Nearly three years ago, Vermont passed a landmark law that aimed to cut greenhouse gas emissions by shifting residents away from using fossil fuels to heat their homes and businesses. Last month, that plan officially died before ever being put into action — and the path toward cleaner heating in the state is murkier than ever.
In May 2023, Vermont legislators passed the Affordable Heat Act, which is widely considered the first law to require the development of a statewide clean heat standard to lower emissions from heating sources. But after years of contentious debate and recent inaction from lawmakers, regulators closed the case in February, possibly for good.
More than one-third of Vermonters rely on furnaces and boilers fueled by oil — one of the dirtiest and most expensive home-heating sources — and about another 20% primarily use propane. Though the clean heat standard did not mandate a switch to electric heat pumps, the policy would likely have spurred greater adoption of the appliances, which are cleaner and cheaper to run.
Some see the clean-heat turnaround as a financial victory for Vermonters, while others see it as a frustrating loss that will only hurt residents and the planet. How, though, did the pioneering plan manage to fizzle out before it even got started? The answer is a mix of complicated politics, an even more complex policy design, and interference from out-of-state conservative groups.
“There ended up being an enormous amount of misinformation floating around about it, which was very frustrating,” said state Sen. Anne Watson, a Democrat/Progressive who voted for the law. “When people are not circulating well-vetted info, that doesn’t serve anybody — that just serves to scare people.”
Vermont has set a legally mandated target of reducing greenhouse gas emissions 80% from 1990 levels by 2050. Almost all the electricity generated in Vermont comes from renewable sources, including hydropower, solar, and biomass, but the state is still heavily dependent on fossil fuels for heating and transportation. That’s where the clean heat standard came in.
A clean heat standard, broadly defined, is a policy mandating that providers of heating fuels steadily lower the emissions associated with their operations. It’s an adaptable approach, said Richard Cowart, a former Vermont utility regulator and a principal at the nonprofit Regulatory Assistance Project, which advises governments on clean energy policy. Each state implementing such a standard will make its own rules about what kinds of clean energy to include, how quickly to transition, and what fuels to target for reduction.
“It leaves choice in the hands of building owners, homeowners, small-business operators,” Cowart said. “It allows some creativity in implementation and flexibility in the way programs can be rolled out.”
This vision has sparked interest in several other states, but is hitting some obstacles. Colorado in 2021 passed a law requiring natural gas distributors to create clean heat plans. Massachusetts’ Department of Environmental Protection has a clean heat standard in the works, but Democratic Gov. Maura Healey recently delayed the implementation until 2028. Another six to nine states have expressed interest in or have begun exploring the concept, but nothing else is on the books, Cowart said.
Vermont’s idea was to create a “market-based system” in which fuel dealers would obtain a certain number of clean heat credits each year. Credits could be generated by installing weatherization upgrades or heat pumps, or by selling fuels with lower emissions; dealers could offer these services themselves or buy credits from other entities doing that work. Either way, the system would have helped pay for a less emissions-intensive heating system across the state.
A complicated history
The standard’s political foundations were never unshakable. The first shot at establishing the policy occurred in 2022. The heavily Democratic legislature passed a bill creating a clean heat standard, but Republican Gov. Phil Scott vetoed the measure. An attempt to override the veto fell one vote short in the state House.
In 2023, a bill was again passed and again vetoed. This time, the veto override succeeded by one vote in the Senate. Part of the deal that helped the legislation pass was a provision that required regulators to design the program and then bring it back to lawmakers for another vote before it could be implemented.
“That was pretty unusual,” Watson said. “Usually, you design a program, then the rules take effect, basically, immediately.”
Lawmakers never had a chance to take that second vote.
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