As the Legislature approaches crossover, lawmakers are advancing several significant energy proposals. While varied in scope, each reflects a shared challenge: balancing Vermont’s climate objectives with affordability, regulatory clarity, and economic competitiveness.

Three proposals have emerged as focal points, each testing Vermont’s ability to modernize its energy framework without eroding affordability or predictability. Together, they underscore a broader question this session: how to advance climate policy while strengthening Vermont’s economic foundation.

Building Energy Standards

H.718 proposes structural updates to Vermont’s residential building energy standards framework (RBES/CBES). The bill would create a stakeholder task force to examine contractor registry updates, evaluate licensure requirements, and better align education standards across trades. It also provides clarity for builders who, in good faith, certified projects under RBES/CBES 2020 pursuant to the Governor’s Executive Order, ensuring they would be held harmless from liability.

Revisions since introduction have improved the bill’s structure and moved smaller-scale builders closer to a more stable regulatory framework. Predictability remains critical. In the Vermont Futures Project Business Climate Survey, employers consistently cite regulatory clarity as essential to housing production and workforce attraction. Housing supply, workforce growth, and energy policy remain structurally linked.

Questions remain regarding funding mechanisms and potential downstream compliance costs. As Vermont works to address its housing shortage, regulatory updates must align with administrative capacity to avoid unintended cost escalation. With crossover imminent and divisions remaining in committee, final adjustments will need to materialize quickly.

Expanding Commercial Property Assessed Clean Energy (C-PACE)

S.138 would expand Vermont’s Property Assessed Clean Energy program to commercial and industrial buildings, allowing businesses to finance efficiency, renewable, and resilience improvements through long-term, fixed-rate property assessments.

At a time when federal incentives remain uncertain, the proposal offers a voluntary, market-based pathway for businesses to invest in efficiency and resilience. In other states, C-PACE programs have reduced operating costs, attracted private capital, and supported job creation. For Vermont employers, the program represents a financing tool rather than a mandate, aligning environmental progress with economic competitiveness.

After sustained stakeholder engagement and multiple revisions, S.138 appears positioned to advance before crossover.

Net Metering

H.716 would remove the adjuster applied to energy generated behind the meter, electricity produced and consumed on-site without reaching the grid. The bill also establishes battery storage goals and directs the Public Utility Commission to account for federal incentive conditions when setting rates.

Earlier language that would have capped the negative adjuster for net-metered energy has been removed, alleviating concerns about immediate cost increases for non-solar ratepayers. However, proposed behind-the-meter and battery-related changes introduce more complex structural questions.

Adjusting this framework outside the established biennial PUC review process could add complexity to one of the most intricate net metering systems in the country. There is also risk that cost shifts could increase rates for non-net-metered customers, undermining affordability for businesses and households alike. Preserving the PUC’s research-driven review process helps ensure that rate decisions remain grounded in economic analysis.

With new language introduced late in the process and crossover near, advancement of the bill in its current form appears uncertain.

What Happens Next

As crossover approaches, compressed timelines and consequential policy choices are converging.  Vermont’s long-term energy strategy must remain aligned with economic competitiveness, workforce growth, and housing development.

The central challenge is not whether Vermont advances its climate goals, but whether it does so in a way that reinforces affordability, regulatory clarity, and long-term economic durability. Striking that balance will determine whether this session’s energy reforms strengthen Vermont’s competitive position or introduce new layers of cost and complexity.