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Regional planning commission affirms support for pipeline

MIDDLEBURY — In a confirmation of its previous support, the Addison County Regional Planning Commission (ACRPC) board voted 23 to 9 on Wednesday, July 1, to continue its support of Phase I of Vermont Gas Systems’ Addison Natural Gas Project.
The purpose of the specially called meeting was to determine whether a change in the commission’s position might be in order given the 78 percent rise in the estimated costs of laying the natural gas pipeline from Colchester to Middlebury and into Vergennes. The cost was originally pegged at $86 million, but over the past two years ballooned to $154 million, raising new questions about the public good the Phase I project would provide.
Ten members of the 39-member board had petitioned for a review of its earlier support, which triggered the board’s decision last month to schedule Wednesday night’s meeting to take up the issue.
The board’s strong confirmation of support sends a timely message to the Vermont Public Service Board, which recently concluded two days of technical hearings reviewing those new cost estimates, among other considerations, to determine whether it should reopen its review of the project’s public good.
While the ACRPC vote is not binding on projects governed by the PSB, the state board does consider the viewpoints of local boards in its decision-making.
ACRPC executive director Adam Lougee noted that the commission has “spent a lot of time on the issue,” including its initial support back in December 2012, and in four other votes prior to Wednesday’s discussion, which Lougee characterized as “a very civil and thoughtful meeting, passionate on both sides, but respectful.”
“I thought the board did a very good job of discussing the issue from all sides,” Lougee said after the meeting, adding that the three largest communities in favor of the project helped convince other delegates of the project’s continued value.
“For those supporting the project, they really felt that the pipeline would create another fuel choice for Addison County, particularly those residents and businesses in Middlebury, Vergennes and Bristol. They viewed it as a benefit to the county’s economic development and argued very strongly that it was important to competitiveness of the businesses in those communities.”
LENGTHY DISCUSSION
At Wednesday’s meeting, ACRPC delegates and around 20 members of the public spent about 90 minutes reviewing the latest Phase I cost estimates and the potential merits of the project’s Certificate of Public Good it granted the project back in December of 2013. It was in July of 2013 that the ACRPC board unanimously agreed to execute a memorandum of understanding with Vermont Gas regarding the Phase I pipeline.
During the discussion delegates were given two minutes each to express their views on Phase I, specifically addressing whether the regional planning commission should ask the PSB to take another look at the project, which some argued had become a vastly different proposal than the one that was OK’d by state regulators two years prior.
“Enough has changed since the initial applications and discussions that we are talking about a different project than the one we were talking about in July and September of 2013,” Cornwall ACRPC delegate Holly Noordsy said. “The project was up-scaled significantly and quite honestly, the reason we are in this room … is because the cost has changed a lot, and more than once.”
Stephen Pilcher, a Monkton delegate to the ACRPC, was among observers of the recent PSB technical hearings for Phase I. He said testimony delivered at the hearings suggested that it would take a significant increase in natural gas fees charged to current ratepayers over a 10-year period to pay for the Phase I price tag.
Pilcher and other pipeline opponents said Vermont Gas will have no choice but to sharply increase rates not only to make up for the inflated price of Phase I, but also to compensate for the loss of around $70 million in revenues that had been anticipated from International Paper. That Ticonderoga, N.Y.-based company was going to foot the bill for a “Phase II” pipeline that would have run from Middlebury, under Lake Champlain, and to the paper mill to provide it with natural gas. International Paper pulled out of the project this past February when cost estimates escalated, so Phase II was scuttled.
 “The question in my mind is, is there still a positive net economic benefit to the Addison Natural Gas Pipeline, and over what kind of time period?” Pilcher asked his colleagues. “I think the change that has occurred during the past two-and-a-half years, the volatility of the fossil fuels industry and the impact of economic losses generated by potential rate increases to current customers, and the success of compressed natural gas in the Vergennes-Middlebury area, it would seem that building the Addison Natural Gas Project doesn’t make any economic sense.”
Vermont Gas CEO Don Rendall, present at Wednesday’s ACRPC meeting, disputed Pilcher’s economic assessment and specific numbers he cited, emphasizing that significant savings over fuel oil and propane would still clearly benefit customers, as well as reducing their carbon footprint. He also warned that a vote to reopen the Phase I certificate before the PSB would “seriously jeopardize this project.”
Other project opponents, however, continued to speculate that natural gas prices might increase sharply during the coming years and potentially negate its current competitive advantage over fuel oil and propane.
