Energy Incentive Programs, Vermont

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Updated June 2015

What public-purpose-funded energy efficiency programs are available in my state?

In 1999, Vermont’s state legislature approved legislation giving the Public Service Board (PSB) the authority to establish a systems benefit charge to fund statewide energy efficiency programs via a non-utility entity (in lieu of utility-specific programs). Subsequently, the PSB approved the creation of an "energy efficiency utility" to run energy conservation programs in the state. The program administrator, Efficiency Vermont, had its budget increased by the PSB in 2006 such that funding levels moved from roughly $19 million in 2006 to over $35 million in 2010 (including low income and residential programs). In 2014, the combined budgets of Efficiency Vermont and individual utility programs in the state exceeded $45 million. Revenues are collected through a statewide charge on consumers' utility bills.

As Vermont’s energy efficiency program administrator, Efficiency Vermont offers a variety of programs for commercial and industrial customers. 

What utility energy efficiency programs are available to me?

Burlington Electric Department (BED) serves the role of "efficiency utility" for Burlington customers and also offers free simplified energy audits to commercial customers. BED partners with Efficiency Vermont (see above) on its incentives programs.  The rebate forms shown for the Efficiency Vermont programs double as those for BED’s programs.

Vermont Gas's Business Programs  provide technical assistance, walk-through audits, and financial incentives for gas energy efficiency measures in new construction and existing buildings. Eligible equipment range from furnaces to waste heat recovery systems. Small low- or zero-interest loans are available for projects related to whole building weatherization, natural gas boilers and furnaces, commercial kitchen equipment, and building controls.

What load management/demand response options are available to me?

The Independent System Operator New England Inc. (ISO-NE) offers its Demand Resources programs, which provide payments to electricity users for load reductions (of as little as 100 kW), either by reducing usage or operating on-site generation during periods of high demand.  Customers may participate in the programs through any participating member (“Market Participant”) of the New England Power Pool, such as a utility company, power marketer, competitive energy supplier, or independent curtailment service provider (CSP).  The Market Participant is allowed to aggregate load to reach the quantity qualification limit, so interested customers with less than 100 kW to offer may want to contact their utility or other eligible party. 

ISO-NE’s Forward Capacity Market (FCM) allows customers to bid their load reduction capabilities – whether constant (such as an indoor lighting retrofit project), seasonal (such as a new energy-efficient chiller plant), or dispatchable (such as a back-up generator or demand management actions) – into a forward capacity auction that allows demand-side resources to compete with supply-side ones.  Bids that are accepted are paid the auction clearing price.  These auctions take place annually for commitment periods three years in the future (though the qualification process begins roughly a year in advance). Interested facilities should contact a market participant regarding the auction schedule; in addition, market participants may have unfilled capacity commitments ahead of the next auction.

Market participation includes both active (conventional demand response, including real-time emergency generation) and passive (energy efficiency and distributed generation, including renewables) options. Active DR opportunities include:

  • Real-Time Demand Response, which provides an opportunity for customers to receive payments for responding to system emergencies.  Participants are paid a capacity payment (through the FCM) and for actual load reductions based on the real-time locational marginal price.  Customers must respond within 30 minutes and must be able to receive dispatch instructions through a market participant or their agent (“demand-designated entity”). Participating customers must also have interval metering installed at their facility.

  • Price-Responsive Demand, a real-time demand response option that allows participants to offer reductions into the day-ahead energy market.  These customers are paid for cleared reductions in the market and are expected to interrupt in real time (according to their offers).

  • Real-Time Emergency Generation, which is for generators whose federal, state, and local permitting limits operation to actual or imminent loss of external power.  Calls to participate are restricted to times when ISO-NE has instituted manual 5% voltage reductions. Real-Time Emergency Generation resources must be capable of curtailing end-use electric consumption from the New England grid within 30 minutes of receiving a dispatch instruction, and maintaining that curtailment until notified.  For an emergency generator that does not operate in parallel with the grid, the participating customer must have an interval meter installed on the generator (or entire facility). Otherwise, interval metering of both are required.

What distributed energy resource options are available to me?

The Database of State Incentives for Renewables and Efficiency  (DSIRE) website provides information on programs that offer incentives for renewable distributed generation.  

  • The Vermont Small Scale Renewable Energy Incentive Program of the Renewable Energy Resource Center provides incentives of up to $16,500 for commercial-scale solar hot water systems. 

  • Through its Solar GMP  program, Green Mountain Power pays customers who have net-metered photovoltaic systems of up to 500 kW an additional $0.06/kWh for power produced by their PV system. 

  • In 2009, Vermont passed the Sustainably Priced Energy Development Program (SPEED), a renewables standard offer, or feed-in tariff, that allows the owners of small renewable electricity generation facilities (up to 2.2 MW) to sign long-term contracts of 10 to 20 years (25 years for solar) for sale of their power to utilities. Rates are determined by the response to an annual RFP process and are capped by technology. 

Are there energy efficiency programs sponsored by the state government?

For information on energy efficiency programs sponsored by the state, refer to Vermont’s public-purpose programs above.  For further information contact the state Public Service Department.

What additional opportunities are available to me?

No utilities in Vermont have area-wide contracts with the GSA.