Petition of Twenty-Four Vermont Utilities

618 A.2d 1295, 159 Vt. 339, 1992 Vt. LEXIS 191
CourtSupreme Court of Vermont
DecidedOctober 2, 1992
Docket91-154
StatusPublished
Cited by23 cases

This text of 618 A.2d 1295 (Petition of Twenty-Four Vermont Utilities) is published on Counsel Stack Legal Research, covering Supreme Court of Vermont primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Petition of Twenty-Four Vermont Utilities, 618 A.2d 1295, 159 Vt. 339, 1992 Vt. LEXIS 191 (Vt. 1992).

Opinion

Dooley, J.,

On October 12,1990 and January 7,1991, the Public Service Board granted petitioners, twenty-four Vermont utilities, interim and then conditional approval, pursuant to 30 V.S.A. § 248, to purchase more than four billion dollars worth of electricity over a thirty-year period from Hydro-Quebec (HQ), a Canadian producer of electricity. The New England Coalition for Energy Efficiency and the Environment (NECEE) and the Grand Council of the Cree (the Cree) intervened before the Board to oppose the purchase, and now appeal the Board’s approval. They argue that (1) the Board erred in basing its own detailed analysis of statewide need for the purchase on evidence not properly before it; (2) the Board’s finding that the purchase of 340 megawatts of electricity on an annual basis from HQ would not require the construction of new production facilities in Quebec, and therefore would not threaten Vermont wildlife, was clearly erroneous; (3) the Board erred in refusing to allow intervenors to present evidence on the impact of a Canadian agency ruling offered after the close of evidence on the implications of the reliability of HQ as an energy source, while requesting an affidavit from HQ as a condition of its approval; (4) the Board erred in conditionally approving the purchase on the basis of a determination of statewide need, allowing for a subsequent showing of need by the individual utilities; (5) the Board’s finding of economic benefit to the state from the purchase failed to account for external economic implications of importing energy, such as the loss of jobs and tax revenue, and therefore was clearly erroneous; and (6) the Board erred in refusing to consider evidence of human rights deprivations of the Cree, a Native American population in Quebec, that would result from HQ’s construction of electricity production facilities. We affirm.

*343 I.

On April 1, 1988, all of Vermont’s electric utilities (petitioners) signed a participation agreement with HQ under which they would purchase between 340 and 450 megawatts (MW) of firm power annually pursuant to schedules that cover thirty years. 1 At a minimum, they would begin to purchase 57 MW in November 1990, and the purchase obligation would grow to 340 MW in the year 2000, declining to zero by the year 2020. The minimum purchase component was crafted to replace current contract amounts with HQ that total approximately 323 MW at present and decline over the next few years. At their option, the Vermont utilities could purchase an additional 110 MW. The participation agreement was subject to approval of the Public Service Board under 30 V.S.A. § 248(a)(1)(A) because each of the utilities will purchase “electric capacity or energy from outside the state, for a period exceeding five years, that represents more than one percent of its historic peak demand.”

After thirty-four days of evidentiary hearings, the Board approved the minimum purchase amount in the aggregate, subject to a specific showing of need for the amount to be distributed to each utility. There were twelve conditions attached to the approval, including that: (1) all amounts above the minimum be cancelled or the petitioners make a separate showing that the additional purchases will promote the general good of the state and will be supplied by existing HQ facilities; (2) petitioners file an affidavit from HQ stating that HQ is obligated to provide the power under the agreement irrespective of regulatory action on licensing and construction of specific facilities, that any shortfalls in power or energy caused by delay or cancellation of generating facilities would be distributed equitably among all purchasers, and that damage and compensation provisions would apply if the National Energy Board of Canada took certain adverse action; (3) each utility would file within sixty days statements supporting its allocation of power; *344 (4) each utility must “develop and implement measures to acquire all resources available from cost-effective acquisition of energy efficiency”; and (5) each utility must file a statement of efforts to sell back to HQ power and energy not needed in the short term. Overall, the Board found that the HQ contract “will provide a source of economic and reliable power” that would save Vermont ratepayers $500 to $700 million over the life of the contract.

The conditions ordered by the Board are similar to those sought by the Vermont Public Service Department, which urged the Board to approve the basic contract but not the additional 110 megawatts. The Department argued for greater specificity in the utilities’ obligation to pursue energy efficiency measures. Before the Board, the main opponents of the purchase were the Cree and NECEE [hereinafter intervenors], and they were joined by the Conservation Law Foundation, Vermont Natural Resources Council and Vermont Public Interest Research Group. Generally, the opponents argued that the purchase did not meet the standards of § 248(b) and thus did not promote the general good of the state. The Cree emphasized the adverse environmental consequences in both Quebec and Vermont, and the effect on their way of life. Many of the opponents argued that the energy needs of the state could be met by demand-side management (DSM) — that is, investments in energy efficiency measures that would reduce demand at a cost less than that of increased supply. They were joined in that position by the Vermont Independent Power Producers Association (VIPPA), who also argued that the state’s needs could be met by in-state renewable resources and cogeneration. Only the Cree and NECEE appealed the Board’s order. 2

II.

Intervenors first argue that the Board erred in relying on its own technical analysis of the need for the HQ power. The circumstances connected with this argument are somewhat complicated and require a detailed explanation.

To address one of the statutory approval criteria, see 30 V.S.A. § 248(b)(2), the Department of Public Service (DPS) re *345 tained Energy Systems Research Group, Inc. (ESRG), to do a detailed analysis of the monetary savings to Vermont ratepayers from the HQ contract, as opposed to alternative sources of supply or demand-side management (DSM) actions. The analysis was based in part on research done by the staff of DPS and a Vermont electric utility dispatch-and-revenue-requirements computer model called “UPLAN.” The results of the analysis were contained in a long report which concluded that approximately $134 million in present value (1989 dollars) benefits would accrue to Vermont ratepayers in the form of reduced electric rates from the HQ contract over the period from 1990 to 2018.

ESRG analyzed two levels of demand-side management that they called moderate DSM and strong DSM. Intervenors and others attacked the ESRG report on a number of grounds, but the strongest attack focused on its treatment of DSM. In intervenors’ view, more intense DSM would eliminate the need for the HQ contract. Responding in part to that criticism, ESRG did further analysis while the case was progressing and, in rebuttal, presented new conclusions based on an increased level of DSM that would reduce Vermont’s peak load by 27% and its energy demand by 20% in the year 2000.

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Bluebook (online)
618 A.2d 1295, 159 Vt. 339, 1992 Vt. LEXIS 191, Counsel Stack Legal Research, https://law.counselstack.com/opinion/petition-of-twenty-four-vermont-utilities-vt-1992.