concerned about creating truly carbon-free energy sources in Vermont, then why did he support the closing of the Vermont Yankee Nuclear Power Station?

    • Lou,
      This is not about carbon-free energy.
      This is about feathering the nests of the global warming INCROWD, that will reap an ADDITIONAL few hundred $million “ to do business”.
      The net effect on global warming of all such measures by Vermont is a big fat ZERO

        • One thing we certainly can do is turn off the furnace at the Capital Building,

          And hold legislature with it’s 24/7 barrage of HOT AIR all winter long.!?!!

          Can we be against global warming and in favor of no heating fuels ??!!

      • The VT-DPS had a study performed of HEAT PUMPS in Vermont.


        CADMUS Survey of Vermont Air Source Heat Pumps

        CADMUS, an energy consultant hired by the Vermont Department of Public Service in 2017, performed a survey of 77 HPs at 65 sites, in Vermont. See URL of CADMUS report

        VT-DPS was ordered by the Vermont legislature to obtain an “independent” study, because many people with air source heat pumps had complained, they did not get anywhere near the annual energy cost savings stated on websites, etc., of GMP, BED, VPIRG, VT-DPS, EAN, EFFICIENCY VERMONT, etc.,

        The CADMUS report was written in such a confusing way, the average Vermonter, including almost all legislators, would not be informed by it, and would be more confused by it, unless they had a mechanical engineering degree, with applicable experience.
        I do have the degree and experience, so I could analyze it.

        CADMUS used a standard HVAC computer program that takes the hourly temperature history of a heating season (obtained from US weather data), and allocates the frequency and duration of temperatures to two-degree temperature intervals, also called “bins”.
        See URL of CADMUS report; horizontal line of figure 14

        The space heat to a site is calculated for each two-degree bin, say 34 F – 36 F
        The total space heat to a site is obtained by adding the space heats for all two-degree bins.

        Figure 14 also shows the aggregate electricity consumption, kWh, of all heat pumps is steadily increasing with increasing heating load, until about 30 F.

        At temperatures below 30 F, the heating load was increasing, but the electricity to heat pumps was decreasing!!

        People turned off their HPs (to save on electricity costs) and, instead, used their much-less-costly-to-operate traditional heating systems, such as oil, gas, propane and wood stoves.

        The CADMUS HVAC computer program calculated:

        – Space heat to a site was 92 million Btu, of which 25.35 million from HPs, and 66.65 million from other fuels
        – Space heat to all sites was 65 sites x 92 million Btu/site = 5,980 million Btu. See CADMUS URL, page 22
        – Space heat from HPs was 77 HPs x 21.4 million Btu/HP = 1,648 million Btu. See CADMUS URL, page 21
        – Traditional systems provided 5980 – 1648 = 4,332 million Btu, or 4332/5980 = 72.4% of the total space heat.
        – HPs provided only 100 – 72.4 = 27.6% of the total space heat for an average Vermont house

        The energy cost savings averaged about $200/y, instead of the $1,200/y to $1,800/y bandied about by GMP, VT-DPS, VPIRG, etc.

        After the CADMUS report, those estimates disappeared from booster websites.


        I have three HPs ($24,000 – $2,400 subsidy from GMP) in my well-insulated/sealed house.
        I displace only 35% of my propane Btus, based on MEASURED consumption data during 3 years.

        I do not use my HPs below 15F, because they are less efficient PER HOUR than my efficient propane furnace.

        I save about $200/y in energy costs, but if I amortize the cost of the HPs over 15 years, I lose about $2,000/y

        Bray, McDonald, etc. know about all those dreadful HP results in Vermont, and yet they are shilling for HPs

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