Does Thetford need to worry about rolling blackouts?

Despite GMP’s claims about its energy supply, its actual dependence on fossil fuels leaves us no less vulnerable to potential blackouts than are customers of other New England utilities.

You may have noticed recent news reports warning about the possibility of rolling blackouts in New England this winter. You’d be forgiven for being a bit skeptical. After all, those dire warnings seem to be a perennial winter phenomenon. Could this be the winter when rolling blackouts hit Thetford?

Probably not, but it's not completely out of the question.

How it could it happen

More than half of New England’s electricity is generated by burning natural gas. Since residential property that’s heated with gas gets priority, if an extended cold spell caused a supply shortage, then conceivably electric generators wouldn’t have enough backup fuel – coal and oil -- to meet increased demand. That’s never happened, but some commentators are giving this year’s alert a bit more credibility. Natural gas is in shorter supply this year, in part because Hurricane Ida clobbered the Gulf coast and disrupted production last summer. Supplies were further diminished by increased use of air conditioning during an especially hot summer to the south, and by soaring U.S. exports of liquefied natural gas.

On the other hand, you might be scratching your head, especially if you’ve read that “GMP’s energy supply is 100% carbon free and more than 68% renewable,” which Green Mountain Power, Thetford’s electric utility, claims on its energy mix page. How could a shortage of a carbon-based fuel like natural gas affect us if our supply is 100% carbon-free? GMP is part of the huge interconnected electrical grid operated by an outfit known as ISO-NE (Independent System Operator – New England), which is responsible for maintaining reliability across the entire regional grid. In the case of a system-wide emergency, such as a temporary shortage of generating capacity, ISO-NE has the authority to ration electricity through rolling blackouts. In fact, it hardly matters what GMP claims, because all of us in New England are using the same supply, and that supply is still mostly fossil-fueled.

GMP’s bogus claims

How then does our electric utility claim a 100% carbon-free supply?  Well, to quote Tom Magliozzi of NPR’s long-gone but much-beloved program Car Talk, “It’s BO-OO-GUS!”  Despite GMP’s claims about its energy supply, its actual dependence on fossil fuels leaves us no less vulnerable to potential blackouts than are customers of other New England utilities.

In 2020, more than 12% of the supply that GMP paid for was natural gas-fired. Obviously that generation produced carbon dioxide (CO2) emissions. From those emissions, however, GMP subtracted emissions that would have been avoided if they had used different energy sources. GMP does that by purchasing from other energy suppliers the “attributes” of non-emitting energy sources, separate from any actual energy.

Here’s how the system works. Every megawatt-hour of electricity sold on the ISO-NE grid has an attribute assigned to it, which identifies how it was generated. Attributes are used by regulators in each state to track how much energy, both fossil-fueled and renewable, each utility is selling and how much greenhouse gas is being emitted in the process. A single attribute of natural gas-generated electricity represents a certain mass of CO2 emitted, which contributes to climate warming. On the other hand, an attribute of nuclear-generated electricity is assumed to have no greenhouse gas emissions, and so is considered “carbon free.”

Attributes of electricity that is generated renewably are given the special status of renewable energy credits, referred to as RECs. RECs are created when electricity is generated by, for example, solar panels or wind turbines. The “renewability” of the energy can only be claimed once, when the REC is “retired” and removed from circulation. Vermont’s Renewable Energy Standard sets the minimum percentage of electric utilities’ supply that must come from renewable sources, with the retirement of RECs demonstrating compliance.

RECs are intended to be a used to demonstrate that new, clean generation has replaced fossil-fueled plants. However, RECs can be abused when they are allowed to be stripped away and sold separately from the actual energy that they were initially attached to. The buyer gets to reclassify a megawatt-hour of fossil-fueled electricity as renewable for each of the “unbundled” RECs that is retired.

GMP takes advantage of RECs both as a seller and a buyer. It employs a scheme that works only because Vermont is unique in allowing its utilities to treat the attributes of large scale hydroelectric energy as renewable, that is as RECs. Since other states don’t allow this, there is low demand for those hydro attributes, and this means that GMP is able to buy large quantities at small expense.

Rather than retire the high-value RECs that come from the wind project it owns in the Northeast Kingdom and from solar panels around Vermont, GMP sells those expensive RECs to out-of-state utilities and replaces them with cheap hydro attributes. In 2018, GMP was selling RECs from its wind project for $23 and replacing them with Canadian hydro attributes at $0.50 to meet Vermont’s renewable energy requirements.  According to the Department of Public Service, through this practice known as arbitrage, that year GMP added $3.6 million to its revenues. When utilities in Massachusetts and Connecticut bought the Vermont wind and solar RECs, GMP surrendered the rights to claim the energy as renewable.

In 2020, GMP sold all of its wind RECs and almost all of its solar RECs, retaining only the bare minimum that Vermont law required. Almost 85% of GMP’s Vermont-generated wind and solar was not delivered to its rate payers.

Hydro-Québec

Things get complicated, and frankly controversial, where the large-scale hydroelectric generators are concerned. GMP gets about a quarter of its electricity supply from Hydro-Québec projects that have flooded vast tracts of forest, approximately equal to the area of Vermont. Indigenous people have been displaced by the hydro projects from land their ancestors occupied for millennia. They have alleged human rights abuses, sued HQ, and demanded reparations.

HQ electricity is classified as having zero emissions in the official Vermont Greenhouse Gas Emissions Inventory and Forecast. However, the author of the inventory’s report is on record acknowledging that there are methane emissions from decaying forests flooded by Hydro-Québec, which the state doesn’t attempt to quantify. Methane is a greenhouse gas that is 86 times more potent than CO2 in the first 20 years after release into the atmosphere.  According to MIT professor Brad Hauger, HQ generation “causes significant greenhouse-gas release.”

GMP's math

Here’s the claim on GMP’s energy mix page.

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Here’s the breakdown of the actual energy mix, before RECs are figured in.

A couple of things may jump out at you from a quick before-and-after comparison. First, before unbundled RECs were bought and sold, GMP’s energy mix was 11.0% solar and 11.4% wind, all of which was generated in Vermont. After the RECs are figured in, GMP ended up with a mix that’s 2.8% solar and 0% wind.

GMP’s 2021 compliance filing with the Public Utility Commission shows that it bought about a quarter of its energy from HQ and the equivalent of another quarter by purchasing HQ RECs stripped from energy.  That’s the 51.1% “large scale hydro” in the first chart.

And that 31.9% of GMP’s mix attributed to nuclear? Well according to the same compliance document, less than half of it was actual energy.The rest was from stripped attributes, which GMP bought from the Seabrook and Millstone nukes. That got GMP to “100% carbon free”in this bizarre shell game. All those emissions from natural gas, oil and coal ... poof …  gone on paper but still actually present in the atmosphere.

State law prohibits nuclear energy being sold as “renewable,” so GMP is limited to a claim of “more than 68% renewable.”  Of course, most of that is undeniably responsible for greenhouse gas emissions and couldn’t legally be sold as “renewable” in any other New England state. But things are done differently here in Vermont.

As for the rolling blackouts? Not terribly likely. The long-range forecast is for a mild winter — the kind we’re becoming accustomed to.

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