On Thursday, February 10, 2000, Vermonters for a Clean Environment (VCE) learned for the first time that under current Vermont law, merchant power plants would be unable to receive a Certificate of Public Good because they would not satisfy the requirement to show "need" for the power as specified in Act 248.

VCE also learned that the Public Service Board (PSB) and the Department of Public Service (DPS) were aware that the power plants proposed for Vermont would be unable to be permitted under current Vermont law. In fact, a bill was introduced in the Vermont House during the 1999 legislative session that would have removed the requirement under Act 248 to show "need" in order to facilitate this power plant project.

These revelations came about because a new merchant power plant bill was introduced in the Vermont House on Tuesday, February 1, 2000. H.816 is sponsored by the chair and 6 members of the House Commerce Committee. Testimony on H.816 was heard by the House Commerce Committee on Tuesday, February 8, 2000. VCE and others provided testimony.

It was during that testimony that a representative from the Public Service Board reminded the committee that they had first seen a merchant power plant bill the year before. He said that if the committee would remember, the reason it came about was because of the realization that the power plants proposed for Vermont could not receive a Certificate of Public Good under current Vermont law. The PSB representative said that the bill last year got complicated and did not go anywhere.

H.816 creates a new regulatory protocol for Merchant Power Plants as an exception to Act 248. In this new protocol, § 248a, several regulatory requirements that pertain to siting power plants in Vermont under existing § 248 have been removed as a requirement for Merchant Power Plants. These omitted requirements are found in existing § 248 at (b)(2), (b)(6), and (f).

• § 248 (b)(2) reads: "Before the public service board issues a certificate of public good as required under subsection (a) of this section, it shall find that the purchase, investment or construction is required to meet the need for present and future demand for service which could not otherwise be provided in a more cost effective manner through energy conservation programs and measures and energy-efficiency and load management measures, including but not limited to those developed pursuant to the provisions of §§ 209(d), 218c, and 218(b) of this title."
• § 248 (b)(6), refers to an existing requirement that the proposed power plant be consistent with the company's "least cost integrated plan".
• § 248 (f), contains a requirement that applicants send their construction plans to municipal and regional planning commissions 45 days prior to filing with the Public Service Board.

In public meetings held on the gas project throughout 1999, the ability of merchant power plants to satisfy the "need" criteria was raised as a question numerous times. Citizens were never told by the state officials who were present to answer questions at these meetings that efforts had been underway in the 1999 legislative session to change the law. Representatives from Vermont's Department of Public Service never told citizens that there was a problem with the law and the approval of merchant power plants.

H.816 is a piece of restructuring legislation. One could argue that this law is premature and should wait for the legislature to look at the whole issue of restructuring before it tackles issues like this piecemeal.

Coincidentally, on February 10, 2000 a news story out of Florida reports that lawyers for Florida's utilities were arguing to the State Supreme Court that state law does not allow independent electric companies to build power plants without having customers to serve. Florida's Public Service Commission has already approved the plan by Duke Energy Corp. to construct a 514-megawatt power plant.