COLCHESTER, VT -- (MARKET WIRE) -- 02/15/2012 -- Green Mountain Power (GMP) today proposed a $21 million investment that would provide approximately $40 million in energy efficiency benefits to Central Vermont Public Service (CVPS) customers. This proposal will enhance customer benefits from the proposed merger of GMP and CVPS, following CVPS's acquisition by Gaz Métro Limited Partnership.
"We believed our initial merger proposal, which contains $144 million in guaranteed customer savings over the first 10 years and millions more afterward, met the standard for PSB approval," GMP president and CEO Mary Powell said. "Having considered regulators' and stakeholders' views since we filed our proposal, and given our strong desire to provide significant, ongoing benefits to our customers, we proposed the creation of a new Community Energy and Efficiency Development Fund (CEED Fund) to help CVPS customers lower their energy bills and reduce their environmental footprints."
The CEED Fund addresses concerns raised by the Department of Public Service (DPS) and AARP stemming from a 2000 Public Service Board order. That year, the PSB approved an increase in electric rates to help the utilities cover the cost of electricity from a contract with Hydro-Quebec, but said that value should be returned to CVPS customers if the company were ever sold.
"This proposal is in addition to the $144 million in guaranteed customer savings," Powell said. "It represents a $21 million investment in energy efficiency on customers' behalf, which will bring around $40 million in customer benefits that can only happen with the merger of these two great companies."
Under the proposal, included in PSB testimony filed Wednesday and modeled after a program created when GMP was sold in 2007, the CEED Fund will invest in customer efficiency measures, community-based renewable energy, weatherization and other improvements that will create additional value and benefit for CVPS customers.
"This proposal demonstrates our continued commitment to the people of our state," Powell said. "Through extraordinary efforts to improve efficiencies both in our own company and in our customers' homes and businesses, we will significantly lower energy costs from what they would otherwise have been."
The CEED Fund would provide resources to lower the cost for CVPS customers to make energy efficiency improvements. According to a recent analysis produced by Optimal Energy for the DPS's 2011 Comprehensive Energy Plan, energy efficiency investments generate $5 in increased economic activity for every dollar spent, and create 43 job-years per $1 million invested. The economic boost comes not just from increased use of in-state resources to provide efficiency services, but in the subsequent spending and reinvestment of energy cost savings.
Besides the guaranteed savings and new efficiency proposal, the merger of GMP and CVPS will provide other substantial benefits for customers, including:
- annual $1 million for a low-income benefit program through VELCO dividend and contribution,
- enhanced storm response,
- integration of separate systems and services,
- an expanded commitment to community service programs established by CVPS,
- and a new Solar City Program and Energy Innovation Center in Rutland.
The new GMP will produce the $144 million in guaranteed savings without layoffs -- except for a handful of executives -- or forced relocation of employees. The company will be headquartered in Colchester, and the Operations Headquarters will be located in Rutland or Rutland Town.