Jeremy Grip, Ripton’s delegate to the ACRPC, pointed to cold-climate heat pumps as a technology that is becoming more financially viable and could bring long-term savings to homeowners. He also noted that Vermont Gas last December activated the state’s first “gas island” on Middlebury’s Exchange Street, giving Agri-Mark Cabot and some of the town’s other large industrial users access to natural gas.
“Should the PSB take another look (at the Phase I permit)? Absolutely,” Grip concluded.
Marcia Parker, the Otter Creek Audubon Society’s delegate to the ACRPC, said the pipeline should not just be measured in economic terms.
“There are so many alternatives to this (pipeline) that aren’t going to impact the environment in a way that the pipeline will,” Parker said. “I think we need to look into the future and hope that we’ve saved some of this Earth for everyone’s grandchildren and their children… There is a finite amount of environment that we can exploit.”
CONTINUED SUPPORT
But a vast majority of the delegates rejected the speculation of pipeline opponents saying the commission should stick to the current facts (that at today’s prices the natural gas pipeline would benefit area residential customers and businesses) and its 2013 endorsement of the Phase I project. They argued that businesses and homeowners should be given the option of what they said is a cheaper and cleaner-burning product than fuel oil.
“I feel that to have the choice of another fuel can’t help but put you in a better position to make choices on your own savings,” Middlebury delegate Karl Neuse said.
Garland “Chico” Martin, a Bristol delegate, called Wednesday’s vote a “referendum on economic justice.” He noted the Bristol selectboard’s support of the pipeline in hopes that it will eventually be extended to Bristol and give local businesses and homeowners a less costly fuel option.
“A vote against the project is a vote against jobs and higher income for the most needy Vermonters in our region,” Martin said.
Vergennes City Manager Mel Hawley, also an ACRPC delegate, noted his community held a referendum in December of 2013 on the issue of bringing natural gas to Vergennes. He said voters supported such a move by a 345 to 143 tally.
“There has never been a subsequent vote or agenda item to reconsider,” Hawley said. “Clearly, those 70 percent who voted in favor are still waiting for their natural gas.”
He added that while UTC Aerospace has been OK’d for a natural gas island, the company sees that amenity as a stop-gap measure and still wants to be served by the Phase I pipeline.
“The ACRPC entered into a memorandum of understanding in 2013 and I really feel that is the position of this group,” Hawley said.
Harvey Smith of New Haven represented the Addison County Economic Development Corp. at Wednesday’s meeting. He said the ACEDC continues to maintain that the Phase I pipeline would be a boon to local businesses, and added it would send a bad message if the commission were to reverse its decision.
“We are concerned that the Regional Planning Commission is becoming somewhat dysfunctional by focusing all our time in debating and re-debating an issue we decided a long time ago,” he said. “We just need to move on and decide what else is good for our community. ”
Shoreham delegate Nick Causton said he believed a pipeline would be a safer method of transporting natural gas than the current mode of delivering fuel by truck or rail.
“We can now hear continuous rumblings and whistles of oil trains, and hopefully there won’t be an explosion,” Causton said. “At least there are no (fuel) barges on the lake here, but there are fuel trucks. I think pipelines are safer.”
PUBLIC COMMENTS
The ACRPC also listened to around 30 minutes of feedback from members of the public. Among them was Maren Visatka of Monkton, who cited the dramatic jump in the Phase I costs and said Vermont Gas ratepayers were going to pay the price.
“These are our citizens of Vermont who are paying money so that corporations can save some money,” Visatka said. “It is pretty much the corporations that are going to benefit from this.”
Rendall, meanwhile, urged the ACRPC to not change its position on the Phase I pipeline.
“I took this job because I believe in the power of choice and opportunity, and that is at the bottom of what this project brings to Addison County,” said Rendall, who acknowledged he and his colleagues have made changes to a Phase I project that is “on track.”
“We’ve made a commitment to this community, to this county; important businesses and institutions have made big investments, and they are counting on us,” he added. “We’re committed to delivering to those who have invested and we are committed to delivering to the families and businesses who are looking forward to the opportunity to have the choice.”
The commission took a roll call vote on whether to affirm the vote of support it gave to the project in July of 2013. Those voting ‘no’ included delegates Jim Duclos and Holly Noordsy of Cornwall; Diane Benware of Leicester; Tim Davis of Ferrisburgh; Stephen Pilcher of Monkton; Susan Smiley of New Haven; Jeremy Grip of Ripton; Richard Warren of Starksboro; and Marcia Parker of the Otter Creek Audubon Society. Twenty-three members reaffirmed their support of the project.
The board will send the Public Service Board a record of its vote by July 8, so that it can be included in the public record of its latest review of the Phase I cost estimates.
Reporter John Flowers is at johnf@addisonindependent.com.

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