State Headliners: Carbon-tax-supporting Chittenden County has state’s lowest household energy burden

By Guy Page

In a well-loved Aesop’s Fable, a country mouse visits his cousin in the city. At first impressed by the excitement and the gourmet cheeses, he goes home after their fine meal is interrupted by attacking dogs. The moral of the story: country life may be boring, but it’s more secure. As 13th century Bishop Odo commented on the fable, “I’d rather gnaw a bean than be gnawed by constant fear.”

Alas, it’s the country mouse and his human counterpart who are feeling insecure now — about the high cost of energy. A study published this month finds that, as a region, rural New Englanders pay the highest percentage of their household incomes for energy. They earn less than their city cousins but pay a higher percentage of their incomes – 5.1 percent – to keep the lights on and stay warm. And the study doesn’t even count the higher cost of transportation.

In Vermont, wealthy, energy-efficient Chittenden County has the lightest ‘total energy burden’ in Vermont, according to a 2016 Efficiency Vermont study (see graph, page 39). Chittenden pays less than 8 percent of household income for ALL energy needs, including transportation. Meanwhile, many towns in the poorest rural regions, such as the Northeast Kingdom, have a ‘total energy burden’ exceeding 12 percent.

Even city dwellers outside of Chittenden County suffer more. Many of Vermont’s urban poor live in Barre, St. Albans, Springfield, Rutland and St. Johnsbury, in part because of their relatively low rent, proximity to corrections facilities, and/or intensive social services. All five of these communities show double-digit energy burdens, ranging from 18.8 percent in Springfield to 26.6 percent in Rutland City (page 24). By contrast, the lowest energy burdens are in wealthy communities like Shelburne, Charlotte, Burlington, and South Burlington.

It should be obvious that any carbon tax on gasoline and home heating oil that punishes heavy users would only transfer wealth from poor rural Vermont to Chittenden County. Tough luck for the poor Country Mouse! As if low-paying jobs and a growing drug culture weren’t making self-sufficiency hard enough for his/her family, the carbon tax sponsored mostly by City Mouse lawmakers would just make it harder.

Gov. Phil Scott opposes carbon taxation. So do many rural legislators, Democrats and Republican alike. At least one possible challenger of Gov. Scott in the November general election supports carbon taxation, even though she won’t call it a tax – preferring the term “carbon pricing” instead. Christine Hallquist, widely respected for her work as general manager of Vermont Electric Cooperative, recently told WDEV talk show host Dave Gram she backs carbon pricing but resisted Mr. Gram’s efforts to get her to call it a tax.

Of Vermont’s 27 poorest (per capita income) municipalities, 21 are in the Northeast Kingdom counties of Essex/Orleans/Caledonia. Two of the six exceptions — Eden and Richford — border Orleans County. Hopes for economic investment and renewal were quashed by the EB-5 scandal. Orleans County unemployment is consistently highest in the state, including a June 2018 rate of 4.3 compared with 2.8 statewide.

The win-win solution would be to create carbon taxation that doesn’t hurt the poor. That’s something the ESSEX plan pushed last year tried and, in the opinion of many, failed to do. The trick is to get more energy efficiency into lower-income homes without hurting them or our recovering economy. How to do that is a column for another day. For now, Vermont policy makers would do better to lead low-income energy-users with the carrot of incentives, rather than beat them with the punishing stick of taxation.

Vermont to postpone Vermont Yankee decision until federal government rules

And speaking of economic recovery — the Vermont Public Utilities Commission announced July 6 it will postpone its final decision on the sale of Vermont Yankee to NorthStar until after the U.S. Nuclear Regulatory Commission rules. The sale is expected to be finalized by about year’s end. NorthStar plans to make the suitable ready for redevelopment as soon as 2026, far sooner than the estimated 60 years under the current owner’s decommissioning plan.

Barre wind turbine, battery storage company announces “hardship” financing

Northern Power Systems, a Barre-based developer of wind turbines and electricity storage batteries, announced July 19 it will seek “hardship financing”. Northern Power has $5 million in unpaid bills and in April announced the furloughs of an unknown number of the 50 workers at the Barre facility.

Statehouse Headliners is intended primarily to educate, not advocate. It is e-mailed to an ever-growing list of interested Vermonters, public officials and media. Guy Page is affiliated with the Vermont Energy Partnership; the Vermont Alliance for Ethical Healthcare; and Physicians, Families and Friends for a Better Vermont.

Image courtesy of Michael Bielawski/TNR

One thought on “State Headliners: Carbon-tax-supporting Chittenden County has state’s lowest household energy burden

  1. Guy Page,
    “The win-win solution would be to create carbon taxation that doesn’t hurt the poor.”
    That, by definition, means it is ok to have a win-lose for others.
    You should know there is no FREE LUNCH

    The Vermont Comprehensive Energy Plan, CEP, goal aims to “transform” the Vermont economy. It would require investments of about $33.3 billion, about $1 billion per year for 33 years, during the 2017 – 2050 period, per Vermont Energy Action Network 2015 Annual Report. The CEP could not be implemented without a very high carbon tax and other taxes, surcharges and fees of at least $970 million per year for 33 years.

    A large group of Vermont legislators, pressured by RE and other special interests, co-sponsored a bill to enact a law to impose a unilateral, regressive carbon tax on already-struggling households and businesses. Fortunately, the proposed bill died in committee. Governor Scott is against any unilateral carbon tax and against any additional wind turbines on ridgelines. However, RE and other special interests continue to drum up support for their carbon tax that would line their pockets at the expense of all others.

    Carbon Tax Impact On A Typical Vermont Family, as reported on VTDigger:

    – The carbon tax would impose a $10 per ton tax of carbon emitted in 2017, increasing to $100 per ton in 2027.
    – The carbon tax would generate about $100 million in state revenue in 2019 and about $520 million in 2027.
    – The carbon tax would be added to the fuel prices at gas stations and fuel oil/propane dealers. Drivers should expect a tax increase of 9-cent per gallon of gasoline in 2017, increasing to about 89 cents in 2027.
    – Homeowners, schools, hospitals, businesses, etc., should expect a tax increase of 58-cent tax per gallon of propane and $1.02 per gallon of heating oil and diesel fuel in 2027.
    – A typical household (two wage earners, two cars, in a free-standing house) would pay additional taxes in 2027 of about:
    – Some of the carbon tax extortion would be at the pump, some when the monthly fuel bills arrive, and some as higher prices of OTHER goods and services.

    Driving = $0.89/gal x 2 x 12000 miles/y x 1/(30 miles/gal) = $712/y
    Heating = $1.02/gal x 800 gal/y = $816/y
    Total carbon tax in 2027 = $1528/y
    Sales tax reduction 5/6 x 1400 = $233/y
    Net tax increase = $1295/y

    – The hypocritical sop of reducing the sales tax from 6 to 5 percent would save that household about $233 in sales taxes, for a net loss of $1295 in 2027. That means such households, the backbone of the Vermont economy, would have about $1300/y less to make ends meet.
    – Many of these households have had stagnant or declining, spendable real incomes (after taxes, fees, surcharges; other recurring expenses, etc.), plus dealing with a near-zero, real-growth Vermont economy, since 2000.
    – With less real income, and higher real prices for goods and services, they also would have to make their own energy efficiency improvements.

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