Georgia & Vermont: A Contrast in Energy Policy Leadership
In the energy policy space, as it pertains to the power sector, Georgia’s government leaders, its Public Service Commission and its electric power sector are of a different fabric and a different economic orientation than states such as Vermont where nuclear is being abandoned and rates are some of the highest in the country. The numbers bear out that Georgia is providing real leadership for a stable and reliable electricity future that will attract industry and support Georgia’s economic growth while keeping rates affordable for Georgia citizens.
Vermont, the Green Mountain State, is often touted as one of the more progressive states in the U.S. with respect to energy use, particularly in its power sector. On the surface, Vermont’s in-state power generation credentials are impressive (Table 1):
In 2015, Vermont’s in-state power generation totaled 1,979,000 MWhrs while in-state sales for its residential, commercial and industrial sectors totaled 5,435,431 MWhrs (Table 2). This left the state with a shortfall of 3,456,431 MWhrs created by the closing of its 605 MW Vermont Yankee nuclear power plant at the end of 2014. In 2014, its last year of operation, Vermont Yankee generated 5,061,000 MWhrs of baseload generation that had to replaced. Vermont’s recourse was to import power from the New England grid and Canada; power generated from a resource mix that included natural gas and nuclear. This means that Vermont depended on other states and another country to meet 63.6% of the electricity needs for its citizens. By comparison, Georgia imported only 8% in 2015 (Table 2).
Vermont’s willingness to sacrifice its power generation autonomy is questionable. What isn’t questionable are Vermont’s electricity rates, which, compared with Georgia, are 47% higher for residential and commercial customers and 75% higher for industrial (Table 2).
Moreover, Vermont has the smallest GDP in the U.S. contributing only 0.17% of total U.S. GDP whereas Georgia has the nation’s 9th largest GDP and constitutes 2.77% of the U.S. total (Table 3). With industrial electricity rates as high as they are in Vermont and with Vermont lacking autonomy over its own power generation, this is very unattractive to industry, which looks for long-term stability, reliability and low prices before deciding where to locate its facilities. Georgia remains in control of the disposition of its power generation and looks to shore up that autonomy with the addition of 2.2 GW of new nuclear capacity with Plant Vogtle Units 3 & 4.
When a state loses baseload nuclear capacity, the resulting loss in generation will be made up with other baseload generation. That means, coal, natural gas or nuclear power with limited contributions from renewables such as solar or wind. Vermont is no exception and the last couple of years are bearing that out. While its in-state generation appears green, its consumption is different, and the state has diminished control over its power generation—it is largely a customer for power generated in other states and Canada. Moreover, with little contribution to the overall productivity of the U.S. economy, Vermont can afford to experiment with renewable energy while relying on the country’s productive states to do the heavy lifting of agriculture, manufacturing, construction and trade to provide material goods to Vermont’s small economy.
According to a recent article, Vermont Governor Peter Shumlin reaffirmed his belief that the decision to close Vermont Yankee was the right decision from an energy standpoint. Gov. Shumlin contends that the state is better off without the 605 MW of Vermont Yankee nuclear power and that a new emphasis on renewables and energy efficiency is the right thing to do environmentally and economically. It’s difficult to discern how losing zero-carbon nuclear capacity, along with the associated jobs, can generate environmental and economic benefits. In fact, it seems quite the opposite. Nonetheless, Vermont’s energy policy is generally a policy based on renewables and energy efficiency with 17% of households using wood pellets for heating. While Vermont’s government leaders and energy policymakers have decided to sacrifice the state’s economy in order to appease the environmental powers-that-be, Georgia’s leadership has clearly and decidedly taken a more pragmatic, balanced and calculated approach that has resulted in a 38% decrease in CO2 emissions in its power sector since 2007, has kept retail rates below the national average, has attracted new industry, and, most recently, is incorporating 2.2 GW of zero-carbon nuclear capacity thus bolstering the state’s commitment to both environmental and economic objectives. This is leadership. Vermont is doing something altogether different—whatever that is.
So, why can’t Georgia be like Vermont?
We could be…We just don’t want to be—Somebody has to work.